Toolbox for Green Innovation
Sustainable Film Production in Lithuania: A Case Study Report
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1. NEEDS CONTENT
In the past decade, the Lithuanian film industry has experienced a remarkable resurgence, retaining a solid position domestically while also establishing itself on the international filmmaking stage. The country’s combination of versatile locations, technical expertise, cost-effectiveness, and tax incentives that are applicable for local productions has received significant attention and investment. This renaissance is mirrored in the growth of domestic film output increasing budgets and international collaboration. Recent years have seen an increase in the number of Lithuanian films recognized at major film festivals including Venice, Cannes, and Sundance.
2. Key Issues
No modern film studio with multiple pavilions: keeping up with the latest filmmaking technologies and maintaining a robust infrastructure is crucial for competitiveness. Outdated equipment and inadequate facilities hinder the production quality, capacity and efficiency of filmmakers.
Talent drain: there is no dedicated film school (or talent attraction programme) for the training and upskilling of a wide range of behind-the-camera professionals. Addressing this gap is crucial for the continued growth of the Lithuanian film industry and its competitiveness on the global stage.
Funding and budget constraints: scarce funding models and a single source of public funding hinder filmmakers from producing high quality work in line with global trends. An excessive focus on the relevance of film content to local cultural standards, with no links to the distribution performance of films both domestically and globally, leads to an industry that is focused only on production and not on distribution and export.
Data: there are no regular statistics at national level on the contribution of the film industry to the national economy, including its impact on the performance of other industrial sectors. The creation of a specific statistical satellite account would help to track the performance of the film industry and to take timely and relevant decisions for its subsequent successful growth.
3. Background
The growth of Lithuania’s film industry has been a gradual journey. It started as a poetic cinema tradition developed behind the Iron Curtain, primarily serving a local audience. Institutionally, the Lithuanian Film Centre (established in 2012) operating under the Film Law (amended in 2011) is now the key stakeholder tasked with developing policy infrastructure to foster sustainability of the Lithuanian film industry. Lithuania’s film industry has now evolved into a transnational collaborative practice of filmmaking that resonates with funders, promoters, and audiences. This transformation began with the production of the Warner Bros. series Robin Hood in the early 1990s and continues today, with Netflix and HBO frequently choosing Lithuania as their filming location.
Over the past decade, the Lithuanian film industry has experienced a remarkable resurgence. The lion’s share of admissions is still in the domestic market, but it has gained recognition internationally, particularly as a production hub. This success can be attributed to several factors, including versatile filming locations, technical expertise, cost-effectiveness, and attractive tax incentives. In 2022, foreign productions invested €35.3 million in Lithuania, leading to the creation of 19,000 long-term and temporary jobs in the capital city, which is the industry’s hub. This growth is further evident in the increasing number of Lithuanian films achieving recognition at major international film festivals like Venice, Cannes, and Sundance.
The Lithuanian film industry is thriving both locally and internationally. However, along with its growth, it faces new challenges, such as nurturing emerging talents and maintaining its infrastructure.
4. Production
In Lithuania, the film sector is relatively small, which fosters a close-knit community. Many individuals often work across various facets of the industry, including commercials, service productions, arthouse films, and more mainstream genre films. However, despite this interconnectedness, there are certain distinctions worth noting.
National arthouse cinema is supported primarily by minimal public funding through the Lithuanian Film Centre. This limited funding is reflected in the small number of national feature fiction films released each year. The average budget for a local feature film ranges between €500,000 and €2 million, significantly lower than that of an average European film. This is attributed to modest subsidies, a small linguistic market (with less than 3 million people living in Lithuania), minimal private funding, and limited support from local broadcasters. As a result, the Lithuanian audiovisual industry heavily relies on public funding, co-productions with foreign companies, and pan-European film support initiatives such as the Creative Europe MEDIA programme and the EURIMAGES Fund.
Despite these challenges, Lithuania remains steadfast in its cinematic ambitions to establish itself as a vibrant hub for native film production and culture. Recent successes, including Marija Kavtaradze winning Best Director award in Sundance film festival for feature film Slow (LT, ES, SE 2023) in 2023 and Laurynas Bareisa receiving the Orizzonti award in Venice Film Festival for Piligrimai/Pilgrims (LT 2021) in 2021, underscore the rising prominence of Lithuanian cinema. Lithuanian films are increasingly appearing in major film festivals, signalling a strong resurgence in the country’s film industry and culture.
National commercial films: while there are more and more bold creative projects carried out by talented filmmakers that get invited to and awarded at international festivals, Lithuania also produces several commercial titles yearly, usually smaller in budgets than auteur cinema and very popular with audiences. There are plenty of commercial titles for those who see film as entertainment. Still, commercial fare remains geared towards the domestic market only.
Other relevant sectors of the audiovisual industry: over the past decade, Lithuania has experienced remarkable growth in its VR and animation industries, fuelled by a new generation of skilled creators who are open to innovation and collaboration. Their creations are increasingly being featured at top-tier festivals, including the Annecy International Animation Film Festival, which premiered the short film Matilda ir atsargine galva/Matilda and the Spare Head (LT 2020) directed by Ignas Meilūnas, and the Venice Film Festival, which showcased the 360 VR project-film Trail of Angels (LT 2018) directed by Kristina Buozyte.
Lithuania’s advertising production portfolio is significant to the audiovisual sector at large. It encompasses over 3,000 commercials, spanning a diverse array of products, including brands such as Adidas, Nike, BMW, Mercedes-Benz, Porsche, Google, and McDonalds, among others. Recent successes include Grand Prix in Cannes Lions for a commercial shot by Lithuanian company MAGIC.
Recognizing the economic and cultural significance of the film industry, the Lithuanian government introduced a tax incentive in 2014. This scheme allows film producers to save up to 30% of their budget costs through private investments. In 2023, foreign film producers took advantage of this incentive, spending €42.7 million, which was €7 million more than in the previous year.
5. Funding
Lithuania supports its film industry through public funding provided by national film boards. The Lithuanian Film Centre (LFC) is a key institution responsible for allocating funds and supporting various stages of film production. Public funding is crucial for fostering local talent, facilitating film development, production, and distribution.
There are no regional film funds to decentralise funding of the film industry, so funding relies on a single public funding source.
Lithuania quite actively participates in international co-productions, which involves collaboration with filmmakers and production companies from other countries. The Lithuanian Film Centre (LFC) has minority co-production funding schemes.
The Film Tax Incentive is part of the Lithuanian Film Funding Structure, which aims to attract international productions and promote the local film industry. The model has been in place since 2014 and has proven to be very successful in attracting a huge number of foreign producers, which is why it was extended for another 5 years in 2023.
National TV Film Funding twice a year organises a contest to fund domestic films (approximately €5,000-10,000 for documentary film, €20,000-30,000 for fiction film).
Video-on-Demand (VoD) platforms and streaming services operating in Lithuania do not have commitments to invest in local content production but there has been a slight change during recent years. Lithuania already has examples of how providers (Telia TV, GO3) invest in domestic content creation but not yet systematically and more based on individual agreements with producers and filmmakers.