Hungary's booming film industry faces the U.S. tariff threat

Hungary's film industry, often called 'Hollywood on the Danube', is bracing for uncertainty after U.S. President Donald Trump proposed a 100 percent tariff on films made outside the United States.

Hungary has spent the past decade building one of Europe's largest production hubs. Last year, the country hosted 300 productions and earned $910 million in revenue — four times more than in 2018.

The growth is driven mostly by American productions, drawn by a 30 percent tax rebate and highly trained local crews.

Jonathan Halperyn, a film producer and managing partner at Hero Squared in Budapest, said the proposed tariffs could harm a global industry.

"This protectionism idea is very old-fashioned," said Halperyn. "Filmmaking is a global business. You want people from all over the world. That was how Hollywood was constructed."

Halperyn left Hollywood for Hungary and co-founded Hero Squared in Hungary seven years ago. His company has since worked on productions for Apple, Netflix and other major U.S. studios.

"I think the Hollywood studios will have to all sit down and talk about 'what does it mean?'" Halperyn said. "'What do you really want from us? How do you want us to function?' Because the worst thing you can have in any business is uncertainty."

That uncertainty is shared by economists.

"It certainly is a major industry now in Hungary," said Bod Péter Ákos, a former governor of Hungary's central bank. "Film production contributes to 1 percent of the total GDP. So this is very bad news, very bad news."

Expansion

Just two months ago, the National Film Institute completed Hungary's largest studio expansion since the 1980s. The upgrade includes four new soundstages and nearly 30,000 square meters of new production and support space.

The country's film commissioner, Csaba Káel, said the impact of any tariffs may not be immediate.

"The formulation and implementation of potential U.S. protective tariffs that could impact the Hungarian film industry is expected to be a lengthy process," Káel said in a statement to CGTN. "In the meantime, we continue to engage in discussions with international partners across multiple continents to explore further opportunities for cooperation."

Halperyn agrees with the idea of reviving U.S. movie-making but questions the method.

"Reinvigorate movie-making in America, which I think is a beautiful thing to do," he said. "But tariffs may not be the right approach."

For now, cameras are still rolling in Budapest. But those behind the scenes know the next scene may be written in Washington.