One Year into Lee Jae-myung's Administration: South Korean Film Industry Sees Increased Support but Faces Ongoing Challenges

One year into Lee Jae-myung's administration, the South Korean film industry is experiencing both signs of recovery and structural challenges. Successful films such as "The King’s Affection," "Salmon," and "Goonch" have emerged, while titles like "Hope" and "Goonch" were invited to the Cannes Film Festival, reaffirming the presence of Korean cinema. However, issues such as the holdback controversy, a decrease in the number of productions, and a lack of trust in the Film Promotion Committee remain unresolved.

Over the past year, the government's film policy has focused on crisis response and increased support. The Ministry of Culture, Sports and Tourism allocated an additional budget of 65.6 billion won to help revive the stagnant film industry. This funding aims to support mid-budget film production, independent art films, and advanced technology production, injecting capital into a production environment that has been weakened by COVID-19. The distribution of movie discount vouchers to encourage theater attendance has also been implemented.

Since May 13, the Ministry and the Film Promotion Committee have distributed 2.25 million movie discount vouchers worth 6,000 won each. This is half of the 4.5 million vouchers secured through the supplementary budget. The vouchers were made available through major multiplex websites and apps, with an additional 2.25 million set to be distributed in July during the summer peak season.

Minister of Culture, Sports and Tourism Choi Hwi-young highlighted some recovery in the film industry during a press conference marking the first anniversary of Lee's government. He noted that theater attendance increased from 20.82 million in the first quarter to 31.90 million, and the number of films with production budgets exceeding 2 billion won rose from 26 last year to 40 this year. He stated that these indicators suggest that "escaping the film crisis is possible."

This year, the box office has indeed shown positive trends. Director Jang Hang-jun's "The King’s Affection" successfully attracted family audiences and fans, while the horror film "Salmon" surpassed its break-even point and established a long-term box office trend. Director Yeon Sang-ho's "Goonch" was invited to the Midnight Screenings section of the 79th Cannes Film Festival and quickly surpassed 2 million viewers domestically. Director Na Hong-jin's "Hope" marked the first Korean film in four years to compete at Cannes, while Director Jeong Joo-ri's "Dora" was also invited to the Directors' Fortnight.

However, the success of individual films does not necessarily indicate a full recovery for the industry. The total number of moviegoers, which exceeded 200 million in 2019 before the pandemic, has significantly declined, and the production of mid-sized commercial films continues to be stifled. Concerns are growing that the reduction of mid-budget films, which have traditionally served as a gateway for new directors and actors, is leading to a rigid production ecosystem.

In the field, there are ongoing discussions about the direction and execution of government support. The mid-budget film support program has faced criticism for being misaligned with production realities, despite the budget increase. Film and drama productions often take years to complete, but government funding must be utilized within the fiscal year, leading to situations where funds must be returned if additional investment is not secured after selection.


Minister Choi is aware of this issue. He previously stated at a meeting of the Cultural Arts Policy Advisory Committee's Film and Video Division that "asking works to be created according to the government budget schedule is a reversal of the order," emphasizing that funding should be provided according to the production cycle that allows for the best works to be made. His remarks align with calls from the field to adjust annual support programs to better match actual production timelines.

A major issue facing the film industry is the holdback. Holdback refers to the grace period between a film's theatrical release and its transition to subsequent platforms such as OTT and IPTV. There is ongoing debate between those advocating for the restoration of theatrical value and those arguing that prolonged restrictions on subsequent distribution make it difficult for investors and distributors to recoup their funds.

Some government and National Assembly members have discussed limiting OTT releases for a certain period after theatrical premieres to encourage theater attendance. However, investors, distributors, and some film organizations strongly oppose a six-month legislative mandate, arguing that extended delays in transitioning to subsequent platforms would lengthen the period for recouping funds and further stifle production and investment structures.

During a press conference marking the first anniversary of the people's sovereignty government, Minister Choi announced the establishment of a 22-member public-private consultative body for the film industry, aiming to reach a conclusion by the end of August. He stated, "We all understand each other. We know each position on the issues. What is now needed is to reach a conclusion, whether it be a gradual or fundamental one."

He added, "We are currently in a crisis and difficult times, and while there may be a slight tailwind, the film industry is not yet in a normalized state. I believe all participants in the film industry—production, investment, distribution, and theaters—are united in the sincerity of finding a solution." He also expressed the government's willingness to participate if there is a need for policy and budgetary roles.

Distrust surrounding the Film Promotion Committee remains a challenge for the film policies of Lee Jae-myung's first year. At a meeting in Jeonju in April, strong concerns were raised by industry professionals regarding the committee's lack of communication, understanding of current issues, operational methods, and expertise. Some attendees criticized the committee's chair for not adequately listening to industry voices compared to the frequency with which the Minister meets with filmmakers.

The distrust in the film industry goes beyond mere communication issues. Complaints have accumulated regarding the committee's failure to adequately represent industry demands during discussions on the normalization of the Gender Equality Center, the imposition of ticket fees, and the budget restoration process. The film industry coalition has criticized the committee for not fulfilling its role as a policy executor, stating that industry professionals are directly persuading the National Assembly during the legislative and budgetary processes.

The government has also outlined plans to elevate the K-culture industry as a national growth engine. Minister Choi announced at the press conference that the target size of the K-culture industry would be raised from 300 trillion won to 400 trillion won by 2030. The export target for K-culture is also set to increase from $35 billion to $110 billion. The film industry will inevitably be addressed within this broader K-culture expansion strategy.

However, what the film industry demands is not merely an increase in industry size but a restructuring of the distribution framework that allows production, investment, distribution, theaters, and OTT to operate cohesively. Recovery of theater attendance, subsequent platform revenues, and production cost recovery structures must align for mid-budget films and new projects to thrive once again.

The film policies of Lee Jae-myung's first year have shown a commitment to crisis response. The supplementary budget allocation, distribution of discount vouchers, expansion of mid-budget film support, and the establishment of a public-private consultative body on holdback have all elevated the stagnant film industry to a policy agenda. However, there are still strong calls for structural reforms following the budgetary infusion.

Ultimately, the key to the second year of film policy will be the conclusions and execution capabilities of the consultative body. If discussions on holdback favor one side—whether theaters, investors, distributors, producers, or OTT—conflict is likely to recur. Conversely, if realistic guidelines reflecting changed audience consumption patterns and platform environments are developed, it could mark the starting point for the recovery of Korean cinema.

Minister Choi stated, "The first year was a time of running swiftly to meet many people and establish direction. The second year will focus on execution. I will concentrate on practical measures to ensure that we can feel the effectiveness of our policies." The film industry is now at a stage where it awaits not just confirmation of support but also specific institutional improvements and implementation.