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How Did Iceland Become the World’s Favourite Film Location?

Star Wars, Game of Thrones and more are also boosting the nation’s economy.

With its gargantuan glaciers, thunderous waterfalls and other-worldly black sand beaches it’s easy to see why Iceland appealed to the producers of the latest Star Wars box office smash, Rogue One.

The film’s cast and crew shot in Iceland for prolonged periods during 2015 and 2016 – and they weren’t alone. The Rogue One team overlapped in the tiny Nordic country with more than half a dozen other big budget international productions, from Game of Thrones to Captain America: Civil War. At one point they weren’t even the only Star Wars crew on the island, as a team from the as-yet-untitled Episode 8 flew in to join them. (The eighth episode of the Fast and Furious franchise, The Fate of The Furious, also decamped to Iceland, in March 2016.)

As far as entertainment executives are concerned, the Land of Fire and Ice is very hot right now. With an average of 10 international feature films and TV series now shooting there every year, there are no signs of cooling down. Similarly, there’s no let-up in large entertainment companies investing heavily in top-end and potentially globally successful content.

HBO spent $10m on each episode of season six of Game of Thrones, while Netflix spent $130m on ten episodes of British royal family drama The Crown. In 2016, Disney was lauded for becoming the first Hollywood film studio to garner $7bn at the global box office, thanks in part to its Marvel, Pixar and Star Wars movies, but it had to spend about $3.5bn on making and marketing 13 films to do so (and will only receive about 55 per cent of the box office takings).

Professional filmmakers can spend as much time in Iceland as they do on sound stages in Los Angeles or London

So how and why did a tiny country, on the verge of economic collapse in 2008, bounce back to become a central pillar of big-budget entertainment – the New Hollywood of the North? According to Karen Möller Sívertsen of Íslandsstofa, the organisation promoting Iceland to both tourists and filmmakers, there are a number of factors behind the silver screen-sparked renaissance.

“Physically, our scenery is both unique and incredibly diverse, so within a relatively small geographical area, you can find backdrops that can double for all kinds of different places – and planets,” says Sívertsen. “There’s also the geographic advantage that it’s easily accessible from both the US and Europe, particularly the UK. And the fact that there are so many well-educated, multilingual crew to be hired here.”

So far so good. But drill down further and there’s an even richer vein to be mined in Iceland. As is so often the case in the film industry, it’s all about the bottom line. Blockbuster films of the kind being partly shot in Iceland can require a total production and promotion spend of around $400m (on average, a Hollywood film now costs $60m to make and another $35-40m for marketing).

“The Icelandic rebate incentive for film and TV has increased in recent years, and it’s attracting more and more filmmakers,” Sívertsen says. That tax reimbursement scheme stood at 14 per cent in 2007, and was raised to 20 per cent in 2010, sparking a glut of major productions including Interstellar, Prometheus, Oblivion, Transformers: Age of Extinction and Star Wars: The Force Awakens. As of January 2017, it will rise again, to 25 per cent and so even more blockbuster projects are expected to take advantage.

“The rebate incentive is designed to make producers consider Iceland, and when they do, they’ll see the incredible potential for filming here,” says Einar Hansen Tómasson, Iceland’s film commissioner. “Within a two-hour drive of Reykjavik, you’re able to get the big glaciers, the black deserts, the sulphur mountains, the dormant volcanoes, green valleys, big rivers and big waterfalls. Where else can you get that amount of diversity in such a small, easily manageable area?”

It’s a strong argument, and one that will only be strengthened next year, when an enormous, state-of-the-art film studio opens in May, on the outskirts of Reykjavik. The driving force behind the 20,000m2 facility, known locally as ‘film land’, is to make it easy for entire productions to be completed in Iceland, rather than just location shoots.

It’s a move that makes a lot of sense, particularly to professional filmmakers, many of whom can spend as much time in Iceland as they do on sound stages in Los Angeles or London.

“Iceland is genuinely becoming as familiar as Pinewood or Paramount,” says Tim Browning, an experienced art director who has worked on the most recent two Star Wars movies, as well as James Bond films Skyfall and Spectre. “You look at the cash saving, the ease of transportation and the availability of good crew and extras, and the fact that it barely gets dark during the summer months so you can shoot well into the night, and it’s a no-brainer.”

Browning, a certified drone pilot, is also working with adventure travel company Black Tomato to offer visitors their own little piece of the action. Their new ‘Drone the World’ holidays see guests accompanied by their own personal drone cameraman, who produces a Hollywood-style movie of their Icelandic adventure afterwards.

It’s a smart move, but an unsurprising one when you look at the figures: one of the happy knock-on effects of Iceland’s recent cinematic success is that tourism has skyrocketed. Visitor numbers have doubled since 2010 to well over a million tourists a year, with one in seven of those who visited in 2014 saying they were inspired to do so after seeing the country in a foreign film or TV show.

Looking back to the financial crisis of 2007, then the infamous eruption of the Eyjafjallajökull volcano in 2010 that brought air traffic to a standstill, Iceland has recovered remarkably quickly. The island, which has suffered so much in recent years is, through hard work, clever use of natural resources and canny policy-making, enjoying a rebirth to rival anything Hollywood could script.

Jonathan Thompson is a travel and lifestyle writer for Condé Nast Traveller, The Guardian, Mr Porter, Sunday Times Travel and many more. The Photograph is of Ben Stiller, playing Walter Mitty in ‘The Secret Life of Walter Mitty’ taken by Promote Iceland.