2019 was meant to mark the triumph of the Korean film industry’s three-decade rise to global prominence. Bong Joon Ho’s Parasite claimed the Palme d’Or at Cannes before making history as the first non-English language film to win the Academy Award for Best Picture, while domestic box office revenues soared to an unprecedented $1.38 billion. Nevertheless, this crowning achievement proved fleeting. While the Covid-19 pandemic dealt a blow felt symmetrically across global cinema, Korea’s recovery has been uniquely anaemic. Revenues dropped to just $369 million in 2020 and have since clawed back to $861 million by 2024, still 38% below pre-pandemic levels. After three years of tepid recovery, 2025 has brought a further deepening of the crisis.

Despite a brief surge in attendance in the summer driven by local hits such as the comedy-drama My Daughter Is a Zombie and the horror Noise, alongside Hollywood blockbusters like F1: The Movie and Jurassic World Rebirth, overall box office receipts have fallen 22% in the first eight months of the year compared to 2024. Investment capital continues to flee the sector, and major studios have slashed their output to barely a third of previous levels.

The crisis compelled the newly appointed minister of Culture, Sports and Tourism, Chae Hwi-young, to issue an alarm that would have seemed unthinkable during Parasite’s victory lap: “Investment has stopped, and the film production scene has run out of money. The ecosystem of the film industry is collapsing to the point where filmmakers cannot make a living.”

Minister Chae’s warning was not simple rhetoric. indeed, the incumbent Lee Jae-myung administration’s agenda has repositioned cinema from important cultural export to strategic industrial sector, unveiling a five-year strategy aiming to expand Korea’s content market to 300 trillion won ($216 billion) by 2030.

As part of an extensive policy package combining tax incentives, direct investment, and targeted sectoral support, the ministry announced an 80% increase in film industry funding, nearly 150 billion won for the coming year, with a pronounced emphasis on indie and small-to-medium budget productions, AI-enabled filmmaking, and a new virtual production studio in Busan. The centrepiece of this public response is the “K-Content Fund,” a 600-billion-won government-led investment vehicle whose Film Account will channel approximately 53 billion won into animation, mid-budget features, and IP-driven content. In addition, the ministry has pledged half the capital for a 140-billion-won ($101million) film investment fund, seeking to lure back institutional investors and hedge funds that once financed prestige projects such Parasite, but have since retreated from the sector.

Public Support in France and in Korea

Governments often believe they should provide necessary public support for domestic film industries to cope with competition from Hollywood.  France has maintained for decades one of the most comprehensive subsidy regimes in the world, combining direct funding from the National Cinema Centre (CNC), a 30% tax credit on production costs, regional grants, and mandatory investments from television and streaming platforms.

In 2024 alone, the Centre national du cinéma (CNC) distributed $328 million in subsidies, while broadcasters and platforms invested $429 million, helping to produce 309 films, a steady output by historical standards. Yet, recent box-office results have ignited debates about the system's effectiveness. Several high-profile domestic films, including Luc Besson's Dracula: A Love Tale ($47 million budget) and 13 jours, 13 nuits ($31 million), performed poorly, while American blockbusters like F1 and Jurassic World: Rebirth drew millions of viewers. Nevertheless, Cinema attendance has remained relatively healthy in France, avoiding the decline observed in Korea. 

Convergence

For decades France and Korea represented opposite approaches to film policy. France built a subsidy machine, while Korea leaned on market forces. Only recently the two are converging.

France's subsidy regime began in 1948 as a compromise: when American pressure opened the market, policymakers replaced import quotas with a "temporary" tax on cinema tickets that became permanent in 1959. Two features ensured its permanence. The funds stayed ring-fenced for film, never passing through the general budget, and their management fell to the CNC which is self-administered by both government and industry stakeholders, from producers to distributors.

By 2014, subsidies had reached around 40% of the industry’s total value. Over the years, new levies were successively introduced on television channels (1986), video sales (2003), streaming platforms (2007), and internet subscriptions (2013), all justified as defending France’s cultural exception. Yet, this expansion also entrenched a system of direct subsidies akin to an industrial policy of “picking winners.” The CNC, through its numerous expert committees, “bets” on selected filmmakers or projects deemed culturally or financially promising.

Korea took the opposite path. Through the 1990s and 2000s, subsidies remained negligible, amounting to less than 3% of industry value. The boom that made Korean cinema a global force was driven by private investment. After the 1997 financial crisis, conglomerates redirected Hollywood investments back home, building vertically integrated operations that could finance, produce, distribute, and exhibit with little state help.

Then came the convergence. In 2007, following a box-office dip blamed on retracted screen quotas, Korea adopted its own seat tax, managed by the Korean Film Council (KOFIC), explicitly modelled on France's CNC. Like France, it was meant to be temporary. Like France, it was renewed in 2014 and more recently in 2025.

Divergence

France and Korea now share a similar institutional framework for supporting cinema, both grounded in the belief that cinema can serve as a vehicle of national identity and international visibility. However, the nature of their subsidies differs markedly. Korea’s government support has been relatively modest and largely indirect, focusing on strengthening the industry’s ecosystem through investment in infrastructure, training, and distribution networks that level the playing field benefitting all participants. France, on the other hand, relies heavily on direct subsidies, with its 2023 cinema budget including targeted support measures ranging from unemployment schemes for intermittents du spectacle to direct financial aid for several individual productions.

This reflects fundamentally different industrial logics. Korea's infrastructure-focused approach created a lean, competitive environment. While indirect public subsidies may end up in infrastructure that is either too large or obsolete, an oversupply of film schools or studios would be a much more manageable issue than the market distortions led by direct subsidies à la française. The few international successes generated by French cinema suggests there’s high opportunity costs inherent in direct subsidy allocation, where funding one filmaker necessarily means leaving others without support, even when their projects might promise to be more attractive internationally.

The CNC attempts to manage this uncertainty through elaborate governance structures. In 2011 alone it convened 46 committees comprising 656 professional experts. The "professional experts" making allocation decisions are themselves industry insiders, friends and competitors of the very producers whose projects they evaluate. Over decades this has calcified into a system that rewards local feuds and insider networks rather than artistic innovation and, most importantly international appeal. Despite France's steady output, it has been unable to match Korea's recent heights in producing international hits.

Covid19 and Beyond

Only the covid shock could dream of stifling cinema's own hallyu. The pandemic hiatus handed streaming platforms the opening they needed to reshape Korea's talent ecosystem. Foreign giants like Netflix and Disney invested aggressively in Korean drama series destined for digital release. Squid Game's global success in 2021 embodied both the streamer's ascendancy and theatrical cinema's eclipse. Fierce domestic competition from well-capitalized local operators like Tving, Wavve, and Coupang Play struggled to stem the American platforms' rise, yet had the secondary effect of bidding up talent. The streaming gold rush siphoned directors, crews, and on-screen talent away from struggling theatrical features into faster-moving, better-paying serialized content, inflating production costs and salaries across the board. By the time cinemas reopened, the damage was structural. France's subsidized system told a different story. Automatic subsidies and employment protections kept talent anchored to theatrical production even when audiences vanished. Less creativity, perhaps, but in a crisis that stability was not a weakness. It was insurance that Korea, racing to implement its own 140-billion-won rescue fund by 2025, finally recognized it needed.

France and Korea now confront crises, each a product of their policies taken to their logical extremes. When French producers failed to develop new talent or cinematic languages that could compete globally, the state weaponized its direct subsidy regime to become Europe's co-production powerhouse. France now offers foreign productions attractive tax rebates alongside automatic subsidies for projects meeting criteria including language thresholds, French crew minimums, and location shooting requirements. The strategy has proven effective at keeping professionals employed and ensuring French landscapes populate everything from Hollywood blockbusters to niche auteur projects. Yet this system produces what critics dismiss as "films of French nationality" rather than French films of international appeal: productions engineered to meet checkboxes while remaining culturally anonymous.

Korea, meanwhile, has belatedly discovered co-production not as strategy but as survival tactic, while lacking France's systematic infrastructure for attracting foreign investment. Only modest tax rebates offered by fragmented local councils exist, with no automatic subsidies for co-productions and no decades-long institutional memory of managing international collaboration.

Nevertheless, overseas partnerships by Korean producers have accelerated sharply after decades when the robust domestic market rendered international collaboration largely unnecessary. Companies that once focused exclusively on Korean titles have scrambled to open their doors. Barunson E&A now invests in Southeast Asian productions like Don't Cry, Butterfly, which premiered at Venice in 2024. Meanwhile industry leader CJ ENM has diversified its investments with major deals such as a two-way development and financing pact with Warner Bros covering both English and Korean-language projects, and First Light StoryHouse, co-founded with former Academy president Janet Yang and East West Bank's CEO Dominic Ng to target Asian-American narratives. However prestigious, these agreements reflect a move away from the traditionally autarkic Korean cinema.

Will Korea increasingly adopt France's institutional model at the precise moment France's model is criticised as culturally exhausted? The grass, as it turns out, was never greener on either side. Yet the alternative, allowing private capital flight and streaming platforms to hollow out theatrical production entirely, is untenable for two nations that pride themselves on cinema as their podium to the world.