animation industry canary islands boom

Animation puts Canary Islands in global spotlight

Animation takes the lead in diversifying the Canary economy

Last week it was announced that French animation studio STIM is setting up in the Islands – the latest addition to an accelerating wave of arrivals that has cemented animation as the most firmly established emerging sector in the Archipelago in recent years. The challenge now, according to Rubén Zarauza, president of the Canary Islands Audiovisual Cluster, is to avoid “dying of success”, and the surest way to meet that challenge is to “focus on training”.

Successes are being racked up across various corners of the economy, but in the race to achieve meaningful diversification of the Canary Islands’ economy, animation is currently out in front. More and more studios are deciding to put down roots in the Islands, and the newcomers often outshine those that came before – particularly given that they are making the leap at a time when the business model is in a constant search for maximum returns.

“A few years ago there were plenty of studios, all fighting to offer the best content – what the Mexicans would call the most chingón,” says Zarauza. Today, however, consolidation is unstoppable. Where exclusivity – selling a series to just one platform such as Netflix – was once the norm, content now appears across multiple channels simultaneously. The business has been turned upside down, and nothing suggests the current formula will remain the only one for long. In such a context, only solid foundations allow an industry to absorb so many plot twists.

Why are investors choosing the Archipelago?

So why this wave of investment? And why is confidence in the Archipelago growing among operators? The short answer points to the low-tax zone (Zona Especial Canaria, ZEC) established under the Canary Islands Economic and Fiscal Regime (REF). Paying less tax may appeal to any company’s finance director, but it is not enough. In fact, “the US has incentives, and so does Ireland,” explains the cluster president. Ecosystems do not grow because of a single factor, but there is one essential element that cannot be overlooked: the abundant success achieved by the pioneers – those who first turned their gaze towards this corner of the Atlantic as the ideal place to boost their creative activity.

“In the Canary Islands we have shown we are at the level of anyone,” says Zarauza. This capacity to deliver translates into knowing how to work within whatever time is allocated to a task, adds the CEO of Amuse Studios. If two hours are allowed for producing a single frame – the minimum unit of moving image – the final result will be cheaper but of lower quality than if seven hours were given. Being prepared to navigate either scenario successfully builds trust.

STIM is the latest link in a chain marked by success in which chance plays a very secondary role. Or more precisely, luck was a protagonist at the very beginning, before handing over to the strategies deployed to nurture the sector’s growth.

From happy accident to strategic success

First came serendipity. Around ten years ago, Mexico’s Ánima Estudios (creator of El Chavo Animado, among other productions) – now in deep crisis – was looking for somewhere to set up and, by chance, learned of the Canary Islands’ tax incentive. After studying their options, they set aside the alternatives – Canada and Puerto Rico – and decided to come to the Islands. “Contrary to what is often cited as one of our problems, what ultimately convinced them was the greater legal certainty they could obtain here,” says Pablo Hernández, president of the ZEC. They arrived when virtually everything was still to be built. “As far as I can tell, there was just one animation studio, La Casa Animada (Cleo), in Tegueste” in Tenerife, Hernández continues.

Thus Ánima Kitchent was born, allowing the Islands to take their first major leap and present their credentials as a place capable of offering much more than accommodation, catering and hire cars – attention that, incidentally, helped a wide range of international film productions choose the Islands’ landscapes. It was not long before 3Doubles Producciones (Flamingo Flamenco) followed, in another battle won by the Canary Islands, this time against the Basque Country and Madrid, which had initially appeared as the priority destinations.

At that time, all the production companies were arriving in the Islands “with a handful of trusted workers”, explains Pablo Hernández. Over the years, the workforce has become increasingly Canarian. The ten to fifteen workers with whom projects might start grew exponentially to “around 2,000”, according to ZEC data, currently operating in the sector. Hence the importance Rubén Zarauza places on training as a guarantee of a long life for animation in the Archipelago.

Well-paid jobs and the need for training

The volume of jobs “has multiplied by two or three in a very short time,” continues the president of the Canary Islands Audiovisual Cluster, and the engine is still accelerating. “Half of my workforce [at Amuse] are workers born here,” and among them are those who “already lead teams”. That is another characteristic of a “craft trade”, as Zarauza defines it. People progress quickly and “salaries are well above the minimum wage”.

Another reason the Canary Islands should pursue the take-off of industries like this is precisely the remuneration of labour. Over-reliance on a sector such as hospitality creates many jobs but with little added value, which keeps the region’s average salary among the lowest in Spain. Lifting the population out of that tail-end position requires, among other things, generating opportunities that demand a high degree of specialisation from workers.

The sector’s current workforce of around two thousand has been achieved “in just eight years, and now, in a short space of time, we need to be able to double those figures,” announces Pablo Hernández. Is it achievable? The ZEC president believes so, “but we need to give it a push”. That is to say, the combined efforts of the ZEC itself, together with the Canary Islands Government, ICEX, Proexca and the island cabildos, have turned the Archipelago into “the European Hollywood of animation”, in Hernández’s words.

Now the task is to maintain the pace of attraction and, moreover, roll up our sleeves a little further so that education covers the needs of production. The Felo Monzón vocational training centre in Gran Canaria and César Manrique in Tenerife offer curricula tailored to this field. The Gran Canaria School of Art and the Fernando Estévez School of Art and Higher Design in Tenerife run programmes in animation, illustration and design. “We must bear in mind that of these young people joining our companies, around five or six will decide over the years to set up their own studios,” notes Rubén Zarauza; “that’s what happened to me,” he adds.

A growing roll-call of international names

The slow-burning emergence of this boom also attracted Mondo TV in 2016. It is now called Hi Animation after being acquired by Spanish group Squirrel. The buyout and capital concentration processes are further proof of a well-oiled machine. After Mondo came French company Atlantis Animation (Tara Duncan, Messi and the Giants), dedicated to top-quality advertising production and also a Disney+ supplier. Internationally recognised names were beginning to land.

The pandemic also played in favour of the boom. The lockdown period and subsequent movement restrictions gave greater meaning to quality of life. French studio Fortiche, which produces Arcane – Netflix’s most-watched animated series – suffered a loss of professionals and was prompted to look for locations where it could continue its work with the guarantee of permanence. Once again, the Archipelago was the chosen destination.

The trickle has been constant ever since. Gigglebug (Gigglebug and Friends), Surfing Giant Studios (Hey A.J.!), Oscar-winning DNEG (Interstellar) and the aforementioned STIM (Garfield, Coyote vs. Acme) have all come to enrich a landscape that others, such as Tomavision (Tulipop), began to build. Animation is soaring and showing the way that other activities, such as video games or software, could soon follow.

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