Maurice Reyna, appointed president of Venezuelan film institute Centro Nacional Autonomo de Cinematografia (CNAC) in February, has lost the first round of his battle with the Chavez government for more support.

The Caracas government approved CNAC's 2001 budget of $1.07m (761m) Bolivars) yesterday (April 17), an amount Reyna declared completely "inadmissible and lacking." Reyna had lobbied the government to double CNAC's 2000 budget of $1.5m in order to better address the needs of the country's struggling film industry.

The setback comes at a time when Venezuelan cinema has shown the first encouraging signs of a comeback. Last year, six full length features and four shorts were released theatrically. Among the features, bio epic Manuela Saenz, raked in huge admissions.

Venezuela's film commission (VFC), which is incorporated within CNAC, reported earnings of $2.6m from foreign film productions shooting in the country. Film and television projects shot on location in Venezuela included those from the US, Germany, Austria, Japan, Argentina, Canada, France and the UK.