This year's Filmfest Dresden has been dealt a financial blow by the city hall just three weeks before the opening of the international festival of animation and short films on April 13.

The City of Dresden has slashed its support for the 2004 edition by 40%, leaving the festival with a Euros 50,000 hole in its Euros 340,000 budget and insufficient time to find alternative sources of finance.

The state of Saxony on the other hand, has extended its support for the festival this year by sponsoring a new prize worth Euros 20,000 for the national competition to be invested in the production of a new short film. With over Euros 50,000 worth of prize-money on offer, Filmfest Dresden is the most generous of the European short film festivals thanks to its various sponsors.

According to the festival organisers, the 2004 festival has attracted a record number of film submissions, up from 2003's 1,565 to 1,688 titles.