Italy's nationalassociation of independent directors and producers, API, has released astatement lashing out against the Italian government's decision to reduce statefunds for the local film industry.

The Italiangovernment will cut its general fund for entertainment (FUS), (which includesfilm, opera, dance and theatre) by 20% in 2004 and by 25% in 2005, API said,adding that the government 'had already failed to increase the fund inrecent years despite devaluation.'

Last month, the government had announced its first plannedincrease of the FUS in years. It planned to increase the fund by Euros 111m in2004 compared to the previous year, while the film industry was set to receiveEuros 178,600,000, up from Euros 93,193,220 in 2003.

'This meansthat the film industry will now get Euros 60m that will have to be dividedbetween production, distribution, promotion, Cinecitta', the Venice FilmFestival, the National Film School, etc, etc', API said.

In a stronglyworded statement, API blamed the cuts on the government's economic maneuveringand said that Italian prime minister Silvio Berlusconi is 'sacrificingcultural production in Italy in order to maintain his electoral promises[...].'

API also warnedagainst the possibility that the Italian government might ask for stateincentives and funding to the entertainment industry to be fully reimbursed.'This would completely paralize the entire [film] sector and would makethe new cinema law completely useless.'

API underlined that thenumber of people who work in the Italian film industry and are threatened bythe current crisis is equal to the entire work-force of Fiat, Italy's numberone car-maker.