The <i>Avatar</i> story continues, with the new movies filming in New Zealand.

The Avatar story continues, with the new movies filming in New Zealand.

Three new Avatar movies are slated to be made in New Zealand after the local government struck a more generous deal with director James Cameron and the major studios backing the sequels.

Cameron said the films would have been made offshore had it not been for a an increase to the tax rebate going back to filmmakers.

New Zealand Prime Minister John Key announced today that the films would be made locally, with at least $NZ500 million ($461 mill) spent in the country during their production and thousands of Kiwis being employed.

Director James Cameron warned his films would be made offshore if NZ wasn't willing to come to the party.

Director James Cameron warned his films would be made offshore if NZ wasn't willing to come to the party. Photo: Mark Cuthbert/UK Press

Key made the announcement of a memorandum of understanding with Lightstorm Entertainment and Twentieth Century Fox, alongside economic development minister Steven Joyce and arts minister Christopher Finlayson.

Also present were Cameron, producer Jon Landau, and Paul Hanneman of Twentieth Century Fox.

Provided the three films met the requirements set out in the deal, they will qualify for a total tax rebate of 25 per cent, which will go directly to the Avatar films.

The requirements include:

  • Spending at least $NZ500 million in New Zealand, including most of the live action shooting and visual effects.
  • New Zealand hosting at least one official red carpet premiere, and a featurette on New Zealand being included in DVDs and Blu Rays.
  • An offer by Cameron to serve as a founding member of a new screen advisory board, which will provide advice and guidance to New Zealand screen and film makers looking to succeed internationally.
  • Marketing and promotion of New Zealand and its film industry.

Cameron said it was hard to give figures for how many New Zealanders would work on the film but at times it would be in the "thousands".

Work was already underway making the films which would be released in Christmas 2017, 2018, and 2019.

Joyce, who has previously ruled out increasing the rebate, insisted this was not a backflip.

"We can't just keep increasing incentives. What we have got is small increases which make it attractive for these films," the economic development minister said.

Other changes were being made to encourage locally-owned projects.

Joyce said the sequels would provide "hundreds of jobs and thousands of hours of work directly in the screen sector as well as jobs right across the economy".

It was agreed among the ministers that the filming of the Avatar flicks would provide "substantial benefit to New Zealand economically and culturally".

The government also announced changes to screen industry incentives designed to attract more international productions and encourage more "mid-sized" local productions.

"We want to protect and enhance the wider economic benefits from the screen sector including tourism and boosting New Zealand's international profile, while at the same time developing a more sustainable local industry that is less dependent on international productions," Finlayson said.

- Fairfax NZ News