The Prime Minister is ruling out offering any additional subsidies to Hollywood producers to make their films here, despite Hobbit director Sir Peter Jackson warning that New Zealand has to be competitive in order to attract high-profile productions.
On Radio New Zealand this morning, Jackson warned the Hobbit films came very close to not being filmed here.
The director said that Warner Brothers even sent scouts to seek out locations in the UK.
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"They literally had the Hobbit broken down into each scene and in each scene there were Scottish highlands and forests in England," Jackson told interviewers.
Back in 2010 when Warner Brothers was deciding where to shoot the films, the New Zealand government responded to its threat to move the production to Europe.
It hammered out a deal with studio executives and agreed to make controversial changes to the labour laws, as well as offering $67million in tax breaks.
Jackson says the incentives are a necessary reality.
"You got to be aware of what other American states are offering as tax incentives, you got to be aware of exchange rates and you got to be in the game," he said.
But Prime Minister John Key is not making any promises for future projects
"We need to be competitive, I mean that is the nature of this industry," he said. "We are looking at some potential changes, maybe around television, but I would be very surprised if we moved beyond where we are at in terms of our incentives,"
Labour has questioned the government's deal with Warner Brothers, but many of its members will take part in the premiere celebrations tomorrow, for which they are copping criticism.
"There were still a lot of people employed in New Zealand from the making of this film," said Labour leader David Shearer. "It's a great achievement."
Key is also defending the tourism marketing campaign based around The Hobbit, saying it is an investment that has paid off.
"If we're able to achieve another 100-200,000 visitors, which would be similar to what was achieved with Lord of the Rings, over the next two or three years, that'd be a fabulous result," said Kevin Bowler, Tourism New Zealand Chief Executive.