It is midday on the set of Tequila – a ­scandal-ridden family saga revolving around tequila-producing gentry – and the technical crew are scrambling to build a 1940s doctor’s surgery inside a barn at Hacienda del Carmen for the film’s final scenes. The cast, director and his team are nowhere to be seen as most did not get to bed until 6am after filming last night’s rain-soaked fight scene in the agave fields down the road.

Dankmar García, 27, a first-time ­producer, is looking a little bleary-eyed, tucked away in a back room watching the dailies (raw, unedited footage viewed after each day’s filming). “The idea was to make a quality film with a low budget,” he says, ­estimating that the period piece will cost a measly $3.5m (€2.2m). “The new ­generation of filmmakers in Mexico want to produce cinema that is not just Mexican cinema, but that can compete at an international level.” In 2007, a trio of Mexican film directors – Alfonso Cuarón, Alejandro González Iñárritu and Guillermo del Toro – garnered an ­unprecedented total of 16 Oscar nominations between them, but mostly for films made outside the Mexican industry.

Pablo Cruz, a bespectacled 36-year-old who was named by Variety last year as one of its 10 Producers to Watch, says, “Here you have three incredible filmmakers making films that are not ­Mexican. These people [set themselves up] in the US back then ­because the ­industry here was a piece of shit.”

While the new century has brought an influx of Mexican talent to international festivals, a new generation of Mexican filmmakers is speaking in voices more ­intimate, more raw and more representative of Mexican reality than ever before. But at home the recognition has not always translated into commercial ­success. “In Mexico I would say we do not really have a film industry, but we do have incredible filmmakers,” Cruz says. The buzz that these young guns are bringing to Mexican film prompted him to return to his homeland in 2005, after years spent living in Spain. He then joined forces with actors Gael García Bernal and Diego Luna to set up the ­production house Canana Films based in Mexico City.

Their aim is to make films that convey the essence of Mexico and create a bridge between Spanish-speaking ­audiences and the rest of the world – and also make money. Recent success stories include production of Gerardo Naranjo’s critically acclaimed Drama/Mex, and ­distribution of sleeper hit El Violin. “What we want to do is see how the few resources that the Mexican film industry has at the moment can be optimised, and that with less we can do more,” says Cruz, in his rapid-fire ­English that is speckled with expletives. He adds that Canana Films hopes to become a hub for Latin American talent, on and off screen, by working on co-productions across the region and providing a link to the US film system. Canana Films has signed a first-look deal with US production, financing and distribution company Focus Features, allowing it right of first refusal to develop and/or produce Canana projects. Sin Nombre, a film about Central American immigrants ­directed by Cary Fukunaga, is the first film to be ­developed under this deal and is ­currently in post-production.

Many trace the so-called nueva ola (new wave) of Mexican cinema back to the success of Amores Perros in 2000. The film, by first-time director González Iñárritu, portrayed life on Mexico City’s mean streets, including dog fights and teenage pregnancy, intersecting with lives of the privileged upper classes. Hard on the heels of this success, was Cuarón’s Y Tu Mamá También (2001). The road-trip tale of teenage sexual awakening became a ground-breaking film for its young stars García Bernal and Luna – Mexican cinema had truly arrived in the eyes of the world.

“One of the things that made Y Tu Mamá También such a world success was that those kids spoke the language they spoke whether their Spanish was understood or not, and it was specific to their culture and their problems,” says Cruz whose own reality is a colonial-style house in the quaint, residential neighbourhood of San Miguel Chapultepec, close to the centre of Mexico City.

It is not just Canana Films’ famous names that are stimulating the Mexican film industry. Although Cuarón, Del Toro and González Iñárritu – fondly known as “los tres amigos” – mostly make films outside Mexico nowadays, their ­success has clearly served to raise the profile of Mexican cinema. “The visibility of the tres amigos has been a great motivating factor for the young Mexican filmmakers,” says Daniela Michel, director general of the Morelia Film Festival, which is held every October in the ­colonial city of Morelia and works to ­promote young Mexican film talent. “They realise the best way to support cinema is to support those who are coming up through the ranks.” This attitude is beginning to have an impact on the film industry at home. During the 1990s production almost ceased as a result of an economic crisis. In 1997 just nine films were produced – the lowest number since 1932. But by 2007 film production was at its highest level in 17 years, turning out 70 films.

“In Mexico few people want to go and see a film about someone being mugged or attacked when that could happen to you on any street corner,” says Alfonso Pineda-Ulloa, a fresh-faced 29-year-old whose first feature Amor, Dolor y Viceversa premiered at the Tribeca Film Festival this year. “Mexican cinema needs to be more diverse in the social classes it covers. For example, I think we need to start making more films about the middle classes.”

The viability of Mexican filmmaking is part-founded on US budgets: films are often shot in Mexico and ­local crews are employed simply because they are cheap. “Working on foreign shoots teaches people discipline and our technicians are some of the best-trained around,” Cruz points out with pride as García Bernal strolls into his office. The actor/director is fresh from filming Rudo y Cursi, a comedy-drama about the relationship ­between two brothers who are professional football players. He ­radiates ­enthusiasm for Mexican cinema. “Mexico is extremely strong,” says García Bernal. “It’s strong on visuals and on technicians.”

Back on the set of Tequila, Dankmar García is hoping that a thirst for nostalgia will drag Mexican viewers away from their telenovelas and bring commercial ­success to his 1940s period piece. “We want to capture certain Golden Age values, as well as stylistically reflecting films that were made then,” he says.
It remains to be seen whether nostalgia will draw Mexican audiences in or whether other types of commercially driven films will do the trick. Still, it is clear that Mexican films can triumph on the international festival stage. Now the industry needs to capitalise on its creative success to create a sustainable business and allow its talent to grow.

The Morelia Film Festival’s greatest hits: premieres from previous years

Batalla en el Cielo (2005, directed by Carlos Reygadas). A no-holds-barred account, using non-professional actors and with strong sexual content, of a driver and his wife who kidnap a baby in Mexico City.

El Laberinto del Fauno (2006, directed by Guillermo del Toro). Del Toro’s 2007 Oscar-winning film, set in post-civil war Spain.

El Violín (2006, directed by Francisco Vargas). A family of musicians lead a double life as guerrilla fighters struggling against an oppressive Latin American regime.

Luz Silenciosa (2007, directed by Carlos Reygadas). Marriage, infidelity, love and faith in a Mexican Mennonite community.

Quemar las Naves (2007, directed by Francisco Franco). Homosexuality and incest are wrapped up in the story of a brother and sister living in a provincial city, charged with the care of their dying mother.

Morelia, 4-12 October 2008, in numbers:

500 submissions (the festival plans to show approximately 45 shorts, 12 documentaries and five feature films in the competition).

400 screenings of films.

55,000 people are expected to attend.

Future film exports to be released later this year and in 2009

1. Rudo y Cursi (directed by Carlos Cuarón). Gael García Bernal and Diego Luna play rival brothers in the world of professional football. General release December 2008.

2. Los Bastardos (directed by Amat Escalante). A Los Angeles-based drama in which two Mexican immigrants are hired as contract killers. General release end of 2008.

3. Voy a Explotar (directed by Gerardo Naranjo). The tale of two teens who rebel against the adult society they are surrounded by. Due for release in 2009.

4. Amor, Dolor y Viceversa (directed by Alfonso Pineda-Ulloa). In the tradition of twisted fairy tales, the film follows the story of two strangers who meet in their dreams. General release February 2009.

5. Sin Nombre (directed by Cary Fukunaga). A family divided by immigration cross paths in this raw story. Due for release in 2009.