The Future of US-China Relations, as Seen from the Box Office

Despite the ongoing U.S.-China trade war, in December 2018 Marvel Studios confirmed the start of production of the Marvel film “Shang-Chi and the Legend of the Ten Rings” (hereafter referred to as “Shang-Chi”). The Walt Disney Company has high hopes for “Shang-Chi,” which is to be released on Sept. 3 of this year, and will be available only in theaters. Shang-Chi is an Asian character from Marvel Comics, one of the most highly trained martial artists in the Marvel Universe, with fighting techniques far superior to those of Captain America, Daredevil and other superheroes known for their fighting.

The main market for “Shang-Chi” is likely mainland China. The main character is played by Simu Liu, who was born in Harbin, Heilongjiang province, and immigrated to Canada when he was 5 years old. He is best known for his part in the TV sitcom “Kim’s Convenience.” “Shang-Chi” is the first film in which he is starring with the lead role. The other main actor in “Shang-Chi” is Hong Kong’s Tony Leung, who plays the villainous character Mandarin, a modified version of Fu Manchu from the Marvel comic. Fu Manchu is a terrible guy; in China, comics starring him have been accused of degrading China. The new Mandarin is an effort by Disney to ensure that “Shang-Chi” can be a big hit in China.

It makes sense for Disney to focus on the Chinese market, as 70% of Hollywood’s revenue now comes from overseas, with mainland China accounting for the largest share. “Godzilla vs. Kong” grossed nearly $200 million in China, surpassing the U.S. box office; in 2019, “Avengers: Endgame” made Hollywood a huge profit, earning $2.8 billion worldwide, but China alone earned more than $600 million from the box office. In the past two years, China has surpassed the United States to become the world’s largest movie market, and now China’s annual box office revenue has exceeded $10 billion.

Hollywood has made many efforts to target the Chinese market, but they are not quite on point. In 2020, “Mulan” suffered a Waterloo in China, grossing less than $70 million globally at the box office. Part of the reason was that scenes in the movie did not offer an accurate portrayal of Chinese history and were criticized for inappropriate characterizations and cultural elements. In the drama, Mulan is seen fighting with a super-powerful witch, a princess of the Northern Wei is depicted playing with a parasol in a Manchu-style palace, and Mulan is shown living in a Fujian tulou [a circular earthen building].

“Eternals,” which will be released at the end of this year, is also a superhero movie adapted from a Marvel comic. The cast also contains actors of Chinese descent, and the film will be directed by Chloé Zhao, a recent Academy Award winner and an immigrant to the United States. Neither film has been approved for release by the Chinese Communist Party, but since China still welcomes U.S. companies to do business in China, and American films comprise the most popular foreign films in China, it is expected that American films will continue to be approved for release in China.

In fact, Chinese companies have been making their presence felt in Hollywood for years. Chinese investment in Hollywood-produced films, like Chinese technology products sold in the United States, is being questioned by Americans as having a negative impact on American society — for example, the fact that Sandra Bullock, the hero of the movie “Gravity,” survived by entering the Chinese space station, in doing so helped to promote China. Although Chinese investment in Hollywood has declined significantly since the start of the U.S.-China trade war, as Hollywood becomes more interested in the Chinese market, this business relationship will become a two-way street. For American films to make money in China, the U.S. may also have to allow Chinese businesses to make money through investment in American films. The quality of filmmaking in China is improving rapidly. “Detective Chinatown 3” was released in China earlier this year and has received great attention in the U.S. after breaking box office records. U.S. media has said “Detective Chinatown 3,” earning nearly $700 million at the box office, is proving that China no longer needs Hollywood movies.

With the ongoing battle between the United States and China, can film provide a reflection of the future relationship between the two countries?