On Thursday, China announced it would promptly impose restrictions on the import of Hollywood films in response to President Donald Trump’s recent increase in U.S. tariffs on Chinese goods.
For the past thirty years, China has allowed the import of ten Hollywood films annually. The National Film Administration indicated that Trump’s tariff hike would further diminish the already declining domestic interest in U.S. films in China.
“We will adhere to market principles, honor audience preferences, and moderately decrease the number of American films we import,” the NFA stated on its website.
Chris Fenton, author of “Feeding the Dragon: Inside the Trillion Dollar Dilemma Facing Hollywood, the NBA, and American Business,” remarked that this action serves as a “high-profile statement of retaliation with minimal repercussions for China.”
Hollywood films represent only 5% of the total box office revenue in China. Additionally, China imposes a 50% tax on this small share before any profits are sent back to the U.S., Fenton explained to Reuters.
He noted that Hollywood studios receive just 25% of the box office earnings in China, while other markets typically offer studios double that amount.
“This prominent action against Hollywood is a strategic display of strength by Beijing that will undoubtedly capture Washington’s attention,” Fenton added.
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Since 1994, China has imported ten American films each year through a recognized revenue-sharing distribution model. Blockbusters like “Titanic” and “Avatar” have achieved significant success in the Chinese market, turning actors such as Leonardo DiCaprio and directors like James Cameron into well-known figures among Chinese audiences across generations.
As the second-largest film market globally, China has seen a decline in enthusiasm for Hollywood films in recent years, coinciding with the growth of its local entertainment industry.
Since 2020, domestic films have consistently made up about 80% of annual box office revenue, an increase from approximately 60% in earlier years.
