Wanda's Wang Jianlin Warns Against U.S. Protectionism in Entertainment Sector
"If China were to retaliate it would be bad for both parties — I do not wish to see that scenario materializing," China's richest man said during a Q&A session in Davos.
Addressing the global elite in Davos, Switzerland, China's richest man urged the U.S. not to erect barriers against Chinese investment into Hollywood.
"That would be a step back," Wang Jianlin, chairman of property and entertainment conglomerate Dalian Wanda Group, said during a Q&A session at the World Economic Forum on Wednesday. "That will be about protectionism emerging in the U.S.," he added.
Wanda's ongoing buying spree in Hollywood, including last year's acquisitions of Legendary Entertainment and Dick Clark Productions, has raised alarm among some U.S. politicians. Bipartisan lawmakers, including the incoming Senate minority leader Chuck Schumer, have called for closer scrutiny of such deals to see whether they are being directed by Chinese government interests.
Wang argued that his investments in the U.S. have been "a good thing," however. "We don’t interfere with the content — I just want the profit," he said.
"I've proven that with the purchase of U.S. cinemas," he continued, referencing his 2012 takeover of American exhibitor AMC Entertainment. "They're still showing U.S. films; there is no change."
As he has on numerous occasions in the past, Wang also noted that he'd like to buy one of the six major Hollywood studios if any were to come up for sale. "I'd be a happy buyer," he said with a smile.
Much like Chinese President Xi Jinping did during a speech in Davos on Wednesday, Wang also suggested that any escalation in trade tensions between the U.S. and China would only hurt both sides.
"The main growth market for English-language films is actually China, not anywhere else," he said. "So, if China were to retaliate, it would be bad for both parties. I do not wish to see that scenario materializing."
Wang said he has asked MPAA Chairman Christopher Dodd to carry a message to President-elect Donald Trump — "'Let's leave the entertainment industry alone, no war please.'"
Of course, many will note the irony of China's president and richest man arguing, in back-to-back appearances, for a drawdown in protectionist trade practices. China's media and entertainment sector is one of the world's most highly restricted. The country allows just 34 foreign films across its borders each year on revenue-sharing terms. And Beijing outright forbids foreign companies from buying and controlling local media firms — precisely what Wang has done in the United States.
Highlighting this fact, Senator Schumer recently argued in a letter to the U.S. Treasury Secretary for greater reciprocity around trade with China. According to the Wall Street Journal, the Trump transition team, meanwhile, has circulated a document proposing additional review of any foreign transaction that couldn't be replicated by a U.S. company going the opposite way— terms that would entail any Chinese acquisition of a U.S. media firm, given that China blocks all such deals on its turf.
Experts say China is very unlikely to allow any foreign ownership of media, which is considered a sector of the utmost sensitivity by the ruling communist party. But many observers do expect the country to begin allowing more U.S. films into its market this year.
"More Hollywood films coming into the market is also good for China, because it benefits local theater owners and it helps the overall box office expand, which feeds into the narrative of a rising China becoming the biggest market in the world," says Stan Rosen, a professor of political science at the University of Southern California. "But opening up local media to foreign control is not beneficial to China's leaders, so I don't think anyone sees that happening."
The U.S. and China are scheduled to begin negotiating a new trade agreement on film imports in February.