Movie Deals Start to Flow as Russia and China Get Closer

China Quota Wheel Illustration 2014

Closer relations between Presidents Vladimir Putin and Xi Jinping are behind the new movie relationship.

One of the oldest embassies in the world is the Russian embassy in Beijing, a vast complex which has seen a lot of traffic recently, as the Dragon and the Bear cosy up to each other. Russia and China have signed a flurry of deals of late, cooperating on film festivals and discussing ways of allowing more Russian films into China, as well as deepening levels of co-production.

For Russia, reeling from economic crisis and sanctions imposed by the international community over its actions in the Ukraine, China provides a valuable outlet for Russian films.

China is keen to expand its cultural reach overseas and also wants to use cultural exports as a way of underlining friendship between the two countries, particularly as Beijing looks to Russia for natural resources.

This closer cooperation could have implications for Hollywood if there are moves to allocate to Russia more of the 34 movies allowed on a revenue share basis under China's quota system, although much of the conversation seems to be about expanding this quota to allow more Russian movies in, rather than replacing Hollywood films with Russian ones.

At the Beijing International Film Festival this year, Artem Tsypin won the best actor category in the Tiantan Awards for his role in White White Night, while Yulia Peresild won best actress for her role as a World War Two sniper in the Russian-Ukrainian film Battle for Sebastapol.

Fedor Bondarchuk, the prominent Russian filmmaker, actor, producer, and Chairman of the Lenfilm studio Board of Directors, was on the Tiantan Jury.

And Russia is set to have a similarly high profile at the Shanghai film festival this month, with Sunstroke, from Russian director Nikita Mikhalkov among the movies vying for a Golden Goblet award. Leviathan director Andrey Zvyagintsev will head the Golden Goblet Jury.

China and Russia have been busy discussing closer cooperation for more than a year, and a high-profile fruit of these meetings is a $15-million investment by the state-owned China Film Group in a sequel to Russia’s top-grossing local movie of 2014, Viy, starring Jason Flemyng and Rutger Hauer.

Producer Alexey Petrukhin told the Russian daily Izvestia in late April that CFG would also distribute the movie.

According to Petrukhin, the Chinese investment of $15 million is to cover just under one half of the movie's announced budget of $36 million.

Centered on the story of a British traveler who was commissioned by Russian Emperor Peter the First to travel to Russia's Far East and ended up in China, the film is set to be Russia's highest-budget co-production of all time.

Flemyng and Hauer have agreed to a lower fee for Viy 2 that was originally negotiated, taking into consideration the financial crisis in Russia. Jackie Chan and Chinese actress Xingtong Yao are also cast in the movie, which is to be directed by Oleg Stepchenko, like the first Viy movie.

At Cannes, Chinese distributor Lotus Film International Culture finalised a deal for a wide September 2015 theatrical release of war film Battle for Sevastopol.

The film - about a woman sniper during a crucial struggle between the Red Army and the Nazis - is a Russian-Ukrainian coproduction that wrapped last year under challenging conditions after the Kremlin seized Ukraine's Crimea territory, where it was shooting.

Negotations for the deal, with Evegeny Drachov, sales manager of Ukraine's, began in earnest during the Beijing International Film Festival.

Wu Jiawei of Lotus said audience reaction at Beijing was critical to the company's decision to pick up the film.

"Audience laughter, cries and focus on the plot gave us great confidence," he said.

He added that Chinese audiences would enjoy the realistic battle scenes and faithful emotional language of the movie that tells a war story from the point of view of a woman.

In November last year, Tong Gang, deputy director of the State Administration of Radio, Film and TV, told the second Sino-Russian cultural forum how the two countries were hosting mutual film festivals, and would both focus on war-themed movies to commemorate the Anti-Japanese War, as WW2 is referred to in China, or the Anti-Fascist War, as the Russians call it.

"China and Russia fought side by side in the Anti-Fascist War, therefore this theme has a special meaning for the two countries' cooperation," Burnt by the Sun director Mikhalkov told the ifeng website in China.

Tong hoped that a Sino-Russian film agreement could be signed this year to encourage co-productions and better promotion of common interests. Moreover, they hope to actively create better conditions to import more films from each other, said Tong.

Jiao Hongfen, Chairman of China Film Group hailed the performance of Russian films in China, in particular said Stalingrad, which made $10.75 million.

The political backdrop to the growing closeness is important and much has been made of the "bromance" between Russia's President Vladimir Putin and his Chinese counterpart, Xi Jinping.

Xi travelled to Moscow in April for a parade to mark the 70th anniversary of the end of World War Two, where President Barack Obama and European Union leaders were conspicuously absent.

Xi and Putin met five times during 2014, and they will meet at least that often this year, including a return visit by Putin to attend a parade in Beijing to mark the end of the war against Japan in 1945. President Xi is known to admire Putin's authoritarian style of leadership.

The Soviet Union and Chairman Mao Zedong's China were both communist allies in the 1950s but relations soured and they became mortal enemies, despite their ideological similarities.

However, China needs natural resources from Russia, and both share a skepticism about the United States, which has also fuelled warmer ties.

Russia's deputy minister of communications Alexey Volin is confident that Russian movies can do as much as $100 million worth of business in China, if movie quotas can be agreed.

Volin said Russia did not expect box office receipts of $300 million, "but we believe we can strive towards $100 million, because we know how to shoot high quality, interesting movies."

His comments have drawn scorn from film industry commentators in Russia - who point out that in the past 20 years, Russian and Ukrainian films have barely achieved more than an average of $8 million a year at the international box office, but expectations are growing in official circles that closer cooperation will generate bigger revenues.