The Sky's the Limit for China as Local Box Office Soars to No.2 in World Rankings

The MPAA released its annual box office report for 2012 and the biggest news was China's higher than expected ranking. Previous estimates had put the size of the market at around $2.3-2.4 billion, which would have been just under Japan's total, but the actual figure came out at $2.7 billion, an extraordinary 37% year-on-year jump. Considering the fact that last year's rise was similar (35%), it's quickly becoming clear that China is a force to be reckoned with.

China is not the only growing market on the international scene as places like South Korea also experienced significant growth last year (~20%). But whereas Korea's market is probably close to saturation, China is not likely to show any signs of slowing down, particularly as it is said around 10 new screens are being built there every day.

Despite a quota system that severely limits the number of foreign films allowed into the country, China saw its local market share dip below 50% for the first time in four years. However, that number has probably seen a sharp rise recently with the major successes of films like Lost in Thailand ($202.1 million) and Stephen Chow's Journey to the West ($195.5 million and counting). In fact, four of the all-time top 10 films at the Chinese box office are local hits that were released in the last nine months.

The Chinese government has also been very hands on regarding the development of its film industry. Yesterday, THR wrote about a new tax-free culture zone in Beijing (read it here) that would include TV and film facilities. The 'Beijing Freeport of Culture' is an $800 million arts and entertainment hub that will be set up by a media corporation with government backing.

I'm no expert on Chinese cinema but having just returned from the bustling Hong Kong Filmart (which just had its biggest year), it's hard not to get the sense that China is making huge strides on the global scene. It's early days though and as of yet, Chinese films have only managed to find success in their domestic market. However, with most Asian film industries making massive advances, the currents of cinema appear to be slowly drifting towards the East.