A RECORD number of Japanese films have been imported into China’s vast theatrical marketplace this year, while Beijing’s biggest movie studios are mining Tokyo’s deep IP pool for bankable stories to adapt.

Growing business ties between China and Japan was the key theme on the market floor at the 2018 Tokyo International Film Festival.

“The relationship between China and Japan now seems very good,” Yasushi Shiina, CEO of Tokyo’s TIFFCOM content market, told The Hollywood Reporter, noting that Chinese buyers are now the most prevalent and active non-Japanese participants at the event. “Every year the number of Japanese films released in China is increasing,” he added.

A total of 12 Japanese films were imported into China’s theatrical market during the first three quarters of 2018, surpassing the eight titles brought into the country in 2017. Japanese auteur Hirokazu Kore-eda’s Cannes Palme d’Or winner “Shoplifters” led the way, earning US$14.1 million, a new record for a Japanese live-action film in China and a powerful performance for an art house film.

At last year’s Tokyo film festival, Japanese officials revealed that Beijing and Tokyo were in advanced talks to establish a co-production treaty. That agreement was formally ratified in May this year. Now, leading companies from both nations are looking to capitalize on the pact’s incentives while leveraging the unique strengths of the content sectors in both countries.

During day two of the Tokyo market, powerhouse Beijing-based studio Bona Film Group — riding high on the US$160 million box-office success of its latest Chinese release “Project Gutenberg” — unveiled a partnership with Japan’s Toei Animation to co-produce the big-budget animated film “The Monkey Prince.”

“Japanese anime and manga are extremely popular in China, so there’s a lot of potential for us to collaborate,” said Bona’s executive VP Jeffrey Chan during a morning co-production seminar.

In 2016, Japanese anime sensation “Your Name,” produced by Tokyo studio FUNimation Films, earned US$83.7 million in China, besting the local performance of many big-budget Hollywood animations, such as “The Angry Birds Movie” (US$75.6 million) and “Finding Dory” (US$38 million). The latest installments in Japan’s long-running Doraemon film series also routinely generate substantial box office in China, such as 2018’s “Doraemon the Movie: Nobita’s Treasure Island,” which brought in US$32 million in July.

Chan also argued that China’s relentless box-office growth belies the difficulties local studios are forever facing to turn a profit, which partly explains their increasingly collaborative approach.

“It’s not cheap to make films in China anymore; it’s a very rough, competitive market,” he said, noting that a typical tentpole film budget in Beijing is now US$80 million. To gain an edge in the marketplace, Chan suggested, Chinese producers are increasingly flocking to overseas IP repositories like Japan in search of proven stories for adaptation.

Beijing studio Enlight Pictures’ recent youth thriller “Animal World,” directed by Han Yan and co-starring Michael Douglas, was adapted from the Japanese manga “Ultimate Survivor Kaiji” by Nobuyuki Fukumoto. It earned US$75 million in China over the summer and was later acquired by Netflix for worldwide online distribution.

Leveraging the popularity of some manga properties across Asia — and even in Europe and North America — could also help Chinese films gain more of the offshore marketshare they covet, Chan said.

“We have to look for diversified income sources,” he explained. “Even though our domestic market is growing, most Chinese films are not selling internationally. Less than 5 percent of the total revenue for Chinese-language films is generated overseas.”

Japan’s aging and shrinking population, meanwhile, has Tokyo film veterans also looking outwards for growth with increasing urgency.

“Japan’s population is 130 million, but what we should be targeting is the population of 7 billion people who are living overseas,” said veteran Japanese film producer Toshiaki Nakazawa (“Departures,” “13 Assassins”).

Nakazawa noted that “Departures” (2008), Japan’s last winner of the Oscar for best foreign-language film, was a sizable international commercial success. “But those days mostly are over,” he said. “We can participate in festivals and competitions with our Japanese films, but if we don’t win the top prize, it will just be an expensive and costly marketing exercise.”

“Going forward, co-production and producing films together with leading producers from other countries will be the best path,” he argued. “Just like Japan’s great automobile companies Toyota and Honda, we need to be aggressive about finding strong international partners to develop new markets.”

The Tokyo International Film Festival runs from Thursday to Nov. 3. “A Star Is Born” produced and directed by Bradley Cooper opened the festival, while “Godzilla: The Planet Eater,” directed by Kobun Shizuno and Hiroyuki Seshita, will close the fest Nov. 3, the date the original version debuted in 1954. (SD-Agencies)