China targets Hollywood films in retaliation of tariffs; Trump responds

China announced the immediate restriction of imported American films as the country retaliated against President Donald Trump’s escalated U.S. tariffs on imported Chinese goods.

Trump was asked about his reaction to China’s latest move of targeting cultural exports from the U.S. on Thursday during a cabinet meeting.

“I think I’ve heard of worse things,” the president said, which was followed by a room full of laughter.

Reuters reported that the financial impact would likely be minimal, according to industry experts, but mainly because box office returns have significantly declined in recent years in China.

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For about 30 years, China imported 10 Hollywood movies annually. But the National Film Administration (NFA) in Beijing said on its website that Trump’s tariffs would continue to sour its domestic demand for American movies in China.

“We will follow market rules, respect the audience’s choices, and moderately reduce the number of American films imported,” the NFA said on its website.

China was once looked to by Hollywood to help boost the box office performance of movies, since the former is the world’s second-largest film market.

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China’s domestic movies, though, are increasingly outperforming American movies shown in China. For instance, Pixar’s “Inside Out 2” was eclipsed by “Ne Zha 2” to become the highest-grossing animated film of all time, Reuters reported.

Hollywood movies now only account for 5% of the overall box office receipts in China. Hollywood studios also only receive 25% of ticket sales in China, though in other markets, they take in double their profits.

It is not clear if China will allow several major blockbusters expected to hit the screen this year.

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Walt Disney recently received permission to debut the new Marvel superhero movie “Thunderbolts” on April 30, but others, like Tom Cruise’s “Mission: Impossible – The Final Reckoning” and James Gunn’s “Superman,” could be in jeopardy.

The news comes after the White House said Thursday it had imposed 145% in new tariffs on China, up from the 125% Trump announced the day before.

While hiking rates on China, Trump said he would reduce tariffs on other countries that did not retaliate against the U.S. to his baseline of 10%.

Reuters contributed to this report.