Dealing with China is one of the most difficult things for Hollywood to do at the moment.  It is a huge market, one that can add significant returns to a film's international box-office take, but in order to do so, there's a bit of a tap-dance that any film must do, and very few films ever get that official state-sanctioned release.

And while the first inclination of longtime "Iron Man" fans is going to be "Yay, they're using the Mandarin" because of the news that the upcoming "Iron Man 3" is not only going to shoot in China but actually be co-financed by the Chinese, I would think that's a dangerous assumption to make.  The Mandarin is a tough villain for the film series to introduce without flirting with the sort of "Yellow Peril" stereotypes that makes China nervous about Hollywood in the first place.

In general, Disney is busy laying down some groundwork for ongoing relationships with the Chinese film industry, and why not?  You're talking about a market that could conceivably add billions to a film's box-office if given a wide release there.  Billions.  With a b.  And in order to have access to that potential audience, involving the Chinese in the production of the film seems like a logical step.  You want to make sure that you're speaking to local tastes and interests and that you're creating something that is going to be allowed to play as widely as possible.

When Ben Kingsley was first rumored to be joining the film, people started speculating about whether or not he'd be playing The Mandarin.  I think that's less likely than ever now, because I doubt China would want an English actor playing a Chinese character, especially one who is unabashedly villainous.  I don't think the key to cracking the Chinese market is having an American hero beat the crap out of a Chinese bad guy onscreen.

Film is increasingly an international concern, and while this is important for Disney as a company looking to gain a foothold in a huge potential market, we also have to take into consideration the message that is sent when we partner with China and start exporting more than just the principal photography part of a picture.  It sounds like China's going to have a real stake in this movie, and with shooting taking place there, at least some of the film will have Chinese crew working on it.  China is a complicated political situation these days, so Disney embracing them to this degree is risky.  It could easily turn into a public relations nightmare, and it's got to make American crews uneasy.

Still, this is just one part of Disney's overall China plan, so expect more announcements like this in the near future.

"Iron Man 3" is set for release May 3, 2013.