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Advertisements for Avatar and a trailer showing the state-backed biopic Confucius at a cinema in Beijing are depicted in this file photo.

Ng Han Guan/AP

Ten new movie screens open each day in China as the popularity of cinema soars in the country, but the appeal of Chinese films has failed to maintain the pace.

Box office receipts jumped 30 per cent last year to 17 billion yuan ($2.7-billion U.S.), lifting China up to become the world's No. 2 cinema market behind the United States, figures last week showed.

Yet foreign titles took the bulk of the money, scooping up just over half the revenue in 2012 despite facing an annual cap of only 34 releases – while Chinese filmmakers produced 893 films last year.

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"The successful movies are nearly all Hollywood blockbusters," said Pen Kang, a researcher for the Hong Kong Baptist University Academy of Film.

"Chinese domestic films have no advantages compared to these Hollywood films. The production standards and technology are less advanced."

China only increased its foreign movie quota from 20 in 2012 after long pressure from Hollywood and the World Trade Organization. As a result foreign films edged out domestic ones in ticket sales for the first time in a decade, taking 51.5 per cent of the total.

Naxin Ping, who manages an antique shop in Beijing, said she went to the cinema several times last year, watching both foreign and domestic titles including The Amazing Spider-Man, Mission Impossible: Ghost Protocol, martial arts film The Grandmaster by Hong Kong director Wong Kar Wai and Renzaijiongtu, a Chinese comedy. "That's my taste," she said.

She is typical of China's growing middle-class population willing and able to pay the relatively high price of movie tickets – around $13 – that has made Chinese theatres such an attractive market.

The country's leading property group Wanda became the world's biggest cinema owner last year after acquiring U.S. company AMC Entertainment Inc. for $2.6-billion.

But State Administration of Radio, Film and Television (SARFT) vice-minister Tian Jin in November urged domestic filmmakers to "enhance creativity," saying their movies faced tremendous pressure and needed to be more competitive.

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In recent years Hollywood blockbusters such as Avatar and Transformers: Dark of the Moon have brought in whopping sums, though the low-budget Chinese comedy Lost in Thailand unexpectedly upended them last month to become the country's biggest-ever box office hit.

But Robert Cain, a producer who has worked in China for 25 years, pointed out that it was among successful domestic movies that "drew large audiences in China because they released at times when Hollywood movies were blocked out of Chinese theatres."

Mega blockbusters such as the latest James Bond movie Skyfall and the widely anticipated The Hobbit, based on the J.R.R. Tolkien novel, hit cinemas around the world last year but have 2013 release dates in China – by which time many potential viewers will already have seen them on pirated DVDs.

Just as Chinese movies have lagged domestically, they have also struggled to garner significant popularity or renown abroad, despite being the world's third most prolific film industry according to SARFT.

And despite being the world's most populous country, China has failed to produce anything with the global cultural impact of South Korean singer Psy's "Gangnam Style" or Indian musician Ravi Shankar, who died in 2012.

President Hu Jintao acknowledged last year that China's soft power had not kept pace with its growing political and economic stature, saying: "The international influence of Chinese culture does not correspond with the international status of China."

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But Rance Pow, an industry analyst who heads the consultancy Artisan Gateway, was optimistic that domestic filmmakers would steadily improve.

"Chinese films remain on course to produce commercial hits not only for the China market but for international audiences as well," he said.

The difficulty comes in part from the censorship that China exercises over film and other cultural productions.

The Communist Party imposes strict rules over what films are allowed to be seen by the public, banning what it considers any negative portrayal of contemporary politics or issues it says might lead to social unrest.

In an open letter last month award-winning Chinese director Xie Fei said the censorship system had "become a corrupt black spot for controlling the prosperity of the cultural and entertainment industry, killing artistic exploration and wasting administrative resources."

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