For the first time in 10 years, box office takings from Chinese films have exceeded revenue from foreign films in China.

Chinese actress Zhang Ziyi performs in the film "House of Flying Daggers," directed by Zhang Yimou. [baidu]

Box office revenue in China exceeded 1.5 billion yuan (US$182 million) in 2004, with Chinese films taking up 55 percent of the market share, said the State Administration of Radio, Film and Television (SARFT).

The top three films in China last year were House of Flying Daggers, A World without Thieves and Kung Fu Hustle, all of which were Chinese, a distinct turn from the past foreign-film-dominated box office.

Zhang Yimou¡¯s House of Flying Daggers has made 153 million yuan, far exceeding The Lord of the Rings. Film industry analysts estimate the two Chinese New Year blockbuster films A World without Thieves and Kung Fu Hustle have already made up to 200 million yuan.

Chinese director Lu Chuan's film Keke Xili, about the protection of wild animals in Northwest China, also made good performance.

"2004 was the year that Chinese films made their greatest leap," said Weng Li, vice manager of the film exhibition and distribution arm of China Film Group, China¡¯s biggest film producer and the only company authorized to import foreign films.

According to SARFT, China produced 212 films in 2004, 80 percent of which were either funded by private capital or foreign investment.

House of Flying Daggers was financed by privately owned Beijing New Picture Distribution Co. Ltd. and A World without Thieves and Kung Fu Hustle were both produced by privately-owned Huayi Brothers, one of the mainland's most commercially successful film and TV production companies.

In October 2004, U.S. film giant Warner Brothers Pictures set up China's first movie production joint venture with China Film Group and the privately-run Hengdian Group.

In November 2004, China announced it would let foreign companies take up to 49 percent of stakes in local television production companies, giving the international media better access to the world's biggest market.

Yang Buting, chairman of China Film Group, called the loosening restrictions on Chinese film industry "an unprecedented golden opportunity."

However, the Chinese film industry cannot allow 2004's figures to let it rest on its laurels.

According to China's WTO commitments, foreign films meeting import qualifications will soon be swarming into China.

"A battle for market share is in store," said Zhu Hong, SARTF spokesperson.

Editor: Donald