Why Baz Luhrmann Wants to Make a Chinese Film

China presents a major movie audience and an obstacle course to reach it.

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Baz Luhrmann has told reporters he's interested in making a Chinese film.

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Speaking to reporters at the "The Great Gatsby" premiere in Beijing Thursday, the film's director Baz Luhrmann revealed he was "seriously considering" making a Chinese movie.

"I take a very long time to decide what films to make, but I'm seriously thinking about a movie set in both China and the West. China is an overwhelmingly exciting place, and I want to participate in what's happening," Luhrmann said.

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Such a film would give Luhrmann an excellent opportunity to subvert Orientalist traditions to the tune of a pop culture-pastiche original soundtrack. But making a Chinese film also could have a major effect on the movie's bottom line, as China presents both an exponentially growing audience and an increasingly difficult obstacle course to reach it.

When it comes to the Chinese movie market, the numbers speak for themselves. The Chinese box office brought in $2.78 billion last year – a 30 percent increase over 2011 – making China the second largest movie market after the United States. An average of 10 new movie screens open every day in China, and it is expected to be the largest global market by 2020.

And Chinese audiences have a hearty appetite for American films. Last weekend, for instance, American films occupied the No. 1, 2, 4 and 10 spots at the Chinese box office. Together they made $52 million, more than two-thirds of the total haul of the weekend's top 10 films.

However, the path for U.S. films to Chinese audiences is not an easy one. The Chinese government has a quota on the number of foreign films – raised to 34 from 20 in 2012 – they allow to be distributed in China. It is up to the government-run State Administration of Radio, Film and Television to determine which 34 films make it to Chinese screens, and Hollywood is competing against the rest of the world. (Luhrmann suggested Thursday that the fact that "Great Gatsby" was an Australian film helped it get into China.)

Foreign films face a long list of qualifications to be accepted by the Chinese government. In 2009 SARFT released a set of 31 guidelines – which ranged from nudity and violence to religion and gambling, and of course negative depictions of China and the Communist government – that they would consider in approving foreign films. American movies are often recut to meet Chinese standards.

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Even still, they are met in China with some political backlash. Earlier this summer an officer in China's People's Liberation Army wrote an op-ed in a state military publication warning that American films "have always served as a propaganda machine to convey American values and their strategies in the world."

One way Hollywood is attempting to navigate China's tricky standards is by making films that are co-productions with Chinese studios, which do not count against the quota. To be considered a co-production by China's measures, one third of a film's funding must come from Chinese sources, one-third of its main cast must be Chinese and it must have scenes shot in China. In 2009 the MPAA held a forum in Beijing on U.S.-China co-productions and continues to host events to encourage Chinese and U.S. partnerships.

However, U.S. film executives have grown frustrated by the co-production process. According to The Hollywood Reporter, studios have struggled to find Chinese investors and once they do, still have had trouble attaining co-production status from Chinese authorities. They also worry that China's participation in co-productions is more about building its own competitive film industry than teaming up with the American studios.

Even films approved by the Chinese regulators face issues in reaping the most out of the Chinese box office. "Django Unchained" was yanked from Chinese theaters minutes before its April premiere, with "technical reasons" being the only explanation given. It was allowed in Chinese theaters a month later once it had been cut to please China's censors, but was distributed on smaller scale than originally planned. It was a flop in the Chinese market, which many blame on both its limited release and the delay, which made way for it to be more widely pirated.