After importing cartoon series for TV for more than 20 years, China is determined to develop its own animation industry. But China's potential Walt Disneys are yet to find their Mickey Mouse.

The nation imported a large number of cartoons from 1981 to 2004. But the policies implemented since then to encourage the domestic animation industry has shown impressive results, with China's cartoon production of the past year alone amounting to half of the total production of the previous decade, says Jin Delong, a PR officer with China's showbiz watchdog, the State Administration of Radio, Film and Television (SARFT).

He was speaking at the sixth edition of the China International Comics and Games Expo (ICG Expo) held recently in Shanghai.

However, this still cannot mask some serious problems in China's animation industry. It lags far behind those countries where animation is highly developed, such as Japan and South Korea, says Liu Yuzhu, an official from the Ministry of Culture.

Liu listed a number of problems at the forum on animation and derivative industries at the ICG Expo. Many training institutions and enterprises have been founded without taking a long-term view, he said. Local cultural administrations were excited at the seeming prosperity of the animation industry, without realizing that they had neither the resources nor the market for it. Also, many places lack good teachers and creative talents. All this has contributed to poor product quality.

"They may produce 3,000 minutes of cartoon, but a lot of it will never appear on TV screens — they simply do not meet the quality standards," says Chen Yingjie of an investment company under the Shanghai Media Group (SMG).

A cartoon industry insider, who preferred to be anonymous, did the math for Chinese cartoon makers: TV stations in China will pay no more than 500 yuan ($74) for each minute of cartoon, and of the 35 TV stations that show cartoons, only a few are ready to pay this price. On the other hand, good quality cartoon entails per-minute costs of at least 10,000 yuan — many cartoon makers try to limit their producing cost to 1,000 yuan per minute because that equals the amount of subsidy the company can expect to get from the government for each minute of its product that gets shown on TV.

SARFT issued a circular in 2004, decreeing that at least 60 percent of cartoons shown on TV should be domestically produced. It banned foreign animated films from being shown from 5 pm to 8 pm in 2006 and extended this to 9 pm in 2008.

According to Chen, however, this ban on foreign cartoons has only harmed the market — when you are forced to show low-quality cartoons, nobody will watch and you simply get no advertisements.

In contrast to the tight control of foreign cartoons on TV, many animated movies have had outstanding box-office success in the Chinese market, which proves the market potential for good animation.