Chinese characters as they are portrayed in Hollywood films. Photo illustration by Tian Chi

Not too long ago, Western movie audiences' idea of a Chinese character was Fu Manchu - an evil mastermind who plotted to take over the world in the 1969 film The Castle of Fu Manchu.

But eight decades later, Hollywood and the silver screens of the West are acknowledging the growing importance of the film market in a country that is also rising in influence on the global stage.

Most recently, the American action film Red Dawn, directed by Dan Bradley and scheduled for a November release, changed its villains in post-production from an invading Chinese army to one from the Democratic People's Republic of Korea.

The Western film industry is now aggressively pushing beyond the negative portrayals of Chinese people - and even the iconic kung fu roles of Bruce Lee, Jackie Chan and Jet Li - to tap what promises to be one of the world's most lucrative movie markets.

"True, Bruce Lee, Jackie Chan and Jet Li have freed the industry from some preconceptions, but they have made a new one - Chinese can (only) fight," said film critic Luo Jin.

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But things are changing, given that Hollywood is always interested in expanding its market, said Ken Jurkiewicz, associate professor at the School of Broadcast and Cinematic Arts at Central Michigan University.

"In general, Chinese characters were either inscrutably intelligent, or they were treated like comic relief. Something mysterious and exotic, and that would be true of the female characters too," Jurkiewicz said.

But the Western film industry is now aware that "there's this sort of virgin territory in China, millions of people could be exposed to the Hollywood product. So they can't really denigrate or demean people using those old stereotypes.

"Hollywood is being very careful about how Chinese people are portrayed because they don't want to lose a potential audience", Jurkiewicz said.

Guy Aoki, founding president of Media Action Network for Asian Americans, an organization that monitors how Asian Americans are portrayed in US movies, TV and the media, said movie roles are actually being altered to avoid provoking or angering Chinese audiences.

"The most recent example is Red Dawn, where they changed the villains to be North Korean. I think that's a very big sign of how much they want to make money off of China. They don't want to offend China or Chinese audiences," Aoki said.

In June 2010, release of Red Dawn was delayed because of financial difficulties and amid growing controversy in China after excerpts of the script were leaked onto the Internet. Chinese media sharply criticized the film, with headlines such as "US reshoots Cold War movie to demonize China".

"They had to digitally alter everything after the fact. So many American movies do not make back their budget on domestic box office, and they have to rely on overseas markets. China is becoming bigger and bigger, so they really need China now," Aoki said.

"It's positive in the sense that they're less likely to cast Chinese villains ... The reality is that when they have villains from China and Japan, it still affects Asian Americans. It's positive to have less Chinese villains in Hollywood movies."