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Anthony Wong in this year's Ip Man: The Final Fight. The actor is one of the industry's skeptics: "I've been claiming our cinema was dying for two decades".

Take 2: the remaking of celluloid city

Hong Kong may no longer be the capital of Asian film but it is building a new reputation based on quality, not quantity

Hong Kong cinema is either dead or has transformed itself into a sophisticated new creative powerhouse. It just depends on who you're talking to and how you define the terms to start with.

"I've been claiming that our cinema was dying for two decades, and I've always been criticised for saying it," says actor Anthony Wong Chau-sang, who has had a front-row view on the industry's rise and fall since the 1980s.

"The only thing that can keep Hong Kong cinema afloat is our cultural advantage - but who's going to watch our films today?" Wong asks. "We've lost the Japanese market, the Thai market and basically the entire Southeast Asian market. [It] has been a long time coming."

Hong Kong's film industry began to decline in the 1990s, with a gradual diminishing in prestige amid the rapid advancement of other national cinemas in the region - in both creative and technical accomplishments.

In 2011, Indian comedy raked in over HK$20 million and the Taiwanese teen drama became Hong Kong's all-time highest-grossing Chinese-language film. Together with the recent South Korean film - a remake of the local film (2007) - they provided evidence of the maturing, if not actually superior, production abilities of our neighbouring markets.

With no local cinema tycoons in sight and with the big investment resources of the mainland providing a handy lifeline, it's no wonder that all the major Hong Kong filmmakers at every level of the business are now working in China, says revered film critic Li Cheuk-to, who is also the Hong Kong International Film Festival's artistic director.

Swiftly after the trend of Hong Kong-mainland co-productions began in earnest with the signing of the Closer Economic Partnership Arrangement (Cepa) in 2003, local filmmakers found themselves facing an inconvenient truth: with the exponentially larger returns from across the border came the ensuing obligation to cater not only to a new target audience but to a draconian censorship system as well.

"While Cepa facilitates the entry of Hong Kong films to the mainland market, the new censorship by the mainland authorities that they have to face has often compromised the results," says Li, referring to the agreement that was meant to allow jointly financed films to enter the mainland market without restrictions.

For actor-producer Donnie Yen Ji-dan, who became one of Hong Kong's best-paid action stars with his two Ip Man films (released in 2008 and 2010), it's an inevitable transition that "Hong Kong films" would be replaced by the blanket label "Chinese films".

"The mainland market is too big to be ignored," he says. "It's all about how you play this game. Especially when you're making an action movie, which typically requires a bigger budget, you have no choice but to go north."

In spite of the dwindling number of Hong Kong productions - there were only 50 local titles released last year - Yen takes comfort in the increase in quality that is accompanying the loss in quantity.

"Our industry has become more elite," he says.

"While there used to be not-so-professional people who just happened to have the money to make movies, all the Hong Kong filmmakers working today are true professionals."

Indeed, the range of exemplary co-productions lately gracing our screens - from (2007) and (2009) to (2011) and (2013) - hint at the industry's growing expertise in skirting around the mainland censors' numerous aversions, be it horror, nudity, sci-fi, politics or the triad themes that we have long grown accustomed to.

This rising respectability of partly mainland-financed projects may have surprised a few sceptics - but certainly not Edmond Pang Ho-cheung.

Despite seeing his own low-budget comedies (2010's , 2012's ) spearhead a new vogue for Hong Kong-centric productions, the popular director is in no mood to apologise for having the luxury of being able to chase China's lucrative market.

"Don't forget that a story which passes [mainland] censorship can also be a good one," says Pang, who reveals he once turned down a HK$100 million mainland-financed project to make his romcom sequel - also a co-production, but one that gleefully maintained the sassiness of Hong Kong films.

"While there are some subject matters that you can't tackle with a co-production, nobody is forcing you to make a bad movie," he says.

Hong Kong directors' assertion of their cultural identity or their determination to venture outside mainland-approved subjects are ambitions shared by many of the industry's new faces.

According to Winnie Tsang Lai-fun, managing director of the independent distribution company Golden Scene, the warm reception that greeted the street-dance drama (which she produced), the politically conscious thriller (2012) and the 3-D erotica (2012) are all encouraging signs that the industry is rediscovering its resolve to branch out into more adventurous topics.

"I've always thought that people shouldn't follow the herd and all make the same movies in a short period of time," says Tsang. "The success of these films has reassured the investors.

"It gives out the message that no matter what its topic is, as long as you make an interesting film, it's going to turn out just fine."

This article appeared in the South China Morning Post print edition as: Take 2: the remaking of celluloid city
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