“My grandson likes animated shows…he is a fan of Ultraman,” said Chinese premier Wen Jiabao when he paid an investigation visit to an animation company in Wuhan, Hubei Province, in March 2009. He added that “China should develop its own animation industry and Chinese children should watch more animated shows based on China’s history and culture.”

Like Wen’s grandson, millions of Chinese youngsters are crazy about Ultraman, the fictional character featured in tokusatsu, or "special effects" television programs in Japan.

“Ultraman is the favorite toy of my seven-year-old son. He has a large collection of Ultraman toys,” said Wang Fengying, a traveler to Beijing from the neighboring Shanxi Province.

Besides Ultraman, lots of other foreign animated characters have charmed Chinese youngsters. Nineteen of the top twenty Chinese youngsters’ favorite animated characters are from Japan and only one—Monkey King—is from China, according to a survey in the 2009 Blue Paper on Culture.

Another report shows that among Chinese teenagers’ favorite animation products, those from Japan and South Korea account for 60 percent, European and American ones 29 percent, and products from mainland China, Hong Kong and Taiwan a mere 11 percent.

Chinese homemade animated products have not been well received at home since their foreign counterparts dominated the Chinese market in the 1990s. In an attempt to revive the industry, the Chinese government adopted a series of measures in the past few years, including a ban on broadcasting foreign-made animation during prime time and policies to encourage local Chinese companies to produce their own animation content.

Under the government’s support, China’s animation industry has made tremendous strides in recent years. Statistics from the Institute for Cultural Industries of Peking University shows that China now boasts over 78 animation industrial bases and 6,400 animation companies, a mind-boggling rise from 120 in 2002. China produced 249 animated programs with a length of 131,042 thousand minutes in 2008, an increase of 28 percent in comparison to 2007, and more than 33,900 minutes from 1993 to 2002.

Although more homemade animated products are being churned out, few are being well received in the market. China’s animation industry has been thrown into a dilemma after years of fast growth under official support. Insiders are busy diagnosing the ailing industry to give it a much-needed boost.