MUMBAI: Chinese vice president Xi Jinping will endorse the growing ties between his country and Hollywood on Friday when he is scheduled to unveil a joint venture between DreamWorks Animation (DWA) and two state-owned Chinese media groups.

Xi, who is due to visit Los Angeles on the final leg of his US visit will announce the tie-up between Shanghai Media Group, China Media Capital and DWA, according to several people familiar with the situation.

Under the terms of the joint venture, the companies will construct a studio facility in Shanghai with the aim of developing film, television and live stage productions for the fast-growing Chinese media market.
 
From a long time, Hollywood studios have been eager to find ways into China‘s fast-growing film market and this at a time when they are facing challenges on the domestic front: the decline of DVD sales.

On the other hand, film business is booming in China where new cinemas are being added at a rate of about three screens a day, faster than that in any other country.

China is forecast to be the world‘s biggest cinema market within the next decade and touched $2bn in box-office receipts in 2011, a near $400m increase on 2010.