After almost three years of formal negotiations, Australia and China signed off a film co-production agreement in the Australian Embassy in Beijing earlier this week.

The treaty with the Chinese government will cover production of films and telemovies.

The first film to be produced with China as part of Australia's Official Co-production Programme is the Australia-China-German co-production, The Children Of Huang Shi, which is in the final stages of post-production.

Directed by Roger Spottiswoode, the film is a drama, about a young British journalist and a courageous Australian nurse who save a group of orphaned children during the Japanese occupation of China in 1937. The cast is headed by Jonathan Rhys Meyers, Radha Mitchell, Chow Yun-Fat and Michelle Yeoh.

It is expected that the agreement between the two countries will come into force in the next few months. Australia's International Co-production Programme is administered by the Australian Film Commission.

The Australian government already has film and television co-production treaties with the UK and Northern Ireland, Canada, Italy, Ireland, Israel and Germany and Memoranda of Understanding with France and New Zealand. A treaty with South Africa is currently under negotiation and another with Singapore is close to finalisation.

China represents a huge potential growth area for Australian production. The agreement will give Australian filmmakers greater access to the film market of the world's most populous nation and the important wider Asian market.