Rian Johnson's film was made with the help of Chinese funding in Shanghai and satisfies country's appetite for action

Artistes can be notoriously reluctant to compromise their creative vision at the behest of the Man. Not so director Rian Johnson. He agreed to transplant the plot of his latest sci-fi blockbuster to another continent – from Paris to Shanghai – in order to gain lucrative Chinese funding.

The switch paid off: this weekend Looper became the first new Hollywood film to make more money in its opening weekend in China than the US, provisional figures suggest.

"I'm thrilled the movie did so well in China. I don't think any of us expected those kind of numbers. It's fascinating to watch that market emerge and crazy to suddenly be part of the story," Johnson said.

He insisted shifting the action from France to China was not a creative sell-out, but "gave us production value we'd never dream of". He added: "In many ways Shanghai was a more natural setting for a sci-fi movie than my beloved Paris."

The film, which was shot for just $30m (£18.5m) and stars Joseph Gordon-Levitt and Bruce Willis as two versions of a futuristic hitman, made an estimated $21m on debut in the US. But according to Deadline it is likely to return $23m-$25m in China.

The change in location, along with a number of other concessions, allowed Johnson's tale of time-travelling hitmen to become a US-Chinese co-production, allowing it to bypass strict rules on the number of foreign films shown in Chinese cinemas.

Only 34 foreign features are allowed to be shown in Chinese cinemas each year. Co-productions, however, are exempt from this strict quota system, giving them a huge advantage in the world's most populous nation.

Looper's stunning performance is sure to encourage other directors to tweak their work in order to appeal to the increasingly lucrative Sino audience, said Robert Cain, a producer and entertainment industry consultant who has been doing business in China since 1987. "We will see far more of this in the future," he said. "Like everywhere else in the world, Chinese people like watching films set in places they know, starring people who look like them."

During a five-day visit to Beijing last month, Titanic and Avatar director James Cameron said he was looking very seriously at the possibility of a co-production with China. He said he was visiting the country on a fact-finding mission to "find out what restrictions need to be met, find out what content guidelines need to be met, and find out the economic incentives are".

The 3D re-issue of Cameron's Titanic earlier this year became the first Hollywood film to perform better in China than the US on opening. It ended up grossing $154.8m in China, compared with $57.9m in the states. More co-productions are likely after China announced in May it was to build a $1.27bn Hollywood co-production film studio.

Doing business in China means dicing with the country's strict censor board. Earlier this year, the baddies from Men In Black 3 were excised from the China edition after the censors took offence at the fact they were all Chinese.

Portraying any public official in anything other than a glowing light was a risk in China, said Cain: "Police officers are always honest people of integrity who always catch their man. Tthere is no bloody crime in China, no homosexuality, no nudity and no 'excessively terrifying scenes'. Horror is very difficult in China. You can't have ghosts or gore, no demons or monsters."

With a potential 1.34 billion cinemagoers, China this year overtook Japan to become the biggest foreign market for Hollywood films. Twenty-five thousand screens are set to be installed in the country over the next five years, many with the latest 4k digital technology. China has also become the fastest growing IMAX market in the world, already home to 78 IMAX cinemas, six times as many as the number in the early 2010. And the country is launching its own version of IMAX technology, called DMAX.

Already China boasts the third largest annual box office returns in the world. In 2011 alone, it rose by an annual rate of 18% to 12bn yuan (about £1.22bn).

China's spiralling demand for movies is propping up the ailing US box office – last year Chinese cinemagoers helped offset a drop in the US box office of 3.5% to $10.2bn, the lowest return in 16 years.

It's easy to sum up what sort of film goes down well in China, said Cain. "Action, number one. Action, number two – and action, number three."

Film critic Craig Skinner said Hollywood "spectacle" films with simple plots do best in China. "Films which are visually impressive and not too hard to digest perform well at the box office in China – plots which do not require the viewer to be familiar with certain cultural aspects," he said, citing Avatar as an example of a universally understood story which became the highest grossing movie in China in 2010, raking in 540m yuan ($85.6m) in only 15 days. One of the worst performing foreign films in China last year was The King's Speech, starring Colin Firth as the stuttering monarch George VI.

Top grossing films in China in 2011 (in US$)

1 Avatar

2 Transformers: Dark of the Moon

3 Let the Bullets Fly (local)

4 Aftershock (local)

5 Kung Fu Panda 2

6 Inception

7 Pleasant Goat and Big Big Wolf 2 (local)

8 Pirates of the Caribbean: On Stranger Tides

9 If You Are the One 2 (local)

10 Transformers: Revenge of the Fallen