SHANGHAI — China needs to open up its market to foreign movies to match the country’s increasingly sophisticated film market, Dan Glickman, chairman and CEO of the Motion Picture Assn. of America, told an audience of biz leaders at the Shanghai Film Festival on Sunday.

China needs to “make the most of the collective economic opportunity by nurturing the health and growth of the legitimate marketplace,” Glickman said.

A record 406 films were made in China last year, and the box office take, excluding rural market and factory screenings, rose 30% to $635 million.

However, to help boost the local film industry, a quota system ensures that only 20 foreign films are released each year. Chinese co-productions are exempt from this rule.

“A healthy film industry and vibrant marketplace can bring great economic opportunities to both of our countries, and these opportunities serve as the foundation that keeps this vital artistic and creative medium vibrant … allowing the next stories to be told and shared with audiences around the world,” Glickman said.

China is the world’s fastest-growing major film industry, but it is also the worst offender when it comes to film piracy. An MPAA study from 2005 showed that member companies — including Hollywood studios — lost $6.1 billion to worldwide piracy. Of that lost revenue, some $1.2 billion came from piracy across the Asia- Pacific region.