The Birth of Asiawood.(Thai film industry)

It is 6 a.m. on a scorching March day in the hills of central Thailand, but the cast of "Jan Dara" is already hard at work. Forty sweltering extras, dressed in 1930s costumes, are pretending to have a good time at a wedding reception in a grand French-style villa amid the towering trees of Kao Yai National Park. Between takes, Thailand's most acclaimed film director, 39-year-old Nonzee Nimibutr, chain-smokes Marlboro Lights while he studies storyboards mapping out the erotic period drama. As Nonzee visualizes the next shoot, the director of photography and several assist-ants yank their only camera from a cherry picker and position it for a close-up. Amid the hum of cicadas, the film's star, Chinese-Vietnamese actress Christy Chung, rehearses her lines in a language she barely speaks. "Her intonation isn't exactly Thai," says Nonzee. "But her lip movement is good enough to sound-sync later."

"Jan Dara" is breaking new cinematic ground: it is the first Thai-Hong Kong co-production ever made. As producer Peter Ho-Sun Chan from Hong Kong's Applause Pictures sees it, the venture can't miss. For less than it costs to make a commercial in the United States, Chan has hired an award-winning director, a Hollywood-quality crew and Chung, a well- known Hong Kong actress. His goal is to make a film that is marketable from Bangkok to Tokyo--and beyond. All over Asia, directors, producers and actors are buying into this dream. The reason: lower costs and wider play. At least four Pan-Asian movies are currently in production in Hong Kong alone, including "2046," Wong Kar-wai's vision of Hong Kong 50 years after the handover from Britain, which will feature Thai, Korean, Japanese and Chinese stars and will be shot in Hong Kong, Thailand and South Korea. Coming soon is "Musa" (The Warrior), a Korean-Chinese coproduction shot in China and featuring Chinese star Zhang Ziyi and Korean hunk Jung Woo Sung. And that's just the start. "Three years ago there weren't any [Pan-Asian films]," says Catherine Park, director of sales and acquisition for Korea's CJ Entertainment, which is collaborating on "Musa." "Now everybody is doing them."

These films reflect the new willingness of Asians to look beyond their own borders for everything from jobs to food and entertainment. "Chinese or Japanese or Korean, nobody cares," says Hong Kong director Fruit Chan. "Young people just want to watch good movies." A Japanese film of bizarre suspense, "Tales of the Unusual," recently reached No. 3 on Hong Kong box-office charts. "Il Mare," a Korean love story, hit the ninth spot in Singapore. Last month two Japanese films, "Shikoku" and "Fancy Dance," broke the top 10 in South Korea. Films like "Jan Dara" merely take the trend one step farther, making the ventures cross-cultural from the outset.

The advantages are clear. Coproductions can bomb in one place, sell out in another and still be in the black. "If you acquire just local distribution rights you are taking all the risks for a film's release," says Yoshito Hayashi, overseas manager for Tokyo's Suncent CinemaWorks. "But if you are an investor, you can diversify the risk." For directors, foreign stars can attract au-diences and financing from abroad. And talent can be found cheaply in places like Malaysia, China and Thailand; on the set of "Jan Dara," the director of photography charges $5,000 for two months' work, 15 times less than the going rate in Hong Kong. Postproduction work can now be done for less in state-of- the-art facilities outside Hong Kong or Tokyo; in Malaysia, the government is planning to develop a 10,000-acre "entertainment" village with sound stages and production facilities.

It wasn't always that way. Until a few years ago, Asia was a jumble of provincial film markets. Works from Japan, Korea, Hong Kong and Thailand were made largely for domestic markets or European art houses. Other than Hong Kong kung-fu and mobster flicks, local movies rarely crossed borders within Asia and local filmmakers never collaborated out of their country. By the early 1990s, when Asia's economies were booming, its film industry was shrinking. In Japan, audiences yearned for blockbusters that local film companies couldn't deliver. And with audiences paying as much as $18 a ticket, annual attendance dropped from 146 million in 1990 to 135 million in 2000. Even Hong Kong action films lost their box-office punch. Asian filmmakers complained that video pirates and American giants were stealing their audience.

As the climate soured, big-name talents like John Woo, Jackie Chan, Michelle Yeoh, Chow Yun-Fat and Ang Lee took off for Hollywood, leaving a gaping hole in the industry. "The local markets in Asia became too fragile," says Wouter Barendrecht, chairman of Fortissimo, a film-sales group based in Hong Kong. "And film as a medium became too expensive to be made for only one territory." Only India retained a market big enough to sustain a local film industry, but the appeal of Bollywood was and is confined largely to its Indian fans around the world.

By the end of the decade Hollywood was pushing its way through protectionist barriers in East Asia. In 1998 the Motion Picture Association of America urged South Korea to drop barriers that reserve more than one third of theater screen time for Korean films, even though those films account for only a quarter of box-office receipts. Seoul not only rejected that plea, but fought back by pouring money into improving standards in its film industry. The following year, Samsung released "Shiri," a $5 million spy thriller starring Yunjin Kim that broke the local box-office record held by "Titanic." "Shiri" went on to become a hit in Hong Kong, Taiwan and Japan as well. Korean investors began pouring money into movie production, and other Asians are now following. "People complained about Hollywood and pirating, but the truth was that our movies just weren't good enough," says Chan of Applause Pictures.