The program, jointly initiated by the Kunming Dingye Group and Lijiang County, involves a budget investment of 500 million yuan (about US$60.24 million) and will be completed within three years.

Situated in Lijiang County, a World Culture Heritage list site since 1997, Shuhe Township is a "living fossil," part of the site's ancient role as an important conduit linking China and the outside world, both culturally and commercially.

Back in the Tang Dynasty (618-907), Shuhe was a crucial post in mountainous southwest China through which trade caravans sent their tea and leather to Tibet, Sichuan, India, Nepal, Bhutan, Sikkim and the coast area of the Red Sea.

Although more than 1,000 years have passed, the township still retains its past atmosphere as a cozy village. A square surrounded by stores of various kinds is the only bazaar in the township.

Inside the township, hemmed in by orchards and green fields, houses are built along three clear streams.

Liu Jiachun, president of the Dingye Group, said some ancient houses and historic scenic spots would be protected and a museum established.

All electricity cables would be laid underground to make the township look tidier, said Liu.

"Our purpose is to bring back the township's history and give it better protection."

(Xinhua News Agency May 19, 2003)