Yunnan Province, 10km (4 miles) N of Lijiang, 535km (332 miles) NW of Kunming, 165km (102 miles) NW of Dali

Shuhe is an excellent example of how a burgeoning tourist town can be created from scratch in just 10 years. Back in 2002, the Lijiang Municipal Government agreed to let the Kunming Dingye Construction Company invest ¥500 million into the 13 sq. km (5 sq. mile) area of Shuhe, essentially a spill-over town to Lijiang. Almost a decade later and there are now more than 1,000 hotels and guesthouses (including international five-star brands) in this small town, most of whom are livid that the original investor still insists on charging a ¥30 entrance fee for the whole town. Back in the Tang Dynasty, Shuhe was a crucial post on the Tea Horse Road and was built along the mountainside to take advantage of the flowing waters. Channels and streams pass by each house; with the stony roads linking the town in a dense honeycomb. At the outbreak of war in 1937 it was the only route in and out of China and corduroy and wool from the U.K. and cigarettes from the U.S. were common trade items here. Despite its revamped appearance, originally this was the center of Lijiang. Just 10km (6 miles) from Lijiang, Shuhe was meant to be an overflow development although, unrestricted growth has now made Shuhe almost as busy as its counterpart.