By Li Hongmei

The Jan. 11 fire in an ancient town in Shangri-la, a resort county in southwest China's Yunnan province, is estimated to have caused an economic loss of over 100 million yuan (US$16.5 million) and may affect development projects currently under construction, reports China Business News.

Besides the 335 houses destroyed or damaged in the fire in the Dukezong ancient town, known for well-preserved Tibetan dwellings, local authorities are still trying to determine the damage done to cultural artifacts such as the Tibetan thangka paintings and other Tibetan art pieces, the paper said.

The fire is not expected to impact much of the local tourism sector however, except a possible reduction in the number of backpackers, as winter is normally a low season for group tourists.

"It is peak tourism season in Shangri-la most of the time, except in winter, when roads are blocked by snow and ice, making it difficult for visitors to enter the mountainous region," said Qu Jia, who founded and runs a local tour agency.

Dukezong, meaning "town of the moon" in Tibetan, was built 1,300 years ago during the Tang dynasty. It is one of the sites to see in Shangri-la, which reported visitor numbers of 7.57 million and an income of 7 billion yuan (US$1.2 billion) from tourism in 2012, the paper said.

Hu Xiaoying, a developer who is involved in several projects in Yunnan, said there are many companies buying up land in Dukezong for planned tourism projects, but only those which had begun construction are likely to be affected by the fire.

One of these ongoing projects is a resort being built by Lijiang Yulong Tourism, which plans to invest 624 million yuan (US$103.2 million) in a hotel and a Tibetan culture-themed tourism facility. The construction was set to begin last year and be completed in two years to meet the target to open in 2015, the paper said.