SUN MOON LAKE, Taiwan (Reuters) - Sun Moon Lake has been compared to a classical Chinese landscape painting with its crystal waters reflecting surrounding snow-capped mountains.
But a hotel building boom around the mountain resort in central Taiwan has locals and environmentalists worried the unspoilt beauty of the lake, which draws 3 million tourists a year, might be ruined.
"Sun Moon Lake is a very important international site, and such an important resource should be protected," said Liu Ming-lone, spokesman for the Environmental Quality Protection Foundation, a Taipei-based non-governmental organization.
Seven hotels are being planned and built on the lake shores, with some of them charging as much as $500 per night.
One 200-room hotel just opened, while two more hotels are under construction. Another four hotels are being planned, including a high-end 100-room hotel resort and a 400-room two-star hotel geared toward budget tourists from mainland China.
Prospects for a tourism deal with China, which does not have diplomatic relations with Taiwan, have spurred development as the region prepares to host millions of well-heeled Chinese visitors should tourism agreements be reached between Beijing and Taipei.
The lake is well-known in China where descriptions in literature and text books give the impression that its beauty is unmatched on the mainland. Legal barriers to Chinese citizens entering Taiwan, a self-ruled island that China regards as a renegade province, give the lake an extra mystique.
But some locals suspect the hordes of tourists in China eager to visit the lake might be disappointed as development has already caused water pollution and traffic congestion. Locals also complain about unregulated construction without a unified theme as well as breaches of building codes.
"We don't need to limit the number of people, but we need to limit the number of buildings," said Roger Chang, 28, a regular visitor to the lake.
One of the hotels under construction will be 30-storeys high, far above new lake area height restrictions of seven storeys.
"With such a beautiful lake, we need some sort of master planned design to make it work out," said Hu Shan-wen, owner of the 6-year-old Spa Home hotel on the lake shores.
Faced with a faltering economy and high unemployment, the Taiwan government is keen to ramp up tourism to stimulate the services sector. Some critics believe it's eagerness is overcoming any prudence over Sun Moon Lake development projects.
Local authorities promise to put a cap on lakeshore development after the hotels in the pipeline are built, although construction will be allowed to proceed in the surrounding mountains with easy vehicle access to the lake.
There's concern the already congested two-lane highway to the lake will further clog with traffic when the new hotels open up despite a new shoreline shuttle bus route around the lake.
"There's still space to develop, but we should add only a few more hotels as there are transportation limits," said Joe Tseng, general manager of The Lalu, the shoreline's most famous lodging.
Locals are also concerned that the development boom will cause pollution that might muddy the lake's pristine waters.
Last year, lake pollution rose about 2 percent from 2006 and the Taiwan Environmental Protection Administration fined four hotels for improper treatment of wastewater.
"Lake water quality is very important," said tourism official Tseng Kuo-chi. "Right now it's being maintained well but as tourist numbers go up, we're afraid the quality could go down."
Seeking to cope with new pressures, two public water treatment systems will open up next year, handling 95 percent of the lakeshore's sewage, local tourism officials said.
Last year, the government approved funds to landscape the tip of Lalu Island, a boat tour landmark that was once a hill considered sacred by the local Thao aboriginal group.
China and Taiwan want a deal to bring up to 1,000 Chinese tourists to Taiwan per day, but negotiations are stalled. Taiwan is in the throes of a March 22 election and negotiations could be restarted when the new president takes office in late May.
An influx of visitors from China could mean that profits from tourism might outweigh concern about environmental impacts.
Editing by Megan Goldin