China is building a replica Alpine village in a grimy industrial city.

It hopes the chalets in the southern city of Huizhou will be sought after by homesick Europeans.

The village will be a £5.7billion copy of Hallstatt in Austria, complete with artificial lake. Posing as tourists, the Chinese have been photographing every building there for three years.

The copy of Hallstatt in Guangzhou China.

Real Hallstatt in Austria

The plan was discovered when a Chinese guest at Hallstatt’s hotel left behind a bundle of blueprints.

China already has Chengdu British Town, modelled on Dorchester, and Thames Town, near Shanghai.

Publicly, Hallstatters say they are proud that their village has caught the eye of Minmetals Land Ltd. the real estate development arm of China Minmetals Corp., China's largest metals trader.

With most of them dependent on the hundreds of thousands of tourists who overrun Hallstatt's 900 inhabitants each year, they see the project as good for business.

'We're happy they find it beautiful enough to copy,' says souvenir store owner Ingrid Janu.

Hallstatt Mayor Alexander Scheutz describes the plan as 'a compliment to our village,' while hotel owner Monika Wenger thinks at least some Chinese who have seen the copycat version of Hallstatt will want to visit the original.

But in a deeply traditional part of Austria shielded for centuries from much of the rest of the world by towering mountains and steep valleys, the apparent secrecy surrounding the project has also revived suspicions of outsiders, even though Hallstatt survives only because of the millions of tourist dollars spent here every year.

Although the Chinese developers say construction started in April, Scheutz and Wenger say the village knew nothing about the plan to replicate Hallstatt until early this month.

They say a Chinese guest involved in the project and staying at Wenger's hotel spilled the beans - apparently inadvertently - showing Wenger drawings and plans she should have kept to herself of the central marketplace, Wenger's 400-year old hotel and other landmarks that were mirror images of the originals.

'I saw myself confronted with a fait accompli,' says Scheutz of his first reaction when he saw the drawings, now collected in a thick folder on his desk containing documents that he says copy much of the town, down to the individual boards of scenic wooden balconies.

While he disputes local media accounts citing him as furiously vowing to prevent the Chinese project, he acknowledges being 'definitely a bit stunned.'

Wenger is more outspoken. She says most of the villagers she has talked to are 'outraged - not about the fact but the approach.'

'I don't like the idea of knowing that a team was present here for years measuring, and photographing and studying us,' she said Thursday, sitting at her hotel's terrace against the stunning backdrop of Lake Hallstatt, its surface mirroring nearby granite peaks.

'I would have expected them to approach us directly - the whole thing reminds of a bit of Big Brother is watching.

'This house is my personal work of art,' she said of her 400-year-old hotel.

'And then someone comes here and copies it - for me, it's as if a painter copies someone else's artwork.'

The Chinese developers are advertising the project as low-density, high-end residential development 'surrounded by mountains with mountain and lake views,' to be built 'in a European architectural style, with a commercial street built with the characteristics of an Austrian-style town.'

But at the Chinese site, in the city of Huizhou about 100 miles north of the border with Hong Kong, there is little to indicate that the copycat version will ever approximate the beauty of the original.

A few low-rise buildings are in the early stages of construction, their frames covered with bamboo scaffolding and green mesh. Cranes and trucks moved around the area Friday dodging workers carrying steel construction elements.

Though the area is hilly, there was not an alpine peak in sight and the waters of a nearby lake - apparently the faux Lake Hallstatt to be - were green and murky. Instead of mirroring majestic alpine mountaintops, several dead fish floated on the surface.

Minmetals executive Crystal He says the developer plans to copy all of Hallstatt's touristic core. She said the project will spread over 20,000 square meters - nearly 5 acres - and will include a shop selling Austrian-style glass crystal and other souvenirs.

The subdevelopment will likely appeal not only to upscale Chinese but also 'Caucasian people living in Hong Kong who are homesick,' she said.

Wenger, the Hallstatt hotel owner, noted the drawings in her possession show sections of Hallstatt in mirror image - possibly suggesting an effort to evade copyright claims. But Minmetals' He said the idea was never to copy the Austrian town down to its last details.

There will be no issues with 'so-called intellectual property,' she said.