While China's urbanization has become a new spur for the country's economic growth, its progress has not been smooth in historical cities like Kaifeng, where developers have come up against restrictions on building around protected relics.

They may attract tens of millions of tourists every year, but the ancient attractions in Kaifeng of central China's Henan Province are in effect hindering the livelihood-boosting reconstruction of old blocks of crudely built and poorly maintained houses.

Currently, 100,000 households in the city are still living in run-down areas. In 2012, Kaifeng's gross domestic stood at 120.71 billion yuan (17.7 billion U.S. dollars) and per capita disposable income at 17,545 yuan, both ranking among the lowest cities in the province.

Amid the national campaign to improve the living standards of urban residents in run-down areas, Kaifeng initiated shantytown rebuilding in 2008, hoping to help relocate residents from shabby houses to bright apartments. But to date, work on only 10,000 targeted households has been completed.

Kong Xiangcheng, deputy director of Housing and Urban-Rural Development in Kaifeng, believes the major challenge of rebuilding the city stems from construction restrictions in its ancient parts.

As a 1,700-year-old ancient capital, Kaifeng served as the country's political center for seven dynasties and possesses numerous historic and cultural relics including 14.4-km-long defensive walls and city ruins.

In accordance with the Chinese Cultural Relics Protection Law, the cultural ruins should not be moved or damaged during the demolition and rebuilding process, adding complexity to the regional renovation.

Furthermore, to maintain the overall historical appearance and boost the tourism industry, the city's long-term planning requested that all buildings should not be taller than 15 meters, which means there is not enough living space for all residents currently living in the city center. Some will have to be relocated outside the downtown area.

In the city's Shunhe Hui Autonomous District, the Ming Dynasty (1368-1644) Dongda Mosque, one of the oldest sites in the area, was boxed in by row upon row of old houses sheltering over 20,000 people of China's Hui Muslim ethnic group.

Zhang Guangju, a 74-year-old Hui, insisted that residents currently living around Dongda Mosque should be allowed to move back when the rebuilding is completed, instead of being relocated far from the mosque.

"It's our tradition that cannot be breached," he said, stressing that Muslims like to live around mosques for worship and other religious activities.

However, under cultural relics protection law, all shabby houses near the ancient mosque should be pulled down. Areas less than 150 meters from the building are classed as preservation zones in which no construction is allowed, explained Fu Liming, a major official in charge of shantytown rebuilding with the district.

According to the rebuilding plan, all these households will be settled in a residential community nearby, and the block surrounding the mosque will include streets dedicated to halal food, Muslim shopping and demonstrations of ethnic culture, which will both help develop tourism and secure jobs for local Hui people.

But implementing the plan is not easy.

"We invited a property developer to participate in the demolition and reconstruction program, but it retreated after estimating that expenditure for cultural relic protection would be around 300 million yuan (49 million U.S. dollars)," Fu said.

This is not an isolated case for Kaifeng, where 247 historic sites have been recognized as unmovable protection units. They are dotted around among local dwellers' self-constructed homes in the city's run-down areas. Such sites have left real estate developers unable to bulldoze every building and make new ones on an empty lot.

"Extra expenditure resulting from preservation of cultural relics and thin profits expected from developing the area have scared away many real estate companies. With no developers joining the reconstruction project in the old urban districts, progress is lagging," said Kong Xiangcheng.

According to an urban development scheme, the municipality planned to relocate downtown dwellers to suburban residences that were new but relatively distant from the city hub. Meanwhile, the emptied regions would be used to boost tourism centered on such existing sites as Dongda Mosque and the ancient city wall.

Despite various difficulties, however, the city government has exerted every effort in preserving the ruins and historical appearance, eyeing the cultural relics' potential in the the city's long-term development.

"The ruins are treasure left from our forefathers, and we should leave them to our future generation," according to Kong.