Don't stop me Mao: Shanghai's ambitious skyline continues to soar towards the stratosphere

Harriet O'Brien explores the city then retreats to the limestone peaks of rural China

The high-rise towers of Shanghai stretched as far as the eye could see, a great forest of soaring shapes punctuated here and there by huge construction cranes. It was as if I were gazing at a surreal sculpture park. One of gigantic proportions. And while the visual impact was terrific, the sense of paradox was almost sublime. In the face of recession, Shanghai continues to be a great monument to money and commercial success. Yet it was only 60 years ago this month that the city fell, without a fight, to the Communists.

Back in May 1949, Robert Guillain of Le Monde witnessed the arrival of Mao Tse-Tung's army. The troops, he cabled back to France, "were not accompanied by any motorised transport or artillery". They had only "old rifles and machine guns, worn-out shoes, uniforms faded by the sun and the rain". It was an army, he wrote, of hardened peasant soldiers, who during short periods of rest "craned their necks to stare at the tops of the 15- or 20-storey buildings, an obviously unfamiliar sight to them".

Today, small armies of tourists – domestic as well as foreign – come to gaze in wonder at Shanghai's high constructions (many storeys taller, of course, than those of the 1940s). The best views are offered on boat trips along the Huangpu river that cuts a swath through the city. So I joined a little troop of visitors and set off on an hour's tour.

Shanghai is home to more than 4,000 buildings, but it is the Huangpu's east-bank development, Pudong, that is spellbinding. In 1990, this area was still marshy farmland. Whoosh: Pudong is now, in effect, where Milton Keynes meets Blade Runner. Here, an astonishing jostle of gigantically tall buildings reaches up and up.

"My skyline's better than yours," they seem collectively to be asserting in a sort of face-off against Shanghai's Puxi district across the river.

For the time being, Puxi remains the heart of the buzzing city of 20 million souls. Even in this far older part of town, there's a sense of relentless energy, a craze of construction. The area near the river is studded with fairly recent high-rise additions, among them the pineapple-topped eccentricity that houses the Westin Hotel. With Shanghai in the throes of preparation for Expo 2010, drills resounded around the Bund, the iconic embankment of Puxi. It was once the Wall Street of the city and is still partly lined with stately buildings of neoclassical grandeur.

Our cruise boat disgorged us near the Expo construction clamour and I wandered the gracious curve of the Bund waterfront with my guide. A quick-talking 25-year-old, she was very conscious of being in the post-Cultural Revolution generation, a child of the new China. The first bridge over the Huangpu was erected only in 1991; now, there are six. While she explained this, I watched two young boys racing down the riverside walkway engaged in that wonderfully timeless Chinese activity of kite-flying. They made a satisfying antidote to the litany of building achievements. All the while we were tailed by sibilant traders hawking fake Gucci watches and Prada bags. Such is Shanghai touristland.

When the traders gave up on me, we were able to pause and take in the view of the Bund as it sweeps down to the near-legendary Peace Hotel. A monument to Art Deco, this was where Noël Coward wrote Private Lives in 1930.

Shanghai was a modest fishing town until the 1840s, when Western merchants – and their armies – started developing "concessions", effectively self-governing trading centres. The British established a foothold first, the French swiftly followed, and fortunes were rapidly made on the export of opium, tea, silk and spices.

By 1930, the city had become the "Paris of the Orient", an alluring place of tycoons, adventurers, émigrés and racketeers. Much of this intriguing old-time Shanghai was demolished in the recent rush of development but there's a rearguard appreciation of the areas that remain.

You may anticipate being visually stunned by China's largest city, but you might not expect to be charmed. Yet to the west of the Bund the old French Concession neighbourhood is captivating.

Little avenues of arching sycamores are backed by low-rise buildings and enticing boutiques. On Xin Le Road I watched a man load a tricycle with a wardrobe and then pedal slowly past an onion-domed Russian Orthodox Church. It was built in the 1930s and is now a library. My hotel stood opposite, a 1932 villa that once served as the clubhouse of Du Yue Sheng (or "Big Ears" Du), one of the city's richest and most notorious gangsters. Fabulously renovated, the Mansion Hotel opened as a boutique establishment in 2007. The old and new are beautifully blended here, the lobby sitting-room oozing atmosphere and featuring a number of wind-up gramophones. My room, one of 30, had a fireplace, a huge bed with fretwork headboard, Wi-Fi, large flatscreen television and more, while the bathroom featured an "intelligence toilet" with heated seat and spray nozzle. It took some time to figure out how to activate the flush.

Transforming the old for chic contemporary life has become a latter-day speciality of Shanghai, reflecting a not-absolutely-too-late concern for conservation. The city changes daily, my guide remarked, but not entirely through flashy new development. Shanghai, she said, has been re-emerging as a vibrant arts centre. So off we went to explore.

To the north-west of the Bund, an unofficial arts district has evolved around Moganshan Road, known elliptically as M50. Here, a host of warehouses and factories have been reborn as studios and little showrooms. And the area has become a world unto itself with about 100 artists in residence and more than 300 galleries. On the day I visited, exhibitions ranged from video installations to haunting paintings of the Cultural Revolution era.

For less seriously priced art, as well as an insight into traditional Shanghai living, we drove south to Taikang Road. The prospects looked unlikely at the outset: a network of lanes opposite a new metro station. However, turn down an alleyway beside a lively food market and you enter a warren of lanes lined with small brick houses, the time-honoured shikumen architecture of Shanghai. Many are now tiny cafés and dainty shops offering designer-cool clothes and artworks.

This hip art and fashion world coexists with stoic neighbourhood customs and as you wander this charming maze you pass old men playing cards and residents dozing outside their homes.

The individuality inherent in Shanghai's funky creativity is not what you might immediately associate with modern China. From a distance, I had perceived the country in monolithic terms. But I found plenty to confound this and other preconceptions, not least the friendliness of ordinary people in contrast to the austerity of their government. What's more, since the Olympics and the start of the global financial downturn, travel and accommodation in China are becoming ever more keenly priced.

From the dynamic urban China of Shanghai I headed south to sample some of the country's most spectacular scenery – and to see the territory of a few of the ethnic-minority peoples. The city of Guilin in Guangxi province, south-west of Shanghai, is the gateway to particularly dreamy landscape. This is limestone karst country, studded with knobbly peaks that rise up from picturesque meadows and rice fields. Travelling through this area is like being in an exquisite Chinese scroll painting, the blue outlines of hills stretching back and back to the horizon. The popular tourist jaunt here is a day cruise on the lovely river Li from Guilin to Yangshuo, a beautifully situated small town that started to develop into a backpacker haven about 20 years ago. Today it makes a relaxing base from which to explore outlying villages on hired bikes or take bamboo-rafting trips on the Li's small tributary, the river Yulong.

Both Guilin and Yangshuo offer plenty of choice over places to stay. But there's a real treat halfway between the two. Yuzi Paradise is a vast sculpture park, its 200 artworks looking all the more weird and wonderful for their craggy limestone setting. The name means "Fool's Paradise" and this is a folly in the grand, 18th-century sense of the word. It is, implausibly, the creation of a Taiwanese cemetery entrepreneur, Rhy-Chang Tsao, and his son, who have also established two hotels here: mid-priced Homa (Hotel of Modern Art) Sutra, on the outskirts of the park; and luxury Homa Libre, magnificently positioned within the park. The latter is one of only two Relais & Chateaux hotels in China, its corridors lined with contemporary paintings, its 49 bedrooms designed with quirky originality. My Cappadocian-style "cave" room was a wonder of turquoise and white with undulating plasterwork and clever lighting.

Nine years ago, the completion of a new road running north of Guilin opened up a magical area which is home to the Zhuang and Yao minority groups. From Guangxi's northern city it takes about two hours to reach the Longji district. Leaving the karst countryside you drive through flat farmland. The journey becomes more scenic as you twist into majestic hills blanketed with bamboos and firs. Longji, meaning "Dragon's Backbone", is the name of a single hamlet yet now also refers to a wider region of about 13 villages. These are linked by footpaths but otherwise set in rural solitude on hills stunningly sculpted with rice terraces. There's an almost palpably poetic resonance here: the tiny fields were created about 600 years ago, not long after the time of Kublai Khan. Gazing over these intricately carved slopes you feel lost in time, swallows diving around you and distant farmers looking picturesque despite the toughness of their toil.

The area has become protected parkland, visited by middle-class Chinese tourists quite as much as by foreigners. You pay a fee of 50 yuan (£5) to enter, leaving your vehicle in a car park and proceeding on foot up narrow paths – although sedan chairs are available for the dismally unfit or lazy.

The village of Pingan, about a 20-minute amble uphill from the road, has become a travellers' centre offering guesthouses and restaurants. While most accommodation is fairly basic, there is now one upscale option. Li-An Lodge occupies a prime position affording particularly sublime views. A 16-bedroom wooden house, it is the labour of love of Chinese-American photographer Keren Su. He spent 10 years constructing and then furnishing the lodge before opening it in 2007. It is beautifully devised, with walls and ceilings panelled in rattan weave, and each room decorated according to a Chinese theme – abacus, calligraphy, silk and more.

Beyond Pingan lies prime hiking country. Accompanied by my guide from Guilin, I took a day's walking trip to the village of Dazhai. You can travel through China on your own, but without local knowledge, to say nothing of an interpreter, you would have very limited understanding of what you see. Passing through breathtakingly lovely landscape, we paused by ancestral tombs; met Zhuang women farmers, dressed in black with towelling head-dresses; and stopped in the Yao village of Zhonglu, where we gave way to pack horses, and pack humans, negotiating the narrow alleyways between wooden houses.

The Zhuang, my guide explained, are China's biggest minority group, numbering about 16 million – more than many European countries. They are far richer than the three million Yaos, who, as if to compensate, have become charmingly pushy traders. Yao women dressed in their Sunday best of pink embroidered tops and black pleated skirts do brisk trade selling local trinkets to tourists. They also take small tips to demonstrate their complex headgear, letting down their long hair to show their use of multiple hair extensions. At times I felt there was a disturbing element of being in an ethnic theme park here, at others that the Longji parkland is an admirable conservation project, with the resulting tourism giving a much-needed boost to the local economy.

About a two-hour drive west of Longji we moved on to the land of the Dong people, newly accessible to tourists because of vastly improved roads. With a population of about three million, the Dong are party people, my guide explained, their social lives centred around traditional drum towers and "wind and rain" bridges.

Looking like pagodas, the drum towers are where villagers congregate, nowadays to play cards, gamble, and watch television, while in the towers' forecourts they stage plays and hold festivals. The bridges are elegant wooden structures roofed and lined with benches where in new tourist areas souvenirs are sold, but where traditionally people sit and chat – and where the young meet on first dates. We wandered around Chengyang, a staggeringly pretty complex of three Dong villages that, as with Longji, you pay a small fee to enter. Then we pressed on, along very newly tarmacked roads, to the market town of Dudong.

Here we were off the tourist radar, and here we stumbled into a local music festival. It was taking place around a large drum tower that had been renovated a few months before. Soaking up the village-fete atmosphere, I joined the crowd outside listening to competing musicians playing bamboo pipes. The resulting sound was weirdly like church bells chiming. In front of them stood the drum tower, modern yet ancient. For despite its new cladding, it seemed centuries apart from the high-rise towers of Shanghai I had gazed at just a few days before.

Getting there

Harriet O'Brien travelled to China with Cathay Pacific (020-8834 8888; cathaypacific.co.uk ), which flies from Heathrow to Hong Kong four times daily. The airline offers connections to Shanghai on its partner, Dragonair. Return fares from London to Shanghai start at £569. Connections from Hong Kong are also available on Dragonair to more than 20 destinations across the People's Republic, including Guilin.

The writer travelled through China with Audley Travel (01993 838200; audleytravel.com ).

A 14-day journey taking in Shanghai, Guilin and the Longji area, as well as Chengyang and beyond, costs from £2,895 per person.

Non-stop flights from Heathrow to Shanghai are available on British Airways and Virgin Atlantic.

Staying there

The Mansion Hotel, 82 Xin Le Road, Shanghai (00 86 21 5403 9888; chinamansionhotel.com ). Doubles $259 (£175), room only.

Hotel of Modern Art, Yuzi Paradise, Dabu Town, Yanshan District, Guilin (00 86 773 386 9066; www.homarc.com ). Doubles start at 2,080 Yuan (£200), including breakfast.

More information

Visas for China are available from the Embassy of the People's Republic of China, 31 Portland Place, London W1B 1QD (020-7631 1430; line open 10am-1pm and 2pm-4pm; chinese-embassy.org.uk), price £30. The embassy also has visa offices in Manchester and Edinburgh.

China National Tourist Office: 020-7373 0888; cnto.org.uk

China: a minority view

The Chinese government recognises 56 ethnic groups across the country, with the majority Han comprising about 93 per cent of the population. From the Achang to the Zhuang, the other 55 groups mainly occupy rural areas. There are five 'Autonomous Regions' and several smaller 'Autonomous Districts' where non-Han people predominate.

Bordering Vietnam, the southern province of Guangxi is one of China's five official self-governing regions – although how much that translates into meaningful minority power is very debatable. The peoples of this province first came under Han sovereignty in around 214BC. With intermarriage and assimilation many of the groups of this district no longer look very different from the mainstream Chinese. However, latterly the authorities have been working hard to promote and preserve the minority cultures here.

On China's northern border, Inner Mongolia (as distinct from independent Mongolia) is also an 'Autonomous Region', as is the little province of Ningxia just beneath it. Meanwhile on the western frontiers the Autonomous Regions of Tibet and Xinjiang are far more volatile and controversial. Chinese troops are stationed in both of these provinces, the official line being that they are there to keep the peace and protect the borders.