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Wednesday, July 09, 2008

Royal Group Seeks $2 Billion to Build Cambodian Island Resort

By Netty Ismail

July 10 (Bloomberg) -- Royal Group, which owns Cambodia's biggest mobile-phone operator, plans to raise as much as $2 billion with Hong Kong-based Millennium Group to build resorts, casinos and an airport on an island off the coast of Cambodia.

Royal Group and the Millennium real-estate investment firm are seeking investors and partners for resorts, apartments, casinos, golf courses, polo fields and an airport on Koh Rong island, according to a financing investment document obtained by Bloomberg News. The island is the largest of 22 off the coast of the southern port city and beach resort town of Sihanoukville.

``This is a place that people haven't discovered yet,'' said Royal Group Chairman Kith Meng in an interview in Phnom Penh. ``It's like the Maldives,'' an island country in the Indian Ocean southwest of Sri Lanka, he said.

Cambodia, the second-poorest of 10 Southeast Asian nations, is relying on tourism to fuel economic growth as garment exports slow. The country attracted about $400 million of tourism-related investments in the first half of 2008, mostly for resorts, Commerce Minister Cham Prasidh said. Visitors to Cambodia exceeded 2 million for the first time last year, up from 118,183 in 1993 when Cambodia emerged from a two-decade civil war.

Our dream is to transform our costal line into the next Riviera of Asia,'' Cham Prasidh said in a July 4 interview. ``There'll be plenty of resorts appearing on the islands and all along the coast of Cambodia. There will be billions of dollars of investment in that sector this year and next year.''

Angkor Wat

The companies will raise funds from investors in London and the Middle East, and it will take 10 years to 15 years to develop the island, said Kith Meng on July 4.

Cambodia wants to develop tourism beyond the key destination of Angkor Wat, known for its ancient temples. The island project may face competition with beach resorts also being developed in Vietnam and Thailand.

``The tourism industry is overwhelmingly concentrated on Angkor Wat because of the unique attraction you can't find elsewhere in the world,'' said Agost Benard, associate director at Standard & Poor's in Singapore. ``As far as developing a beach resort, you'll be competing with a lot of countries because it's a generic product.''

Royal Group and Millennium are raising funds as record oil prices prompt airlines to cut flights. Cathay Pacific Airways Ltd., Hong Kong's largest airline, said July 2 that earnings would be ``disappointing'' because of record fuel costs.

``I don't know if the current oil prices will affect air travel and if it's going to be a booming sector in the near term,'' Benard said.

Turquoise Waters

The companies are trying to get resort and hotel operators, including Singapore-based Banyan Tree Holdings Ltd., to participate in the project, Kith Meng said.

Royal Group and Millennium plan to develop the 76 square- kilometer (29 square-mile) Koh Rong island, now inhabited by fishermen, into a ``luxury resort destination,'' according to the document. The island has 28 white sand beaches, including the 6.1 kilometer Snowdrift Beach, surrounded by shallow turquoise waters.

Kith Meng, who was educated in Australia, declined to say how much Royal Group is paying the government for a 99-year lease to the island.

Royal Group also is planning to build a resort in Siem Reap, near the temples of Angkor Wat, with India's Oberoi Group. Royal Group already has a telecommunications venture, MobiTel, with Luxembourg-based Millicom International Cellular SA, and another partnership in Cambodia with Australia & New Zealand Banking Group Ltd., Australia's third-largest bank, called ANZ Royal Bank.

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Aust drug smuggler jailed for 6 years in Cambodia

By South East Asia correspondent Karen Percy

A Cambodian court has sentenced an Australian man to six years prison for trying to smuggle 40 grams of the drug known as "ice" out of the country, a judge says.

Simon Peter Conway, 50, was convicted of drug trafficking in a trial on Tuesday and sentenced to six years and a $2,631 fine, Judge Chan Madina said.

He was arrested in October at Phnom Penh International Airport after authorities found 40 grams of the methamphetamine with him.

Conway's lawyer Dun Vibol says he has already filed an appeal seeking to have the prison sentence reduced.

"Conway confessed everything during the trial," he said.

"But we want his sentence to be reduced to the minimum."

He also added that Conway intended to bring the drug to Australia to use as a pain killer for a leg injury.

Ice can be produced in rudimentary laboratories from a range of chemicals and resembles clear, chunky crystals that can be smoked, snorted or injected.

Although drug arrests have risen, Cambodia is becoming an increasingly popular trafficking point for methamphetamines and heroin, particularly since neighbouring Thailand toughened its stance on illegal drugs in 2002.

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Congratulate Cambodia, don't curse it

ACHARA ASHAYAGACHAT

Thailand should congratulate, not curse, Cambodia for its success in having the ancient Hindu temple of Preah Vihear inscribed as a new World Heritage landmark.

Thailand should now concentrate on restoring its standing and educate the world that the temple's settings, some of which are in Thai territory, also deserve the same preservation.

To achieve that difficult goal, the country needs to first make sure that there is no more fanning of nationalism by either the Democrat party or the People's Alliance for Democracy for the sake of personal political gain.

But the civic protest group and the opposition, and senators, should spare the Samak administration from punishment, especially Foreign Minister Noppadon Pattama, for confusing the international community about Thailand's true position on Preah Vihear.

The national drama unfolded with the government supporting Cambodia's call that its new temple map, minus the disputed 4.6km border area, be used for the heritage listing. The government was forced to change its position after the Administrative Court issued an injunction against cabinet approval for the signing of the joint communique.

Thailand also felt Preah Vihear was inextricably linked to the surrounding cultural and natural landscape on Thai territory, and therefore a joint nomination should be made for the listing of the site.

That was the position the present Thai government should have taken and argued for from the very start.

The court's ruling made Mr Noppadon swallow his words and he backtracked on the issue by saying that the joint communique signed on June 18 should not be taken as a guarantee of Thailand's endorsement for Cambodia's latest bid for registration of the temple.

Thailand failed miserably in its efforts to convince Phnom Penh and the technical experts advising the World Heritage Committee in Quebec that the temple should not be listed until the two neighbours settle their border disputes.

If anyone is to be blamed for what has happened it is the Samak administration, for rushing to clinch the deal and support Cambodia's proposal.

Another lesson from the Preah Vihear case is that the government cannot afford not to take the advice of experts into account before agreeing to any future proposals, or we may find ourselves in another hopeless situation.

But this should not prevent the two neighbours from cooperating in exploring ways to enhance their mutual respect, friendship, and in the peaceful management of the ancient heritage site that has served local communities of both countries for centuries.

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Former Cambodian Khmer Rouge minister denied bail

The United Nations-backed Khmer Rouge tribunal in Cambodia has dismissed a bail request by former Khmer Rouge cabinet minister, Ieng Thirith.

The presiding judge told the court it was necessary for Ieng Thirith to stay in jail as "there are well-founded reasons to believe" that she committed the crimes for which she has been charged.

The court was also told it is suspected Ieng Thirith is a flight risk and that her detention is necessary to protect her against possible revenge attacks from Khmer Rouge victims.

Ieng Thirith, 76, was minister of education and of social affairs during the Khmer Rouge reign from 1975 to 1979.

She is the wife of former Khmer Rouge deputy prime minister and foreign minister Ieng Sary.

Both husband and wife have been charged with crimes against humanity, while Ieng Sary has also been charged with war crimes.

Ieng Thirith was the third of the five Khmer Rouge leaders awaiting trial whose appeals for release have been denied.

Ieng Thirith's lawyers previously insisted the 76-year-old is mentally ill and in poor chronic health.

However, court officials have said doctors deemed her fit to stand trial.

It has taken three decades to start bringing senior officials of the Khmer Rouge, who left up to two million people dead from overwork, starvation, torture or execution, to trial at the joint Cambodia-UN tribunal.

The court was not established until 2006, and the trials of the regime's five surviving senior leaders are not due to begin until later this year.
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