T he Government has given the go ahead to Malaysia's Ariston for an airport expansion

and power station project in Sihanoukville, plus a $100 million casino hotel on nearby

Naga Island, all to be built by 1997.

The approvals given by the Council of Ministers on Oct. 13 cover only about $160

million worth of development, not the whole $1.3 billion mega residential, commercial,

industrial project announced in January. Ariston is the same company that owns the

floating casino on the river behind the Cambodiana Hotel, and the Cambodia Times

and Cambodia Asia Bank.

Ariston officials who had arrived in Phnom Penh for the meeting declined to comment

on the project or what was approved or not approved. Iain Gray, chief general manager

of Ariston SDN BHD, would say only that he was in meetings and that he expected to

return to Malaysia soon.

Minister of Tourism Veng Sereyvuth said following the Council of Ministers meeting

that "generally we approved the concept, but further discussion is needed on

the land titles." He didn't elaborate.

Foreign companies aren't allowed to own land in Cambodia, but businesses routinely

get around the restriction with a long term land lease.

Later Veng Sereyvuth said at a news conference that approving the airport, power

station and hotel was a sign of "positive news" for Cambodia, and that

when those approvals were combined with upcoming approvals expected for hotel expansion

in Siem Reap, the country would be in a better position to achieve its goal of attracting

a million tourists a year by the year 2000.

With tourism, he said, "you're selling choices. You're selling variety, Phnom

Penh, the river, the Royal Palace... Siem Reap with the famous Angkor Wat, and Sihanoukville...

with sand and beaches."

The airport expansion would mean that international flights would be able to land

in Sihanoukville by 1997, he said.

The Council of Ministers also created a Sihanoukville Development Authority (SDA)

to oversee the development projects and to be led by Cambodia's two prime ministers.

The SDA will consider and decide on the masterplan for a tourism village submitted

by Ariston back in January and a proposal for a 99 year leasehold for foreign investment

land.

In January when the Ariston project was announced in Kuala Lumpur, the company said

that its plans were to "transform the entire Sihanoukville region into a comprehensive

tourism, industrial, commercial, residential and entertainment center."

The project called for a complete "tourist zone" with a golf course and

a cable car linking Sihanoukville to Naga Island, a water theme park and other attractions.

All Veng Sereyvuth would say about the rest of the $1.3 billion development was that

it was a long term plan. "It will be implemented 20 years from today,"

he said.

A tourism official said that Ariston had agreed to pay the government a $103 million

"commission" for the rights to develop the project and that the money would

be paid in increments, but he didn't know how much had been paid so far. As of May,

when the $10 million floating casino opened, $3 million had been paid.

He said bids would go out for the airport and power station soon. "The airport

project is basically an expansion of the existing airport," he said. He said

the new airport would be capable of handling 737 aircraft.

He said the size of the power station wasn't known, but it would be between five

and 20 megawatts, at a rough cost of $1 million per megawatt, and an agreement would

be negotiated between the Ministry of Industry and Ariston by Dec. 31 1995.

Few details were announced about the hotel project, other than that it would be a

361 room hotel-casino on the island to be refined "with the relevant authorities."

People living on the island will be moved, he said, because it's state property.

Eventually there would be a marina and other amenities on the 100 hectare island.

The work should begin soon, Sereyvuth said. "Once everything is approved it

should go forward as quickly as possible. If one of us does not do his job, that

is not good."