R ESTORATION has begun on Phnom Penh's old and famous Royal Hotel, a key part of

the government's efforts to lure more tourists to Cambodia.

Built in the

1920s under French colonialism, the hotel - on the boulevard between the Railway

Station and Wat Phnom - will have a face-lift under a $25 million contract

between the Royal Government and the Singapore-based DBS Land and its

subsidiary, Raffles International.

"This project signifies the Royal

Government's intention to restore the noble capital city Phnom Penh in the

Kingdom of Cambodia to its former glory as the 'Pearl of Asia' and an 'Oasis of

Peace', superlatives used and experienced during the Sangkum Reastr Niyum [the

rule of then Prince Norodom Sihanouk]," First Premier Norodom Ranariddh said

during a ground-breaking ceremony on Aug 29.

Ranariddh said the ceremony

set a milestone in the country's growing tourism industry and meant economic

development and more jobs for Cambodians.

DBS Land, which owns the

internationally renowned Raffles Hotel in Singapore, will take a 60-year lease

on the Royal under an agreement signed last October with Cambodia's Ministry of

Tourism.

DBS Land Chairman Patrick Yeoh said the first phase of the

restoration should be completed in early 1997, with 209 rooms, a swimming pool

and other facilities ready for guests. More buildings may be added

later.

"When the Royal Hotel reopens its doors to welcome visitors once

again, it will be one of the finest places to stay in Cambodia and certainly in

this region.

DBS is also due to restore the Grand Hotel in Siem Reap, and

Yeoh said the two hotels "will appeal to visitors from abroad with a charming

mix of the traditional amidst the new, a showcase of Cambodian culture and an

oasis of comfort for the traveler."

The Royal has a special place in

Phnom Penh's history since the 1920s. For decades, it was the classiest hotel in

Cambodia, catering for the rich and famous and visiting dignitaries such as

Churchill, de Gaulle and Jackie Kennedy.

Following the overthrow of

Prince Sihanouk in 1970, it gained a new identity as the Phnom Hotel, a popular

haunt for foreign journalists and highlighted in the movie The Killing

Fields.

During the Khmer Rouge years, it was turned into a garrison for

Pol Pot's Chinese advisers, before being reopened as a hotel after the

Vietnamese invasion.

During the 1980s many expatriate NGO workers were

housed fulltime in what was then called the Samaki Hotel.

Renamed the

Royal, or Le Royale, in the early 1990s, the years finally took its toll on the

building and it was closed in September 1993.

The government made plain

its determination to see the hotel refurbished and returned to its former

grandeur, but two previous agreements with foreign companies to renovate the

Royal fell through.