NEWSFLASH

SAMAL GARDEN ISLAND RESORT CLOSED

Davao City, Jne 30, 2000 - Huge losses due to low occupancy rate have forced a Malaysian conglomerate to shut down its sprawling 300-room casino resort in the Island Garden City of Samal last Sunday, barely three years after it opened.

But tourism officials were quick to claim the closure was only temporary.

The conglomerate, Ekran Berhad, owned by Datuk Ting, a close friend of Malaysian Prime Minister Mohamad Mahathir, shut down the P3.5-billion Samal Casino Resort reportedly as a consequence of the ongoing fighting between government and Moro secessionist forces in certain parts of Mindanao and the hostage crisis in Sulu where eight of the captives are Malaysians.

Ekran Berhad, which operates a chain of resorts in Malaysia, was convinced by former President Ramos in 1995 to invest in the casino resort project in Samal. Convinced, it later signed an agreement with the Philippine Tourism Authority for the flagship project.

Acting Department of Tourism regional director Roger Layson, however, said the closure of Samal Casino Resort is only temporary.

"It is really temporary. They cannot afford to lose millions," Layson told The STAR. "The management assured us that they will resume operations as soon as the business climate improves."

According to Layson, Ekran Berhad intends to reopen the casino resort with a management group running its operations, as soon as the situation in Mindanao normalizes.

But Layson said Ekran Berhad is willing to enter on a lease agreement or total buyout for the casino resort.

Due to the low occupancy rate, Layson said the resort was losing at least P2 million a month. In the past few months, Ekran Berhad had sustained its operations by offering promotional daytime tours to local residents which, tourism officials said, were not enough to cover operational costs.

The Ekran Berhad management also claimed that the current dispute over the Philippine-Taiwan air agreement and the lack of direct flights between Davao City and Kuala Lumpur have affected revenue projections.