The island is linked to the east end of Tortola - the biggest island in BVI - via a bridge.

'This is our focus in the next 10 years,' said Raymond Hung, managing director of Applied International, which bought the island for US$10 million in 1992.

Total investment in the island project is expected to reach about US$1.03 billion.

'I was attracted by the beautiful scenery,' Mr Hung said.

When completed in 10 years' time, the 225.7 hectare project will comprise an 18-hole Jack Nicklaus Signature golf course and a 450-unit residential community, comprising single family homes including town houses and condominiums.

'We are in talks with Ritz Carlton, which is interested in running our resort hotel there,' Mr Hung said.

He said the deal was not yet signed and depended on finding a partner for the entire development.

'We are looking for a joint venture equity partner to build the project.

'If the partner is a hotel operator it will be interested in managing the resort hotel,' Mr Hung said.

He added that Ritz Carlton was one of the parties involved in talks to buy an equity stake in the development.

Mr Hung's move comes in the wake of big Hong Kong players like Sun Hung Kai Properties and Cheung Kong (Holdings) increasing investment in China, where the economy has grown 10.2 per cent in the first quarter.

Commenting on Hong Kong and international companies moving north, Mr Hung said not every city in China was a good place to invest.

He said Beijing and Shanghai were the best. 'Other than that, it is not easy to find good opportunities in the second-tier cities.'

He said the Virgin Islands showed great investment potential as its economy was considered one of the most stable and prosperous in the Caribbean.

He expected most of the buyers of the project's residential units would come from North America,

20 per cent from Europe and 10 per cent from South America.

'Hong Kong people and mainland Chinese will not buy there, it is too far away from home,' Mr Hung said.

However, he revealed that the company would look at the potential for developing resort hotel projects in Asia in the future to cater for the growing number of affluent Chinese.

British Virgin Isles

A British overseas territory, it comprises 16 inhabited and more than 40 uninhabited islands and keys. The two largest islands are Tortola and Anegada, which account for 60 per cent of the BVI's land mass.

The BVI covers a large area to the northeast of the US Virgin Islands and is about 144km east of Puerto Rico.

The population was estimated at 22,000 in July 2004 and gross domestic product per capita is US$37,000.

The total number of visitors to the BVI was 813,000 in 2004, of which 220,000 were air arrivals and 593,000 were by boat. Most of the visitors were Americans. Europeans made up the rest, predominantly from Britain, France, Germany and Italy.

In 1984, there were only 500 companies incorporated. That figure grew to 1,500 in 1985 and 5,000 in 1986. Last year, the figure exceeded 650,000.