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SCMP Reporter

DEFYING a debilitating trade embargo and severe infrastructure problems, Hongkong's New World group is poised to open the doors to the largest hotel in Vietnam within a year.

    The 574-room New World Hotel Saigon represents the largest Hongkong investment to date and a model joint venture project between a foreign investor and a state-owned enterprise.

    ''We've been getting along quite well with our Vietnamese partner,'' said Mr Nixon Chung, the hotel's resident manager, who has spent the past three years in Vietnam on the project.

   He added that government officials had been doing their best to provide the project with adequate links to water, power and telecommunications.

    ''They have been trying to make all the provisions,'' he said. ''But being a pioneer we don't expect things to be fully available.''   As well as coping with a strained infrastructure, New World got around the United States trade embargo by forsaking syndicated loans and financing the project itself.

   Since construction started on a 12,000-square-metre site in District 1, the 14-floor hotel has become the centre of attention because of its size and unique shape.

   Escalators have not yet made their way to Ho Chi Minh City, and most buildings do not exceed 10 storeys.

   Mr Tao Ho, who is overseeing the renovation of Government House in Hongkong, designed the hotel.

   New World, which is using its own construction company to build the hotel, has had to import most of the materials.

   Total investment is US$62.5 million, with partner Saigon Tourism contributing 25 per cent and New World the balance.

    Construction of the Ho Chi Minh City property comes amid an ambitious expansion by New World Hotels International.

   Two other hotels are under construction in Kuala Lumpur and Manila, and plans have been unveiled for new properties in Bali, Jakarta, Taipei and Kota Kinabalu.

    Upon completion, the New World Hotel will be by far the most opulent property in the booming city, surpassing the Hongkong-run Century Hotel and the Australian-built Floating Hotel as the city's crown jewel.

   The food and beverage outlets will include Vietnamese, Chinese and Western restaurants, a Japanese pub, lobby lounge, corner bar and fast-food restaurant.

    Other facilities include a business centre, gymnasium, swimming pool and tennis courts.

   The ballroom will be able to accommodate a sit-down assembly of up to 250 people.

    A generator has been installed to deal with Ho Chi Minh City's frequent power cuts.

   Hand-picked to run the hotel was general manager Regis Catoire, who came from the 570-room Yangtze New World Hotel.

    In the near future, New World will decide when to proceed with phase two of the project, an adjacent office tower.

   The existing Le Lai Hotel will be bulldozed to make room for the tower.

    With affluence spreading rapidly among Ho Chi Minh City's four million residents, the hotel is expected to attract many locals into its food and beverage outlets.

  ''We will try to identify ourselves as a social centre in the city,'' Mr Chung said.

    New World has not yet begun recruiting staff, but when it does most will be local residents.

   ''Our objective is to utilise local resources as much as possible,'' said Mr Chung. ''It's always better to have fresh, young people.''     Taking advantage of low wages in Vietnam, New World plans to maintain a high staff-to-guest ratio.

    With most hotels in Ho Chi Minh City running at capacity and arrivals growing at about 30 per cent a year, New World officials believe it will not be long before the group recoups its investment.

   Most of the guests are expected to be businessmen, and strong bookings are also expected from foreign firms housing expatriates.

    New World also sees business coming from its strong customer base in Hongkong. The territory ranks as the number two investor in Vietnam.

      Because of the scarcity of four-and five-star hotel rooms in the city, room rates at such hotels have surged to the US$150 range.

  Mr Chung said that because of poor infrastructure and the stigma brought about by the US trade embargo, it would be some time before Vietnam evolved into a popular tourist destination, especially among American tourists and businessmen.

    ''We still don't see Vietnam to be an ideal destination,'' Mr Chung said. ''But there has been very positive growth. More and more international companies are coming here on a long-term basis.''     Mr Chung said further growth would depend on improvements to the national infrastructure, especially at Ho Chi Minh City's international airport.



New World thinks big in Vietnam