The Singapore government today gave Genting International (GIL) the go-ahead to build the Sentosa Intergrated Resort (IR), following a series of probity checks on its shareholders sparked off by the group's involvement with Macau tycoon Stanley Ho.

Minister for Trade and Industry Lim Hng Kiang, speaking at the groundbreaking ceremony today, said that Resorts World at Sentosa (RWS) "understands the requirement for probity checks and has no issue with it."

The event, which was held at the old Sentosa ferry terminal, was also hosted by Genting International Group Chairman Mr Lim Kok Thay, and RWS Chief Executive Officer (CEO) Mr Tan Hee Teck.

Earlier in the year, local authorities expressed concern over Genting's business tie-ups with casino mogul Stanley Ho, who had acquired a stake in Star Cruises in exchange for a 75 per cent stake in a hotel-casino project in Macau to Star Cruises and GIL. Star Cruises has a 25 per cent stake in GIL's Resorts World at Sentosa.

Since authorities announced that suitability checks would be conducted, GIL said it would pull out of the Macau hotel-casino project, and Star Cruises would pull out of the Sentosa IR venture.

At a press conference, chairman Mr Lim Kok Thay confirmed that Genting is currently on its way to acquire Star Cruises' 25 per cent stake in the Sentosa IR, pending the shareholders' go-ahead.

The local construction and development services industry is set to receive a boom when building work for RWS gets underway.

Some S$20 million worth of pre-construction contracts have already been awarded to Singaporean firms, with another $508 million worth of building contracts up for tender in the coming months.

The earlier ones were awarded for site survey, soil investigation, site hoardings and demolition services, and the remaining contracts will be awarded from April to June will be for road diversion, reclamation works and site formation.

Mr Tan Hee Teck, CEO of RWS, estimates that a total of S$3 billion worth of building contracts will be given out by 2010.

He also says that all contracts will have a clause that caters for material costs fluctuations, addressing concerns of possible construction materials shortages caused by the reduced granite and sand supplies.

Earlier this year, Indonesia imposed a ban on sand exports, and its navy had detained two vessels on its way to Singapore, which were suspected of smuggling sand together with their granite load.

Minister Lim said that for projects in which the government is the developer, it will share in the higher costs incurred by the disruption of the sand and granite imports.

"It is not equitable for the contractors to bear the full burden. By pitching together we will be able to solve this problem more effectively. We are looking at alternative sources with the Ministry of National Development (MND) and the Jurong Town Council (JTC). The supply will come," he added.

In terms of overall developmental costs to Genting, Chairman Mr Lim does not foresee any budget overrun, as a contingency has been factored in during planning.

The RWS and the Marina Bay Sands are expected to contribute an additional 2 to 3 million visitors in 2010, when both integrated resorts are operational. This will bring total annual visitor arrivals to about 13 to 14 million.

The average length of stay is also expected to increase from 3.4 days in 2006 to 3.6 days in 2010, which will increase the number of visitors per day by 55 per cent, from about 90,000 in 2006 to an estimated 140,000 in 2010.

Singapore hopes to attract 17 million visitors and generate S$30 billion in tourism receipts by the year 2015.

Top picture: [from left to right] Mr Tan Hee Teck, Chief Executive Officer, Resorts World at Sentosa; Minister for Trade and Industry, Mr Lim Hng Kiang; Mr Lim Kok Thay, Chairman, Genting International Group.