Planned Theme Park Stirs Controversy : Environment: A 200-room hotel, a 350-unit condominium complex and theaters will turn one of Malaysia’s wealthiest states into an ecological nightmare, critics say.

A futuristic theme park planned for a hill on Malaysia’s Penang Island that developers say will revive the tourist trade has environmentalists howling in protest.

The project, at a cost of more than $130 million, would boost Penang’s tourism, eroded by the rising popularity of Phuket in Thailand and Bali in Indonesia, developers said in a report.

But environmentalists say the theme park will turn Penang, one of Malaysia’s wealthiest states, into an ecological nightmare.

The project includes a 200-room hotel, a 350-unit condominium complex and theaters on Penang Hill, whose 2,500 foot crags dominate the island that calls itself the “pearl of the Orient.”

A complex of futuristic architecture is planned also, with planetarium, observatory and theaters inside a large white dome, a water world, cable car and Chinese and Islamic gardens.

The sprawling forest swathing the hill is home to unique flora and fauna, which environmentalists fear will be destroyed if bulldozers are allowed in.

“The project will definitely damage the ecology and cause massive soil erosion,” said Salleh Mohamed Nor, director of the Malaysian Forest Research Institute.

“Massive flooding will occur and the island’s main water catchment areas located on the hill will be severely damaged,” said lawyer Meenakshi Raman.

She represents the Consumers Assn. of Penang and the Friends of the Earth leading the campaign to preserve the hill, with its stunning view of the port at the tip of the Strait of Malacca. Penang Hill was popular with British colonial officers more than 100 years ago as a refuge from the tropical heat.

Said Meenakshi: “Nobody was informed beforehand, which is not right, as the hill is very dear to the hearts of Penang people. This is a real shock.”

The state government revealed the plan on the day an agreement was signed with Penang Hill Leisure Resorts last September. The company is 51% owned by the Berjaya Corp., led by millionaire Vincent Tan, 39.

The report said the project “would have some adverse impact on the ecology of the area, but the adverse environmental impact is not expected to be severe” when compared to the economic benefits.

After the first howls of protest, Penang Chief Minister Koh Tsu Koon assured the local Assembly in December that the development plans would be revoked if studies showed that the park would harm the environment.

But while he appealed for patience, he rejected calls for a public hearing on the scheme.