KUCHING – The Sarawak government needs to be more transparent and accountable by clarifying the total cost of setting up a boutique airline for the state, said Bandar Kuching MP Dr Kelvin Yii.
He said it was in the best interest of all Sarawakians for such information to be made known, including the project’s economic feasibility and sustainability study, as well as cost-effectiveness analysis.
“While I am supportive of what is good for Sarawak, especially to find ways to improve connectivity and stabilise tickets prices into Sarawak, I express some reservations on the idea of setting up Sarawak’s own airline as it may not be sustainable and economically feasible and it will come at a huge economic cost to Sarawak,” he said in a statement.
Although Prime Minister Datuk Seri Anwar Ibrahim has agreed in principle for Sarawak to have its own boutique airline, Dr Yii said the running of an airline business was very tough, aside from being subjected to many regulations concerning organisational structure, passenger safety, speciality and other aviation requirements.
“This decision may cost a lot of public funds to set up, let alone find it tough to sustain the business model and maintain the assets as Sarawak may not have the economy of scale to keep it sustainable.”
Yii said a scenario whereby the state government has to use large amounts of public funds to bail out the airline to keep it afloat due to an unsustainable business model after a period of operation should be avoided.
“I still believe the better option is to find ways with existing private national and private airlines to improve connectivity, especially domestic routes within Sarawak, by offering incentives and even subsidies.”
He said such an option would be a better alternative compared with setting up a new airline company that requires high investment, high costs and high expertise that might not be beneficial to the state’s interests in the long term.
“In principle, it should not be the business of the government to be in business.”
Dr Yii said the government should instead provide a conducive environment and ecosystem for businesses to thrive in or incentivise the private sector to come up with sustainable business plans for the people.
In response to a request by Premier Tan Sri Abang Johari Openg during an event here yesterday, Anwar said he agreed in principle for Sarawak to establish its own boutique airline company and the proposal would be brought up during Wednesday’s cabinet meeting. – Borneo Post Online, April 18, 2023
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