KUALA LUMPUR: There is a huge value propositions Malaysia Airlines Bhd (MAB) brings to the country and economy beyond profit and loss, said Khazanah Nasional Bhd managing director Datuk Shahril Ridza Ridzuan.
He said looking at the aviation industry in Malaysia, it is clear that the industry has vast capacity for economic development.
“There is a huge amount of economic benefits generated by all airlines to the Malaysian economy - from tourism, business deals, work appointments to various local industries.
“It is actually an industry where, if you look at the across the whole chain, plenty of other (industries) make money, rather than the airline itself.
"We just have to find new ways for the airlines themselves to reach higher efficient state for us to relook and restructure the industry.
"I think it is quite conceivable, looking at an industry where demand is not going as fast as capacity growth,” he said during a panel session at Invest Malaysia 2019 here today.
He said Khazanah’s investment in MAB remains relevant despite the airline missed its target to break even last year.
“I think it is quite important for the government to understand what is the cost of keeping up the airline - investment of new planes and refurbishment - against the much bigger loss to the economy if MAB were to stop operating,” he said.
Besides that, Shahril said Khazanah plans to utilise the remaining balance from the RM6 billion fund injection executed in 2014.
Khazanah, which took MAB private in 2014, invested the amount in the airline in a bid to return to profit within three years.
“There is still some funds left from it. It will be injected (into MAB) this year and later on,” he said.
On March 6, Shahril, during Khazanah’s 2018 performance briefing said half of its RM7.3 billion impairments registered last year was attributed in sustaining MAB.
Last week, Finance Minister Lim Guan Eng has given his assurances that the government will not shut down MAB.
It was earlier reported that the government was looking into ways to resolve MAB’s financial conundrum with several options on the table, including shutting down the national carrier.
Prime Minister Dr Mahathir had said the matter was being discussed following heavy losses sustained by MAB since it was privatised in 2014.
He had been commenting on suggestions by several experts on the need to sell or shut down MAB.