KOTA KINABALU: The federal government will continue to subsidise MASwings for rural air services in Sabah and Sarawak, with RM190 million allotted for another seven-year contract.
Transport Minister Datuk Seri Liow Tiong Lai said the federal government, however, was reviewing destinations that no longer require the subsidy when the contract ends next year.
“The federal government is aware that rural folk still need assistance for cheaper flights out of their places but we will have a re-look as we will no longer subsidise locations where other airlines like AirAsia and Malindo Air are plying, for example Sibu and KK.
“Last time, there were 49 destinations identified in Sabah and Sarawak that needed government subsidy and we will start the reviewing process from now so we can re-negotiate the new contract,” he said when attending the Sabah MCA Chinese New Year open house at KK High School hall here.
On another note, Liow said there were no restrictions for MASwings to expand in terms of acquiring jets instead of just operating turboprop aircraft, nor are there any restrictions for tapping into the Brunei-Indonesia-Malaysia-Philippines-East Asean Growth Area (BIMP-EAGA) routes.
“We encourage MASwings to move into the BIMP-EAGA sector but those routes, of course, will not be subsidised,” he added.
Present at the open house yesterday were Yang di-Pertua Negeri Tun Juhar Mahiruddin and Chief Minister Datuk Seri Musa Aman.