No more business as usual in airport expansions, govt to review financing model, says Loke

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KUALA LUMPUR (July 26): Expansions of airport by the government would no longer run on a 'business as usual' mode, as it looks to a new financing model to cut cost but without the monopoly of a single airline, said Transport Minister Anthony Loke.

“As far as airport expansion is concerned, we are not satisfied with the status quo. How do we expand the airports without incurring cost? We cannot keep spending on developmental expenditure for airport expansion,” he told reporters at the Parliament lobby.

The current model states that the government bears the cost for airport expansion, resulting in financial constraints.

"We have to look at other models whether it is JV or PFI or any other models as a way forward. Airport expansion does not have to be government-driven,” he added.

However, there would not be a monopoly or exclusive right given to any airline to operate an airport, he said in view of AirAsia Group Bhd's interest in operating the Kota Kinabalu International Airport (KKIA)'s Terminal 2 (T2).

"We are open to the idea (and) not dismissing the proposal but it needs to be studied, and the position of the Sabah government and stakeholders would be sought.

"They are proposing to operate from T2. Right now, all airlines are operating in Terminal 1 in KKIA, so if AirAsia wants go back to T2, it is probably because it is cheaper and easier to operate.

“But the operation model for that airport has to be operated and by who, (so) that has to be studied,” he added.

In Malaysia, it is not normal for a single airline to operate an airport, Loke said.

“There is no precedent for an airline company to operate an airport (here), but it is in other countries. So far, only AirAsia has expressed interest to operate the terminal. It is a major decision and implications that we have to study a new model,” he added.

Loke said the government would have to sit down and talk to various stakeholders, including the Malaysian Aviation Commission (Mavcom), Malaysia Airports Holdings Bhd and regulating bodies.