PETALING JAYA: Shutting down troubled Malaysia Airlines (MAS) is an option that the government can consider in light of its legacy issues, according to former Khazanah Nasional Bhd managing director Tan Sri Mohd Sheriff Mohd Kassim.
“There are a lot of people saying that we may need to re-examine if we really need a national airline, and I think we should look into whether we actually need this national airline,” Mohd Sheriff said on the sidelines of the Malaysian Strategic Financial Outlook Forum 2019 organised by The Asian Strategy & Leadership Institute here.
“MAS had been bailed out not just once but two or three times before, and it will never be successful. After each bailout, it will be alright for two or three years and then it starts again,” said Mohd Sheriff, who is also the current chairman of PLUS Malaysia Bhd.
He said it was not easy for the national carrier to be profitable and it may be better for resources to be deployed into more productive areas of the economy so that the country could enjoy better returns on investment.
He noted that the government could profit instead from the potentially increased collection of airport taxes and tax collections through Malaysia Airports Holdings Bhd
and other airlines when the aviation sector is completely opened up.
“This line of thought (to shut down) has been gaining ground. Also, it is not easy since we don’t have such a big market such as Singapore or Thailand,” he said.
Meanwhile, Mohd Sheriff also said that there should be serious thought and discussions as to whether there should be so many types of government-linked companies (GLCs) in the country.
“The governance standards (in GLCs) should be improved and there should be no political interference in the running of the GLCs,” he said.
Commenting on Khazanah’s financial situation, Mohd Sheriff said the assets that the sovereign wealth fund owned are strong, despite having reported a loss recently.
“Of course, the loss was due to the impairments. But generally, provision for impairments is not a cash item. There are non-performing companies and this has been acknowledged by the management and they are planning what to do next with these companies,” he said.
Earlier, when speaking at the forum, he said the presence of many GLCs implied that they are competing on “unfair terms” to the economy.
“This is because they have access to special government funding. GLCs which are not viable and are operating in the private sector should be sold off so that they do not pose a threat to the private sector,” he said.
On another matter, he said that politicians should not be involved in the day-to-day affairs of the running of a GLC to ensure transparency and accountability in the running of these companies.
“For us in PLUS, we come from the Khazanah group. We observe the GLC transformation programme quite strictly wherein no politically-connected persons can be appointed to the board of PLUS,” he said.
“GLCs should also not give any political funds to political parties.” he added.
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