Subang Airport sale goes against the peoples’ interests

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The proposed selling of public-owned Subang Airport to WCT Holding Berhad linked to private capitalist Desmond Lim Siew Choon is against the interest of the people1.

Neither WCT Holding Berhad nor the capitalist Desmond Lim Siew Choon has the financial capacity to invest RM3.7 billion without taking massive debts from the bond markets and bank loans.

The cash holding of WCT Holding Berhad as of 31st December 2019 was less than RM650 million2. WCT Holding Berhad cannot solely rely on private jet travelers and must claw into the mass-passengers handled by other airports such as KLIA & KLIA2 to pay off the massive debt and earn profits.

MAHB utilizes the revenues generated from the commercial activities of KLIA & KLIA2 to “cross-subsidise” the maintenance of 18 Short Take Off & Landing Ports (STOLPORTS) 3. The drop in revenue for KLIA & KLIA 2 will lead to poor maintenance of STOLPORTS. Subsequently, the government must divert funds from public taxes to subsidise STOLPORT.

For rural East Malaysia without road connectivity, air connectivity through STOLPORTS is the sole lifeline to bring in goods, food, medical personnel, education and newspapers. The STOLPORTS are part of the Rural Air Services (RAS) which was one of the items included by Sabah and Sarawak during the negotiations to form Malaysia in 19634.

In the long run, MAHB may have to raise landing charges to compensate for the loss of revenue leading to higher airline ticket prices. Higher airline ticket prices will reduce arrivals of international tourists and connectivity between East and West Malaysia.

MAHB being a GLC provides lower preferential rates for government use. The government cannot expect such lower preferential usage rates from the profit-motivated private capitalists in the long run.

MAHB operates as social-commercial hybrid model which cannot be exposed to full market competition. The selling of Subang Airport to private capitalists will expose MAHB to profit-oriented competition which will lead to negative impacts to the people.

The government is the custodian of public wealth including strategic national infrastructure such as electricity, water, roads, seaports, airports, and railways which should never be privatised to politically-linked cronies.

Central Committee Member
Parti Sosialis Malaysia (PSM)


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