KUALA LUMPUR - Economist said yesterday the government should not bail out Malaysia Airlines, but instead, take drastic action to revive the national carrier.
Prof Dr Hoo Ke Ping said privatisation was an option to salvage MAS, but it should be de-listed first.
"The AirAsia-MAS share swap two years ago taught us a lesson to be more transparent if any form of privatisation is being considered. "Even before the deal was finalised, insider trading was taking place. It should not have happened."
He said the government and people should view the issue from an economic perspective. "The term 'national' has been abused. If the government keeps salvaging MAS because of the country's sentiments over the national carrier, the rakyat's money will go to waste."
Hoo said the government should allow the market to decide MAS' future.
A Hong Leong Investment Bank analyst, who did not want to be named, said MAS could not survive any more, given the sharp decline in its market value, even if the company decided to head down the privatisation route.
"Even if it is privatised, there are a lot of issues to take into account," he said, stressing that there was no one-stop solution, as there were many factors that came into play, such as MAS' internal management, market environment and airline competition.
He said MAS' organisational structure was messy, with employees not fully supporting the company, as seen in the call by Malaysia Airlines System Employees Union for MAS leaders to step down.
The Public Accounts Committee urged the government to review its financial aid for MAS.
Its chairman, Datuk Nur Jazlan Mohamed, lauded government efforts to review the National Aviation Policy (NAP), adding that the focus should be to review MAS' financial performance.
"NAP was initially created to improve transportation and connectivity with the rest of the world, while still (allowing for) profit. But, the operational model has ceased to serve its purpose, since MAS is shrinking by cutting routes and losing money."
Deputy Prime Minister Tan Sri Muhyiddin Yassin had announced last month that the government would enact NAP to accelerate the aviation industry's growth by recommending measures to boost the aviation ecosystem.
Nur Jazlan said with the ASEAN Open Skies Policy, which is expected to be introduced next year, MAS would face stiff competition from more budget airlines.
"The government can reduce its stake in MAS by selling to investors and not being the major stakeholder. MAS is part of public policy. If the policy cannot support it any more, then the airline must run as a commercial entity."
MAS posted a net loss of RM443.4 million (S$173 million) in the first quarter of the year, compared with a net loss of RM278.8 million (S$109 million) in the same period last year. Additional reporting by Rahmat Khairulijal.