Ling warns that excessive market intervention could discourage airlines and reduce overall market competitiveness.
SIBU (April 30): The issue of high airfares should not be addressed through price ceilings but by increasing flight frequency and market participation, said Sibu MP Oscar Ling.
He warned that excessive market intervention could discourage airlines and reduce overall market competitiveness.
“A long-term sustainable solution should be achieved by increasing flight frequency or developing the market so that more airlines can participate in competition,” he said in a statement.
He was responding to remarks by Sarawak United People’s Party (SUPP) Dudong chairman Wong Ching Yong, who recently questioned whether problematic policies should remain unchanged or be corrected.
Ling said when the Democratic Action Party (DAP) took over the Ministry of Transport in 2018, the ministry had studied the proposal of setting airfare caps.
However, he said the findings showed that direct price control would not resolve the issue.
“In fact, cheaper tickets may be raised to the capped level to maintain airline profitability, and in severe cases, this could even lead to flight cancellations.”
Drawing parallels with essential good pricing, Ling said past attempts to impose price ceilings on eggs had led to supply shortages as producers reduced output due to losses.
“Eventually, supply only improved through free market competition,” he said.
He added that the federal Ministry of Transport is actively addressing airfare issues, particularly by ensuring ticket prices remain reasonable during festive seasons.
Outside peak periods, he said fare levels are largely determined by competition among airlines.
Ling also noted that many rural routes in Sarawak remain unserved due to low passenger demand and limited commercial viability.
To address this, he said the federal government has implemented the rural air services (RAS) initiative, which provides an annual subsidy of RM200 million to airlines in Borneo to sustain these routes.
This, he added, is part of the government’s effort to ensure connectivity in less commercially viable routes.
He said measures such as increasing flights during festive seasons or arranging charter flights with fixed fares have helped ease airfares pressures during peak periods.
At the same time, he called on Wong to clarify when state-owned airline AirBorneo would commence direct flights between Kuching and Sibu, and how it intended to ensure affordable airfares for Sarawakians.