Malaysia has embarked on an ambitious plan to court top carriers that fly to neighbouring Singapore by offering financial perks and fifth landing rights, an official said today.

The announcement by Malaysia Airports Holdings Bhd, which manages and operates 37 airports in the country, comes at a time when Malaysia is wooing more shipping lines from Singaporean ports.

Rosman Abdullah, Malaysia Airports executive director for finance, told reporters Malaysia's aggressive campaign to import customers from Singapore's port had added momentum to Malaysia Airports' aviation initiatives.

"We are going beyond landing and parking charges. Tax breaks and fifth landing rights could be one of them," he told reporters.

The rights would allow airlines to pick up passengers while on transit in Malaysia.

"We want to attract carriers that fly to Singapore to Malaysia's Kuala Lumpur International Airport (KLIA). We want to increase utilisation of the airport. We target 25 million passengers."

Basir Ismail, Malaysia Airports chairman would announce Thursday the new incentives for international carriers which are currently not flying into KLIA to attract them to use the airport, he said.

Regional hub

Rosman said the new incentives would be given to new airlines as well as existing ones which are planning new routes into or out of KLIA which at present serves 43 international carriers.

Malaysia Airports would spend RM10 million to promote KLIA a regional hub for 2002, he said.

The KLIA opened in June 1998. But five carriers including British Airways, Qantas and Lufthansa have stopped flying to the futuristic KLIA, dealing a blow to make it a regional aviation hub.

Rosman said the Malaysian government was prepared to consider fifth landing rights to carriers.

"This would encourage carriers to increase frequency of flights to Malaysia," he said.

Rosman said both Lauda Air and Air Emirates enjoy the facility, adding that Lufthansa too could enjoy it if they fly to Kuala Lumpur.

"Why not give it to Lufthansa?. The market offered by Germany is a lot bigger. Since last year, Malaysia has started loosening up (its regulations)," he said.

Rosman painted a rossy picture of Malaysia Airports' performance for 2002, saying the company expects passenger volume at KLIA to hit 18 million this year compared to 14.6 million last year.

"The first quarter traffic this year is a lot higher than the previous quarter... this is a strong indicator of what will happen this year," he said.

Uphill task

Rosman said the turnaround in air travel for Malaysia was evident and that the negative impact of the September 11 attacks on the US is likely to have been felt fully in the last quarter of 2001.

But an aviation official said it would be an uphill task for KLIA to be a regional hub due to its close geographical proximity with Singapore.

"How can we become a hub when Singapore Airlines undercut ticket prices in Malaysia. A lot of Malaysians are flying international destinations via Singapore," the official told AFP on condition of anonymity.

"Their fares are killing even other airlines that operate in Malaysia We need to stop the filtering of passengers from Malaysia to Singapore."

The official said to become a hub, there was a need for more international carriers and flight frequency from KLIA. "But if there is no yield, no carrier will come even with the incentives."