Kuala Lumpur, April 18 - Malaysia is making a big change in its aviation sector. Malaysia Aviation Group (MAG), the owner of Malaysia Airlines, will transfer its smaller airline, MASwings, to the Sarawak state government on January 1, 2026. This change is significant because it makes Sarawak the first Malaysian state to own its own airline. The state wants to build its economy and improve travel connections in the region. A sale and purchase agreement between MAG and Sarawak's government was signed on February 12, 2025. The transfer should be completed by late 2025, adhering to all legal requirements.
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MASwings started in 2007 and plays an important role in providing rural air services in East Malaysia, helping connect remote areas in Sabah and Sarawak. The airline uses eight ATR 72-500 turboprops and six DHC-6-400 Twin Otters, flying to 22 locations, including a shared route to Brunei. Its main hubs are in Kota Kinabalu and Miri. MASwings helps areas with limited road access by operating on routes that do not make money, supported by about RM10 million from the government each year. Even though MASwings was financially neutral for MAG, it required significant operational attention. According to MAG's group managing director, Captain Izham Ismail, transferring MASwings will not affect MAG’s finances but will let the group focus more on its main businesses, like Malaysia Airlines.
The Sarawak government’s plan with MASwings is to turn Sarawak into an aviation hub for Borneo and a gateway to ASEAN. After taking over, MASwings will be rebranded as AirBorneo and will offer full-service flights. The Sarawak Premier, Tan Sri Abang Johari Tun Openg, has ambitious plans for AirBorneo, which will continue to serve rural areas but will also start regional and international flights. The goal is to fly to destinations within four to five hours and, later on, add long-haul flights to cities like Frankfurt, South Korea, and Japan. To support this expansion, the state plans to lease jet aircraft and will keep all 300 staff from MASwings, using their skills and experience.
The transition should take between six and eighteen months and will require approvals from the Malaysian Aviation Commission, the Civil Aviation Authority of Malaysia, and international organizations such as the International Civil Aviation Organization (ICAO) and the International Air Transport Association (IATA). During this transition, MASwings will keep operating under MAG’s management to ensure no disruption in service. Sarawak is investing in aviation infrastructure, including building a new terminal at Miri Airport and planning an international airport at Tanjung Embang to support AirBorneo’s growth. These investments are expected to boost tourism, create jobs, and open up more economic opportunities in the region. The plan initially aimed for completion by December 2024 but faced delays due to disagreements over asset valuations, which required a third-party evaluation. Now that these issues are resolved, the agreement is signed, marking a critical step for Sarawak’s aviation goals. This transfer is backed by Malaysia’s Ministry of Transport and MAG’s shareholder, Khazanah Nasional Berhad, showing a joint effort to enhance regional travel while aligning with Sarawak’s strategic plans. As AirBorneo prepares to start, it aims to reshape Sarawak’s role in Malaysia’s aviation sector, offering better accessibility and economic growth.