Thu, 30 Jan 2003

Maiden flight of new local airline

Apriadi Gunawan, The Jakarta Post, Medan

North Sumatra Governor T. Rizal Nurdin inaugurated on Wednesday the maiden commercial flight of Sutera I Airlines from Medan, capital of North Sumatra, to Sibolga in a bid to connect the province's more isolated areas.

The launch of Sutera I to seven western coastal regencies and municipalities followed the signing of a memorandum of understanding (MoU) between the province and state-owned PT Merpati Nusantara Airlines on Jan. 3.

Rizal said after the launching ceremony that the provincial administration was duty-bound to open up isolated parts of the province's west coast instead of merely seeking profits, particularly after the cancellation of Sutera flights by a Malaysian airline company several months ago.

North Sumatra canceled unilaterally its cooperation with PT Rabin Global Air Servindo, owned by a Malaysian entrepreneur, to fly Sutera routes to the western coast due to a dispute with the company.

According to the governor, North Sumatra will provide a Rp 3.5 billion subsidy for Merpati this year from the regional budget at the ceiling of Rp 4,622,753 per flight hour or around 70 percent of the number of seats.

"It means the subsidy will be reduced when the number of passengers nears full capacity, with profits to be shared at the ratio of 30 percent for North Sumatra and 70 percent for Merpati," he explained.

Half of the subsidy fund will be borne by the provincial administration and the other half is evenly shared by the seven regencies/municipalities, namely Central Tapanuli, Sibolga, Nias, Padang Sidempuan, South Tapanuli, North Tapanuli and Mandailing Natal.

Merpati president Hotasi Nababan told The Jakarta Post that his firm would strive to minimize the subsidy over the next six months and gradually phase out the aid thereafter.

The Merpati leader was also there to witness the signing of a cooperation agreement on air cargo transport from and to North Sumatra's western coast, between Governor Rizal Nurdin and PT Manunggal Air Service Jakarta's President Director Zainal Sudarmadji.