Federal government awaits additional details from KXP AirportCity before approving Kedah Aerotropolis, citing funding and operational concerns.
KUALA LUMPUR: The federal government will give further consideration to approving the Kedah Aerotropolis development project once KXP AirportCity Holdings Sdn Bhd respond with the additional information requested by the Ministry of Transport (MOT).
The MOT explained that the ministry issued an official letter on March 26, 2025, to KXP Airport City, copied to the Kedah state government, for additional information on several issues.
The ministry stated that KXP AirportCity was requested to submit measures addressing Kulim International Airport’s (KXP) impact on the operations of the Royal Malaysian Air Force’s (RMAF) main airbase, a financial contingency plan, a financial forecast of the audited account, and supporting documents concerning service commitments and cargo projections.
“KXP AirportCity’s application for the KXP project lacked a risk-mitigation strategy for securing funding from investors.
“CAAM also found there is a lack of strong demand or commitment for full cargo services to operate at KXP, and the cargo projections provided are overly ambitious,” the ministry said in a written response posted on the Parliament’s website.
The MOT was replying to Datuk Azman Nasrudin (PN-Padang Serai) regarding the government’s efforts to expedite approval of the Kedah Aerotropolis and the expected timing for approval, given the project’s potential to boost the northern region’s economy.
The ministry added that an economic assessment by the Civil Aviation Authority of Malaysia (CAAM) found no solid documentation or evidence to support the project’s ability to raise RM5.67 billion to cover its Phase 1 development. – Bernama
