KUCHING, Sept 14 (Bernama) -- The airline industry, which has faced many challenges in the last few years, can survive the stiff competition by having airlines combining their entities, Chief Minister Tan Sri Abdul Taib Mahmud said today.

He said the general trend was that even low-cost airlines needed to find ways to survive in the face of rising fuel prices.

Asked if the setting up of the new low-cost airline, Malindon Airways, would complement Sarawak's tourism sector in terms of air accessibility, he said, the situation would be assessed when the right time came.

"I do not know beyond that," he told reporters after officiating at the Re-imaging of Sarawak Economic Development Corporation (SEDC)'s Tourism and Leisure launch here.

Early this week, Prime Minister Datuk Seri Najib Tun Razak announced that the airline, borne out of a collaboration between National Aerospace and Defence Industries Sdn Bhd (Nadi) and Indonesia's PT Lion Group, would begin operations on May 1 next year and be based in KLIA 2.

Earlier, Taib said it was fortunate that the state could still attract good markets in the Asian region, including China, India and South-East Asia, which shared many cultural similarities despite a slow-down in the number of long-haul tourists.

Given the many hurdles also being faced by the hospitality industry, he said, the airlines industry should look into the issue of minimising extra charges while the services sector such as tour operators, taxi drivers and restaurant operators must stick to their ethics of being honest and reliable.

He was confident SEDC could appeal to the mass tourist markets through cooperation with local hotels to better sell its image through efficient services, accommodation and industry ethics as studies showed that most tourists preferred to return to Sarawak at least twice or thrice.

At present, the SEDC's tourism and leisure group is one of the corporation's major commercial sectors with investments of over RM500 million in a portfolio that includes hotels and resorts, tourist attractions, shopping complexes and dining outlets.

Up to June this year, Sarawak achieved more than 50 percent of its four million tourist arrivals for 2012.