Do we want a story of untold miseries?

The world economies are already displaying volatile financial fluctuations, and Malaysia may be one of the firsts to go down the drain with a devaluation of the ringgit.

COMMENT

By Chua Jui Meng

THE recent Bank Negara Malaysia (BNM) report for 3rd Quarter (Q3) 2012 revealed that the Barisan Nasional government has officially breached or exceeded the 55% federal debt ceiling or legal limit to Gross Domestic Product (GDP) ratio by RM27 million.

This means, if there is a sudden downgrade of the Malaysian Government Sovereign Credit Rating by international rating agencies such as Standard & Poors, Fitch Ratings and Moody’s Investors Service, the value of the ringgit may fall.

The international fall in the value of our currency can happen any time, depending on our government’s immediate fiscal controls, especially in spending and borrowings.

This is due to our BN government’s precarious financial standing – both in the domestic and international arena.

The world economies are already displaying volatile financial fluctuations, and Malaysia may be one of the firsts to go down the drain with a devaluation of the ringgit.

The next general election must be called by June 2013. Government spending is then expected to shoot up.

According to the last updated GDP 2011 by the Malaysian Statistic Department, our GDP is at RM 881,080 billion, placing the 55% federal debt limit at RM484,594 billion.

The current federal government debt now stands at RM502.4 billion, excluding federal guarantees on loans taken by government-linked companies (GLCs).

Can you now see what will happen or the immediate damning effects to our economy if and when the value of our ringgit falls in the international market?

It is nothing short of a socio-economic disaster and nightmare for Malaysians. It will be a story of untold misery, for all Malaysians, except the millionaires or billionaires.

All Malaysians must ask and answer with honesty whether the BN government is making any attempts to address the country’s growing debts?

Is the Umno-led BN government capable of initiating real and positive change?

Chua Jui Meng is PKR vice-president and Johor state chief. He is also a former MCA vice-president and an ex-Cabinet member.