Total govt debt exposure now at RM1.25 trillion

 

The government says federal debt is at 56.6% of GDP, less than the 60% limit set recently.

KUALA LUMPUR: The government’s total debt and liability exposures are estimated to be RM1.257 trillion, or 87.3% of the Gross Domestic Product (GDP), as at the end of September.

Federal debt as at end-September amounted to RM874.3 billion or 60.7% of GDP, said Deputy Finance Minister II Mohd Shahar Abdullah.

“However, based on statutory limit calculations, the federal debt, comprising Malaysian Government Securities (MGS), Malaysian Government Investment Issues (MGII) and Malaysia Islamic Treasury Bills (MITB), is at 56.6% of the GDP, which is less than the 60% limit set recently,” he told the Dewan Rakyat today.

He was replying to Amanah president Mohamad Sabu (PH-Kota Raja) who asked for the government’s current debt position and the debt-to-GDP ratio.

“The government is committed to ensuring that the refinancing of its debts is implemented in an orderly manner according to schedule,” Shahar said.

In view of the prolonged Covid-19 pandemic, he said, the government would focus on economic recovery to safeguard the people’s welfare and support business activities.

Shahar said that after the economy recovers, the government would go back to implementing fiscal consolidation measures to ensure the debt and financial liability exposures remain well-controlled and manageable.

The measures would include expanding the revenue base, strengthening tax administration and enforcement, and increasing spending efficiency to contain the federal deficit level.

“That will reduce the government’s dependence on borrowings and curb debt and financial liability exposures,” he said. - FMT