Dr M has a plan to pare debt by 20 pct

Prime Minister Dr Mahathir Mohamad believes that he has found ways to reduce the national debt to about RM800 billion from the current RM1 trillion.

In an interview with broadcaster Voice of America, the premier said the plan was being hashed out with his ruling Pakatan Harapan coalition colleagues.

"The previous government has accumulated huge amounts of borrowings from other countries, from foreign banks and even from local sources.

"So the first thing that we need to do, of course, is to ensure that we are able to service the loans at least and to try to reduce the principal amounts that have been borrowed," he said.

Mahathir said his government was now confronting massive debt issues because it had inherited a financial system that had been "destroyed" by his predecessor, Najib Abdul Razak.

"Well, my first 22 years as prime minister was fairly easy. I inherited a system that was already there.

"All I had to do was to introduce new ideas so that we could expedite the growth and development of Malaysia.

"But here, I am dealing with a country that has been actually destroyed. Its finances have been destroyed.

"The system of government has been ignored and not used and a new system, or rather an authoritarian system, has been introduced," he said.

Najib has been accused of plundering through 1MDB - a company formed by his administration which now has a RM42 billion in debt - and masking the national debt figure through creative accounting.

According to new Finance Minister Lim Guan Eng, the national debt - which according to his definition included government guarantees on the debt payments of various agencies as well as lease payments - now stood at RM1,087.3 billion, or 80.3 percent of the GDP, as of Dec 31, 2017. 

Putrajaya's debt levels rose exponentially since Najib took power in 2009. However, he claimed that the debt-to-GDP ratio supplied by his administration was accurate and complied with international standards.

He also accused the current administration of redefining national debt to score political points at the expense of investor confidence.

According to VOA, Mahathir also quashed suggestions he was having second thoughts about abolishing the Anti-Fake News law, a key promise of his Harapan coalition in the run-up to the May 9 general election.

However, he said some controls needed to remain on the media to prevent the incitement of racial tensions. - Mkini