Najib: Congrats for unnecessarily spooking market with RM1 trillion claim

In a sarcastic swipe, former premier Najib Abdul Razak congratulated the new government for unnecessarily spooking the market with the RM1 trillion national debt claim.

He said this led to sharp falls of the stock exchange this week - capping 14 consecutive days of foreign capital outflows.

“This debacle has led to real losses to stock market investors and our GLICs such as EPF, KWAP, Khazanah and Tabung Haji.

“I hope and pray that government ministers will be more careful in making assertions in future,” he added in a Facebook posting titled “The 'spade' had always been called a spade”.

Najib, who also oversaw the finance portfolio, said he was glad that Finance Minister Lim Guan Eng chose to come clean on the official federal government debt.

He was responding to the finance minister's statement yesterday that the debt remains at RM686.8 billion (50.8 percent of the GDP) and not 65 percent or RM1 trillion as previously claimed.

The former premier also pointed out that the 50.8 percent level was far lower than the 103.4 percent during Dr Mahathir Mohamad's first tenure as prime minister.

Najib said his government had always complied with international public debt reporting guidelines as defined by the IMF and World Bank.

“Therefore, the figure of 50.8 percent is a universally accepted measurement,” he added.

He said contingent obligations, such as guarantees, have never been included in the official measurement of government debt, not even during Mahathir's previous reign.

“The previous government gave these guarantees to certain entities it owns to help lower their financing cost. These are typically long-term obligations backed with revenue-generating assets.

“As for PPP / PFI leases, these are operating expenses and not debt, and are for much needed social infrastructure, including schools, police stations, hospitals, universities, etc,” he added.

Najib said the previous BN government had been transparent and never hid the figures revealed by the current finance minister.

All these figures are published in Treasury Reports, BNM reports, accountant-general's reports, auditor-general's reports every year without fail.

“Market analysts, economists, and investors are all well aware of these numbers, which are manageable and can be serviced, a fact confidently admitted, by the finance minister himself.

“Therefore, we did not hide RM300 billion of debts or falsified figures as alleged. The spade had always been called a spade as per universally accepted guidelines,” he added. - Mkini