KUALA LUMPUR, Oct 28 — Malaysia has cut back on its national debt, keeping it at 52.8 per cent of gross domestic product (GDP) as of June this year, said Datuk Seri Najib Razak, Malaysia’s prime minister as well as finance minister.
The current debt level is an improvement from last year’s debt to GDP rate of 54.7 per cent, which was teetering close to the self-imposed debt-to-GDP ceiling of 55 per cent.
Najib said the federal government currently owes RM568.9 billion, of which 97.1 per cent or RM552.7 billion is made up of domestic borrowings while 2.9 per cent or RM16.2 billion comprises offshore debt.
The quantum of Malaysia’s national debt, however, has progressively increased over the years, with the country borrowing RM547.6 billion in 2013, RM501.6 billion (53.3 per cent debt to GDP level) in 2012, RM456.1 billion (51.5 per cent) in 2011 and RM407.1 billion (51.1 per cent) in 2010.
“The government’s debt position remains manageable under 55 per cent of GDP and categorised as a country at moderate indebtedness,” he said in a written parliamentary reply to DAP’s Seputeh MP Teresa Kok.
Najib, who is also prime minister, noted that Putrajaya has maintained prudent debt management, servicing all debt repayments according to schedule and only borrowing to prop up development expenditure and only after considering the government’s ability to repay the debt.
He added that debt service payments are expected to remain at 10.3 per cent of revenue, which is still some way off the 15 per cent ceiling as laid out in the government’s fiscal management regulations.
