KUALA LUMPUR, March 8 ― The government will not cancel any public project, Prime Minister Datuk Seri Najib Razak said today, adding that it has a contingency plan to deal with the economic challenges wrought by global factors.
Najib, who is also finance minister, said the projects will continue despite fiscal financial constraints.
“Through the revision of the Budget 2016 that was recently announced, I am happy to see in this noble House, the government will not cancel or reduce the projects that have been approved.
“But it is more towards adjustment of cash flow by redistributing the allocation of a project or development programme,” he said in reply to Datuk Ar. Wan Mohammad Khair-il Anuar Wan Ahmad (BN-Kuala Kangsar).
In reply to the Kuala Kangsar MP's supplementary question, Najib said the government already has a contingency plan if the global crude oil price falls below the threshold of US$30 (RM123) per barrel.
“The most sensitive indicator to the national Budget is if the oil price falls drastically to below US$30 per barrel consistently, and not just for a day or two… at that time we will carry out the contingency plan.
“But it seems recently the crude oil price has been strengthening, today it's in the range of US$40 per barrel. During the revision of the Budget, we assumed US$30 to US$35,” he said, also noting that the ringgit's value has been improving and is now at a rate of almost RM4 to US$1.
He said that Malaysia's fundamentals seem to be getting better and added that the government will closely monitor the situation.
Earlier in his reply, Najib said projects with high multiplier impact on the economy will be given priority and continued despite the country's fall in revenues due to the decline in global crude oil prices.
He said the Ministry of Finance had on March 1 issued a guideline to ensure optimum spending by government departments.
“It is aimed at having department chiefs in all government agencies manage their resources well and restructuring the priority for their programmes and projects in order to be more effective and in line with the national agenda,” he said.