After cynicism, MoF confirms Malaysian debt exceeded RM1t

Minister of Finance Lim Guan Eng (second right) speaks during a press conference in Putrajaya May 22, 2018. — Picture by Miera Zulyana
Minister of Finance Lim Guan Eng (second right) speaks during a press conference in Putrajaya May 22, 2018. — Picture by Miera Zulyana

PUTRAJAYA, May 22 — Finance Minister Lim Guan Eng has confirmed that Malaysia has crossed the RM1 trillion debt threshold, as announced by Prime Minister Tun Dr Mahathir Mohamad yesterday.

Speaking to a press conference after his first day on the job, Lim said the estimated figure of RM1 trillion debt will be reviewed during the Ministry of Finance (MoF) discovery exercise.

“Yes I would like to confirm what Tun said. The debt is indeed above RM1 trillion and I think it will be reviewed during the discovery exercise when all relevant departments can start consolidating their numbers and accounts,” Lim said.

The minister however did not elaborate on his remark.

“Right now, certain accounts and files are not accessible,” said Lim referring to a group of “red files” which are only accessible to certain parties which has impeded officials and auditors from carrying out their duties to ascertain the factual condition of the nation’s coffers.

One of the first thing he did in his first day as Finance Minister was to instruct that all accounts must be accessible to the Treasury Department and the Auditor-General’s Department.

However, despite the worrying confirmation, Lim remains confident that Malaysia’s fundamentals and fiscal position remains healthy, due to a robust and well capitalised banking and financial system.

“The fundamentals of the economy remains strong. What is important is to clean up the mess left behind and I think the public know that once you clean up the mess you can only grow financially stronger.

“What we need is a vigorous and robust financial economy to put Malaysia on a higher economic level,” said Lim.

He added it is important to maintain financial health by ensuring that the nation’s current account balance remains in surplus. He also admitted that Malaysia might have to through some pain on a temporary basis until the government’s finances have been cleaned up.

Lim also said that the scandal ridden 1Malaysia Development Bhd is one of the main factors behind Malaysia’s one trillion debt.

When asked whether the country is heading towards bankruptcy, he wittily quipped that it would have been the case in the previous Barisan Nasional government but not under Pakatan Harapan’s watch.