Sarawak has not defaulted on loans from federal govt, says CM

Abang Johari said the Sarawak state government provides sufficient allocation in its annual budget for repayment of its loans. — Picture by Sulok Tawie
Abang Johari said the Sarawak state government provides sufficient allocation in its annual budget for repayment of its loans. — Picture by Sulok Tawie

KUCHING, Jan 7 — Chief Minister Datuk Patinggi Abang Johari today said that Sarawak has been repaying its federal loans on time, based on schedules as stipulated in the agreement between the state and the federal government.

“As at December 31, 2018, we owe the federal government RM2.38 billion.

“Sarawak is one of the states which has no outstanding loans or arrears in loan repayment and this has been reported by the Auditor-General in its annual report and presented to the National Financial Council,” he said in a statement today in response to Finance Minister Lim Guan Eng asking the state to settle its federal loan.

Lim, when reacting to Sarawak Tourism, Arts, Culture, Youth and Sports Minister Datuk Karim Rahman Hamzah’s request for the state’s share of RM2.7 million of the tourism tax revenue, had asked the hornbill state to settle the RM2.5 billion owed to the federal government with nearly RM50 million arrears.

Abang Johari, who is also the state Finance and Economic Planning Minister, said the Sarawak state government provides sufficient allocation in its annual budget for repayment of its loans.

The chief minister said it is normal procedure, as provided for in the Federal Constitution, for the states in Malaysia to seek for federal funding whether in the form of grants or loans.

He said the form of funding would be based on the nature of the projects, that is, whether the projects would generate revenue in the future.

“In the case of Sarawak, the federal loans were obtained to finance the implementation of various projects under the Current List of the Federal Constitution, including water supplies, sewerage, industrial estates, housing and agriculture,” he said.

Related Articles