KUALA LUMPUR, July 29 ― The government will table a motion to increase the country’s statutory debt limit from 60 per cent as a ratio of the economy during the next parliamentary meeting, said Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz said today.
In his speech in Parliament this morning, Tengku Zafrul said the government was in the process of fiscal consolidation as the debt level was already at 56.8 per cent of GDP as at the end of June.
“[But] it is still below the statutory debt limit of 60 per cent of the GDP.
“With a limited fiscal space, the government has no choice but to optimise existing financial sources through rationalising expenditure, increasing revenue from the government ecosystem including the utilisation of funds from KWAN (National Trust Fund) as well as the readiness to increase the KWC-19 (Covid-19 Fund).
“At the same time, the government is ready to relax the debt limit rules to support economic recovery plans based on the capacity of national indebtedness. Therefore, the government will table a motion of amendment in the coming term.
“Looking forward, the steps to strengthen the government financial position, especially steps involving revenue, are very crucial to ensure the government financial position remains strong and resilient in the medium and long term,” he said.
Earlier in his speech, Tengku Zafrul said the government has announced eight stimulus packages since the pandemic struck the country with the biggest national budget announced in 2021 of RM322.5 billion.
In total, the eight-stimulus package is worth RM530 billion and in 2020 alone, the stimulus packages announced for the year were worth RM305 billion or 22 per cent of the national GDP, said Tengku Zafrul.