KUALA LUMPUR, Jan 21 — A budget deficit of 3.2 per cent of gross domestic product (GDP) for 2015 is achievable, says Affin Hwang Investment Bank Bhd.
Prime Minister Datuk Seri Najib Tun Razak yesterday announced a new fiscal deficit target for the revised Budget 2015 at 3.2 per cent, slightly higher than the three per cent set last year.
“However, there is a risk that Malaysia’s budgetary position could get larger, due to a possible shortfall in tax revenue receipts, especially from direct taxes, with the external environment remaining uncertain,” the research house said in a note today.
On the country’s negative sovereign credit outlook, Affin Hwang said the risk of Malaysia’s sovereign rating being downgraded is small. “International rating agencies are likely to consider the government’s further efforts to bring down the fiscal deficit, especially with the introduction of the Good and Services Tax,” it said.
The research house said it believes fiscal policy management will likely be reinforced further with the earlier setting up of the Fiscal Policy Committee as the government continues to introduce fiscal consolidation measures. — Bernama
