KUALA LUMPUR: The Government is committed to ensure national expenditure does not exceed 55% of the Gross Domestic Product (GDP) so national debt remains at a manageable level.
Prime Minister Datuk Seri Najib Tun Razak assured lawmakers that the national debt was still manageable, and Malaysia is portrayed as a nation with moderate debt levels.
“Our national debt as of June 2016 is at RM655.7bil or 53.2% of the GDP. Of this, 95.9% or RM628.8bil is domestic debt, while 4.1% or RM26.9bil is from offshore loans.
“Debt incurred by the Government is following a drop in revenue, as we took the loans to fund development projects,” he said in reply to a question by Datuk Noor Ehsanuddin Mohd Harun Narrashid (BN–Kota Tinggi) during the Minister’s Question Time in Parliament Monday.
Najib observed that the Government’s expenses were productive, since they were used to fund economic activities that were beneficial to the rakyat, such as building hospitals and dams for better water supply and flood mitigation.
He added that the private sector also directly benefited from the loans, conducting projects to stimulate economic growth.
“The total guarantee given by the Federal Government as of June 2016 is RM180.9bil, or 14.7% of the GDP.
“Guarantees were given mainly to public entities that conduct infrastructure projects and manage higher education, such as Prasarana, MRT Corp and PTPTN,” he said.