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Finance Minister Lim Guan Eng said Pakatan Harapan government have to take on additional RM58.05 billion in debts in the first half of the year because it has to service the existing commitments by the previous government. NSTP photo by MOHAMAD SHAHRIL BADRI SAALI

KUALA LUMPUR: The Pakatan Harapan government have to take on additional RM58.05 billion in debts in the first half of the year because it has to service the existing commitments by the previous government, said Finance Minister Lim Guan Eng.

"The additional debts undertaken is to carry out existing commitments that were already made previously.

"In terms of percentage, our total commitment, including government guarantees and contingent liabilities have been successfully reduced from 80 per cent to 75 per cent of our economy," Lim said.

The minister was responding to a worrying query raised by Universiti Tun Abdul Razak economist Barjoyai Bardai that the government's debt had swelled to RM799.1 billion from RM686.8 billion as at the end-2017.

“You must realise that the previous government hid the fact that they had been repaying the 1MDB loans. Only after the new government took over that we are transparent about the debt paying with the public.

"So, we continue to pay off the 1MDB debts,” Lim told reporters after officiating at AirAsia Foundation's Destination: GOOD social enterprise hub here today.

Also present were AirAsia group chief executive officer Tony Fernandes, executive chairman Kamarudin Meranun and AirAsia Foundation executive director Yap Mun Ching.

While the government has incurred new debt — comprising RM51 billion government sukuk and RM7 billion Samurai bonds, Lim explained the government has also repaid RM17.7 billion in the same six months.

The minister went on to highlight international credit agencies S&P Global Ratings and Fitch Ratings had recently reaffirmed Malaysia’s sovereign credit rating with a stable outlook despite the Pakatan Harapan government revealing the full extent of Malaysia's fiscal and debt obligations.

"In the second quarter of this year, Malaysia's economy grew 4.9 per cent from a year ago. This surpassed the 4.5 per cent economic growth in the first quarter.

"I think our economic performance so far has shown that not only it has exceeded expectations. Foreign investors continue to come in," he added.

Last week, Prime Minister Tun Dr Mahathir Mohamad announced the government will relook into the imposition of departure levy on travelers flying out of Malaysia.

Lim confirmed the Cabinet had made a decision, but stopped short of making an announcement.

“The Cabinet has made a decision and it has been decided that the announcement will be made by the Transport Ministry,” added Lim.

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