Malaysian PM warns against high budget deficit

PUTRAJAYA: Malaysian Prime Minister Anwar Ibrahim warned on Wednesday that the country cannot continue with a high budget deficit.

The government is trying to reduce its debts without affecting its development programmes, according to a press conference after a Cabinet meeting.

The country can no longer survive with a high budget deficit and we want to reduce debts and reduce the debts that are not burdened with reductions that do not burden our development programmes.

Mr Anwar said that he received some additional feedback from the ministers on this matter.

Last month, during his speech at the Budget Dialogue, Mr Anwar said that Malaysia's debt has reached RM 1.5 trillion US $350 billion, which has already exceeded 80 per cent of the gross domestic product GDP, and that this has a direct impact on the economy.

Anwar said that the country's budget deficit will widen further than the earlier estimate of 5.8 per cent of GDP for 2022, and that it is possible that the country's budget deficit will be larger than the earlier estimate of 5.8 per cent of the GDP for 2022.

The debt has already touched RM 1.2 trillion and if liabilities are included, the debt is RM 1.5 trillion, he said.

In 2018, Prime Minister Mahathir Mohamad revealed that the country was saddled with more than RM 1 trillion in debt after the opposition coalition won the 2018 General Election. The previous government, led by former protege Najib Razak, blamed Mahathir for the issue.

Last year, finance minister Tengku Zafrul Abdul Aziz said that the country's debt stood at RM 1.045 trillion at the end of June 2022. This corresponds to 63.8 per cent of the GDP of Malaysia at the time.