The government has not used foreign borrowings to fund the execution of the Prihatin Rakyat Economic Stimulus Package (PRIHATIN) and the National Economic Recovery Plan (PENJANA).
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said instead, it has been using local borrowings by tapping into the local bond market, especially Malaysian Government Securities (MGS) and Malaysian Government Investment Issues (MGII).
He said the total debt to gross domestic product (GDP) currently stands at 52 per cent, which is still below the statutory limit of 55 per cent.
"The key is that we have to ensure that we have enough liquidity in the market...which we do.
"If Malaysia needs to raise the statutory limit of debt to GDP ratio of 55 per cent, given the unprecedented and challenging times, it has be on a temporary basis, with a focus on lowering it back in the near future..three years should be ideal," he told Bernama.
Tengku Zafrul was also optimistic that Malaysia could afford the expected deficit that is projected to be about 5.8-6.0 per cent this year, given that the country has a good track record in bringing it down from 6.7 per cent in 2009 during financial crisis to about three per cent within five years.
The expected deficit for 2020 took into account the oil price which was at US$30 per barrel (Brent crude) and the execution of the government's stimulus and short-term recovery plans.
With efficient execution of the stimulus packages, he said the government was expecting a contribution to GDP of 2.8 per cent from PRIHATIN and 0.6 per cent from PENJANA.
In line with the reopening of the country's economy in phases, which saw 12.7 million or 83.5 per cent of workforce returning to work so far, Tengku Zafrul was confident that Malaysia is better prepared to head for the road to recovery in 2021.
He also stressed on the need for the people to spend their disposal income and consume more domestic goods and services to stimulate the domestic demand, which represents about 60 per cent of GDP.
Meanwhile, for the medium and long term, Tengku Zafrul acknowledged that the Internet access and digital services would continue to be the key focus for the government to address.
"We need to accelerate the investment in terms of quality and Internet access in the country, as it has shown how important it is to the people during the Movement Control Order," he said.
Besides, he added, the need to invest in human capital and equip people with the right skills through training, re-training and re-skilling would also be another key focus for the government even after the COVID-19 pandemic.
In total, both the PRIHATIN and PENJANA packages are worth RM295 billion, with RM45 billion in the form of direct fiscal injection.
-- BERNAMA
Bernama
Thu Jun 11 2020
Tengku Zafrul said the total debt to gross domestic product (GDP) currently stands at 52 per cent, which is still below the statutory limit of 55 per cent. - Filepic/BERNAMA
ISIS Malaysia's perspective of Budget 2025
An excellent rakyat-centric budget under the overarching principle of a caring and humane economy.
Budget 2025: Record increase in STR, SARA aid initiatives
The government will provide a significant boost to the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) initiatives next year.
Budget 2025: EPF contributions to be made mandatory for foreign workers – PM Anwar
The government plans to make it compulsory for all non-citizen workers to contribute to the Employees Provident Fund (EPF).
What policies to expect from Indonesia's new President Prabowo
Prabowo will be open to foreign investment, his aide has said, such as by offering investors management of airports and sea ports.
Budget 2025: Govt allocates RM470 mil to empower women's participation in PMKS
The Women's Leadership Apprenticeship Program will be intensified as an effort to produce more female corporate personalities.
Israel sends more troops into north Gaza, deepens raid
Residents of Jabalia in northern Gaza said Israeli tanks had reached the heart of the camp, using heavy air and ground fire.
Indonesia ramps up security ahead of Prabowo's inauguration
Prabowo Subianto will be sworn in as Indonesia's president on Sunday with Vice President-elect, Gibran Rakabuming Raka, also taking office.
Immediate allocation of RM150 mil for local authorities, DID to tackle flash floods
Datuk Seri Anwar Ibrahim said this allocation is intended to address the recent flash floods that hit the capital and several major towns.
Budget 2025: Sabah, Sarawak to continue receiving among highest allocations - PM
Sabah and Sarawak continues to be prioritised under Budget 2025, with allocations of RM6.7 billion and RM5.9 billion respectively.
NFOF will be operational in November 2024 with funding of RM1 bil
PM Anwar Ibrahim said NFOF will support venture capital fund managers to invest in startup companies with RM300 million set aside for 2025.
Minimum wage to increase to RM1,700 effective Feb 1, 2025
The Progressive Wage Policy would be fully enforced next year with an allocation of RM200 million, benefiting 50,000 workers.
Bursa Malaysia ends higher on Budget 2025 optimism
The benchmark index, which opened 1.85 points higher at 1,643.29, moved between 1,641.71 and 1,649.31 throughout the trading session.
Five important aspects relating to people’s lives in Budget 2025 - PM
The focus is on driving the MADANI Economy, speeding reforms, cutting red tape, raising wages, and tackling the cost of living.
Economic outlook: Govt plans to leverage, expand existing city transit system
The expansion aims to provide a more efficient and reliable public transportation network, reduce congestion, and improve accessibility.
Economic outlook: Budget 2025 to lay foundation for a digital-driven economy
The report said Budget 2025 will entail efforts to position Kuala Lumpur as a top 20 global startup hub by 2030 through the KL20 initiative.
Economic outlook: Corruption and lack of accountability hinder economic progress
Special Cabinet Committee on National governance is established to curb corruption, law reforms to modernise outdate regulations, MoF said.
National Wages Consultative Council will be strengthened
The govt will also incentivise hiring women returning from career breaks, offer job matching and improve care services facilities.
Economic outlook: Ensuring 11 years of compulsory education for all children
Budget 2025 will continue prioritising upskilling and retraining initiatives to equip workers with the latest skill sets necessary.
Consolidated public sector projected to record lower surplus of RM41.7 bil 2024
The MoF said the consolidated general government revenue is estimated to increase slightly to RM384.7 billion in 2024.
PM announces substantial Budget 2025 hastening Malaysia to become Asian economic powerhouse
Datuk Seri Anwar Ibrahim said it would create jobs and also tackle financial leakages to enhance public spending efficiency.