Surprisingly, when the Malaysian government was taken over by Tun Dr Mahathir, Malaysia’s latest debt has reached Rm1 trillion while under the leadership of Najib Razak.
After the election of GE 14, various issues have arisen mainly on ‘National Debt’. Many Malaysians are shocked by the recent 1 trillion state debt exposure by the recent Finance Minister of Malaysia. Various perceptions have been raised to the previous government with the allegations of hiding the real figure of the country’s debt. In fact, national debt is always reflected in the country’s previous financial reports.
The country’s total debt is now estimated at over RM1 trillion, putting a big challenge for the country.
MP Prof Datuk Dr Mohamed Mustafa Mohd Hanefah, a member of the National Profession Council’s Council for Economic ; Management Cluster Committee (MPN), said 90 per cent of the debt was involved in domestic institutions, but it would have a huge impact if the government failed to settle it.
“Previously we did not know the real amount of the national debt and the RM1 trillion was quite big enough to give us a lot of challenges to solve it. Most national debt involves domestic financial institutions such as the Employees Provident Fund (EPF) and the Retirement Fund (Incorporated) (KWAP) and the rest of the external debt through mega projects. Should the situation still be stable but when it involves so much, the opposite goes, “he said.
6 Real Source Of Malaysian Debt Continues to Increase
1) Many Recordings of Unpaid Debt Payment Record
Based on records, for example, the granting of a grant to PTPTN RM2 billion annually, Capital injection to the Infrastructure that suffered losses annually was not included in the budget and many more spending on capital injection and pay off debt are not recorded in the budget and clearly contribute to Malaysia’s debt problem.
2) High interest payments
As of March 19, the government was forced to pay a 12.5 percent debt interest (RM31 billion) of the total income received by the Malaysian government. It is 2 times compared to our neighboring country, just as low as 6.1 per cent.
3) Infrastructure Expenditure
Former United Nations Secretary-General, Jomo Kwame Sundaram disputes the transparency and accountability of the Malaysian government on how the country manages the total infrastructure spending in Malaysia.
4) Operating Expense Costs
Based on news reports released by The Edge Malaysia Editor, Cindy Yap said the increase in management expenditure by the Malaysian government by an average of 6 percent contributed to the ups and downs of Malaysia’s debt
5) Malaysian Income Revenue Impaired
With the collapse of world oil prices slightly affected the state revenue. Based on an American dollar record the world oil price hike for each world crude barrel provides a nation’s revenue of RM300 million
Based on Malaysia’s debt records, the amount has been more than double the debt owed by the Prime Minister since Tunku Abdul Rahman, Tun Razak, Tun Hussein Onn, Tun Dr Mahathir, Tun Abdullah Ahmad Badawi. The amount is now worrying enough for Malaysians.