Govt Expected To Continue Fiscal Consolidation Measures To Reduce Debt

KUALA LUMPUR, Oct 21 (Bernama) -- The government is expected to continue its fiscal consolidation measures as part of the debt management strategy following the reported decrease in new debt, which is forecast to fall to RM80 billion by 2025.

 Member of Parliament Datuk Mohd Shahar Abdullah (BN-Paya Besar) said an abrupt reduction in debt, as opposed to a gradual approach, can affect the development process and economic stability.

“When we reduce the national debt drastically, it would have a dual impact. First, it would cause a shock to the ongoing national development process and secondly, it would affect the internal chains in the country’s circular economy.

“We already have the Fiscal Responsibility Policy and have approved the Public Finance and Fiscal Responsibility Act, so we should follow the existing plans,” he said during the Supply Bill 2025 debate session at the policy level in the Dewan Rakyat today.

He was replying to a query from Sim Tze Tzin (PH-Bayan Baru) who wanted to know whether a drastic reduction in debt would affect national development plans.

In tabling Budget 2025 last week, Prime Minister Datuk Seri Anwar Ibrahim said the government has taken firm and gradual measures aimed at consistently lowering the deficit.

He said new debt is expected to continue decreasing from more than RM90 billion in 2023 to an estimated RM85 billion this year and then to RM80 billion in 2025.

Meanwhile, Mohd Shahar, who is also the Backbenchers Club chairman, called on the government to strengthen ASEAN-level diplomatic relations and cooperation when Malaysia assumes the ASEAN chairmanship next year. 

He proposed taking into consideration the establishment of an ASEAN Halal Research Training Centre and ASEAN Shariah Stock Exchange to make the region the global leader in Islamic finance.

“At present, if we go to the equity market, there are only shariah counters. We want a stock exchange that is shariah-compliant. That’s why I propose that ASEAN explore a common trading platform called the ASEAN Shariah Stock Exchange,” he added.

-- BERNAMA