PUTRAJAYA: The government should not be the biggest investor in the country’s economy but instead it must be driven by the private sector, said advisor to the Prime Minister Datuk Seri Idris Jala.
Speaking to the media in a briefing ahead of the National Transformation Programme (NTP) announcement next Friday, Idris said since the start of the NTP, the government has managed to post record government revenue, fiscal deficit reduction as well as keep the government debt below limit of 55 per cent in the last seven years.
“Under the ETP, the first thing we did was to get the private sector to be biggest investor in this economy, reducing the government’s expenditure so that we don’t over borrow. If we kept overborrowing at the rate that we were doing, we would have been bankrupt by 2019.
“Since 2013, we have been in safe zone in the last five years whose debt level of less than 50 per cent with fiscal deficit of 4 per cent and less.”
Idris added that last year, the country managed to reduce the fiscal deficit from 6.7 per cent in 2009 to 3 per cent.
“Malaysia's debt level had also been in the safe zone since 2013 following the government's decision to execute the National Transformation Programme (NTP),” he said in elaborating on the progress of Malaysian economy with the implementation of the NTP.
He said Malaysia also saw its compounded annual growth rate (CAGR) having doubled from 5.5 per cent between 2006 and 2011 to 11 per cent between 2011 and 2016, something that it had not experienced in a long time.
"Malaysia has also recorded cumulative RM1.5 trillion in investments in 2016, surpassing its target of RM1.4 trillion to be achieved in 2020, four years ahead of plan and superceeded our expectations.
"We have also increased Malaysia's GNI per capita by RM10,100 from 2011 to 2017, ensuring that we no longer stuck in the middle income trap," he added.
Since 2010, Idris said, the government has increased its revenue every year and this was the catalyst of the economic growth.
"Every year, we saw a record government revenue. Because of that we used it to cut our fiscal deficit, hence reaching the safe zone earlier than anticipated. Since we managed to grow the economy while at the same time not increasing the debt as the private sector is doing the investing, we managed to keep the government debt even lower.
"The Malaysian economy is also much more diversified with the wholesale and retail as the largest GDP contributor to the country and government's revenue from oil and gas reducing from 41 per cent to 15 per cent," said Idris.
Under the NTP, it was targeted that 3.3 million jobs would be created in 10 years.
To date, 2.26 million jobs have been created, while 64 MNCs out of the targeted 100 have established their regional office or regional HQ since 2011, further promising job opportunities in the economy.