Govt guaranteed loans, debt at manageable levelNovember 29, 2017 @ 4:48PM
By Veena Babulal
KUALA LUMPUR: The federal government has guaranteed loans worth RM217.37 billion as of June 30 this year said the Finance Ministry.
The guarantees were given to four statutory bodies and 26 companies under the Minister of Finance Inc.
“The government guaranteed these loans in order to carry out high impact strategic projects as well as to provide benefits to the people in general through the education, services, infrastructure, financial holding and utilities sectors,” said the ministry.
It said this in a written reply dated Nov 22 to Dr Lee Boon Chye (PKR-Gopeng) who asked on the government’s current contingency liability
In a separate reply to Fauzi Abdul Rahman (PKR-Indera Mahkota), the ministry said the federal government’s total debt stood at RM685.1 billion as of June 30 2017.
“The total debt represents 50.9 per cent of the country’s gross domestic product (GDP),” added the ministry.
This is below the self-imposed debt ceiling of 55 per cent of the GDP.
“Of the total, 96.7 per cent, or RM662.4 billion is made up of domestic debt (42.9 per cent of GDP), while the remaining 3.3 per cent, or RM22.7 billion, were foreign borrowings (1.7 per cent of GDP)."
“The federal government’s debt position remains manageable and is categorised as a moderate debt level,” stated the ministry in a written reply dated Nov 20.
The statement further revealed that this year’s gross debts amounted to RM108 billion, from which principal repayment was RM67.2 billion and loan-to-finance deficit was RM39.9 billion.
“The government will always ensure that the repayments of principal and interest will be done as scheduled and on time. The government, to date, has never failed in paying on time,” added the ministry.