PETALING JAYA: Debt and liabilities exposure comprise of Federal Government debt, as well as other financial obligations consisting of committed guarantees, 1Malaysia Development Bhd (1MDB) debt and other liabilities namely commitments of projects under public- private partnership (PPP) and private financing initiatives (PFI).
As at end-2022, total debt and liabilities exposure was estimated at RM1,445.9bil or 80.9% of gross domestic product (GDP)
The 1MDB total outstanding debt reduced to RM18.2bil as at end-2022 (2021: RM32.1bil) following the debt redemption for both 1MDB Energy Ltd in May 2022 and 1MDB Energy (Langat) Ltd in October 2022 .
The redemption of 1MDB Global Investment Limited bond in March 2023 amounting to US$3bil (RM13.3bil) is allocated in the 2023 Budget. The redemption of 1MDB final debt principal of RM5bil will be due in May 2039.
As at end-2022, the commitment for PPP projects and financial obligations of PFI projects amounted to RM142.2bil (2021: RM151.1bil).
There are 105 ongoing PPP projects with an estimated commitment of RM92.1bil (2021: RM97.8bil), whereas outstanding PFI liabilities were estimated at RM50.1bil (2021: RM53.3bil).
PFI projects include refurbishment of schools, universities, training centres as well as repair and maintenance of Federal Government buildings.
Going forward, the Government said it aims to improve debt affordability and sustainability in the medium- and long-term, in line with the fiscal consolidation trajectory supported by fiscal reform initiatives.
Its continuous monitoring of the Federal Government debt and liabilities exposure will ensure that the Government is able to manage and improve the level of indebtedness, mitigate risks as well as enhance efforts towards sound public finances.
The Government has also reiterated the emphasis on enhancing governance, plugging leakages and implementing public finance best practices in mitigating further exposure of contingent liabilities.
