KUALA LUMPUR: Malaysia’s commitment to purchase 30 Boeing aircraft from the United States will not impact the country’s finances, says Deputy Finance Minister Lim Hui Ying.
Lim said the US$9.5bil purchase will not affect development expenditure in the 13th Malaysian Plan (13MP).
“It will not affect the debt or the fiscal deficit situation we are facing now. So, for now, everything is within our projection,” Lim said during Question Time in Parliament on Tuesday (Aug 19).
She was responding to Datuk Dr Nik Muhammad Zawawi Salleh (PN–Pasir Puteh), who asked if Malaysia’s finances would be affected by the purchase.
Aminolhuda Hassan (PH–Sri Gading) then asked about steps to reduce Malaysia’s debt so it would not affect the national economy.
Lim said the government has measures to reduce debt levels, including fiscal consolidation to ensure future loans are lower than current levels.
“Apart from widening the tax base, we want to optimise public spending, including rationalising diesel and RON95 subsidies, and reviewing government loans to fund certain 13MP projects.
“We have several measures to ensure Malaysia’s debt levels will reduce,” Lim said.
She said as of the end of June this year, Malaysia’s debt stood at RM1.3tril, or 63.9% of GDP, compared to RM1.247tril or 64.6% at the end of 2024.
Lim added that the increase in federal debt was due to the need to cover development expenditure.
“But the government isn’t relying solely on debt to fund development expenditure. It is also funded by tax and non-tax revenue,” she said.
Lim said the government is confident of achieving its 3.8% fiscal deficit target to ensure debt does not exceed the statutory limit.
“During the tabling of 13MP, the government is also committed to reducing the fiscal deficit to less than 3% and debt levels to below 60% of GDP in the medium term,” she added.
Earlier this month, Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said the additional aircraft purchase was part of reciprocal negotiations with the US.
The order includes 18 Boeing 737-8s and 12 Boeing 737-10s powered by CFM LEAP-1B engines, with an option for 30 more 737s.
Orders for hundreds of Boeing jets were announced in deals with Japan, the UAE, Indonesia, Cambodia, Bangladesh and others as part of negotiations to reduce US tariffs.
The US announced a reduction in tariffs on Malaysian exports to 19% from the previously announced 25%.
