KUALA LUMPUR: Malaysia’s debt pressure is expected to ease by late 2028 and into 2029, in line with the government’s fiscal consolidation path, says Prime Minister Datuk Seri Anwar Ibrahim.
He said the government had already reduced annual new borrowing from RM100bil previously to about RM70bil at present, with a further drop to RM20bil projected in the coming years.
"With this trend, states should not ask for cuts to essential development work next year.
'The reduction shows our capacity to continue core projects – flood mitigation, basic infrastructure, education, health and others," he told the Dewan Rakyat during Minister’s Question Time on Tuesday (Dec 2).
Anwar stressed that a lower deficit naturally translates into lower debt obligations over time.
"When deficit projections come down, it means our debt burden will also lessen. As long as we meet all our repayment obligations, the pressure gradually decreases.
"By 2027 and 2028, the numbers are expected to plateau, and if the government remains consistent, our debt pressure will start easing by the end of 2028 and into 2029," he said.
Syahredzan Johan (PH-Bangi) had raised concerns about misleading narratives claiming that federal debt had breached the statutory limit of 65% of GDP.
Such claims reportedly stemmed from commentators using the RM1.4 trillion total external debt figure and presenting it as statutory federal debt.
Anwar, who is also Finance Minister, dismissed the claims as inaccurate and irresponsible, saying they relied on "twisted statistics".
"Statistics should not be manipulated to deceive. Statutory debt is clearly defined in our laws. It covers federal borrowings and does not include our relatively small external debt or Treasury bills," he said.
He added that the government remained focused on lowering statutory debt as quickly as possible, without shifting the burden to the public.
"What matters is our ability to reduce debt immediately, but without imposing unnecessary strain on the rakyat. That balance is a key policy decision," he added.
