Treasury: Report on deficit doesn’t show true picture

Irwan-Serigar-Abdullah_malaysia_economi_600PUTRAJAYA: Treasury secretary-general Mohd Irwan Serigar Abdullah today dismissed a media report that the fiscal deficit widened in the first five months of 2017 as not reflecting the true picture.

He said the actual figures – whether the national deficit improved or worsened compared to the previous year – could only be known at the end of this year after all the factors were taken into account.

“Perhaps, during certain months, revenue fell but there are other months when the deficit was far smaller than expected.

“Some dividends are paid in June or July, for example the dividend of Petronas for the second quarter,” he told reporters at the Finance Ministry’s Hari Raya programme.

A report in The Edge Financial Daily on July 7 quoted Citi Research as saying that the fiscal deficit for January-May this year widened to RM30.5 billion, against RM26 billion for the same period the year before.

Citi Research vice-president Kit Wei Zheng said the deficit resulted from a drop in petroleum tax collection and personal income tax while expenditures increased.

Irwan said the government was on target to meet the deficit target of 3% this year with the possibility of higher revenue.

Besides dividend, land sales and monetisation of assets would boost revenue, he said.

“In May, the value of exports climbed 31.5% while inflation fell from 4.4% to 3.9%. International reserves held by Bank Negara strengthened.

“So, the national economy is improving. We may have a nice national budget this year,” he added.

He described the news report’s analysis as unfounded.

“Don’t play up the claim that the deficit has widened…wait till December when we release the full figures,” he said.