KUALA LUMPUR: Total government debt as of end-June 2017 stood at RM685.1 billion or 50.9% of the gross domestic product (GDP), the finance ministry said in a written reply at the Dewan Rakyat today.
“From this amount, 96.7% or RM662.4 billion was domestic debt (49.2% of GDP) while 3.3% or RM22.7 billion (1.7% of GDP) was offshore loans.
“The federal government debt remains well-managed and categorised as moderate,” it added.
It was responding to Teresa Kok (DAP-Seputeh) who had asked for the country’s total internal and external debt.
According to the reply, RM496.2 billion or 72.4% of bonds and Islamic bonds (sukuk) was held by domestic investors.
“These investors consist of strong institutions like banks (29.7%), Employees Provident Fund (EPF) (27.2%), insurance companies (4.5%), retirement funds (3.5%) and development financial institutions (3.0%), non-banking financial institutions (0.1%) and others (4.4%).
“The balance RM188.8 billion or 27.6% is held by non-residents like federal bank assets and fund managers (10%), supranational and government (8.5%), retirement funds (4.8%), banking institutions (2.3%), insurance companies (0.8%), bilateral and multilateral institutions and others (1.2%).”
It said the government was still committed to ensuring that federal government debt does not exceed 55% of GDP.
“To make sure the federal government debts remain low and managed, fiscal consolidation steps are taken to reduce the deficit level in stages.
“This will reduce the government’s need to borrow and will reduce debts. Focus on strict fiscal discipline and debt management will be prioritised in order to ensure strong fiscal standing and a macro economy that can withstand any crisis.”