Anwar: Government prioritises fiscal discipline for sustainable economy

New Straits Times

a day ago

KUALA LUMPUR: The country's financial management must be carried out prudently and with discipline, in line with the spirit of the Public Finance and Fiscal Responsibility Act 2023 (FRA), said Prime Minister Datuk Seri Anwar Ibrahim.
He stressed this while chairing the Fiscal Policy Committee (FPC) meeting, which is an important platform for drafting clear fiscal policies and setting the direction of the country's economy.
He said the Madani Government needs to continue to find a balance between efforts to maintain the momentum of economic growth and ensuring the country's fiscal position remains sustainable, especially in the volatile global economic environment.
"Although the world is still grappling with uncertainty, the national economy remains strong with a growth rate of 4.4 per cent for the first half of 2025.
"The unemployment rate has also dropped to three per cent, the lowest in 10 years," the prime minister said in a post on his Facebook page.
He added that the government has successfully reduced the fiscal deficit from 5.5 per cent in 2022 to 4.1 per cent of Gross Domestic Product (GDP) in 2024, an achievement that demonstrates its commitment to responsible fiscal management.
Meanwhile, in a separate statement following the FPC meeting today, the Finance Ministry said as the Madani Government embarks on the 13th Malaysia Plan, fiscal space must be optimised to deliver public investments that materially transform the economy (Raise the Ceiling) and improve the rakyat's quality of life (Raise the Floor).
In 2025, Malaysia's economy is expected to grow between 4.0 per cent and 4.8 per cent, underpinned by strong domestic demand, moderate inflation and a stable labour market.
"The FPC meeting today reaffirmed the government's commitment to reducing the 3.8 per cent fiscal deficit target for 2025 and subsequently achieving a deficit of three per cent or below in the medium term, in line with the FRA commitment," said Anwar, who is also the finance minister.
The session also serves as an important step in setting the government's fiscal trajectory ahead of the forthcoming Budget 2026, scheduled to be tabled on Oct 10.
Under the provisions of the FRA, the ministry said the Madani Government is undertaking the Medium-Term Revenue Strategy (MTRS) to broaden the revenue base and establish a more progressive tax system, while strengthening compliance with international best practices.
"Moving forward, priority will be placed on addressing leakages and enhancing efficiency through measures such as the phased implementation of the e-invoicing system.
"These efforts underscore the government's resolve to build a fairer, more resilient and sustainable fiscal framework that supports long-term economic growth and the well-being of the people," said the ministry.
– BERNAMA