PM: We're cutting debt gradually to keep investors' trust [WATCH]

New Straits Times

3 hours ago

PUTRAJAYA: The government is committed to gradually reducing the national debt while safeguarding economic growth and maintaining investor confidence, said Prime Minister Anwar Ibrahim.
In his address at the Finance Ministry's monthly assembly, Anwar said efforts had been ongoing to reduce the fiscal deficit from 5.5 per cent in 2022 to a projected 3.8 per cent this year.
"Some people ask why we must reduce it so sharply — why not just channel more to the people?
"But if we don't, we lose trust from investors, and trust is critical. Leadership and economic stewardship require making policies we genuinely believe in.
"With trust comes the ability to solve wider issues — from revenue generation and job creation, to overall economic development," he said.
Anwar, who is also the finance minister, rejected claims that the government's focus on reducing debt came at the expense of the people's welfare, saying it was part of a long‑term strategy that required prudent and measured management.
He said the total national debt had decreased from RM100 billion in 2022 to RM90 billion in 2023, RM85 billion in 2024, and was expected to drop to RM80 billion this year.
"Since we came into office in 2022, we have reduced the debt by RM20 billion," he said.
Anwar added that resolving the national debt could not be done hastily, and required patience and a gradual approach.
"It's like when a son inherits a company after his father's death and finds RM50,000 in debts. He can't wipe it out in a year — it has to be resolved step by step," he said.
In March, Finance Minister II Datuk Seri Amir Hamzah Azizan announced the government's commitment to reducing the fiscal deficit to 3.8 per cent in 2025, in line with its long‑term goal of bringing it down gradually and consistently — from 5.5 per cent in 2022, to five per cent in 2023, and 4.1 per cent last year.
He said this approach would also slow the rise in total debt by reducing new borrowings each year — from nearly RM100 billion in 2022, to RM92.6 billion in 2023, and roughly RM77 billion last year.