save malaysia!
Moody's maintains Malaysia debt burden at 50.8% of GDP
savemalaysia
Publish date: Wed, 13 Jun 2018, 01:25 PM
KUALA LUMPUR: Moody's Investors Service is maintaining its estimate of Malaysia's direct government debt at 50.8% of GDP in 2017.
It said on Wednesday its assessment of contingent liability risks posed by non-financial sector public institutions has also not changed following some statements by the new Federal Government led by Pakatan Harapan which won the 14th General Election on May 9.
“However, the new administration's treatment of large infrastructure projects that may be placed under review but have benefited from government-guaranteed loans in the past, and outstanding debt from state fund, 1Malaysia Development Bhd (1MDB, unrated), will play an important role in determining risks that contingent liabilities pose to the credit profile,” it said.
Moody's said fiscal measures are a particular area of focus, given that the country's high debt burden acts as a credit constraint.
“Consequently, to what extent the new government achieves fiscal deficit consolidation will be vital in gauging the eventual effects on Malaysia's fiscal metrics and credit profile,” it said in a report entitled: "Government of Malaysia: FAQ on credit implications of the new government's policies".
Commenting on the impact of the new government's removal of the country's goods and services tax (GST), Moody's said in the absence of effective compensatory fiscal measures, “this development is credit negative because it increases the government's reliance on oil-related revenue and narrows the tax base”.
Moody's estimated revenue lost from the scrapped GST would be around 1.1% of GDP this year — even with some offsets — and 1.7% beyond 2018; further straining Malaysia's fiscal strength.
On the planned reintroduction of fuel subsidies, it viewed this as credit negative because subsidies distort market-based pricing mechanisms.
The move could alsostrain both the fiscal position and the balance of payments while raising the exposure of government revenue to oil price movements.
On the growth outlook, Moody's pointed out the change in government will not materially alter growth trends in the near term. The removal of the GST could boost private consumption in the short term.
“However, a review of large infrastructure projects could also result in any pick-up in investment being more spread out than Moody's had previously anticipated,” it said.
https://www.thestar.com.my/business/business-news/2018/06/13/moodys-maintains-malaysia-debt-burden-at-50pt8pct-of-gdp/
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Discussions
Be the first to like this. Showing 15 of 15 comments
Forgot our useless FINANCE MINISTER LGE, he cant save country, but we rakyat can save our own. No need to count on him.
2018-06-13 20:15
All tis sorhead must b trap at high px. Lost a lot in stock market. Dun blame lge. He is trabsparent
2018-06-13 20:21
ww cant deny, that this is worse thing we ever seen, on our stock market...day by day by day foreign fund get out...so cant deny amateur movement from a finance minister. or just wanna make some revenge....without thinkin the tge concequences towards the economy...
2018-06-13 20:45
ironically, yes he still trap in an opposition mindset..harming the market meaning harming malaysia...scraping ecrl,mrt3, hsr (recently change to postpone statement!?), showing some arrogant...yes Proton 2.0 is idiot...you want to compete in a pack industry?, while scraping ongoing projects? double arrogant...yes former prime minister if make mistake on 1mdb, yet something that is good should be considered laa....
2018-06-13 21:03
Wat is the use,of public ttansport wor. I stay in puxhong, stil jam like hell. Wat is the use of lrt wor? Cannot reduce ham, sama saje. Build lrt for foreign workers naik,saje...
2018-06-13 21:27
bout the public transport dont laa too arrogant by scrapping all at least mrt3 proceed la (just example), coz u need to think the high compensation involve, and foreign investors confidence..but ok, new statement just postpone the hsr, hopefully he realize a bit now..about proton 2.0 now many advancement in automotibe industry. we take a look at geely itself..take over volvo, incorporate with geely expertise, and now lotus...can proton 2.0 compete? yes maybe can, but, too much initial money needed...in time like this..japan car wanna compete with conti cars?! mann please think more....
2018-06-13 21:35
1mdb (if any) or added the fgv, from my raw calculationstill contribute lesser in term of debt compare to maminco(makuwasa), forex scandal,petronas bail out, pkfz, etc....or maybe we can say same...mann and added more proton 1.0...aiyoooyo...ok just ma2cents laa
2018-06-13 21:39
Its all a game
....in this case, a game played by white collar criminals from Moody's.....
2018-06-13 21:53
in a world full of bad news, new era Malaysia is the good news the world so lacks.
2018-06-13 22:14
anonymous > Jun 13, 2018 10:17 PM | Report Abuse
old man is going to bring us to old era of 19 century la.. so happy..
===========
actually new era Malaysia looks good, very good........and in the history of the world, authoritarian Parties will UMNO, once defeated is gone for good.....and good riddance .......
2018-06-13 22:20
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So childish this LGE - shame on you. Scare the shit out of everyone with your theatrical. Happy now? Foreign fund has liquidated (net) about RM 4 billion since May 14. Looks like more with the constant flip-flopping, HSR cancelled now postponed, new national car project, Battersea, etc. Borrowing yen, this will increase our foreign borrowing, whatever for?
Please, SAVE MALAYSIA stop posting articles, enough already. Project done, move on.
2018-06-13 13:53