KUALA LUMPUR: The federal government's debt has increased by RM50 billion to RM1.22 trillion as of the end of April this year, compared to RM1.17 trillion at the end of last year.
Prime Minister Datuk Seri Anwar Ibrahim, who is also Finance Minister, said the government had taken gross loans amounting to RM70.5 billion in the first four months of this year.
This, he said, included the issuance of Malaysian Government Securities totalling RM30 billion, Government Investment Issues (RM34.5 billion) and Malaysian Treasury Bills (RM6 billion).
"These loan receipts were used to repay matured debts amounting to RM20.6 billion, with the remaining RM49.9 billion used to cover the deficit and future maturing debts," he said in a parliamentary written reply.
Anwar said this in response to Ahmad Amzad Mohamed (PN-Kuala Terengganu), who asked for the justification for the increase in the government's debt in the first four months of 2024.
He added that the increase in the federal government's debt each year was also due to the need to borrow to finance the fiscal deficit, which is to fund development expenditure (DE).
"DE is crucial as it constitutes public investment with a multiplier effect in driving the country's economic growth.
"The borrowings will continue to increase the government's debt level as long as the government's financial position remains in deficit."
Meanwhile, he added that the government is committed to maintaining a fiscal consolidation trajectory with a deficit reduction in 2023 to 5.0 per cent of Gross Domestic Product (GDP) or RM91.4 billion compared to 5.6 per cent in 2022 (RM99.5 billion).
"The fiscal deficit in 2024 is projected to further decrease to 4.3 per cent of GDP or RM85.4 billion.
"The effort is able to improve the public financial position and further reduce the debt burden in the medium and long term."