KUALA LUMPUR: Malaysia's total debt will start reducing from 2027 onwards as older debts have been cleared, said Economy Minister Rafizi Ramli.
In a post on X, he said the country's debt had been successfully reduced by RM14 billion, from RM100 billion in 2022 to RM86 billion this year, since the unity government came to power.
"Even though the economy is improving and more tax is being collected, the annual debt is still high due to maturing debts from the previous years which need to be paid.
"This is also why the performance in debt reduction should examine the amount of new debt taken by the current administration.
"Therefore, if we can maintain our performance (in reducing annual new debt), the total debt will start reducing from 2027 onwards once older debts are matured," Rafizi said.
He also said the government was committed to reducing the annual debt as they needed to settle debts inherited from the previous administration.
In June, Prime Minister Datuk Seri Anwar Ibrahim announced the government's commitment towards reducing the country's new debt as a short-term measure to improve the nation's financial capacity.
He had said that in 2021 and 2022, the country's new debt stood at RM100 billion before it was gradually reduced.
He added that the reduction was also a result of the government's efforts to reduce its fiscal deficit.