The government still has to service debts linked to 1Malaysia Development Bhd (1MDB), including interest payments, Prime Minister Anwar Ibrahim said today.
Anwar, who is also finance minister, dismissed claims that all debts owed by the strategic investment company had been settled.
He said repayments on existing debts must continue despite the government’s efforts to control new borrowings and reduce the national debt burden through disciplined fiscal management.
“Some say all 1MDB debts have been paid. I don’t know what book they read that from, but it is not true. Our debts, including the interest, must be paid,” he said during the Finance Ministry’s monthly assembly.
Government still faces RM8.9b in outstanding debt
Anwar said the government should borrow only what was necessary to manage the economy and avoid placing an excessive financial burden on future generations.
“Responsible government means you only borrow what you have to in order to manage the economy, but you always plan ahead. You should not burden the future generation to pay for the excesses of the present,” he said.
According to the Finance Ministry, the government’s total financial obligations linked to 1MDB stand at RM51.4 billion, comprising RM42.5 billion already paid and RM8.9 billion in outstanding debt.
The ministry previously said RM31.3 billion had been recovered through asset recovery efforts, leaving the government facing a potential net financial burden of RM20.1 billion if no further funds were recovered.
Fiscal discipline must go hand in hand with governance
Anwar said sound fiscal management must be supported by strong governance and political commitment.
He cited the Public Finance and Fiscal Responsibility Act as an example of efforts to strengthen parliamentary oversight.
Anwar said institutional reforms, including the Parliamentary Services Act, also reflected the government’s commitment to limiting executive powers and strengthening democratic accountability.
