Will Malaysia go bankrupt like Sri Lanka? Tengku Zafrul Tengku Abdul Aziz, the finance minister of Malaysia, responded to suggestions that due to government debt, the nation would experience financial devastation similar to that of Sri Lanka.
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The likelihood of Malaysia facing bankruptcy like Sri Lanka is extremely remote, according to Finance Minister Tengku Zafrul Tengku Abdul Aziz, who spoke in parliament on Tuesday, July 19, reports CNA.
The minister mentioned that the International Monetary Fund (IMF) has never stated that Malaysia was experiencing issues that would lead to bankruptcy in response to a query from Pontian Lawmaker Ahmad Maslan.
Instead, he added, the IMF had voiced confidence in Malaysia’s potential for economic growth.
“In late April this year, the IMF expressed its confidence that our gross domestic product (GDP) will grow at a rate of 5.75 per cent.
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“If we compare our economic indicators to Sri Lanka, it is clear that our economy is far stronger than theirs,” the minister was quoted as saying by New Straits Times.
“Therefore, the possibility of Malaysia going bankrupt like Sri Lanka is very low.”
Mr. Ahmad had urged the finance minister to respond to assertions made on social media that Malaysia’s government debts could cause it to become bankrupt like Sri Lanka.
As of the end of June, Malaysia had statutory debt that exceeded 60% of GDP and offshore loans of RM29.4 billion (US$6.6 billion).
In a statement last week, Tengku Zafrul said that Malaysia’s financial situation was still solid and that the federal government’s debt was still under control.
He claimed that despite experiencing numerous financial and economic recession crises, the government has maintained its high level of discipline and has always made interest and mature debt payments.
“This proves Malaysia’s reputation and ability as a debtor with a good repayment record,” he said, according to Bernama.
“The Ministry of Finance has lodged a formal complaint with the Malaysian Communications and Multimedia Commission on several false reports on social media on the country’s debt position which apparently are aimed at misleading the people and potentially undermining investor confidence in Malaysia,” he added.