Najib Says Malaysia Reserves at $100 Billion

Malaysia’s international reserves, which amount to more than $100 billion, are much stronger now than during Dr Mahathir Mohamad’s administration, says Prime Minister Najib Razak.

In an engagement session with Chinese youth at the Chinese Youth Summit in Serdang Saturday, Najib said during the 1997/98 Asian financial crisis, the country’s international reserves were only around $20 billion, compared with today’s $101.4 billion (RM428.7 billion) as of October 13, Malaysia Insight reported.

 “First of all, I want to tell you that our national debt is at 51%, which is below the 55% self-imposed ceiling, and there are many countries in the world that have much higher debt than Malaysia, including Singapore.

“During Mahathir’s time, the debt was much, much higher, so they cannot criticize us. Even at $20 billion, we didn’t go bankrupt, despite the RM31 billion RCI loss–real money loss, not paper loss–during his time managing the country. Remember that today, we are much stronger, our reserves are much stronger and our deficit is much lower than before. That is because we manage things in a prudent way,” he said.

Najib was responding to a question about the government’s plan to bring the national debt down to make the country’s economy sustainable. Najib said the national debt remained manageable as about 97-98% of the national debt was domestic debt.

“If you don’t borrow, you cannot increase expenditure, and if you cannot increase expenditure, then the economy cannot grow. If the economy grows, the percentage of national debt will decrease, so we believe in an expansionary policy,” he said, adding that the government aimed to achieve a federal government deficit of below 3% of gross domestic product next year.

On household debt, Najib said the government was looking at ways to increase income, as well as encouraging companies to set aside more of their profits for wages.