A view of Kuala Lumpur in Malaysia. — VNA/VNS Photo

KUALA LUMPUR — Malaysian Prime Minister Anwar Ibrahim has pledged to significantly reduce public debt by the end of this year, while the country’s finance ministry aims to lower the debt-to-GDP ratio from 64 per cent to 60 per cent over the next five years.

According to Dr. Goh Lim Thye, a lecturer at the faculty of economics, University of Malaya, the Malaysian Government has been actively implementing measures outlined in the 2024 budget, but national debt remains at a high level.

From Goh’s perspective, as long as Malaysia maintains strong economic growth momentum and follows sound fiscal policies, the national debt can be managed in the medium and long term.

This year, the country’s economy has shown positive growth, recording a 4.2 per cent increase in the first quarter and 5.9 per cent in the second quarter. This success was attributed to increased household spending, the lowest unemployment rate since the pandemic, and sustained growth in the manufacturing sector, particularly in electrical and electronics industries. Additionally, Malaysia has focused on investing in emerging technologies such as electric vehicles (EVs) and artificial intelligence (AI).

Goh held that a high national debt does not necessarily indicate a poor economy.

He said while national debt is an important indicator of economic performance, it is a relative measure. The key is whether a country can effectively manage and utilise borrowed funds for its development. — VNS