Malaysia's ability to increase debt is limited due to a high debt service ratio, which reached 16.3% in 2021 and is expected to exceed 18% in 2022, meaning almost 20% of government revenue is spent on interest payments. Finance Minister Tengku Datuk Seri Zafrul highlighted that debt capacity and sustainability, not just the debt-to-GDP ratio of 63%, determine borrowing limits. With a low tax-to-GDP ratio of 11%, economic growth alone cannot cover rising debt obligations.
Also available in 'The Star', 'The Sun'.MALAYSIA’S ABILITY TO INCREASE DEBT LEVEL LIMITED, SAYS TENGKU ZAFRUL
Malaysia's ability to increase debt is limited due to a high debt service ratio, which reached 16.3% in 2021 and is expected to exceed 18% in 2022, meaning almost 20% of government revenue is spent on interest payments. Finance Minister Tengku Datuk Seri Zafrul highlighted that debt capacity and sustainability, not just the debt-to-GDP ratio of 63%, determine borrowing limits. With a low tax-to-GDP ratio of 11%, economic growth alone cannot cover rising debt obligations.
Also available in 'The Star', 'The Sun'.
