KUALA LUMPUR – There was never a country in the world which had to set-up a trust fund to assist the government in repaying its debt.
Therefore, the move by the Malaysian government in setting up Tabung Harapan Malaysia (THM) could invite bad impressions on its capability in managing finance.
Economist Tan Sri Ramon Navaratnam said, despite having high national debt, the situation was not ‘that bad’ and desperate enough to create a trust fund to accept public donations.
Even Greece and Zimbabwe which faced worse debts and financial situations had never requested money from their people.
He further highlighted that national debt is the responsibility of the government and should not be handed to the people.
Although some rakyat are generous enough to contribute their part but logically, how much money could the people give.
At the same time, the people would need to be more spendthrift due to the widespread uncertainties in the national economy.
“We know that the government has debts but it wasn’t so bad that Malaysia is desperate enough to ask for donation from the people. Our country is not bankrupt yet.
“These national debt issues have been blown out of proportion due to political factors.
“I still believe in the financial ranking reports about Malaysia made by the World Bank and other international rating agencies,” he told MalaysiaGazette when asked to comment about the Tabung Harapan Malaysia announcement by Prime Minister Tun Dr. Mahathir Mohamad yesterday.
The former Deputy Secretary-General of the Finance Ministry also said that if the national debts got too high, Malaysia should obtain the advice from World Bank, which also has its branch here.
The World Bank is also operating in Sasana Kijang in Bank Negara Malaysia.
Navaratnam said that the matter should be handle amicably by the Pakatan Harapan government if they really want to put their focus on overcoming corruption, reduce expenditure and wastage.
“They should not be politicians who spent too much of their time politicking,” he said.
Recently, Finance Minister Lim Guan Eng said that the national debt has amounted to RM 1 trillion as of December last year.
The federal government’s debt is RM686.8 billion, which is 50.8 percent from the Gross Domestic Product (GDP).
These debts include government guarantees to various entities which failed to repay their debts amounting to RM199.1 billion (14.6 percent from GDP).
Besides that, the figure also involves various lease for private and public projects such as school construction, police station, roadworks and others amounting to RM201.4 billion (14.9 percent from GDP)
Ramon added that the national debt listed has yet to become a liability for the country. – MalaysiaGazette