Govt to issue debt, monetise asset to raise funds : Guan Eng

PETALING JAYA: Finance Minister Lim Guan Eng said the federal government will be raising funds by way of debt issuance and asset monetisation to meet financing needs that do not adversely impact growth.
He assured investors that the process of debt issuance will be gradual and transparent to the market via announcements made through the auction calendar as per current practice.
“This will ensure that investors would be able to absorb the additional issuances without major adjustments in yields that could increase the borrowing cost of the government,” he said.
Noting that sovereign debt issuance is the simplest and beneficial option, Lim reiterated that the government will be very prudent in handling its debts and liability, which has exceeded RM1 trillion.
The government will also be monetising non-critical and non-strategic assets by selling shares, land, as well as by leasing of idle assets and buildings.
This will be carried out in compliance with the highest standard of governance and transparency without disruption to the business community and the people.

“A mixed policy strategy have many stakeholders and we will ensure that they are all engaged and considered to ensure a thorough and balanced fiscal strategy that minimises negative impacts,” he said
" At the same time, these stakeholders must also realise the goal of the government in achieving a strategy that benefits the nation and the Rakyat as a whole,” he added.
Although there are several financing options available to meet the financing needs in the short-term the government is guided by factors such-- as lower financing cost and the timing and size of fundraising which will in turn be guided by the ability of the financial markets to absorb in an orderly manner and avoid unintended consequences.
Additionally, Lim noted that any form of strategy adopted will be focused on maintaining the overall confidence in fiscal sustainability and economic resiliency.
Hence in avoiding being an over-reliance on any one specific strategy to meet its financing needs, a combination of the aforesaid fundraising options would be considered.
"If Malaysia can successfully navigate the fiscal challenges over the next three years, those who invest now can expect a substantial profit or returns to investment later,” he added.
Reiterating on the challenges faced by the government in terms revenue shortfall following the abolishment of the Goods and Services Tax and outstanding tax refunds, Lim assured that discussions between government agencies and policymakers continues to take place in regard of mitigating these challenges.
He also added that small businesses will be priority in refunding the outstanding tax refunds as these are the parties who were likely to be most affected by the issue.