MOF: Federal statutory debt expected to stay under 65pc of GDP in 2026 amid cost‑control measures

KUALA LUMPUR, July 10 — The federal government’s statutory debt level, after taking into account borrowing requirements for 2026, is projected to remain below 65 per cent of gross domestic product (GDP).

The Ministry of Finance (MOF) stated that, from a debt management perspective, the government consistently ensures that the debt level remains below the statutory limit.

“Following the geopolitical conflict in West Asia, the government has been monitoring the current economic situation through weekly engagement sessions conducted by the Crisis Management Task Force (PPPK) under the National Economic Action Council (MTEN).

“The focus is to ensure that energy supplies and essential goods remain secure, that costs to the public do not rise sharply, and that the country’s economic resilience is strengthened over the long term.

“At the same time, the government has also implemented several cost-control measures to optimise spending across ministries and government agencies,” the ministry explained in a written reply to the Dewan Rakyat, which was published on the parliament website yesterday.

The ministry was responding to a question from Datuk Seri Hamzah Zainudin (PN–Larut), who asked for the projected fiscal position of the federal government through the end of 2026, including estimates of government revenue, the fiscal deficit, debt commitments, and total subsidy expenditure.

Regarding the 2026 fiscal outlook, the MOF said a revised fiscal projection for 2026 will be announced during Budget 2027, after taking into account the latest economic indicators as well as revenue collection and expenditure performance through the first half of 2026. — Bernama