Najib believes there will be no Malaysia rating cut

Reading Time: 1 minute

Najib1Malaysia’s Prime Minister Najib Razak said he believes that Malaysia can avoid a cut to its credit rating while the government will try its “level best” to prevent a breach of its self-imposed sovereign debt ceiling.

“We will manage it,” Najib said in an October 11 interview with Bloomberg in Putrajaya, the country’s administrative center near Kuala Lumpur. “We’re very closely monitoring how we manage our macro position as well as our fiscal and debt to make sure that we will not be downgraded.”

Najib raised subsidized fuel prices for the first time since 2010 and said he’d delay some public projects after Fitch Ratings cut Malaysia’s credit outlook to negative in July, citing rising debt levels and a lack of budgetary reform. The country, which has a long-term foreign-currency denominated rating of A- at Fitch, has run annual budget deficits every year starting in 1998.

At 53.3 per cent, Malaysia’s debt-to-gross domestic product ratio is the highest among 12 emerging Asian markets after Sri Lanka, according to data compiled by Bloomberg. Moody’s Investors Service said last month the budget gap may exceed Najib’s target of 4 percent of GDP this year and warned fiscal targets will become “increasingly out of reach” unless further measures are taken. Moody’s rates Malaysia government bonds A3 with a stable outlook.

The government will further cut state subsidies, broaden its tax base and manage spending “prudently,” said Najib, 60, who is also finance minister, without elaborating. Cabinet will meet before the 2014 budget is released October 25 to decide if there’s enough public support to introduce a goods and services tax, he said.

Do you like this post?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid

Reading Time: 1 minute

Malaysia’s Prime Minister Najib Razak said he believes that Malaysia can avoid a cut to its credit rating while the government will try its “level best” to prevent a breach of its self-imposed sovereign debt ceiling.

Reading Time: 1 minute

Najib1Malaysia’s Prime Minister Najib Razak said he believes that Malaysia can avoid a cut to its credit rating while the government will try its “level best” to prevent a breach of its self-imposed sovereign debt ceiling.

“We will manage it,” Najib said in an October 11 interview with Bloomberg in Putrajaya, the country’s administrative center near Kuala Lumpur. “We’re very closely monitoring how we manage our macro position as well as our fiscal and debt to make sure that we will not be downgraded.”

Najib raised subsidized fuel prices for the first time since 2010 and said he’d delay some public projects after Fitch Ratings cut Malaysia’s credit outlook to negative in July, citing rising debt levels and a lack of budgetary reform. The country, which has a long-term foreign-currency denominated rating of A- at Fitch, has run annual budget deficits every year starting in 1998.

At 53.3 per cent, Malaysia’s debt-to-gross domestic product ratio is the highest among 12 emerging Asian markets after Sri Lanka, according to data compiled by Bloomberg. Moody’s Investors Service said last month the budget gap may exceed Najib’s target of 4 percent of GDP this year and warned fiscal targets will become “increasingly out of reach” unless further measures are taken. Moody’s rates Malaysia government bonds A3 with a stable outlook.

The government will further cut state subsidies, broaden its tax base and manage spending “prudently,” said Najib, 60, who is also finance minister, without elaborating. Cabinet will meet before the 2014 budget is released October 25 to decide if there’s enough public support to introduce a goods and services tax, he said.

Do you like this post?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid