MALAYSIA will not go bankrupt in 2019

Malaysia will not go bankrupt in 2019 like Greece even if a subsidy totalling RM74 billion a year is continued, says Deputy Finance Minister, Senator Datuk Dr Awang Adek Hussein.

He said the country's economy would not be as bad as it has been portrayed such as not being able to repay its debts should it plan to continue with its subsidising.

The fact is, the move to cut subsidy is aimed at reducing the country's deficit rate and ensure a more stable financial standing for the country, he said.

The country will not go bankrupt, but with reduced subsidising it will reduce the burden of debt, he said.

He was speaking to reporters after delivering his speech at a get-together session at Universiti Sains Malaysia, Kubang Kerian here today.

Awang Adek was commenting on the statement by Minister in the Prime Minister's Department, Datuk Seri Idris Jala, that the country could go bankrupt if the provision of subsidy to the rakyat is continued.

Idris, who is also the Chief Executive Officer of the Performance Management and Delivery Unit (Pemandu) in the Prime Minister's Department, had said bankruptcy could happen as the country's debt is expected to rise 100 per cent of the Gross Domestic Product (GDP) in 2019, if the provision of subsidy continues.

Malaysia is among the countries providing the highest amount of subsidies to its people, which amounted to RM74 billion in 2009.

Former Prime Minister, Tun Dr. Mahathir Mohamad has disagreed with Idris' contention.

According to a media report, Greece's budget deficit in 2009 was 13.6 per cent of GDP which was 2.4 per cent higher than Malaysia's.

Malaysia recorded a trade surplus of RM118.4 billion in 2009 while Greece recorded a trade deficit of RM105.7 billion in the year.

In March 2010, Malaysia's international reserves stood at US$95.3 billion (RM304.96 billion), 17.3 times higher than Greece which had US$5.5 billion (RM17.6 billion).

Awang Adek said the government had taken the best moves for the country's economy including promoting more foreign investments into the country.

Among the results of the government's efforts is the expansion in economy by one per cent in the first quarter this year compared with last year, where the economy contracted below zero per cent.

In his speech, Awang Adek said efforts would be also further increased under the 10th Malaysia Plan to attract more foreign investors into the country.

"Among them is the opening of new investment centres such as the Iskandar region in Johor and Sungai Buluh and Sungai Besi in Selangor," he said. - Bernama