Amro economist Diana del Rosario (pic) said in a briefing that Malaysia “clearly needs to restore fiscal buffers” once the economic recovery is achieved.
PETALING JAYA: Amid Malaysia’s burgeoning debt levels as the government resorts to borrowings to save the economy, the revival of the goods and services tax (GST) is seen as a much-needed lifeline for the country’s debt dilemma.
Asean+3 Macroeconomic Research Office (Amro) said that the government’s aim to bring down the debt ratio to 55% of the gross domestic product (GDP) by 2023 would be challenging to achieve under baseline assumptions.
However, with the reintroduction of GST, the government debt ratio could be lowered substantially as revenue base widens and the pace of fiscal consolidation is accelerated.
KUALA LUMPUR, May 4 ― Despite continued fiscal policy support amid the Covid-19 pandemic, Malaysia’s build-up in government debt underscored the need to restore fiscal buffers toward economic stability and resilience post-pandemic when the country’s economic recovery is on a firm footing, a.