Politically-motivated ‘guesstimates’ should be avoided, says ex-PM
KUCHING: Former prime minister Datuk Seri Najib Tun Razak stresses the importance for the relevant authority to provide accurate figures on the nation’s debts as financial markets depend on such announcements.
According to him, accurate figures must be given in order to not confuse or mislead the people.
In this regard, he claimed the new Finance Minister Lim Guan Eng had, over the past week, continued to cite various figures that were not accurate and could only be viewed as being ‘politically-motivated’.
“Earlier, he (Lim) had spooked the financial market by stating that our national debt was RM1 trillion without giving details. It was only after various parties, including myself, had questioned did he clarify that the official government debt remained at RM686.8 billion, or 50.8 per cent of our GDP.
“The figure of 50.8 per cent is also the lowest it has been for the past 10 years, and is significantly lower than the 103.4 per cent reached in the past under (Prime Minister) Tun Dr Mahathir Mohamad.
“As a result of the unnecessary spooking, the stock market has experienced 18 consecutive days of foreign outflows,” Najib pointed out in a posting on his Facebook page yesterday.
He also noted that Lim had continued insisting that the now-cancelled Singapore-Kuala Lumpur High Speed Rail (HSR) project cost RM110 billion, although the Singapore and Malaysian governments had previously estimated that it would cost a maximum of RM72 billion, including land acquisition costs.
“The Finance Minister (Lim) claims his inflated figure of RM110 billion includes interest costs. How he arrived at this figure is unclear as the international tender, which requires those participating to propose their financing packages, only closes in December 2018.
“In the course of previous discussions, various participating parties had earlier indicated that they’re able to propose low-interest or even no interest financing packages similar to what was offered to India,” said Najib.
He also observed that Lim continued to ignore requests by multiple parties to reveal the feasibility and economic impact studies on the HSR project. In the interest of transparency, Najib added, these reports should be revealed to the public to determine if the best interest of Malaysia would be served by cancelling the project.
“Yesterday (Friday), the Finance Minister continued with his inaccurate ‘guesstimates’ when he said 1Malaysia Development Bhd (1MDB)’s current debt is RM50 billion, (to) which he vaguely said ‘including interest’ – a figure higher than the RM30 billion and RM38 billion that he had given over the past week.
“When giving these figures, the Finance Minister should also mention that the debt was backed by assets that could be worth up to RM30 billion; or the US$3.5 billion (RM14 billion) of that debt is guaranteed by a foreign government and is the subject to further good-faith negotiations as part of a settlement agreement.”
Najib argues that instead of continuing to use 1MDB as ‘a political capital’, the new Pakatan Harapan (PH)-led government should ensure the rationalisation plan for 1MDB would be continued, and its previous asset values should be enhanced and monetised to pay down the debt.
“The elections are over – you (PH) have won and we (Barisan Nasional, or BN) have lost. The focus should now be to safeguard our country’s economic growth, jobs and financial stability – not playing politics with inflated ‘guesstimates’ to provide an excuse for not delivering on PH’s manifesto as per your promised timeline,” he said.
On his posting, Najib also said a few months ago, the World Bank and International Monetary Fund (IMF) reported that the BN-led Malaysia – back then – would reach high-income income nation status in as early as in three years’ time.
“The PH government should ensure that we remain on course to meet this target,” he added.