Govt to give RM1.5bil interim special grant to Sarawak

The Malaysian federal government plans to increase Sarawak's special grant to RM1.5 billion for the current year, Prime Minister Anwar Ibrahim announced during Malaysia Day celebrations in Kuching. Anwar, who also serves as Finance Minister, stated that the federal government had raised Sabah's special grant in stages from RM400 million to its current level of RM1.5 billion as an interim measure.

Although Sarawak is in a strong financial position and does not require an increase, Anwar decided to raise the amount as a gesture of friendship. The government will continue negotiations with Sabah and Sarawak to finalize a formula for the annual special grants. Last year, both Sabah and Sarawak received RM600 million each in special grants following a RM300 million increase two years ago.

In May, Anwar had hinted that Sabah's RM600 million allocation would be increased to RM1.5 billion pending the determination of the state's share of net federal tax revenue. Sarawak's Chief Minister, Abang Johari Openg, proposed that the state's special grant should be based on a share of federal revenue between 5% and 10%, indicating Anwar's agreement to this principle.