Malaysia’s public sector financial position remains sound, well-managed, says MOF

KUALA LUMPUR, October 9 — The Ministry of Finance (MoF) reported that Malaysia's consolidated public sector financial position remains robust and well-managed, benefiting from ongoing public finance reforms and disciplined fiscal management. The report highlighted the implementation of the Public Finance and Fiscal Responsibility Act 2023 (Act 850) and proposed legislation on government-owned entities as key factors driving this success.

The MoF emphasized that each tier of government plays a crucial role in national development by investing strategically in critical infrastructure and social programs to uplift the rakyat's wellbeing. It stressed that balancing mandate delivery with prudent public financial management will provide a solid foundation for the nation's prosperity and the benefit of future generations.

The consolidated public sector (CPS) balance deficit is projected to be RM162.09 billion, or 7.0 per cent of GDP, in 2027. Revenue is expected to grow by 7.3 per cent to RM402.67 billion, while operating expenditure is anticipated to increase by 3.6 per cent to RM434.32 billion. The non-financial public corporations (NFPCs) balance is forecasted to record a surplus of RM60.93 billion, while the public sector's current balance will have a surplus of RM29.28 billion.

For the general government, the overall deficit is estimated at RM75.29 billion, or 3.2 per cent of GDP, in 2027. State governments are projected to achieve a consolidated surplus of RM2.39 billion, or 0.1 per cent of GDP, in 2026. NFPCs are anticipated to have an overall deficit of RM57.15 billion, or 2.6 per cent of GDP, in 2026.