Wednesday, 2 October 2013

Worth Understanding About Malaysia Debt......



Recap from Aznil Hisham brief explanation on country debt which was published by pisau.net.

There are 2 type of debt. External and Internal debt. External debt reflect the actual country debt whereby country taken loan from foreign source for country development and management purposes. External loan will reflect the economy growth of our country. This is the one of the indication use by investor on their investment decision in our country. Meanwhile, Internal debt divided into 3 category. Federal Government Debt, Private Sector Debt and Banking/Non-Banking Debt. External Debt if not being manage wisely can lead to bankruptcy. According to economic specialist from Germany Mr. Philip Bagus said, External Debt is 4 times risky compare with Internal Debt.


Federal Government Debt is only at 2.2% from Internal Debt and balance of the debt produce by Private, Banking and Non Banking sector. Debt by private sector involved TM, TNB, Petronas etc. Same goes to Banking sector. They involve in various investment. The debt made by us…..Housing Loan, Hire Purchase, Personal Loan etc. All this are the contributor for the internal debt. That is why government recently, has implemented new ruling  on all these loan. To reduce country internal debt.


Malaysian Government external debt is only at 5% from the total debt. This mean 95% is from the internal debt. Out of this 95% Internal Debt, 2.2% only by Malaysian Government and the balance debt by private, banking and non-banking sector. Total debt is RM600 billion. At 5% out of it, the external debt by our government is RM 30 billion and 2.2% from the internal debt giving value of 13.2 billion. Total debt by our government is 43.2 billion.


Do you know that :- (info up to Apr 2013)
a). Country Internal Reserved = RM430 Billion
b). International Reserved = RM680 Billion
c). Country Saving = RM43 Billion

Can Malaysia bankrupt? Do we need to worried if Debt to GDP ratio at 53%? Simplified word for this Country Debt is at 53% from Country income? Malaysia economic growth at 5-6% while world economic growth is only at 3%. Most of this information gain from Head of Risk at PM Office. These sources are reliable.


There is no country in this world free from debt. Opposition often barking about Malaysia leading path to bankruptcy. This isn’t true at all……..As Malaysian……..worth giving A thought about this………