KUALA LUMPUR, Oct 11 — The overall federal government debt and liabilities exposure is estimated at RM1.17 trillion or 77.1 per cent of Gross Domestic Product (GDP) as of end of June 2019, the Finance Ministry (MoF) said today.

According to the MoF’s Fiscal Outlook and federal Government Revenue Estimates 2020 report, this was attributed to the increase in federal government debt and committed guarantees.

As of end-June 2019, the federal government debt stood at RM799.1 billion — domestic debt (RM769.9 billion) and outstanding offshore borrowing (RM29.2 billion).

"Of this, federal government debt comprised about 70 per cent of the total exposure,” it said.

On the committed guarantees, it is estimated at RM157.3 billion or 10.4 per cent of GDP, the report added.

It said that financial performance of the 13 companies listed under this category will be monitored closely and aided with recovery plans to ensure the risk exposure to government will be reduced and gradually minimised.

Apart from the federal government debt, other obligations of the government mentioned in the report was 1Malaysia Development Berhad’s (1MDB) entire debt obligation of RM32.2 billion.

"As at end-June 2019, the government has extended advance of RM8.9 billion to 1MDB for debt servicing.

"The government is also in pursue of recovering several assets related to 1MDB’s financial trail and is expected to take some time as most of the assets are currently located abroad,” it said.

1MDB, which was established in 2009 initially to carry out national strategic development initiatives, is currently embroiled in the ongoing corruption trial of former prime minister Datuk Seri Najib Razak.

Najib’s ongoing 1MDB trial involves 25 criminal charges — four counts of abusing his position for his own financial benefit totalling almost RM2.3 billion allegedly originating from 1MDB and the resulting 21 counts of money-laundering.

Meanwhile as at end-June 2019, outstanding public private partnership (PPP) cash commitments are estimated at RM130.6 billion compared to RM135.1 billion as at end-2018 based on the existing 100 projects.

Nonetheless, the report said the government will continue to report a comprehensive position of debt and liabilities exposure to enhance monitoring and transparency.

"Moving forward, the government is committed to its debt consolidation path with a targeted debt-to-GDP ratio below 50 per cent in the medium-term.

"In addition, the Parliament Special Select Committee on Budget has also proposed their recommendations, of which the government is currently in the process of reviewing the suggestions.

"Concurrently, the government will continue to reduce its debt-to-GDP ratio through the implementation of gradual fiscal consolidation effort,” it said.