KUALA LUMPUR, Sept 11 — The government will continue its effort to reduce wastages and leakages while enhancing spending efficiency, hence, the fiscal consolidation measures will be implemented gradually in order to restore fiscal space while reducing the government’s debt and liabilities level, the Ministry of Finance said.

Prime Minister and Minister of Finance Datuk Seri Anwar Ibrahim said the government recognised there is room to continuously improve the strategy, governance and efficiency in managing the nation’s finances.

"This includes formulating strategies and initiatives to further strengthen the government’s revenue management to ensure the sustainability of revenue mobilisation,” he said in a statement today after chairing the Fiscal Policy Committee (FPC) meeting.

The meeting also deliberates the projections of gross domestic product growth, the government’s fiscal position and medium-term fiscal framework for Budget 2024 formulation.

Anwar said in line with the anticipated slowdown in global growth and trade, the Malaysian economy is expected to moderate but still be within the government’s growth forecast of four to five per cent for 2023.

Growth is largely driven by domestic demand as demonstrated by the 4.2 per cent growth recorded in the first half of 2023.

The prime minister also said that the government would continue to take a whole-of-government approach to support the growth momentum through swift and efficient implementation of measures outlined under Budget 2023 and the Madani Economy Framework.

He said as an open economy, escalating external headwinds, including uneven growth across and within regions such as the US and China, volatile financial markets due to tightening monetary policy, prolonged geopolitical tensions and erratic weather conditions, would pose risks to Malaysia’s economic growth.

"Even as we must undertake potentially difficult reforms to broaden the tax base and address leakages from blanket subsidies, we must recognise the cost of living challenges still faced by the rakyat that is compounded by the global economic uncertainties.

"I have not wavered in my stand that fiscal reforms cannot forsake the less fortunate and must provide enough spending to spur economic activities and investments.

"Hence, the sequencing and extent of fiscal reforms need to be carefully considered so that they do not result in drastic shocks to the economy or the rakyat,” he added. — Bernama