KUALA LUMPUR, July 29 (Bernama) -- Bursa Malaysia rebounded to close higher on Wednesday on selective buying of defensive stocks after a volatile trading session. IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said consumer products and services stocks lifted the key index higher, overcoming lingering geopolitical concerns. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 3.08 points to 1,715.56 from yesterday’s close of 1,712.48. The benchmark index, which opened 1.91 points higher at 1,714.39, moved between 1,710.79 and 1,720.59 during the day’s trading. In the broader market, gainers outstripped decliners 550 to 476, while 612 counters were unchanged, 1,129 untraded, and 48 suspended. Turnover rose to 2.96 billion units valued at RM2.48 billion from 2.94 billion units valued at RM2.56 billion on Tuesday.
Federal Government’s Financials Improved in 2023, but Rising Liabilities Require Attention — AG's Report
The federal government's financial performance in 2023 showed improvement compared to 2022, with excess revenue increasing by RM2.028 billion, according to the Auditor General's (AG) Report. Additionally, the government's deficit decreased by RM8.595 billion, bringing the deficit-to-GDP ratio down to 5.0% from 5.5% in the previous year.
However, the report highlighted concerns over the increasing trend of federal liabilities, which consist of federal debt and financial liabilities. These liabilities grew by RM92.038 billion (6.6%) to reach RM1.492 trillion in 2023, up from RM1.400 trillion in 2022. Furthermore, the government's guarantee commitment for 13 companies increased by RM3.288 billion (1.5%).
At the same time, dividends received by the federal government fell significantly, decreasing by RM9.756 billion (17.5%), down from RM55.815 billion in 2022. Despite these challenges, the AG Report stated that the federal government’s financial statements presented a true and fair view of its position for 2023.
Rising Liabilities and Debt Prompt Fiscal Reforms
The report also noted that the federal liabilities-to-GDP ratio rose to 81.8% in 2023, up from 78.0% the previous year. The federal debt-to-GDP ratio increased to 64.3% from 60.2% in 2022, while the statutory debt ratio climbed to 62.1% from 57.5%. In response, the government has implemented fiscal reforms, including the Public Finance and Fiscal Responsibility Act 2023, aiming to achieve fiscal objectives by 2030, including a fiscal balance of 3% of GDP and debt levels of 60% of GDP.
Accounts Receivable Down, but Challenges Remain
Total accounts receivable decreased to RM98.367 billion in 2023, down from RM105.824 billion in 2022. The Inland Revenue Board (IRB) accounted for 35.2% of receivables, totaling RM34.591 billion. Of the total receivables, 28.9% had remained uncollected for over six years, with RM1.635 billion written off in 2023.
AG’s Recommendations
The AG recommended several measures to enhance the federal government’s financial position, including:
- Increasing revenue through diverse sources and improving governance over public expenditure.
- Prudent management of public debt to reduce reliance on new loans, and encouraging better financial management of government companies.
- Closer monitoring of development projects under the 12th Malaysia Plan, with timely interventions to ensure their completion by 2025.
These efforts aim to strengthen the government’s finances and address rising liabilities.
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