KUALA LUMPUR (June 1): There will "definitely be a revision" to the government's fiscal deficit and statutory debt estimates following the implementation of the Movement Control Order 3.0 (MCO 3.0) and the RM40 billion PEMERKASA+ assistance package, said Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz.
At a virtual press conference today, Zafrul said it is still too early to quantify the exact impact of the lockdown and the aid package on the government's fiscal position.
"The definition of deficit and statutory debt depends on GDP (gross domestic product)… Our GDP numbers will definitely be impacted by the closure of many industries, as announced by the National Security Council and the government.
"It is still a relatively early stage, still preliminary. We are still in the midst of calculating the impact. What I can say is that there will definitely be a revision given the closure of some major economic sectors," he said.
"There will be impact on deficit due to the revision in GDP, and of course there is a fiscal injection of RM5 billion [to be funded] either through savings in expenditure or increase in borrowings.
"Of course, Another option is also to look at our dividends from [government-linked] companies and statutory boards," the minister added.
Prior to MCO 3.0, the Ministry of Finance projected fiscal deficit-to-GDP to hit 6% by end-2021, and for the statutory debt to reach 58.5% of GDP.
Malaysia has imposed the MCO 3.0 for two weeks until June 14, which Zafrul said could negatively impact the nation's 2021 GDP growth number by 1%, resulting in 5%-6.5% growth as opposed to 6%-7.5% initially forecast.
The ministry in its Fiscal Outlook 2021 last year projected Malaysia's GDP to be at RM1.45 trillion. MCO 3.0, analysts estimated, could cost the country between RM400 million and RM600 million daily.