The federal government’s domestic debt has soared from RM217bn in 2006 to RM438bn in 2011.
Much of the extra debt has been raised from investment issues and issues of government securities (including a noticeable rise in foreign holders).
The government, however, says nothing to worry, the total federal government debt is only 53.5 per cent of GDP, still below the critical threshold of 55 per cent.
But see how even that ratio has been rising over the years.
Now, most of the federal government’s debt is domestic, but even then, the sharp rise in recent years is cause for concern.
Mind you, this does not include outstanding debt/loans guaranteed by the federal government.
The rising debt level is partly due to the country’s persistent fiscal deficits over the last 15 years:
But how are we going to reduce our fiscal deficits when we keep slashing income tax and corporate tax while doing little to curb rampant corruption, cronyism, ‘leakages’, wasteful spending and bloated government department budgets?