Kuala lumpur: The federal government’s total liabilities have reached RM390.4 billion as of the end of June 2025, marking an increase from RM384.8 billion at the end of 2024. The Ministry of Finance (MoF) made this disclosure in a reply posted on the parliament website.

According to BERNAMA News Agency, the liabilities include guarantee commitments of RM237.1 billion, up from RM236.2 billion in 2024, and other liabilities totaling RM153.3 billion compared to RM148.6 billion the previous year. This information was provided in response to an inquiry by Azli Yusof (PH-Shah Alam), who sought clarification on the federal government’s current debt, including contingent liabilities, and the measures being taken to manage it sustainably.

The MoF reported that the federal government’s debt stood at RM1,304.2 billion at the end of June 2025, rising from RM1,247.6 billion at the close of 2024, driven by the need to finance the fiscal deficit and cover development expenditure. The ministry emphasized that government borrowing is strategically utilized to finance key development projects in infrastructure, education, health, and social protection sectors.

The MoF stressed the importance of this financing in fostering long-term economic growth and enhancing the well-being of the populace, particularly among low and middle-income groups. To mitigate the rise in debt and liabilities, the government is implementing ongoing fiscal management strategies, including gradual fiscal consolidation and broadening the revenue base. Efforts also include strengthening sustainable revenue collection through the expansion of the sales and service tax (SST).

Additionally, the government is optimizing public expenditure by implementing targeted subsidies for diesel and RON95, rationalizing statutory bodies, and ensuring that government loans are allocated exclusively for development projects and programs that yield long-term socio-economic benefits for the nation and its citizens.