KUALA LUMPUR (July 2): The government must stay vigilant in implementing its fiscal consolidation programme to manage concerns about contingent liabilities and debt sustainability raised by Fitch Ratings, CIMB said in its Economic update yesterday (July 1).

Despite the improvement of fiscal finances, favourable GDP growth and low inflation volatility, CIMB analyst Jarratt Ma said Malaysia’s performance in a number of measures is still weaker than other ‘A-’ rated countries.

Fitch’s move to raise Malaysia’s outlook to ‘stable’ after maintaining a negative outlook for almost two years, came as a surprise, Ma said, but was in line with the ‘stable’ outlook of S&P and ‘positive’ outlook from Moody’s.

Meanwhile, Prime Minister Datuk Seri Najib Tun Razak had assured the government would look into the possible expansion in contingent liability due to 1Malaysia Development Bhd (1MDB), according to Bernama.

“The government is taking firm steps to address concerns, including the country's narrowing current account surplus and smaller external liquidity ratio,” he said.  

Treasury Secretary-General Tan Sri Dr Mohd Irwan Serigar Abdullah added that the Finance Ministry would intensify efforts to achieve a balanced budget by 2020, by boosting growth of various economic sectors.