(Updated)

There is still fiscal space to continue to help the people — PM

'The government has proven through eight economic stimulus packages that it does not hesitate to spend money to help the people and help business sustainability,' says Muhyiddin. (Photo by The Edge)

'The government has proven through eight economic stimulus packages that it does not hesitate to spend money to help the people and help business sustainability,' says Muhyiddin. (Photo by The Edge)

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PUTRAJAYA (July 24): The government still has fiscal space, although limited to fund economic stimulus packages to continue to help the people, said Prime Minister Tan Sri Muhyiddin Yassin.

He said the country's economic management, as certified by international rating agencies, is still in good shape.

“Our trade value increased to RM170.9 billion in May 2021, our trade surplus amounted to RM13.7 billion, our current account surplus is stable, our economic resilience is stable, [and] our medium-term growth prospects and fundamentals are strong.

“The government has proven through eight economic stimulus packages that it does not hesitate to spend money to help the people and help business sustainability," he said at a special press conference here today.

Fitch Solutions Country Risk and Industry Research recently claimed that the government would not be able to fund the current stimulus package or other packages in the future due to various constraints facing the country at the moment.

The government has so far implemented eight economic stimulus packages worth more than RM530 billion, including more than RM80 billion in government fiscal injections, for the benefit over 20 million individuals and 2.4 million businesses.

The premier said the government’s deficit is expected to exceed the 6% projection this year, taking into account the impact of the latest movement control order (MCO) and the enhanced MCO (EMCO) in Selangor.

“However, even though this deficit is large, we can push it aside for a while to ensure that the Malaysian economy recovers and the rakyat are protected.

"The growth forecast may have to be lowered slightly, but we are optimistic that when more people are vaccinated and more economic sectors can be reopened in Phase 2 and Phase 3 [of the National Recovery Plan], then our economy will rebound," he said.