KUALA LUMPUR (Sep 7): Malaysia’s true external ‘debt’ is zero, or very nearly so, according to DBS Group Research.

In an economic note today, DBS said Malaysia’s numbers, which show its net external debt rising to 32% of GDP, from 27% in 1997, are “interesting” and reflects how external debt statistics can mislead.

“Just as an individual may have a large automobile debt that is offset by the ownership of 4 to 5 houses, a country may have a large foreign debt that is offset by ownership of other foreign assets, for example companies, stocks, and US Treasury holdings,” said DBS.

The research house explained that Malaysia has run some of Asia’s largest current account surpluses since 1997 — 11% of GDP, on average — and those surpluses have wiped its overall liabilities clean.

“Today, Malaysia holds as many claims on foreigners, as foreigners hold on it.. [its] true external ‘debt’ is zero, or very nearly so,” added DBS.