He said Lim should ensure that Malaysia remained on course to achieve high-income status, estimated by the World Bank and International Monetary Fund to be achieved in three years.
Najib urged Lim to provide accurate figures and to make public the studies carried out on the now-cancelled High Speed Rail link to Singapore, in the interest of transparency.
“In the past week, Lim has continued to cite various figures that are not accurate and can only be viewed to be politically-motivated,” Najib said.
These figures related to:
- the actual size of the national debt: Najib said the actual figure of RM686.8 billion represented 50.8% of GDP, the lowest in 10 years;
- the cost of the High-Speed Rail project: Najib said the cost had been estimated at RM72 billion, but Lim had come up with an inflated figure of RM110 billion, and was unclear about how he arrived at loan interest costs as the international tender would not close until December;
- 1MDB’s debts and assets: Najib said Lim made a “guesstimate” of 1MDB owing RM50 million by vaguely saying this included interest costs but did not account for 1MDB’s assets and a foreign guarantee of RM14 billion.
Pointing out that Pakatan Harapan had won the general election, he said: “The focus should now be to safeguard our country’s economic growth, jobs and financial stability — not playing politics with inflated ‘guesstimates’ to provide an excuse for not delivering on PH’s manifesto as per your promised timeline.”
Lim has announced that five of 10 proposals in the manifesto would be delayed, while the Pakatan Harapan chairman has acknowledged that the government found difficulty in meeting the target of 100 days to deliver its election promises.
Najib made another reference to Lim’s outbursts having affected the financial markets. “As a result of unnecessary spooking, the stock market has experienced 18 consecutive days of foreign outflows,” Najib said.
National debt
Najib said Lim had spooked the financial markets last week by stating that national debt amounted to RM1 trillion and only later clarifying, after being questioned, that the official government debt remained at RM686.8 billion or 50.8% of GDP.
“The figure of 50.8% is also the lowest it has been for the past 10 years and is significantly lower than the 103.4% reached in the past under Tun Dr Mahathir Mohamad (during his time as PM).”
High-speed rail
Najib said the new government continued to insist the project would cost RM110 billion, even though the Singapore and Malaysian governments had previously estimated it would cost a maximum of RM72 billion, including land acquisition costs.
“The finance minister claims this inflated figure of RM110 billion includes interest costs. How he arrived at this figure is unclear. The international tender which requires those participating to propose their financing packages only closes in December 2018.”
He said in past discussions, interested parties were willing to propose low-interest or even no-interest financing packages, similar to what was offered to India.
Najib said Lim continued to ignore requests by multiple parties to reveal the feasibility and economic impact studies for the HSR project, and called for these reports to be made public “to determine if the best interests of Malaysia are served by cancelling this project.”
1MDB debt and assets
Najib said Lim had given inaccurate “guesstimates” about 1MDB’s current debt, saying it was RM50 billion “— which he vaguely says includes interest —” and was a figure higher than the RM30 billion and RM38 billion that he had given in the past week.
“The finance minister should also mention that the debt is backed by assets worth up to RM30 billion or that US$3.5 billion (RM14 billion) of that debt is guaranteed by a foreign government and is the subject of further good-faith negotiations as part of a settlement agreement.
“Instead of continuing to use 1MDB as political capital, the new PH government should ensure the rationalisation plan for 1MDB is continued. Its previous asset values should be enhanced and monetised to pay down the debt.”
Najib, who was also former finance minister, said that the World Bank and International Monetary Fund had reported a few months ago that Malaysia, then led by Barisan Nasional, would reach high-income nation status in as early as three years.
“The PH government should ensure we remain on course to meet this target.”
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