Govt warns of fiscal slippage, plays down recent ringgit decline
Malaysia's Finance Minister II Amir Hamzah Azizan stated that the government may miss its 2026 fiscal deficit target due to rising fuel subsidy costs caused by the Iran conflict. However, the administration remains committed to its medium-term goal of reducing the deficit to below 3% of GDP by 2028.
Why it matters
This highlights the vulnerability of emerging market economies to global geopolitical tensions and the difficult trade-off between fiscal discipline and social welfare spending.
Share Finance minister II Amir Hamzah Azizan says Putrajaya remains committed to achieving its medium-term goal of reducing the fiscal deficit to below 3% of GDP by 2028. Malaysia and other Southeast Asian countries are bracing for a more pronounced impact from the Iran conflict in the third quarter as disruptions to global energy markets increasingly filter through to domestic economies. KUALA LUMPUR : Malaysia may miss its fiscal deficit target for 2026 as the conflict involving Iran pushes up fuel subsidy costs, finance minister II Amir Hamzah Azizan said, while stressing that the government’s longer-term fiscal goals remain on track. “If I end up, at the end of the day, slightly short of the targets, it’s okay,” Amir said in an interview with Bloomberg TV’s Haslinda Amin on Tuesday, underscoring that the government’s immediate priority is to protect vulnerable groups.
The article reports on government statements and economic data without taking a partisan stance or using loaded language.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in