Govt must demonstrate fiscal prudence in Budget 2017: Nazir

KUALA LUMPUR: CIMB Group Holdings Bhd chairman Datuk Seri Nazir Abdul Razak said the government needs to demonstrate fiscal prudence in the upcoming Budget 2017, which some quarters claim will be an election budget.
“The important thing is to maintain the self-imposed debt ceiling of 55% of GDP (gross domestic product), this is what the market is looking at in the current environment,” he told reporters on the sidelines of the Khazanah Megatrends Forum 2016 yesterday.
Nazir said while the government can “spend more”, it can also “save more” in the budget.
“I encourage the government to look at more rigorous spending management. They must know where to cut and where to spend. For some less important spending and operating expenditure, there should be serious cuts. This is how the government can meet its target,” he added.
Meanwhile, Khazanah Nasional Bhd managing director Tan Sri Azman Mokhtar is of the view that Budget 2017 needs to be pro-growth and pro-society with fiscally responsibility.
“Hopefully, it will be a good budget. We know the global conditions are quite challenging. But for Malaysia, we have many strengths and geography is one of that. We look forward to playing our part,” he said.
Azman said companies under Khazanah will continue to participate in the country’s economic growth story. “We need to keep the growth engine going. Without growth, it’s very difficult to do the next things.”
On a separate note, Nazir expects another cut in the Overnight Policy Rate at the next meeting of Bank Negara Malaysia’s monetary policy committee, which is scheduled to be held on Nov 23.
“Our expectation is a possibility of another rate cut, but this cut should not be done just on national dynamics but on international dynamics because it can impact other things,” he said.
The two-day forum themed “Geography as Destiny” has drawn more than 1,000 local and foreign participants.