KUALA LUMPUR: The Government prefers to concentrate on making sure the rakyat remain safe and comfortable in riding out the economic downturn rather than give priority to cutting the budget deficit.
“If we want to inject a bigger stimulus package, the deficit is unavoidable,” said Prime Minister Datuk Seri Najib Tun Razak.
He was replying to a supplementary question from Dr Tan Seng Giaw (DAP - Kepong) in Parliament yesterday.
Najib said a budget deficit was not avoidable in the short term and that all countries faced a higher deficit during the current world financial crisis.
The Government, he added, chose to save the people first but would take steps to reduce the deficit when the time was right.
“Wait for my Budget speech for a picture on how we will handle the deficit.”
When replying to an earlier question by Dr Tan, Najib said Malaysia had pre-empted the international community by adopting unconventional policies when it was hit by the Asian financial crisis between 1997 and 1998.
He said since then Malaysia had bolstered the finance and banking sectors with the Capital Market and Finance Sector master plans.
“Besides that, we have implemented fiscal and monetary policies that are accommodative and encompassing which were deemed radical at the time,” he said.
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