KUALA LUMPUR (June 2): Notwithstanding a rise in direct government debt, Malaysia's overall debt and liabilities in 2018 dropped 3.9 percentage points (ppts) to 75.4% of the country's gross domestic product in 2018, versus 79.3% in 2017, following a successful cost rationalisation exercise involving planned mega projects and Public Private Partnership (PPP) payments .

Finance Minister Lim Guan Eng said this in a statement today, following his announcement on Saturday that the Debt Management Committee, which he chairs, has convened its first meeting on Friday to tackle the government's debt and liabilities, which stood at RM1.1 trillion as at end-2018. At the time, he also noted that the government saw a RM54.2 billion rise in direct government debt to RM741.0 billion from RM686.8 billion.

In his statement today, he clarified that the federal government's debt and liabilities are made up of three components: direct government debt, committed government guarantees that are serviced by the government, and lease payments from various PPP projects as well as other long-term liabilities.

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