KUALA LUMPUR: Pandan Member of Parliament Datuk Seri Rafizi Ramli has questioned the government’s gradual fiscal deficit reduction strategy, or “fiscal glide”, outlined since 2023, following market expectations that the 2025 deficit may miss the official target.

The former Minister of Economy said the government had set a target to reduce the fiscal deficit from six per cent in 2022 to five per cent in 2023, 4.3 per cent in 2024, 3.8 per cent in 2025, and further down to 3.5 per cent in 2026.

However, he noted that current market projections estimate the 2025 fiscal deficit to be between four and 4.2 per cent, higher than the 3.8 per cent target presented in Budget 2025.

“This could be the first time the fiscal glide target is not achieved, although official figures have yet to be announced,” he said while debating the Motion of Thanks for the Royal Address in the Dewan Rakyat yesterday.

He said the failure to meet the target should be taken seriously, as it is directly linked to the government’s goal of controlling national debt by 2028.

Rafizi explained that fiscal discipline is one of the key pillars of the country’s economic recovery narrative, alongside economic restructuring towards higher value creation.

“So far, the government has argued that success in reducing the deficit proves that national financial management is on the right track, but the actual figures need to be viewed with greater transparency,” he said.

According to him, any deviation from fiscal targets, even if small, could affect market confidence and investor perception of the country’s financial management.

At the same time, Rafizi stressed that macroeconomic achievements such as GDP growth, a stronger ringgit, and controlled inflation must be supported by fiscal data that reflect the government’s real financial position.

“If not addressed openly, there will be a gap between the economic narrative presented by the government and the fiscal reality experienced by the public and the market,” he said. – SABAH MEDIA