KUALA LUMPUR, Oct 29 (Bernama) — Malaysia’s external debt increased to RM1.021 billion or 67.4 per cent to gross domestic product (GDP) as at end-June 2021, mainly attributed to higher offshore borrowings from the public sector, as well as non-resident holdings of ringgit-denominated debt securities.

In 2020, it stood at RM958.14 billion or 67.6 per cent to GDP.

External debt comprises the nation’s offshore borrowing, non-resident holdings of ringgit-denominated debt securities, non-resident deposits and other external debt.

Offshore borrowings remained the largest component of external debt at RM589.5 billion, with a share of 57.8 per cent, the 2022 Fiscal Outlook and Federal Government revenue estimates released by the Ministry of Finance (MoF) today revealed.

It said the higher public sector offshore borrowings were due to the issuance of the global sukuk by the Federal Government and foreign currency bonds and sukuk by public corporations.

Meanwhile, non-resident holdings of ringgit-denominated debt securities and deposits collectively accounted for RM338.4 billion, with a higher share of 33.2 per cent of the total.

In terms of maturity profile, the medium- to long-term external debt stood at 62.2% of the total, reflecting low refinancing risk.

Short-term external debt accounted for 37.8%, backed by an adequate level of international reserves.

Furthermore, the external risk is also mitigated by sizable external assets and export earnings.