KUALA LUMPUR • Malaysia may list certain state-owned entities to cut government debt and liabilities, Prime Minister Mahathir Mohamad said yesterday, as it seeks new revenue sources to boost its fiscal position.
Tun Dr Mahathir, who has blamed the previous administration of Najib Razak for saddling Malaysia with debt and liabilities of more than RM1 trillion (S$333 billion), said a panel to cut debt is looking at strategies, such as "identification of opportunities on potential asset monetisation, which means mature unlisted government entities may be listed in the stock market".
He told an investor conference in Kuala Lumpur that state-linked firms could pare equity stakes, adding: "The key guiding principles for monetising any of our assets is that (it)... must never be done at fire-sale prices, and any disposal of shares, monetisation of assets, auctions or other measures will be done in an orderly manner."
He did not identify companies or fix a time-frame.
Sovereign wealth fund Khazanah Nasional this month announced a new strategy, saying it was gearing up to be a "long-term real return provider" to the government through its commercial investments.
A Reuters report last month cited sources as saying Khazanah's new strategy aimed to deliver more cash to the government by pruning stakes in non-strategic assets. Some analysts have also speculated the government could list a small portion of its stake in state energy firm Petronas to generate revenue.
Petronas is the sole manager of Malaysia's oil and gas reserves. Although some of its subsidiaries are listed on the national stock exchange, Petronas is fully owned by the government.
Finance Minister Lim Guan Eng last year said the government had no immediate plans to sell stakes in state-owned companies, but did not rule out the possibility in the future. Mr Lim and Dr Mahathir have blamed corruption scandals in the previous administration for Malaysia's large debts.
The fiscal situation was also hurt after the new government scrapped an unpopular consumption tax, in line with a campaign promise.