Govt paid down 1MDB’s RM51bil debt, RM8.9bil still outstanding

PETALING JAYA: The federal government had paid RM42.5 billion of 1MDB’s RM51 billion in debts and commitments as of June 30, but remains liable for a further RM8.9 billion in government-guaranteed sukuk maturing in 2039.

Deputy finance minister Liew Chin Tong said the government had so far paid RM42.5 billion, covering principal repayments, interest, legal and operational costs, as well as other commitments.

He said the government also remained responsible for RM8.9 billion in government-guaranteed Islamic medium term notes, comprising RM5 billion in principal and RM3.9 billion in interest, which would mature in 2039.

“This means the total 1MDB liabilities that have been and still need to be borne by the government amount to RM51.4 billion,” he said in reply to Chong Chieng Jen (PH-Stampin).

Chong had asked for the total amount of debt assumed by the federal government arising from 1MDB’s debts and how much of that debt had been repaid to date.

He also asked how much the government had so far managed to recover from misappropriated 1MDB funds and assets.

Liew said the government had recovered RM31.3 billion in funds linked to 1MDB.

“If there are no further recoveries in the future, the government will still have to bear the remaining RM21 billion of overall obligations.”

He said the government expected to shoulder most of the remaining net liability, estimated at RM20.1 billion, and that the 1MDB scandal had not only caused substantial financial losses but also damaged Malaysia’s reputation and credibility.

Liew said the government was continuing efforts to recover 1MDB assets through criminal prosecutions and civil suits against those linked to the scandal, as well as legal action against the international financial institutions involved.

However, he said it was unlikely that future recoveries of funds or assets would be sufficient to cover the remaining liabilities, as a significant portion of the recoveries had already been realised.

Separately, Liew said the government had spent RM18.7 billion from operating and development expenditure allocations approved under annual budgets since 2017 to meet 1MDB’s financial obligations.