Bankrupt claim: LGE’s statement misleading, says federation

Sarawak Business Federation (SBF) logo

KUCHING, June 24: Sarawak Business Federation (SBF) has described as “irresponsible” and “over-simplistic” Finance Minister Lim Guan Eng’s recent statement that Sarawak would go bankrupt in three years time if it continues to be ruled by Gabungan Parti Sarawak (GPS).

Lim should realise that whatever he says will wittingly or unwittingly impact market outlook, said SBF in a statement.

While it noted that Lim was making a political speech at a political event, SBF nonetheless felt very uncomfortable with such a sensational statement.

“We believe one of the reasons why Sarawak budgeted RM11 billion this year is because of the relatively small and inadequate budget allocated by the federal government to Sarawak,” it said in a statement.

Hence, Putrajaya should provide Sarawak with funds that commensurate with its contributions and rights in order for Sarawak to extricate itself from backwardness and poverty.

Saying that Sarawak had been making enormous contributions to the federal coffer from its oil and gas resources, SBF said, “The private sector in Sarawak welcomes the commitment by any quarter to pump funds into the economy for basic infrastructure development in Sarawak.”

This is because an expanding economy means there will be more work for the contractors and consultants and also more businesses for traders and small retailers across the state.

“It is, therefore, highly inappropriate for the Finance Minister to belittle Sarawak’s efforts to develop. And to say that if Sarawak were to do so (budgeting RM11 billion annually) for 3 years, we would go bankrupt, is over-simplistic and misleading.

“It is over-simplistic because the minister only focused on expenditure and not revenue. He has ignored Sarawak’s expanding revenue base, especially the sales tax from petroleum products, which is expected to rake in billions of ringgit,” said SBF.

SBF opined that Lim seemed uninformed that RAM Ratings Agency viewed favourably Sarawak’s development-centric State Budget for 2019 to address the state’s substantial developmental needs, which bodes well for efforts to narrow the wide socio-economic gap between Sarawak and West Malaysian states.

“RAM also said that the considerable expansion of Sarawak’s revenue base could cater for enlarged spending commitments while maintaining fiscal sustainability and a formidable reserves buffer,” SBF pointed out. — DayakDaily