In 2025, Malaysia’s national debt has shown signs of improvement — at least on paper. Government borrowing has slowed down compared to the pandemic years, and fiscal reforms are being introduced. But on the ground, Malaysians continue to feel the pinch. Food prices are high, wages remain stagnant, and household debt is climbing. So, what’s going on?
Let’s break it down.
📉 The Government Is Borrowing Less — Good News, Right?
Yes… but it’s more complicated than that.
According to the Ministry of Finance, Malaysia’s national debt-to-GDP ratio has stabilised, and the government has been more disciplined with spending. Several mega projects have been postponed or restructured. Subsidy rationalisation is also in full swing.
In simple terms: the government is trying to live within its means.
This is generally a good thing. It helps improve investor confidence, keeps the Ringgit more stable, and reduces future tax burdens. But here’s the catch...
😟 If the Government Saves Money, Why Are Malaysians Still Struggling?
Because saving money on the government’s part sometimes means more burden on the rakyat.
Here’s how:
Subsidy Cuts – The government has reduced subsidies for petrol, electricity, and essential goods. That means you’re paying more out of your own pocket.
Service Charges & New Taxes – To increase revenue, some new taxes and fees are being introduced or raised, affecting middle- and lower-income households the most.
Cost of Living Crisis – Despite lower national borrowing, prices at the supermarket are still rising. Imported food is more expensive, and local inflation hasn't eased as expected.
Household Debt Rising – Many Malaysians are now turning to personal loans and credit cards to cover daily expenses. So while the government borrows less, the rakyat borrows more.
🏦 A Shift of Burden: From Government to People?
It seems that while the government is tightening its belt, ordinary Malaysians are being asked to carry more weight. This might be okay if salaries rise or costs drop — but that’s not what’s happening.
Youth unemployment is still a concern. Small businesses are recovering slowly. And most importantly, people just don’t feel the recovery — even if the numbers say otherwise.
💡 So What Can Be Done?
For real, inclusive recovery, experts suggest:
Reforming wage policies to ensure Malaysians earn more.
Targeted subsidies instead of blanket removals — to help those who need it most.
Controlling food prices through smarter agricultural and import strategies.
Debt relief programs or financial literacy initiatives to help households manage rising credit usage.
✅ Final Thoughts: Progress on Paper, Pain in Reality?
Malaysia’s effort to reduce national debt is commendable. But any economic policy must balance the books AND the wellbeing of the people. Numbers don’t lie — but neither do empty wallets.
Until reforms reach the ground level, and the average Malaysian feels the difference, many will continue to ask:
“Why does it feel like we’re still struggling — even when the country is doing better?”
👉 What’s your view on this? Have you felt the impact of subsidy cuts or rising prices? Let’s talk in the comments. And don’t forget to share this post if you think more Malaysians need to understand what’s really going on!
#Malaysia2025 #NationalDebt #CostOfLiving #Economy #HutangNegara #RakyatSengsara
