Malaysia Maintains Strong Position as Net Creditor Nation: PM Anwar

KUALA LUMPUR, Nov 18: Malaysia continues to stand as a net creditor nation, supported by robust external resilience and substantial non-reserve foreign currency assets held by local corporates and financial institutions, Prime Minister Datuk Seri Anwar Ibrahim said.

In a written parliamentary reply, Anwar stated that Malaysia’s Net International Investment Position (NIIP) remained positive at RM77.3 billion, or 3.9% of GDP, as of the end of the third quarter of 2025.

“This clearly shows that Malaysia remains a net creditor nation,” he said, adding that the sizeable non-reserve external assets offer an important financial buffer for meeting foreign currency obligations.

The Prime Minister was responding to a query from Datuk Seri Hamzah Zainudin (PN–Larut) regarding the nation’s ability to manage external debt, especially given Bank Negara Malaysia’s reserves, which as of August were sufficient to cover 4.8 months of imports and 0.9 times short-term external debt.

Anwar, who also serves as finance minister, assured that Malaysia’s external debt management remains solid.
“Bank Negara Malaysia’s gross international reserves are fully usable and sufficient to support the orderly functioning of the foreign exchange market,” he said.

He added that corporates and financial institutions have accumulated significant non-reserve foreign assets that can be utilized to meet their external commitments.

As of Oct 31, Malaysia’s international reserves stood at US$123.8 billion (RM521.6 billion), well above international adequacy benchmarks of three months of retained imports and covering short-term external debt. The reserves also represented 104% of the International Monetary Fund’s (IMF) Assessing Reserve Adequacy (ARA) metric.

On the broader external debt, Anwar said risks remain contained.
External debt totalled RM1.4 trillion, or 69.4% of GDP, at the end of the third quarter—still considered a safe and manageable level for the economy.

He noted that concerns typically arise only when external debt is paired with large short-term borrowings, high exposure to foreign currency loans, and persistent current account deficits—factors that do not affect Malaysia’s current position.

“About 56.9% of our external debt comprises medium- and long-term borrowings, which reduces refinancing risks,” he said.
Short-term external debt also remains manageable, supported by strong export earnings and Bank Negara’s prudential regulations.

Anwar further emphasized that the Federal Government’s external debt remains minimal, accounting for less than 3% of Malaysia’s total foreign-currency external debt, with most borrowings denominated in ringgit.

“This reinforces the view that Malaysia’s external position is healthy, resilient, and responsibly managed,” he said.