Fiscal and Debt Problems

In Malaysia, reference to the public sector in the economic literature usually refers to the federal government, the thirteen state governments and the federal territory authorities, city, municipal and town councils, and the non-financial public enterprises (NFPEs). The public sector is clearly dominated by the federal government, with the state governments having relatively limited roles because of legal and political constraints embodied in the federal constitution and imposed by the federal government. The NFPEs — previously known as off-budget agencies (OBAs) — have become increasingly important in recent years, being heavily involved in various commercial and industrial projects.