Malaysia among 10 countries with national budgets fully aligned to UN's SDG assessments, says Tengku Zafrul

KUALA LUMPUR (Nov 8): Malaysia is among the 10 countries in the world which have fully aligned their national budgets to the sustainable development goals (SDGs) based on the United Nations assessments, said Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

Citing Budget 2022, which was announced recently, Tengku Zafrul said the Finance Ministry has mapped out all of the government’s initiatives to the SDGs, allowing Malaysia to better match the national landscape of financing programs with SDGs related projects. 

He added that based on this progress, Budget 2022 will be a budget that will anchor and drive several initiatives that were also announced in the 12th Malaysia Plan earlier. 

“The plan will build on what was achieved in the 11th Malaysia Plan and this will focus on growth and inclusivity.

“Overall on sustainability measures, Budget 2022 includes transition towards low carbon practices, environment and diversity, community empowerment and we are planning to issue our first government sustainability sukuk in the ringgit term,” he said in his keynote interview with Bloomberg head of government and regulatory affairs Asia Pacific Vicky Cheng at the Sustainable Finance Week in conjunction with Malaysia’s participation at Expo 2020 Dubai held virtually on Monday (Nov 8).

In the finance minister’s budget speech last month, Tengku Zafrul said for next year, the government will issue sustainability sukuk denominated in ringgit of up to RM10 billion to be channelled to eligible social or environmentally friendly projects. This, he said, is Malaysia’s commitment to fulfil its obligations as a signatory to the Paris Agreement.

Last April, the government successfully issued the world's first sovereign sustainability sukuk through an issuance of US$800 million. The sukuk has been oversubscribed by over 5.6 times, which reflects investor confidence in the country. 

On a related note, Tengku Zafrul noted the Finance Ministry is looking into establishing a voluntary carbon market that will be launched under Bursa Malaysia, which is part of the efforts to transition Malaysia into a low carbon economy and is expected to help the country meet its goal of becoming carbon neutral by 2050.  

Looking ahead, Tengku Zafrul said the government plans to issue more bonds and sukuk that are focusing on eligible social and nature-friendly projects.

“This commitment necessitates that the government drive the reform in order for growth to be sustainable and competitive in the global market. Our national development priorities also align with the SDGs,” he added.

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