Arya News - Malaysian Finance Minister II Amir Hamzah said the financial burden of the nation`s biggest corruption scandal had also come at the expense of development priorities, with billions of ringgit in public funds channelled towards settling 1MDB`s debts and financial commitments.
KUALA LUMPUR – Malaysia will still be left with billions of ringgit in losses from the 1Malaysia Development Bhd (1MDB) scandal, regardless of how much more the government manages to recover, says Finance Minister II Datuk Seri Amir Hamzah Azizan (pic).
He said further asset recoveries would not fully offset the financial losses suffered by the country, while the damage to investor confidence following revelations of the scandal also remained a concern.
“Although there is good potential for additional recoveries based on the strength of the government’s case in seeking compensation from those responsible, these recoveries will not eliminate the losses arising from the 1MDB scandal or reduce the country’s losses from tens of billions of ringgit,” he told the Dewan Rakyat on Wednesday (Oct 28).
Amir Hamzah said the financial burden had also come at the expense of development priorities, with billions of ringgit in public funds channelled towards settling 1MDB’s debts and financial commitments.
Since 2017, he said the government has spent RM18.7bil from operating and development allocations approved under successive annual budgets to meet 1MDB’s financial obligations.
In March 2023 alone, he said the government had to allocate RM13bil from its development expenditure to redeem US$3bil in government-guaranteed 1MDB bonds.
“The amount represented approximately 13.1% of the RM99bil development allocation for that year,” he said.
Amir Hamzah said the funds could otherwise have been used to finance national development priorities, including the construction of schools and hospitals, road infrastructure, rural water supply and programmes directly benefiting the public.
He also clarified that settling 1MDB’s outstanding debts did not necessarily mean the government had recovered the public funds already spent on those obligations.
As of Aug 31, 2026, he said the government had paid RM42.5bil towards 1MDB-related debts and commitments, including principal, interest and other costs.
“A further RM8.9bil remained payable under government-guaranteed Islamic Medium Term Notes (IMTN), comprising RM5bil in principal and RM3.9bil in interest, with the sukuk scheduled to mature in 2039,” he added.
This brought the total amount already paid and still payable to RM51.4bil, according to Amir Hamzah.
After accounting for RM31.3bil in recovered funds and assets, he said the government’s estimated net financial burden stood at RM20.1bil, assuming no further recoveries.
Amir Hamzah said the government was also unable to determine how much Malaysia would ultimately recover from outstanding 1MDB-related claims.
“The amounts depended on court decisions, appeals, the identification of recoverable assets and the ability to enforce court orders, particularly overseas.
“As such, amounts claimed in legal proceedings or awarded by courts could not automatically be regarded as funds that would eventually be returned to Malaysia,” he said.
He said any estimates would also need to account for third-party rights, settlements, funds already recovered and the possibility of overlapping claims involving the same assets.
Amir Hamzah said the government had not established a definitive deadline for concluding all 1MDB-related legal claims and asset recovery efforts.
He stressed that the 2039 maturity date for the outstanding sukuk was separate from the timeline for resolving legal proceedings and recovering misappropriated assets.
The government would continue pursuing recoveries domestically and internationally while ensuring that its outstanding financial obligations were met according to schedule, he added.
He was responding to Lee Chuan How (PH-Ipoh Timor), who had asked about the government’s target for resolving 1MDB’s remaining net liabilities and the expected value of outstanding asset recovery claims.