Southeast Asia's third-largest economy is dealing with a debt pile of over 1 trillion ringgit ($243.19 billion), which the administration of Prime Minister Mahathir Mohamad has blamed on mismanagement by the previous government.

Malaysia is also struggling with slowing economic growth, hurt largely by a global slowdown and the trade war between the United States and China.

Finance Minister Lim Guan Eng said while Malaysia can meet this year's fiscal deficit target of 3.4%, next year's target of 3% would be harder to meet. He also said he was "cautiously confident" about meeting the government's full year growth forecast of 4.3% to 4.8%.