SINGAPORE: Prime Minister Tun Dr Mahathir Mohamad dismissed that Malaysia was more reliant on oil revenue and stated that Petroliam Nasional Bhd (Petronas) could afford to pay a bumper dividend without its operations being affected.

“RM30bil is nothing to them (Petronas) ...they used to give the government RM80bil at a time when the oil price was at US$120 per barrel.

“RM30bil is because the price of oil is now at almost US$70 per barrel,” he said at the Asean Summit in Singapore.

Last week, rating agency Moody’s Investors Service had raised concerns on the financial strength of Petronas if the government continues to depend on the national oil company paying hefty dividends to fulfil its expenditure.

The rating agency did not downgrade Petronas but changed its outlook from stable to negative.

This came a few days after the government announced in Budget 2019 that Petronas would pay a special one-off dividend of RM30bil to settle the outstanding tax refunds.

Including the special dividend from Petronas, the federal government’s share of revenue from petroleum-related activities will be 30.9% next year. If the RM30bil special dividend was stripped out, it would be 19.5% of total revenue next year compared to 21.7% this year.

For 2019, non-petroleum-related revenue will contribute 70% of federal government coffers.

Dr Mahathir pointed out that the higher dividend payment was only due to higher oil prices. He reiterated that the rating agencies should see that the country did not depend heavily on oil-based revenue.

“We have been telling them (rating agencies) that a substantial portion of Malaysian exports are manufacturing goods.

“But sometimes, the price of oil goes up and they (Petronas) would give more money to the government, that’s all,” he explained.