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Monday, November 5, 2007

Stop relying on foreign labour

Business Times Singapore (5/11/2007): At last count, Malaysia has launched three economic corridors with another two on the way. The Iskandar Development Region in South Johor - launched towards the end of 2006 - was followed by the Northern Corridor Economic Region (NCER) and then the Eastern Corridor Economic Region (ECER).

Economic programmes for the East Malaysian states of Sabah and Sarawak will be unveiled later this year, the intention being to ensure no region misses out.

One of the main objectives of the corridors is job creation and the reversal of inter-state migration. Unveiling the latest last week - the ECER which covers the east coast states of Terengganu, Kelantan, Pahang and north Johor - Malaysia said the initiative was expected to create over half a million jobs over the next 15 odd years.

Agriculture and tourism are two sectors identified in the ECER as well as the NCER as areas to be cultivated given the potential for job and growth opportunities. One can expect similar thrusts for Sabah and Sarawak given their obvious potential in these two areas.

Assuming the sectors take off, it is debatable if Malaysians will warm to the opportunities in these industries and take up jobs that are now mostly performed by foreign workers.

Hired as household maids, plantation workers, factory hands, cleaners, construction workers, food stall handlers - low-skilled foreign workers have become a ubiquitous and permanent factor in Malaysia, which boasts the largest foreign workforce in Asean.

Despite the recognition more than a decade ago that they could pose potential problems to national security, little has been done to overcome the reliance on cheap foreign labour so much so that legally registered foreign workers now number 1.8 to two million - out of Malaysia's estimated total workforce of 10 million - with another million-odd unregistered.

In total, they already account for nearly 30 per cent of the workforce and going by the trend, their numbers could increase to five million by 2010.

In a recent fiasco, one level of the Kuala Lumpur International Airport (KLIA) was even reduced to temporary quarters for stranded foreign workers after their prospective employers did not turn up to collect them within the stipulated period. The problem was attributed to the Malaysian government's decision to outsource recruitment to over 200 agents who incidentally get paid hefty commissions by those attracted to the idea of working in Malaysia.

According to the Malaysian Trade Union Congress, about 1,000 documented workers arrive at KLIA daily, with most of the recent arrivals from Bangladesh.

Although unemployment is a reported low 3 per cent, the Malaysian Institute of Economic Research has observed there were 200,000 fewer jobs created last year than in 2005, particularly higher-value jobs.

Malaysians have reached the stage where they do not want to do the '3Ds' jobs - dirty, dangerous, or difficult - or for the matter, mundane work.

News reports claim that over 15,000 foreign workers work illegally as petrol pump attendants nationwide.

In the 1990s, the country had already signalled its intention to move up the value chain and wanted fewer labour intensive investments. But while higher value jobs are gradually being created, many of the country's professionals are also opting to migrate either owing to better prospects overseas or political considerations.

At the same time, locals who are willing to do the 'grunt jobs' prefer to head to Singapore, Macau or wherever which offers better wages for pretty much the same effort.

There is much to be said for agro-culture as the Netherlands and Taiwan have demonstrated. Reducing the nation's food-bill is also an imperative. But few of the younger generation are interested in farming and unless there is a massive mind-shift and they come round to see it as rewarding and productive work, it will be difficult to see any change.

In Ulu Yam, it is foreign labour that sustains one of the biggest - if not the biggest - vegetable growing areas in the state of Selangor. Similarly in tourism, many hotels cannot operate without such workers.

In time, the new growth corridors may create hundreds and even thousands of jobs.

The greater challenge then might be in ensuring it is Malaysians and not Indonesians, Bangladeshis, Filipinos, Indians, Pakistanis, Myanmese, Chinese, Laotians, Sri Lankans, Vietnamese, Thais and Cambodians who are occupying the bulk of the jobs.


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