KUALA LUMPUR: The hiring of foreign workers should be made more expensive through a multi-tier levy mechanism, including making Employees Provident Fund contributions for foreign workers mandatory and implementing a higher minimum wage, says Deputy Investment, Trade and Industry Minister Liew Chin Tong (pic).
He said when the hiring of foreign workers becomes more expensive, industries will be more encouraged to adopt more automation and technology, hire less labour and pay each skilled worker a higher wage.
“In the 1990s, among the Asian economies, Malaysia’s level of technological sophistication was just behind Japan, South Korea and Taiwan.
“In fact, 30 years ago, most of the more technically competent engineers hired in China to run factories were from Malaysia,” he said during the launch of the Future Ready Financing (FRF) Programme here yesterday.
However, he said today, Malaysia has lagged behind, and instead of venturing into the new field of technology, many Malaysian companies opted to hire cheap unskilled foreign labour.
“Malaysia will not grow if we continue to rely on unskilled foreign labour.
“Our country will grow exponentially when everyone has a sense of solidarity towards Malaysian workers by having a commitment to create quality jobs with better pay for them to stay here and contribute,” he said.
According to Liew, the FRF Programme was indeed a timely initiative and will target small and medium enterprises (SME’s) in Malaysia that are related to manufacturing and the manufacturing-related services sectors.
He added the government is committed to driving growth for this group as they are the backbone of the economy and contribute 38% to Malaysia’s gross domestic product.
The programme, spearheaded by the Malaysian Industrial Development Finance Bhd (MIDF), will see RM200mil being used to assist 100 SMEs transform into smart factories by 2027 while creating more than 500 high-skilled jobs.
The programme is also in partnership with the Malaysian Technology Development Corporation (MTDC), Sirim Bhd as well as technology solution providers.
Liew said MTDC and Sirim play pivotal roles by assessing technological readiness, matching SMEs with the right solution providers, and recommending eligible SMEs for MIDF financing.
“This holistic approach ensures that SMEs are not only equipped with financial resources but also supported with expertise, positioning them for successful integration of smart technologies and sustainable growth,” he noted.
He added that SMEs should adopt Industry 4.0 technology, access real-time data analytics, engage in precision manufacturing, and roll-out smart factory systems across the board.
Meanwhile, MIDF chairman Tan Sri Abdul Rahman Mamat said the FRF Programme is designed to impact the country’s industrial future by supporting SMEs.
He said FRF was not merely about financing, but about building capacity and competitiveness for the long term.
“FRF also leverages our deep partnerships with MTDC, Sirim and solution providers, ensuring SMEs receive a holistic mix of financial backing, advisory support, and technology resources.
“By guiding businesses through this transformation journey, MIDF and our partners are setting SMEs on a path toward operational efficiency, sustainable growth, and technological competitiveness,” he noted.
He said more importantly, the programme is crafted to help SMEs who are challenged by the fast paced world of automation and technology-driven methods.
“With the right tools and expertise, these challenges become opportunities for growth. FRF ensures that financing is not a barrier but a bridge to enable digital transformation and create enduring value,” he said.
Abdul Rahman added that as the country transitions into relying less on foreign labour, FRF will play a vital role by opening doors for local talent development and high-skilled job creation.
