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Malaysia firms turn down orders as migrant labour shortage hits
Despite lifting a COVID-19 freeze on recruiting foreign workers in February, Malaysia has not seen a significant return of migrant workers due to slow government approvals and protracted negotiations with Indonesia and Bangladesh over worker protections, say industry groups, companies and diplomats.
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A worker collects palm fruit at a plantation in Bahau, Negeri Sembilan, Malaysia, on Jan. 30. A European Union proposal to limit the use of palm oil lacks comprehensive scientific evidence and breaches global trade rules, Malaysia’s marketing agency for the edible oil said on Friday. (Reuters/Lai Seng Sin)
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span class="highlight" data-qa-component="highlight-text">Malaysian companies from palm oil plantations to semiconductor makers are refusing orders and forgoing billions in sales, hampered by a shortage of more than a million workers that threatens the country's economic recovery.
Despite lifting a COVID-19 freeze on recruiting foreign workers in February, Malaysia has not seen a significant return of migrant workers due to slow government approvals and protracted negotiations with Indonesia and Bangladesh over worker protections, say industry groups, companies and diplomats.
The export-reliant Southeast Asian nation, a key link in the global supply chain, relies on millions of foreigners for factory, plantation and service sector jobs shunned by locals as dirty, dangerous and difficult.
Manufacturers, who make up nearly one-fourth of the economy, fear losing customers to other countries as growth picks up.
"Despite the greater optimism in outlook and increase in sales, some companies are gravely hampered in their ability to fulfil orders," said Soh Thian Lai, president of the Federation of Malaysian Manufacturers, which represents over 3,500 companies.
Palm oil growers are at breaking point, said Carl Bek-Nielsen, chief executive director of oil palm grower United Plantations UTPS.KL.
"The situation is dire and very much like having to play a game of football against 11 men but only being allowed to field seven," he said.
