MEF president Syed Hussain Syed Husman said the freeze on foreign worker recruitment imposed in 2020 and 2021 to combat the Covid-19 pandemic and the closure of the country’s borders had severely impacted many businesses.

He pointed out that despite the government’s announcement to lift restrictions last month, the application and approval process through the Foreign Workers Centralised Management System (FWCMS) was still not running smoothly.

“MEF is concerned that only 2,605 applications have been approved in the manufacturing and plantation sectors, almost two months after the government opened up applications.

“Also, despite employers trying hard to resolve labour shortages, especially with regard to foreign workers, the approval rate of 0.55% out of the total of 475,678 applications submitted is a major concern as this may derail efforts by businesses to recover quickly.

“MEF is also worried that these shortages may affect Malaysia’s gross domestic product growth for 2022, projected at 5.3% to 6.3% by Bank Negara Malaysia,” Syed Hussain said in a statement today.

He added that continued stimulus packages would help build the confidence of businesses that need more time to recover.

Syed Hussain also called for the government to discuss and negotiate with source countries to control and cap the recruitment fees charged by agents.

“Apart from the high-cost factors that need to be reduced, MEF also hopes that the length of time taken for foreign workers to arrive in Malaysia can be shortened.

“It is estimated that under the normal process of applying for new foreign workers, it may take up to six months before they can start working,” he said.