February 19, 2016 / 11:51 AM / in 2 years

Malaysia halts intake of foreign workers after protests

KUALA LUMPUR (Reuters) - Malaysia on Friday said it would freeze recruitment of all foreign workers and review employment policies, following protests over its plans to bring in millions of workers to satisfy industry demand.

"The suspension will be in force until the government is satisfied with the manpower needs of the industries," state news agency Bernama said, citing Deputy Prime Minister Ahmad Zahid Hamidi.

The protests by Malaysian labor groups and firms followed reports that the Southeast Asian country planned to hire about 1.5 million Bangladeshi workers over three years to meet the demand from industry for labor.

Later the government clarified that its pact with Bangladesh would only allow 1.5 million workers to seek jobs in Malaysia, and did not mean that all of them would be recruited.

Enforcement measures will also be stepped up against illegal foreign workers throughout Malaysia, Ahmad Zahid added.

"Foreign workers without valid documents or those who have overstayed will be arrested and sent back to their country of origin," the agency quoted him as saying.

Malaysia has about 2.1 million documented foreign workers, a figure that falls below its self-imposed cap of 15 percent of foreigners among a total workforce of about 15.3 million.

It put on hold a plan to raise a levy on foreign workers, also announced this month, after opposition from businesses affected by the higher charges.

Malaysian manufacturers on Friday urged the government for more clarity on the sudden freeze on foreign worker recruitment.

"It is unclear to manufacturers how long the suspension would take effect," the Federation of Malaysian Manufacturers (FMM) said in a statement after the announcement.

"FMM hopes that the issues of levy and recruitment of foreign workers can be resolved expediently to avoid any deleterious effect on our economy."

Reporting by Praveen Menon; Editing by Clarence Fernandez

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