Guan Eng urges Budget 2027 to shield employers from higher foreign labour costs

Former Finance Minister Lim Guan Eng has urged the Malaysian government to exclude foreign workers from any minimum wage increase in the upcoming Budget, while also proposing a temporary suspension of the 2% EPF contribution requirement for these workers. Lim believes that imposing both measures on foreign workers would add to the financial pressure on employers, particularly micro, small and medium enterprises (MSMEs) that are already grappling with higher operating costs and a tough economic climate.

Although Lim supports raising wages for Malaysian workers, he believes that any wage increase should be balanced against current economic conditions. The minimum wage of RM1,700 a month may be raised to RM2,000 in the coming Budget, as efforts are made to help workers cope with rising living costs. Lim emphasizes that the economic environment is facing external pressures, including higher oil prices, tariffs, trade wars, and supply chain disruptions.

He stresses the importance of ensuring Malaysian employers, especially those in the MSME sector, remain competitive. Lim's proposal is not directed at foreign workers but aimed at safeguarding the interests of Malaysian employers and workers who are facing higher living costs.