Manufacturers rue ‘lack of support’ in budget

The Federation of Malaysia Manufacturing (FMM) has expressed disappointment with the 2027 budget, alleging it lacks adequate support for the manufacturing sector. FMM President Jacob Lee cited rising operating costs and barriers to technology adoption, innovation, and green investments as challenges facing the industry. He lamented that the proposed RM1.5 billion support package was not incorporated into the federal budget, leaving a funding gap for small and medium-sized enterprises to cover technology adoption expenses.

Lee urged the finance ministry to engage with the industry regarding the proposed RM2,500 monthly minimum wage for semi-skilled workers and graduates. He argued that the wage should be market-driven rather than set by the government, considering job requirements and demonstrating worker competence and productivity. The FMM called for industry consultation on the proposed framework to address existing skills mismatches, which could lead to higher wage obligations and additional training costs for employers.

Despite his concerns, Lee welcomed the review of the reinvestment allowance, hoping for clearer eligibility criteria and broader accessibility. The allowance would incentivize manufacturers to invest in automation and technology, crucial for enhancing competitiveness and generating higher-value jobs. He also endorsed plans to regulate e-commerce platforms, particularly due to foreign firms entering the market without adequate oversight and enforcement.

Lee emphasized that the Putrajaya should assess the impact of low-priced imports through conventional and online trade channels and recommended a comprehensive review of existing trade and regulatory measures to ensure a level playing field for Malaysian manufacturers and SMEs, without impeding legitimate trade or consumer choice.