Which comes to my confusion regarding FDIs or foreign investments. During my early working days in the 70s, we were told that those huge semi conductor firms are given tax incentives to invest and manufacture in Malaysia, due to our tax incentives (pioneer status), good infrastructure, and educated and smart workforce, and an amicable administration. One big reason touted was the availability of tens of thousands of young local [read Malaysian] workers, who keep production costs very low.. Now these low costs are replaced by overworked and underpaid foreign workers who send 80% of what they earn home, thus depriving Malaysia of a significant local consumption churn due to domestic spending. These foreign workers do not add value to our living standards, and contribute more destruction to our environment due to habits brought in from their native countries. Not to mention using up some of our dwindling potable water resources.
What then do these FDIs like JCY HDD bring to our nation? Do they pay taxes, or do they have extended tax holidays like those who come before them, like Motorola? Do they retain their export earnings and spend them in Malaysia, or do they, as expected, repatriate them overseas, like their underpaid foreign workers do with their meagre wages.
If these foreign investments do not benefit our nation as much as before, and give much needed employment to our locals, and provide the necessary transfer of technology, are we then doing the right thing by encouraging them, and then find our countries deluged by so much foreign labour, with increasingly undesirable social consequences that we are seeing today, and more frequently in the near future.
Is this the correct way to achieve "high income status" whatever that means ?
Tam
P Jaya
