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CURRENT PROFILE OF THE MALAYSIAN PLASTICS INDUSTRY. Roadshow 2015 Insights of the Plastics Industry. Contents. Minimum Wage Issues Labour and Foreign Workers Issues Energy cost Caring for the Environment. Key Data for the Malaysian Plastics Industry. Export/Sales Turnover Ratio. E/T
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CURRENT PROFILE OF THE MALAYSIAN PLASTICS INDUSTRY Roadshow 2015 Insights of the Plastics Industry
Contents • Minimum Wage Issues • Labour and Foreign Workers Issues • Energy cost • Caring for the Environment
Export/Sales Turnover Ratio E/T Ratio Turnover RM billion
Minimum Wage Policy and Shortage of Workers • Malaysia is technically having “full employment” as the unemployment rate is only 2.7% • Shortage of workers …. both skilled and unskilled. High dependency on foreign workers is due to circumstances, rather than choice. • However, employment of foreign workers is increasingly difficult to employ due to arbitrary government policies.
Minimum Wage Policy and Shortage of Workers • The implementation of MW in 2014 has resulted in a 30% to 40% wage hike for general workers, mainly foreign workers.Total cost impact depends on type of production processes, size of company and the dependency on foreign labour. • Minimum wage rates are subjected to review at least once every two years. The rates are currently being reviewed.
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
New Mandatory Online Renewal Of Foreign Workers Permit Through MyEG
Rising Energy Cost Revisions of TNB Average Electricity Tariff Source: Energy Commission of Malaysia Rates are subjected to further increases due to the Government’s subsidy rationalisation programme
Increasing Energy Costs • 15% increase in electricity tariff beginning January 2014 (electricity being a major cost component). Despite the 5.8% reduction effective March 2015, the new tariff is still about 8% higher than the 2013 tariff rates.
Increasing Energy Costs • In addition, Energy Commission (EC) informed that the Special Industrial Tariff (SIT) would be phased out gradually. In fact, in January 2014, the discount rate of 5% had been reduced to 3% and by January 2017, SIT will be phased out completely.
Increasing Energy Costs • The ruling that Tariff D users who wish to apply for incentives/discounts must employ an Approved Energy Manager as consultant to monitor usage. The cost of employing an Energy Manager would outweigh the incentives/discount received.
Increasing Energy Costs • EC also announced that Enhanced Time of Use (ETOU) Tariff Scheme, a modification to the existing Time of Use Scheme, would be introduced in 2015. • Under the Scheme, the off-peak rates would be further divided into off-peak (more discount) and mid off-peak (lesser discount), but it is limited to Tariff C (Commercial) and Tariff E (medium to large industrial users).
Increasing Energy Costs • Currently, the Time of Use Scheme with peak and off-peak tariffs does not cover Tariff D users. In the ETOU, again, EC has left out the Tariff D users. • The fact that 90% of MPMA members being SMEs and classified as Tariff D users, they will not be eligible for the ETOU discount.
