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Malaysia to reform labour laws to cut 'over-dependence' on foreigners: PM

Malaysia Prime Minister Mahathir Mohamad speaks during the opening ceremony of the 20th Asia Oil & Gas Conference in Kuala Lumpur, Malaysia, June 24, 2019. REUTERS/Lai Seng Sin

KUALA LUMPUR (Reuters) - Malaysia will review its labour laws to cut an “over-dependence” on foreign labour and address other issues, its prime minister said on Thursday, amid simmering discontent against overseas workers who make up 46 percent of the labour force.

In the first quarter of the year, Southeast Asia’s third biggest economy had a labour force of 15.5 million. More than 7 million of them were foreigners, from countries such as Bangladesh, with many working in the construction and hotel industries.

Labour force refers to employed or unemployed people between the age of 16 and 64.

Prime Minister Mahathir Mohamad told a gathering of international trade chambers that generating more skilled jobs, raising salaries and wages, enhancing “management of migrant workers” and improving labour market conditions were some of his government’s top labour-reform priorities.

“These reforms are crucial, not only in developing human capital to support our future economic growth but also in addressing job mismatches which contribute to graduate underemployment, unemployment, and slow wage growth as well as over-dependence on foreign labour,” he said.

The prime minister said his government was also working on increasing the female labour force participation rate to 59% by next year. In the first quarter, the figure was 55.7%.

Reporting by Krishna N. Das; editing by Richard Pullin