Lately, the government’s announcement to bring in another 1.5 million Bangladeshi workers over the next three years has become the talk of the town.

The move has incurred critiques from all over the country and people from all walks of life. Many of these critiques are based on unfounded xenophobic assumptions.

However, the government allowing/encouraging the country to rely excessively on cheap unskilled migrant labour is more of an issue to be worried about.

Besides capital outflow (through remittance) and issues of labour exploitation, this policy will defeat the efforts of industrial transformation and upgrading in Malaysia.

Our country had enjoyed rapid economic growth during the rah-rah days of high commodity prices and high level of foreign investments.

Nevertheless, we did not utilise the windfall of abundant natural resources to transform our industries from being labour-intensive to capital-intensive.

We were like a “one-trick pony” that only relies on cheap labour to attract foreign investments. The situation has sustained till today - while commodity prices vary with the times, our industries are still depending on cheap labour to survive.

Economists have proven that countries that rely heavily on cheap labour will eventually enter into the vicious circle of “racing to the bottom”.

In order to woo foreign investors, countries with no specific industrial expertise would have to compete to the bottom. The country that allows more exploitation on labour rights will eventually win the race.

Meagre salaries

Over the years, the Malaysian working class has become victims of “racing to the bottom”. They have no choice but to leave jobs because they could not compete with migrant workers to live with their meagre salaries.

Therefore, Home Minister and Deputy Prime Minister Ahmad Zahid Hamidi's challenge to Malaysians to take up dirty, dangerous and difficult (3D) jobs shows that he is plainly ignorant.

Contrary to the perception that the government has tried to create, Malaysians are willing to do 3D work, just like what our forefathers had done in the past. However, Malaysians could not do those jobs with a salary that could hardly make ends meet.

By bringing in migrant workers who are more vulnerable to exploitation, the government is extending the lifespan of this inhumane system.

Similar situations have happened in most of the developing countries - what makes a difference is the choice of government policy implemented.

In the 60s, Singapore started their electronics industry with the packaging of semiconductors. The Economic Development Board (EDB) awarded pioneer status tax incentives to multinational semiconductor companies to set up assembly plants in Singapore.

Thus, many low-skilled jobs were created. However, Singapore started losing competitiveness in labour intensive industries in the 70s.

Instead of protecting labour intensive industries (such as semiconductor assembly plants) to “safeguard employment” and to “attract foreign investments”, then finance minister Goh Keng Swee stopped approving tax incentives to semiconductor assembly operations, allowing them to be phased out.

Singapore's electronics industry was forced to transform.

The Singaporean government provided incentive to firms to invest in higher value-added activities, while building capabilities of workforce to undertake these activities.

Today, Singapore is well positioned in the industry, manufacturing sophisticated medical devices, solar wafers, solar cells and other clean technologies.

With the benefit of hindsight, to maintain status quo or to start moving up the value chain is a no-brainer. Unfortunately, we do not see similar farsighted efforts in Malaysia to encourage our industries to transform and upgrade.

On the contrary, our government seems to be only interested in earning fast money by bringing in more migrant workers and charging them with a hefty levy.

We are already years behind our peer countries in transforming our industries. The country will be doomed to failure if our industries continue to rely on cheap labour.

Thus, it is high time to tell the improvident government: our way or the highway.

CHANG LIH KANG is the PKR Youth secretary and state assemblyperson of Teja, Perak.