I have been observing the "foreign worker industry" since the late 80s; even before the government opened the door to Bangladeshis as the demand for factory workers sky-rocketed. Malaysia was then a popular FDI magnet.
In fact, I was even involved in various aspects of the business of foreign workers, starting with the provision of insurance cover for the guest workers. At one time, I even had management control over two employment agencies licensed to recruit foreign workers but gave up when it was obvious that a dirty game would only get dirtier.
Those were the days before China and India woke up. It was a time when MNCs in labor intensive sectors like the electronics and textile industries were seeking solutions to escalating labor cost in their own countries and found Malaysia an attractive location for factories both in terms of infrastructure and tax considerations. It was the heyday of Mahathirism and nothing must stop his industrialization juggernaut; least of all an acute shortage of cheap, unskilled local labor. Getting orders to supply workers was and is never the problem per se. It is how one gets into a position to offer and deliver the service that counts.
It was, and I believe still is, a "technical know-who" game where rules and regulations are mere formalities to shut out those who are not within the circle at the top of the food chain. This is an industry so perfect for the rent-seeking scourge of NEP Malaysia that it could not be better even if it was by design; or was it? There are more "toll gates" than the North-South highway!
If it is any indication, this 16th July1995 NST report about the infamous Tajuddin Rahman of Pasir Salak speaks volumes. Tajuddin of course denied all allegations.
The main operative mechanism that drives this rent-seekers' gravy train is the quota system which is supposed to be regulative. Supposed to be.
Each stage in the employment of a foreign worker is fraught with palms to grease or lined with gold depending on where one is positioned. But ultimately it is the poor sod who hocked everything he had (or did not have) in his homeland who pays the price.
Moreover, there is an off-shoot to this legal employment of foreign workers; the illegal workers. The thousands of desperate runaways or illegal entrants create rent opportunities for "below the line" authorities and it is by no means small change.
Najib in unveiling Part 1 of his New Economic Model mentioned decreasing dependence on unskilled foreign workers. As a deputy PM before, he would have chaired the Cabinet Committee on Foreign Workers (yes, there has been this special cabinet committee for years now) and he would know the A-Z of the stats and issues. Unless, he has the will to impose a realistic minimum wage policy in the country he can forget about reducing dependence on foreign workers. I wonder how one of his 3 main goals of the NEM i.e. a high-income society (US15,000 to US20,000 per capita by 2020) dovetails with all this.
I could write volumes about foreign workers in Malaysia from a close-up view going back two decades yet it seems my knowledge would not be outdated even today because judging from the following article in the Malaysian Insider today some things just do not change. Please read: