A shortage of workers in the housing and rail construction sector could hamper the development of key projects such as the MRT and LRT extension.

The Malaysian Developer’s Council (MDC) said this could have a negative effect on Malaysia’s economic transformation and is urging Putrajaya to review its foreign labour policy, theMalaysian Insider reported.

In a statement, the MDC said the Economic Transformation Plan (ETP) and national key delivery programmes were boosting the growth of infrastructure and building projects, as well as driving up demand for labour, which the market could not supply.

“MDC therefore urges the Government to review, at least in the short term, its foreign labour policy on the entry of skilled and semi skilled labours from countries such as Indonesia, Vietnam, Myanmar and China that have the necessary pool of resources to quickly overcome the problem,” it said.

“Otherwise, delivery of critical projects such as the MRT, LRT extension, and projects within the 5 corridors, High Speed Rail (HSR) and housing will be in jeopardy particularly if labour costs escalate tremendously.”

Earlier this year, Prime Minister Datuk Seri Najib Razak’s Cabinet reinstated an old levy on foreign workers in Malaysia in an attempt to boost local jobs.

All new foreign workers are now required to pay a tax set between RM34.16 and RM154.16 a month each and foreigners who are renewing their work passes, employment passes or temporary work visit passes will also be taxed in an attempt to reverse the annual RM2 billion cash outflow.

The original levy was paid for by the workers from 1992, until the government shifted the responsibility to employers in 2009.