IDEAS: Refugees could contribute over RM3 billion to the Malaysian economy if granted rights to work

KUCHING: New research published yesterday by think tank IDEAS finds that granting refugees in Malaysia the rights to work would have positive impacts on both the economy and public finances.

“The Economic Impact of Granting Refugees in Malaysia the Right To Work” estimates that if refugees were given the legal right to work, they would contribute over RM3 billion to Gross Domestic Product (GDP) by 2024 through higher spending. The wider economic impact of this policy reform, including indirect effects, could be substantially more.

In addition to boosting GDP, allowing refugees to work would lead to an increase in tax revenues, with a total contribution estimated at RM50 million each year by 2024. The research also concludes that employment and wages of Malaysians would benefit, with refugees helping to create over 4,000 jobs for Malaysians if given the right to work.

In order to realise these benefits, the report recommends that the Government move to implement its manifesto promise to give refugees the right to work.

Commenting on the release of the report, IDEAS chief executive officer Ali Salman said: “Malaysia is rightly seen as a place of refuge by many who are facing persecution. Malaysia can be proud of its record of providing a safe place to those in need.

“This report highlights that refugees can also make an important contribution to Malaysia’s economy – a contribution currently untapped. The Government should move forward with its manifesto promise to give refugees the right to work and encourage them to make the best possible contribution to Malaysia.”

As well as granting refugees the right to work, the report argues that the Government should consider investing in education for refugees to maximise their longterm economic contribution.

It estimates that granting refugees access to education on a par with locals would increase their contribution to GDP to over RM6.5 billion each year by 2040, with annual tax contributions of over RM250 million.

There are currently over 160,000 refugees and asylum seekers in Malaysia registered with UNHCR. Malaysia is not a signatory to the UN Refugee Convention, and refugees do not have the rights to work.

However, many refugees currently work informally, often in dangerous jobs where their productivity is restricted, and they are at risk of exploitation. In its electoral manifesto, Pakatan Harapan committed to giving refugees with the right to work, but this promise has not yet been implemented.