Illegal factories given amnesty as they contribute to economy

The Straits Times, March 3, 2007


KUALA LUMPUR - A MALAYSIAN state is offering an amnesty to 3,500 illegal factories after finding they had attracted foreign investment and were contributing billions of ringgit to the economy, reports said yesterday.

The factories in Selangor did not obtain licences for reasons that included failure to meet pollution standards, but they provided 150,000 jobs and contributed RM2 billion (S$870 million) to the state's economy yearly, an official was quoted as saying.

Many had also attracted foreign investment, exported half their products and were involved in high-technology manufacturing, he said.

'To shut them down would cause hardship to workers and lead to a host of other social problems,' Datuk Mohamad Mokhtar Ahmad Dahlan, chairman of Selangor's housing committee, was quoted as saying.

He said the state government decided to give the factories until the end of the year to legitimise their operations without penalties, after considering their contributions to the economy.

Factories operating on agricultural land, government reserve land as well as those without operating licences or certificates of fitness stand to gain from this exercise.

Applications to convert the status of their land from agriculture to industrial can now be made at the district offices, with approval expected in three months, the report said.

Government agencies, including the environment department, would help the factories to revamp their operations.

'If their operations do not pose any danger to the environment, there should be no reason for permits to be withheld,' said Datuk Mohamad Mokhtar, warning that they would be shut down if they continued to flout the law.

Selangor, Malaysia's most industrialised state, is a key state for manufacturing.

AGENCE FRANCE PRESSE, NEW STRAITS TIMES