THE Malaysian rubber glove industry is appealing for immediate fiscal relief and human capital support in the upcoming Budget 2026, warning that it faces mounting economic pressures and intensifying competition from regional producers.
The Malaysian Rubber Glove Manufacturers Association (MARGMA) has urged the government to reduce or suspend the current cess export duty collected by the Malaysian Rubber Board, citing steep operating costs and shrinking global market share.
The call comes ahead of the tabling of Budget 2026 by Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim on 10 October.
“The Malaysian rubber glove industry is currently battling severely compressed margins due to escalating operational costs and fierce global competition, particularly from rivals in China and Thailand,” Bernama cited MARGMA president Oon Kim Hung saying. “These measures are essential to enhance our global cost competitiveness and ensure the Malaysian rubber glove industry can maintain sectoral growth for our economy to thrive and perform sustainably throughout 2026 and beyond.”
MARGMA has proposed reducing the cess rate from 0.2 to 0.1 percent or suspending it altogether, suggesting a review mechanism that could see the levy reinstated once the sector recovers.
“This relief measure will immediately help local manufacturers of all sizes, including small and medium enterprises, to combat high operating costs and eroding profit margins,” said Oon.
Manufacturers are also grappling with the reintroduction of the Sales and Service Tax, compulsory Employees Provident Fund contributions for foreign workers starting 1 October, the multi-tier levy system for migrant labour, rising utilities, and ESG compliance costs. These are all contributing to what Oon described as a “multi-front cost escalation.”
To address labour shortages, MARGMA is also calling for the reopening and streamlining of the foreign worker recruitment and replacement process.
“We suggest the government expedite approvals for replacement workers to ensure a stable, adequate labour supply,” said Oon, noting that labour shortfalls continue to disrupt production and delivery timelines.
On sustainability and global regulation, the association has requested tax incentives, reinvestment allowances and grants to help firms, particularly SMEs, manage increasingly complex ESG compliance requirements, including those related to the European Union’s Deforestation Regulation.
MARGMA is also pushing for targeted allocations in Budget 2026 to promote Malaysian glove exports. It has proposed a strategic “Malaysia Made Glove” campaign to reposition the country’s gloves globally as ethical, sustainable, and medically certified products.
“This can be further extended to collaborating with international healthcare associations, procurement agencies, and non-governmental organisations to showcase Malaysia’s commitment to sustainable and ethical glove manufacturing,” said Oon.
He further called for dedicated funding to support workforce training and upskilling aligned with artificial intelligence and automation, which are expected to define the sector’s future.
Energy Efficiency Push for Data and Industrial Cooling
Meanwhile, energy service providers are urging the government to prioritise sustainable cooling and industrial modernisation in Budget 2026 to reduce carbon emissions and long-term costs.
Wong Yin Kee, Managing Director of Engie Services Malaysia, said that demand for centralised cooling systems is expected to rise with the expansion of data centres and high-tech manufacturing.
“Centralised cooling is more sustainable and efficient compared to individual systems in each building. Countries leading in sustainable urban development have already adopted district cooling systems (DCS) as a standard. Malaysia should follow suit,” he said.
He also urged the government to strengthen the Energy Efficiency and Conservation Act (EECA) by introducing clear and enforceable targets for high-energy users. While the current policy framework is a good foundation, he said it remains focused largely on reporting, rather than performance.
“To drive real progress, we recommend annual minimum efficiency gains for cooling plants. This would enable industry players to reinvest savings into innovation and expansion,” Wong added.
He said energy efficiency presents a high-impact opportunity to lower carbon intensity and improve business resilience.
“Malaysia has already taken bold steps to integrate energy efficiency and DCS into its policy framework. We now have a chance to turn this into a transformative reality. Engie Services Malaysia stands ready to partner with government and industry to make this happen.”
Budget 2026 will be tabled in Parliament on 10 October. - October 5, 2025
