Human Resources Minister S. Subramaniam said the government wanted to reduce the imported labour force in the country from 2.
2 million to 1.8 million by next year.
He said the plantation sector, in which many foreigners work, was now offering more competitive salaries with housing, education and medical benefits.
"The government hopes this will encourage the locals to fill up the vacancy left by these foreign workers," Subramaniam told the state news agency Bernama.
"The employers are now willing to hire local workers because they don't need to spend on the levy and other fees which they would have to pay if they hire foreign workers," he added.
A second annual reduction in the imported headcount of 400,000 would see numbers cut to 1.
4 million by mid 2010 and 1.2 million by the end of that year, if the total continued to fall at that rate.
Malaysia relies heavily on foreign help from Indonesia, Bangladesh, India and elsewhere to gather crops, clean homes and construct buildings -