Comparing the effects of immigration on GDP in Malaysia, Japan and South Africa.

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1.0        Introduction

Lately, there are a lot of immigrants or foreign labour force residing in many countries either legally or illegally. The International Organization for Migration (IOM) states that there are more than 200 million of migrants globally. The number of immigrants especially in developing countries and developed countries increase very rapidly. According to the United Nations, majority of the migrants are come from Asia.

        Malaysia has hosted more than one million of foreign immigrants, mostly from Indonesia, Bangladesh, Thailand, Myanmar and Philippines while Japan is home for immigrants from Vietnam, China and Myanmar. On the other hand, South Africa has many refugees and asylum seekers residing in it.

        The existence of immigrants would have played a vital role in the economy. They have contributed quite a large portion to the Gross Domestic Product (GDP). We are now going to analyze on the economic condition of Japan which is a developed country, Malaysia as a developing country, and South Africa as an undeveloped country. Analysis on immigrants’ contribution on the economic condition will be done.

2.0         Japan

2.1        Gross Domestic Product (GDP) from 2000 to 2008

Please refer to Attachment 1.0. It is a table of Gross Domestic Product of Japan since 2000 to 2008.  The GDP of Japan shows increase since year 2000 to 2007. However, it suddenly declined 2.74% at year 2008. Reasons will be explained in detail in 2.4 Analysis on Data.

2.2        Number of Immigrants, Unemployment and Crime Incidents  

As shown in Attachment 1.1, during year 2000 to 2007, the numbers of immigrants keep increasing. However, the unemployment rates keep decreasing.

2.3        Illegal Immigrants in Japan

Japan has a population of 127,433,494 as on July 2007 estimate and the news stated that approximately 10,000 illegal immigrants come to Japan each year. Therefore, the estimated number of illegal immigrants in Japan is 250,000 which mean 0.2% of population. There are few proofs of illegal immigrants in Japan. For example, Bangladeshi Abul Kalam Idrish, his son Jakin Prince Alsafa and daughter Saudia are part of the 270,000 so-called “undocumented foreigners” living in Japan long term who do not officially exist.

It’s no secret that Japanese are hiring illegal immigrants. By giving them jobs, they are providing the incentive for illegal immigrants to come to and stay in Japan. This sentence can be taken as a proof; Illegal immigrants from China, Korea, and Pakistan are smuggled into western Japan aboard in fishing boats. Instead of obtaining the $25,000 fee to be smuggled in advance, many immigrants are charge only $2,000 in advance, with the balance due upon successful entry into Japan. The boat trip from Fujian to Japan normally takes one week. In order to pay off smuggling fees, some Chinese immigrants commit crimes in Japan.

However, Japan does not have a serious illegal immigration issue as the total number of immigrants in the country is less compared to other countries.

2.4        Analysis on Data

Graph 1: Data on Japan’s GDP, Population, Immigrants and Unemployment

From the graph, we can see that the GDP for the year 2004 has increased from 487,186.7 Yen  to 493, 501.9 Yen which means has increased by 1.28%. The increase in GDP for the year 2004 would be because the contribution of immigrants towards the economy. It can be proven by looking at the drastic increase in the number of immigrants into the country in the year 2004 where the total number of immigrants was 2,481,308 million which means the percentage change was 22.82%. In line with the increase in GDP, the unemployment has also decreased by 0.12%. Therefore, we can conclude that Japan’s economy in the year 2004 was growing.

        As for the following years, the GDP of the country keep increasing in the range of 0.5% to 1.2% and the total number of immigrants was also increasing in the range 2.2% to 3.5%. In line with this, the unemployment was also decreasing drastically between the ranges of 6.4% to 7.3%. It is because there are more people working in the services industry as the services industry has contributed a lot to the GDP which means there are a lot of job vacancies in the industry. From here, we can see that Japan was maintaining their economy growth well and successfully reduced the country’s unemployment level which means the people in the country was happy with their lives.

        However, in the year 2008, we can see a very different situation compared to previous years. It is because the GDP for the year 2008 has drop by 2.74% which means the economy is contracting for that year. As the GDP decreases during this year, the unemployment level has increase by 3.08% which shows many people are jobless during the year. Other than that, we can conclude that GDP for the year 2008 decrease because the total number of immigrants in 2008 has also fall drastically as Japan is a country which highly depend on immigrants to boost their economy. The fall in the number of immigrants is 21.68%. Furthermore, the radical fall in manufacturing and services industries (refer to the Attachment 1.0) is the reason for the huge fall in the GDP for the year 2008 as manufacturing and services industries contributes a lot to the GDP of Japan.

        On the other hand, the crime rates in Japan is quite high during the analysis period especially in the year 2001 where the crime incidents increased by 31.78%. It can be because many people are unemployed during 2001 as the unemployment level was 5.81%, therefore they find it hard to survive which lead them to do crimes such as thefts and robberies in search for money. As for the following years, the crime rates keep declining as the unemployment level was also decreasing.

3.0         Malaysia

3.1        Gross Domestic Product (GDP) from 2000 to 2009

Malaysia’s GDP has a very steady increase from year 2000 to 2008. However, in the year 2009, the GDP dropped 9.01% if is compared to the previous year. The global economic recession that had happened during the period of time has cause a serious decline in the economy of Malaysia. ( Please refer to attachment 2.0 as reference.)

3.2        Number of Immigrants, Unemployment and Crime Incidents

Malaysia has been hosted about two millions of documented and undocumented immigrants. The decrease of number of foreign immigrants in year 2001 had lead to a fall in unemployment rate and decrease in number of crimes committed in Malaysia. From the figures shown in attachment 2.1 and graph above, we can make a conclusion of decrease in immigrants causes decrease in locals’ unemployment. (Please refer to Attachment 2.1 as reference)

3.3        Analysis on Data

Graph 2: Malaysia’s GDP, Number of Immigrants and Unemployment

From the graph, we can see that there is a decrease in GDP in the year of 2001, which is 2.63%. This is because there is a decrease in the number of immigrants in the country. However, in the year of 2005, the GDP had increased to RM 522,445 million because the number of immigrants has also increased from 1.6 million to 1.8 million. (Please refer to the Attachment 2.0 and Attachment 2.1.)

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Foreign workers or so called as immigrants in Malaysia have contributed a big effort in all sectors. Most of the immigrants are working in construction site. This can be seen from the graph that construction sector has the highest GDP. The second high GDP comes from manufacturing sector, following by mining and quarrying, and the last but not least, agriculture sector. The intake of foreign workers has helped these sectors to perform well every year. Hence, this has made those sectors to have a high dependency levels on immigrants workers. The GDP of these sectors will change according ...

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