Haze Cost Malaysia An Estimated RM8 Billion In Losses & 1,700 Deaths, Study Finds
The health burden of the estimated premature deaths was separately valued at between RM3 billion and RM15 billion.
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The haze from Indonesia is estimated to have caused RM8 billion in welfare losses in Malaysia and contributed to around 1,700 premature deaths, while disrupting businesses and manufacturing operations, according to a report
Commissioned by the Federation of Malaysian Manufacturers (FMM), the report, The 2026 Fire Season and Transboundary Haze in Malaysia, assessed the impact of prolonged haze between 1 July and 22 October.
According to Malay Mail, the study drew on satellite data, air quality monitoring, atmospheric modelling, and a survey of FMM members to examine the severity and consequences of the haze.
The survey received responses from 86 FMM member sites, with more than two-thirds reporting some form of operational impact
While 26% reported moderate or significant disruptions, the report cautioned that the survey was not representative of the entire manufacturing sector. Most responses came from Selangor and Penang, while only two came from Sarawak.
Among the 59 sites that reported operational impacts:
– 81% experienced increased sick leave or health-related staff absences
– 63% said school closures affected staff availability
– 14% reported staff shortages that disrupted shifts, production, or deliveries
The disruptions also affected output and operations, with 37% of impacted sites reporting lower output and 27% temporarily shutting down at least one operation.
The report estimated that the haze exposure between 1 July and 22 October also contributed to around 1,700 premature deaths
About 1,600 of these estimated deaths were attributed to smoke from the fires outside Malaysia, it said.
However, the report stressed that these figures are statistical estimates of deaths brought forward across the population, rather than individually identified cases.
It valued the health burden of these estimated premature deaths at between RM3 billion and RM15 billion.
The figure represents how much people would be willing to pay to avoid the risk of premature death, rather than lost economic output. As such, it should not be added to other economic losses, the report said.
FMM president Jacob Lee Chor Kok said the haze should no longer be viewed solely as an environmental issue, but also as a matter of public health, labour productivity, economic sustainability, and regional competitiveness
"Manufacturing industries are increasingly interconnected through regional and global supply chains. Environmental disruptions in one country can affect economic activities and business operations across national boundaries.
"Preventing haze is therefore not only an environmental responsibility but also an investment in economic resilience, sustainable industrial development, and the wellbeing of future generations," he said.
