KUALA LUMPUR, Sept 14 — Housing and Local Government Minister Zuraida Kamaruddin’s idea to promote the Malaysia My Second Home (MM2H) in restive Hong Kong may trigger a diplomatic row with China, observers said.
Oh Ei Sun, a senior fellow with the Singapore Institute of International Affairs, said China was unlikely to welcome efforts to tempt residents in its special administrative region now wracked by pro-democracy protests.
“The granting of MM2H status to Hong Kong buyers may be frowned upon by China in the current Hong Kong political climate.
“Well, it was reported that some Hong Kong residents are seeking residency elsewhere as the tumultuous situation in Hong Kong develops. China understandably would like to encourage Hong Kong residents to be confident about Hong Kong and remain there,” observed Oh.
Zuraida told reporters at an event recently that she intended on proposing her idea to the Cabinet in an attempt to address the glut of high-end property in Malaysia.
She remarked that real estate prices in Hong Kong are astronomical, with a 250 square feet apartment costing RM3 million, and would make Malaysia property a bargain in comparison.
Some Hong Kong residents and Chinese investors have panicked and began putting their properties on the market, despite making losses while doing so.
Oh also suggested a deeper cause to Malaysia’s excess of luxury property that would not be addressed by Zuraida’s proposal.
“There are undoubtedly plenty of high-end unsold units, as our economy is not performing well and disposable income levels are low. On the other hand, many middle-to-low income earners cannot afford to buy properties.
“So there is some sort of mismatch of supply and demand here. The government should encourage construction of more affordable housing. As to the high-end unsold ones, there is currently no restriction as to their purchases by foreign buyers, but there seem to be no takers anyhow.
“China buyers are very much desired but since a few years ago stricter China foreign exchange controls render many of them are unable to transfer their payments,” said Oh.
Separately, Johor Umno deputy liaison chairman Datuk Nur Jazlan Mohamed claimed the proposal showed that Pakatan Harapan (PH) lacked fresh ideas on governing the country.
“Now reality bites as it is clear PH is struggling in the economy, especially in the property sector.
“What PH has done is to adopt previous BN policies which they were criticising before for selling out to foreigners,” said Nur Jazlan when contacted.
The 53-year-old former deputy minister and parliamentarian pointed out that the previous Barisan Nasional (BN) administration had been criticised over a similar move with Forest City in Johor.
In August last year, Prime Minister Tun Dr Mahathir Mohamad had said the PH government would not allow foreigners to buy residential units in the Forest City project, before later clarifying that he meant the purchases did not entitle them to citizenships.
Nur Jazlan claimed Zuraida’s proposal was simply “repackaging” BN’s policy to encourage foreigners, especially the Chinese, to buy property in Malaysia.