The Malaysian government has decided to revise some of its new rules for the Malaysia My Second Home (MMH2) program for foreign applicants who are already enrolled in the program following criticism from industry experts who claimed the ad hoc changes would make wealthy foreigners go elsewhere.
Speaking at the country’s parliament earlier this week, Malaysian Home Minister Hamzah Zainudin said foreign applicants already enrolled in MM2H program would now have to meet just two out of the 10 conditions that were announced in August this year.
Among the two conditions that must be met are the processing fee hike from 90 Malaysian ringgit (around $21.5) to 500RM ($119.7) for each year, and the minimum time period the enrolled foreigner must stay in the country, which has been increased to at least 90 days per annum.
However, new applicants to the MM2H would have to meet all 10 conditions, according to the minister, which include maintaining an offshore income of at least RM40,000 (around $9,500) per month; previously only RM10,000 (around $2,362) was required. Also, the fixed savings account threshold for new applicants was increased to at least RM1 million (around $240,000), which previously used to be between RM150,000 (around $35,436) and RM300,000 (around $70,871).
MALAYSIA WANTS ‘HIGH QUALITY’ FOREIGNERS
Explaining the reason behind the recent changes to the MM2H, which has made it more exclusive for HNWIs, the home minister told the parliament that the Malaysian government wants only those foreigners who are seen as “genuine, of high quality and can provide positive contribution to the country’s economic growth”, Malaysian media outlets reported.
“The objective of MM2H is to provide the opportunity for high-quality retirees and participants to live and spend in Malaysia,” Zainudin added.
Last September, the minister had cited national security as one of the reasons behind making the changes to the MM2H program. He had back then said that of the 57,478 foreigners currently enrolled in the MM2H program, around 7,000 of them did not live in Malaysia for long periods of time and allegedly used the country as a transit for carrying out “unwanted activities”.
DEMAND FOR MORE CHANGES FOR MALAYSIA
Some industry insiders discouraged with the new rules said they want several more changes to the program since the MMH2 in its current state is not attractive enough to pull foreigners in large numbers to make the program profitable for all stakeholders and save Malaysia’s economy.
Even in the parliament, the Sultan for the Malaysian state of Johor, Ibrahim Sultan Iskandar, was quoted as saying that the government’s MMH2 new rules “would dent the country’s revenue and frighten off investors.”
According to Malaysian government figures, the MMH2 program generated around $2.8 billion between 2002 and 2019.