China’s middle-class dream of a second home in Malaysia dashed by coronavirus and geopolitical tensions
- Many Chinese people have left Malaysia, opting to sell their homes remotely rather than wait to see when and if they will be allowed to return
- Individual Chinese investors are often unprepared – both financially and psychologically – for the risks of overseas investment, expert says
Patricia Li is dismayed and saddened by the exodus of Chinese people she is witnessing in Johor, the southernmost state in Malaysia.
When she moved to the tropical Southeast Asian country from Yunnan province in 2017, the outlook was bright. Thousands of middle-class Chinese investors were flocking to Malaysia to buy property and secure a second home beyond China’s borders.
A number of Chinese developers have also invested heavily in Johor, promoting its proximity to Singapore and developing real-estate projects tailored for affluent Chinese people eager to make overseas investments or embrace a new lifestyle abroad. Since 2011, Guangdong-based developer Country Garden says it has invested close to RM20 billion (US$4.83 billion) in Malaysia, creating more than 1,500 jobs.
For her part, Li opened a teahouse in Johor to serve the Chinese community that was growing there, with many taking advantage of the Malaysia My Second Home (MM2H) programme, which launched in 2002 and offered foreign investors long-stay visas of up to 10 years.
But so much has changed in such a short time. The coronavirus outbreak and a worsening geopolitical environment have made Chinese investors wary, and the latest blow came last month when Malaysia decided to suspend the MM2H programme, in line with the government’s decision to bar foreigners from entering amid the pandemic.