Mahathir bans foreigners from buying Forest City residential units in Malaysia
The project has been wracked by uncertainty since Mahathir’s coalition scored a shock victory at a May general election
Malaysian Prime Minister Mahathir Mohamad said on Monday he wanted to prevent foreigners from buying residential units in the US$100 billion Forest City project, a setback for the Chinese developer as it tries to revive faltering demand for the site.
The project by developer Country Garden Holdings Co Ltd to build a city for 700,000 people in the state of Johor bordering Singapore has faced uncertainty since Mahathir’s coalition won a shock victory at a May general election.
“One thing is certain, that city that is going to be built cannot be sold to foreigners,” Mahathir told a news conference in Kuala Lumpur, the capital. “We are not going to give visas for people to come and live here. Our objection is because it was built for foreigners, not built for Malaysians. Most Malaysians are unable to buy those flats.”
Should Mahathir’s win worry Forest City’s Chinese investors?
Chinese buyers account for about two-thirds of the owners of Forest City units sold so far, with 20 per cent from Malaysia and the rest from 22 other countries, including Indonesia, Vietnam and South Korea.
Country Garden Pacificview Sdn Bhd, a joint venture between Country Garden and the Johor state government to develop Forest City, said it has complied with all necessary regulations in developing the project.
It said Mahathir’s statement “may have been taken out of context” and his comments did not correspond with the content of a meeting two weeks ago between the prime minister and Country Garden’s chairman, Yeung Kwok Keung.
“During the meeting, Tun Mahathir reiterated that he welcomes foreign investment which could create employment opportunities, promote technology transfer and innovations that could benefit Malaysia’s economic growth and job creation,” the company said in a statement.