Stakeholders have baulked at the “drastic” new terms for the Malaysia My Second Home (MM2H) programme.
Unless the government reconsiders these rules, they cautioned that Malaysia may lose out to neighbouring nations in attracting foreign retirees.
The groups also said it was "unethical" to impose these terms on existing MM2H holders, many of whom have built their lives in Malaysia.
Under the new MM2H eligibility terms, the minimum monthly income was raised 400 percent from RM10,000 to RM40,000.
The minimum fixed deposit was also raised from RM150,000 to RM1 million.
Previously at RM350,000, the minimum liquidity requirement is now RM1.5 million.
These are some of the new terms that will come into effect in October 2021 for both new applicants and existing MM2H visa holders.
The latter has one year to come into compliance.
‘Shocking, drastic, unreasonable’
In a joint statement today, the MM2H Consultants Association (MM2HCA) and Industries Unite - a coalition made up of mainly business guilds - objected to most of the new terms.
“Industries Unite and MM2HCA analysed the new terms and found the measures announced by the government recently were shocking, drastic and unacceptable,” they said.
For one, they opined that the “drastic increment” of the monthly income requirement to RM40,000 was “unacceptable”.
This was far higher than the average pension in Japan (RM5,788 a month) and the UK (RM4,492 a month).
“Our neighbouring countries offer a similar programme with much lower income requirements.
“The Thai Retirement Visa for retirees only requires a monthly income or pension of at least THB 65,000 (RM8,262),” they noted.
The two groups also disagreed with the minimum liquidity requirement (RM1.5 million), fixed deposit requirement (RM1 million) and the requirement for an extra RM50,000 in fixed deposits for each dependent.
“Honestly, a rich (and) investment-savvy applicant would not have this sum in liquid assets. Instead, their funds would have been well invested in high yielding products,” they said.
They further disagreed with the government’s move to impose “ridiculous” processing fees - RM5,000 per applicant and RM2,500 per dependent. This was previously free.
Yearly visa fees, meanwhile, have been raised from RM90 to RM500.
Under the new terms, the duration of an MM2H visa was slashed from 10 years to five years.
“This was a unique feature of the MM2H programme (and) it should be maintained at 10 years. It loses its advantage if it is only five years and foreigners have other choices,” they cautioned.
The two groups were also opposed to the rule that visa holders must remain in Malaysia for at least 90 cumulative days per year.
They contended that this requirement should be cut down to 14 cumulative days per year.
No confidence in programme
MM2HCA and Industries Unite further opined it was unfair to impose these new requirements on existing MM2H visa holders.
According to the Home Ministry, there are presently 57,478 MM2H visa holders plus dependents.
“It is unethical to subject existing MM2H holders to these new requirements. This shifting of goalposts will reduce foreigner confidence in our government [...]
“Many MM2H holders sold their properties in their home countries and have been living harmoniously with Malaysians and consider Malaysia their home.
“They spend freely in Malaysia and have contributed to the economy of this country. It would not be fair to ignore their contribution and then subject them to new rulings,” they said.
Based on a recent MM2HCA survey, they said 70 percent of members expressed “no confidence” in promoting the revamped programme.
“We must use the MM2H programme as part of the National Recovery Plan to stimulate the Malaysian economy.
“The new requirements will ensure the failure of this programme and be a huge loss to our GDP,” they said.
The two groups thus urged the government to reconsider these new MM2H terms.
“MM2HCA is happy to have more discussions with the Home Ministry to ensure the success of the MM2H programme,” they offered.
Ministry targets top quality
The ministry’s secretary-general Wan Ahmad Dahlan Abdul Aziz had announced the new MM2H terms and conditions on Aug 11.
In explaining the reasons for the new rules, he said it was to both stimulate the economy and mitigate local “concerns” about foreign citizens.
He also announced a quota for MM2H visa holders.
“The government understands the rakyat’s concerns and worries about foreign citizens entering the country through the MM2H programme, which is feared to increase the flood of foreigners in Malaysia.
“Therefore, the government has agreed to set a ceiling number for MM2H applicants and dependents at no more than one percent of the total number of Malaysian citizens at one time,” he had said.
Dahlan also explained why the ministry had raised the financial requirements.
“Compared to the previous income requirement, the new income requirement is more relevant because the government targets participants who have quality, who can afford it and who have a high income.
“We also take into account their expected expenses. For example, when sending their children to international schools and a lifestyle that suits their standard of living,” he said in reference to the RM40,000 per month income requirement.
As for the RM1.5 million liquidity requirement, Dahlan explained that this was similarly to target applicants who were “financially capable and able to contribute to the economy”.
The higher fees - both processing and yearly visa fees - were to help raise the quality of service.
“The processing fee is aimed at improving the quality of service offered to MM2H participants. An online system will be developed to offer MM2H participants the best service,” Dahlan said.
The top official further explained that the 90-day minimum stay rule was to ensure participants truly spent their money in Malaysia.
“This is to ensure MM2H applicants truly spend and contribute to the domestic economy whether by renting or buying property, (using) healthcare facilities, insurance, education, food and beverage, domestic tourism or other ways that will generate income for the local people,” he said.
MM2H applications were previously frozen when the government closed its international borders on March 18 last year under the first movement control order. - Mkini
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