Malaysia is set to lose at least RM3.7 billion, with the introduction of the Malaysia My Second Home (MM2H) programme’s stricter policies, said the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia (PEPS).
According to PEPS, the figure only included visa fees, hotel accommodation, fixed deposits, medical insurance and checkups and excludes the acquisition of cars, property, children’s education, retail purchases, food and beverages as well as consumer spending, reported Free Malaysia Today (FMT).
The association noted that instead of providing additional incentives to the programme’s participants, the new policies seem to discourage them.
“It can be seen that the main focus of the policies is more towards security concerns or on the spike in the number of participants from a particular country rather than the economic potentialities,” it said in a statement.
“Policies that involve foreign investment must not be quickly reversed as they send negative signals to the existing and potential applicants,” it added.
Security concerns or the spike of participants from a certain country may be managed by having separate policies and processes to prevent the misuse of MM2H visas, said PEPS.
The association suggested conducting more engagement exercises with stakeholders, expatriates and non-government organisations before coming up with new policies since MM2H plays a vital role not only in terms of economic contributions, but also as an international advertisement of what Malaysia could offer.
With this, it called for a deferment of the enforcement of the new policies until a solid inclusive approach is formulated.
“There should be more progressive policies to further increase the number of participants as they are contributing to the economy as compared to foreign workers who generate foreign outflows by repatriating money to their home countries,” it said.
Unlike the foreign workforce, the programme’s participants are net importers of foreign currency, pointed the association. They also added to the country’s economy by way of multiplier spending.
“They are also socially less problematic as the government does not have to provide medical and social services because all these are paid for and borne by the participants. They do not cause any burden to Malaysian employers,” it said.
PEPS said the programme’s new policies should be aimed at attracting good quality foreigners, and not necessarily upper high-end income earners.
Home Ministry Secretary-General Wan Ahmad Dahlan Abdul Aziz recently announced that MM2H applicants will have to comply with 10 new stricter criteria.
These include higher compulsory fixed deposits at local banks, which previously stood at between RM150,000 and RM300,000 and is now pegged at RM1 million.
The applicant’s offshore monthly income was also raised from RM10,000 to RM40,000, while the liquid asset requirement was increased from between RM300,000 and RM500,000 to at least RM1.5 million.