A vast real estate development under construction in Malaysia’s southern state of Johor is in the spotlight over a widening political row pitting the country’s wily nonagenarian premier against a large private Chinese property developer backed by the state’s influential ruler, Sultan Ibrahim Ismail.
The ambitious US$100 billion mega-project, known as Forest City, is administered in partnership with an investment entity whose largest shareholder is the sultan. It is designed to span four artificial islands built adjacent to neighboring Singapore and if fully built will alter the area’s map by creating a new private residential township expected to accommodate 700,000 residents by 2050.
Though Forest City is at an early stage of development and barely inhabited, Chinese nationals reportedly make up some 70%, or two-thirds, of apartment buyers so far, with Malaysians accounting for just 20% of sales. Foreign property buyers from 22 other countries, including Indonesia, Vietnam and South Korea, have also invested in units.
Prime Minister Mahathir Mohamad announced in late August that foreigners could no longer buy properties there, surprising many – including Johor’s state government – and contradicting Malaysian law, which allows for foreign citizens and companies to acquire land and property subject to the prior approval of state, rather than federal, authorities.
Johor’s Chief Minister Osman Sapian, a member of Mahathir’s Parti Pribumi Bersatu Malaysia (PPBM) political party, pushed back against the premier’s remarks and defended the project’s contributions to both the state and national economy, suggesting the national leader was not given “a clear explanation” of the state’s property policy.
The push-back appeared to cause Mahathir to revise his stance by conceding that foreigners would be allowed to purchase resident units, but pledging instead to refuse the issuance of residency visas to buyers. That has stoked concerns that the Malaysia My Second Home (MM2H) scheme, under which foreigners can obtain a renewable social visit pass with 10-year validity, will soon be axed.
Mahathir’s strident criticism of Forest City, which he panned as a “foreign enclave” in early 2017, had set the stage for an election campaign that cast Chinese-backed mega-projects as evidence of his predecessor, ex-premier Najib Razak, selling the country out to Beijing to cover financial shortfalls caused by his administration’s fiscal mismanagement and alleged corruption.
“This is not Chinese investment, but a settlement,” he remarked ahead of his shock victory in elections held on May 9. He has at times compared the China-backed development with Singapore’s establishment as a British colonial settlement and stoked nationalistic fears that foreign property buyers would eventually become Malaysian citizens with voting rights.
Despite that vocal opposition, Mahathir had appeared to endorse both the long-stay visa scheme and the Forest City project during his visit to China last month at an August 16 meeting with Yeung Kwok Kwong, chairman of Country Garden Holdings, the Hong Kong-listed property developer whose subsidiary is leading the project’s construction.
According to the company’s director of strategy, Ng Zhu Hann, Mahathir’s latest public barbs against the sprawling real estate project were at odds with the private stance he took during last month’s 40-minute closed-door meeting, where he said the premier “reiterated that he welcomes foreign investments which could create employment opportunities.”
Azmin Ali, economic affairs minister and deputy president of the ruling coalition’s largest party, added to the confusion when he alleged that Country Garden was behind a “special scheme” to award free condominium units at Forest City to incentivize investment in China. Both the developer and Johor’s chief minister have denied the unsubstantiated claim.
Still, Putrajaya’s pronouncements raise the possibility of unilateral action taken to change investment conditions previously agreed to with the last administration, a move that analysts say would undermine foreign investor confidence over fears that private developments elsewhere could become targets of project-specific discrimination.
Others, however, regard Mahathir’s public remarks as tactical political posturing for mostly domestic consumption.
“Mahathir wants China to be more cognizant of Malaysia’s domestic sentiments when they invest in the country,” says Mustafa Izzuddin, a fellow at the ISEAS-Yusof Ishak Institute in Singapore who believes the premier’s private remarks were intended “to ensure the Chinese leadership that Malaysia is still open to China for investment.”
Mahathir has made the recalibration of ties with China a key foreign policy priority. During a recent state visit to China, he repeatedly welcomed Chinese trade, technology and investment and spoke of promoting bilateral and economic ties, even as he publicly cautioned against a “new version of colonialism” emerging from China’s outward investment.
Unlike the recently deferred High-Speed Rail (HSR) project with Singapore and the China-financed East Coast Rail Link (ECRL), the Forest City project – Malaysia’s largest foreign property investment – has no links to the Chinese state, nor does its construction rely on public expenditure that would further aggravate Malaysia’s substantial national debt.
While his moves to reset the terms for dealing with China were a signal to domestic constituents of Malaysia’s dignified return to a policy of non-alignment, Mahathir’s opposition to Forest City pertains to sovereignty concerns and racial inequity, the defense of which give the premier political mileage to stave off right-wing opposition headwinds.
Chinese state media has been relatively cautious in its response to Mahathir’s remarks and policy changes. Though careful not to criticize Malaysia’s newly elected government, especially as Beijing aims to court trade-reliant Southeast Asia amid rising trade tensions with the United States, certain publications have signaled a creeping sense of malaise.
“China should understand and adapt to Malaysia’s internal adjustments and remain consistent in cooperation with the country while Chinese firms should protect their own interests,” proclaimed an editorial in the nationalist tabloid Global Times which called on the Chinese government to help Chinese companies “safeguard their interests.”
Another factor is the historical animosity between Johor’s sovereign ruler Sultan Ibrahim and Mahathir, who pushed through constitutional amendments during his first premiership to curb the powers of Malaysia’s royals, stripping them of legal immunity from criminal prosecution after two assault cases involving the Johor royal family in the 1990s.
Johor’s charismatic ruler openly laments the Mahathir-era limitations, which prevent royals from exercising veto power on legislation. Addressing the Forest City controversy last year, the monarch leveled a stern rebuke against Mahathir, calling him “selfish and opportunistic” and accusing him of “creating fear, using race, just to fulfill his political motives.”
Sultan Ibrahim, constitutionally ascribed as one of the symbolic guardians of Malay culture, is also a wealthy businessman and champion of Iskandar Malaysia, a special economic zone in Johor touted as the “next Shenzhen.” Forest City is the largest among dozens of projects in the zone poised to become three times the size of Singapore when completed in 2025.
“Relations between Mahathir and the Johor royalty will continue to be strained, with the Johor royalty resenting any undue interference by the Mahathir-led federal government,” says Mustafa. “At present, the strained relationship is being managed privately and diplomatically so that it does not get amplified publicly.”
Political leaders from Pakatan Harapan, the ruling coalition led by Mahathir which governs the state of Johor, “want to cultivate good relations with the Johor royalty as the Sultan is revered by the people of Johor,” he says, adding that Sultan Ibrahim’s support is “important for Pakatan to govern the state effectively.”
The ministry of housing and local government announced in the wake of Mahathir’s recent salvos that it is looking into the possibility of imposing restrictions on foreign ownership of Forest City properties, with the aim to further constrain Johor state’s laws and policies that permit up to 70% foreign ownership in the mega-project.
Johor’s government has reportedly proposed reserving 30% of Forest City units for Malaysian buyers in a bid to allay xenophobic fears of an influx of Chinese residents, however, the Mahathir-led federal government appears intent on imposing tighter restrictions on foreign buyers, a move that will aggravate the premier’s already fraught ties with Johor’s sultan.
Its a very good initiative by Mr. Mahthir.
It seems the same thing happening all around the globe. Its the way any country can protect their local real estate market value.
I know these big organisation will make big storey, try to argue on national and international scale, but Mr. Mahthir please continue on good faith on Allah. My prayer for you.
Joe Wong I agree comparing Comrade Xi with Adolf is ridiculous.
First Winnie Xi couldn’t grow enough facial hair ro have a ridiculous moustache, secondly the Austrian Corporal was only responsible for the murder of 20m (high estimate) while Xi’s CCP have murdered 70m (low estimate) and still counting. Thirdly AH would have loved to have had the ‘social credit system’ to keep his people under control.
Not yet, they have only just started in Africa though.
His style of leadership always amazed me Love this man Mahthir U will live long for your nation Malaysia
In Malaysia the royalty stays, the PM goes, especially Mahthir. Time is not on his side.
For all U Chinese and Indian idealists this is what happens after U fought long and hard and sacrificed your lives to kicked out the British instead of taking over, insisted to be fvcking "civilized" and instituted the "Native First". Now they won’t let your kids have equal rights. hahahah So much for dumb Asian ideals.
Mr. Wu, are you jelous or you are miser, if some one succeeds.
Please try to be happy and smile. That will up lift you.
Nurun Nabi U didn’t succeed in anything. Dumb fvck. Malaysia has the less GDP as Singapore, a country 450 times smaller; Even failing to produce few kids vs Indonesia with 10x more people. In short Malaysian Natives are lazy infertile leeches living off the backs of hard working Chinese and Indians. hahaha… maybe nothing to laugh here. aiiihhhh
Natives First is what stopped competition of the fittest to evolve and let through genetically retarded like u to waste food and resource instead of the smarter Malaysian natives to propagate in numbers. They probably intermarried the Chinesd and Indians ahhahaha
A leopard cannot change its spots. Despite apologizing for his errors before the May election, the old Mahathir or TDM is emerging, playing the racial card.
TDM always have an anti- Chinese streak in him. When he was the 4th Prime Minister, he launched Project IC which gave about a million uneducated, impoverished, illegal migrant workers in Sabah a Malaysian identity with associated privileges which drained the resources of the state. Sabahans have not forgotten. Looks like it is better to have impoverished migrants as citizens rather than wealthy temporary non-citizen residents who can be a boost to the economy.
TDM stripped away the powers of the AGONG which act as a check and balance on the executive and reduced the Agong to as ceremonial role. Now TDM is against Forest City which has the blessings of the Sultan of Johore.
Many of TDM’s policies created the conditions that produced Najib, one of the biggest kleptocrats on the planet.
I quote M Bakri, a practising Malay surgeon in the USA:
" The man lacks the humility and sense of introspection to even consider that just maybe the fault may rest with his policies or if not that, their implementations. It matters not, a brilliant policy badly executed would fail just as a bad policy carried out faithfully.
My plea to Mahathir is please, don’t bother trying to save Malays. You have given that noble mission your best shot and for over two decades. Just move on. Time to give others the chance for that difficult mission."
http://bakrimusa.blogspot.com/2018/09/mahathir-should-focus-on-not-creating.html
Leopards do not loose their spots. Now that he is back in power, Mahatir is back in his Alibaba business again smell his opportunities on this mega forest city project to “Makan” for himself and for his cronies.
This realestate project should only be sold to Malayasians. Not to foreigners. No future projects like this.
We know well of Mahathir ever since the incident of 13 May 1969.
WuKong Sun What a nasty little racist you are. No wonder the Bhumis keep the Chinese as second class citizens…. they do not trust their loyalty.
Shame on you
Isn’t it up to Malaysians to determine how they country is governed.
You are sounding like an Imperialist.
Joe Wong Anti-Boer ? Can you enlighten us as to that meaning ?
Mahathir is no friend of the whites, he is a Malaysia patriot. Your rants only undermine the security of the hard working ethnic Chinese and Indian citizens.
Well done.
What is a ‘a practising Malay surgeon’, does he practise as a Malay ?
I have every sympathy with the hard working, smart ethnic Chinese in Malaya. Like Indians, treated as 2nd class citizens.
But your rants, and people like you (the CCP) will result in another round of pogroms against Chinese.
Come on ‘Big Vince’ BreakingWindRumbler…. where are you when we need you.
Yashad Rizvi, Muslims believe you are either be converted or you are perished by the sword, mercy does not exist in their vocabulary; ISIS is the modern demonstration of Muslim’s believe. “You are either with us or you are against us” is a Christian version of the Muslim doctrine. If the Muslims in Malaysia could get their way, ISIS and Malay will be no different; besides there are a lot of ISIS members are Malaysian besides Uighur.
Before the White arrived SE Asia, Chinese was well established economically and politically in SE Asia, the White had to conducted genocide with the help of the locals to wrest control from the Chinese in order to establish their colonies in the SE Asia. The genocides carried by White against Chinese in SE Asia makes Rohingya tragedy like child play. The West thought as long as they could smear China with fake news beyond common sense, nobody would notice the atrocities, crimes against humanity and crimes against peace they have committed in SE Asia against Chinese as well as the locals did not submit to them.
Spare us your crocodile tears, Malays, Viets, Mongols, the White, the Japs, … Chinese have seen them all. When China is weak Chinese have to endure, the only protection Chinese have is a strong China, appeasement is a fool’s dream to beg mercy from others.
Yashad Rizvi, What a funny idea you have that “it is up to Malaysians to determine how they country is governed.” The FUKUS did not let the people of Iraq, Yugoslavia, Afghanistan, Syria, Ukraine,… and other 150 nations around the world to determine how their countries are governed, the FUKUS bomb, kill and waterboard anyone who tried to govern their own nation by themselves.
Aussie did not let any their surrounding nations to govern themselves, they sent troops into Malaysia, Vietnam, East Timor, … to make sure the people of those nations cannot determine how their countries are governed.
Indian is not brunt, they simply carried out their British master’s tradition by annexing their small neighbours with brutal forces.
Yashad Rizvi, Christian and Muslim are the same in all aspects of human behaviour and mental toxicity, that’s why they cannot stand each other, they waged wars against each other for thousands of years and going into eternity, they are the root of all human sufferings and dismay.
Caste is another creation of the Christian and Muslim world, so they can abuse people on the god’s command.
Joe Wong I suppose you’re right Aus did send troops into E Timor, Malay, etc. But then they withdrew allowing thes people to govern themselves.
Unlike Tibet & E Turkmenistan !
No FUKUS troops in Ukraine or Yugo, they rejected Russland on their own. Iraq & Syria are now self governing, and Afghan & Pak we’ll leave up to the CCP to sort out.
Joe Wong Expect more massacres of ethnic Chinese in SE Asia with comments like this.
Winnie Xi Pooh won’t mind, him and his kids will trouser the gelt whatever happens to you or other Chinese.
Yashad Rizvi Mr. Rizvi, Please note that Joe Wong is hiniously anty Muslim anty humane and an ardent follower of Halaing and Hitler. Joe does not want to know who created ISIS and ARSA.