Country Garden and Johor seek clarification on Forest City’s foreign investment ban

Residential buildings under construction at Forest City in Johor.
Reuters

Prime Minister Tun Dr Mahathir Mohamad’s comment about banning foreigners from purchasing units in the Forest City mega project in Johor on Monday (Aug 27) sent shockwaves that rattled both its developer Country Garden Pacificview Sdn Bhd and buyers.

While speaking at the Cities 4.0 and Business 4.0 International Confer­ence and Exhibition, the Malaysian leader said: “One thing is certain: the city that is going to be built cannot be sold to foreigners. Our objection is because it was built for foreigners and was not meant for Malaysians. Most Malaysians are unable to buy those flats.”

The comment came as a surprise because Dr Mahathir had just met the chairman of Country Garden Holdings, Yeung Kwok Keung, in a 40-minute closed-door meeting less than a fortnight ago on August 16.

The company has since issued a statement to say it believes Dr Mahathir’s comments might have been taken out of context by the media: “We are currently in touch with the Prime Minister’s Office for clarifications, as we believe Tun Mahathir’s comments may have been taken out of context in certain media reports. Today’s comments do not correspond with the content of the meeting between Tun Mahathir and Founder and Chairman of Country Garden Holdings, Yeung Kwok Keung.”

The statement added: “During the meeting, Tun Mahathir reiterated that he welcomes foreign investments which could create employment opportunities, promote technology transfer and innovations that could benefit Malaysia’s economic growth and job creation.”

Country Garden also said it does not issue any permanent residency to foreign buyers of Forest City and the company had complied with all laws and regulations.

The 13.86 sq km Forest City project spans four man-made islands off the Johor coast and the $100 billion (S$136 billion) development comprises apartment blocks, houses, office towers, hotels and shopping centres. When completed, it is expected to house 700,000 residents; and according to a report in The Star, Chinese nationals accounted for about 70 percent of apartment buyers last year.

The Johor state government also said it is reaching out to the Prime Minister’s Office for clarification. “We are still trying to make sense of this new move, as we have yet to be informed,” commented Johor Housing and Rural Development Committee chairman, Dzulkefly Ahmad, who added that land, water and forest matters are all within the purview of the state government.