The MM2H programme is a way for foreigners to retire and live in Malaysia for an extended period of time.
In August 2021, Putrajaya imposed stricter MM2H conditions, which included needing to show RM1.5 million (US$338,000) in liquid assets and having a minimum RM40,000 monthly income.
Previously, applicants only needed savings of between RM300,000 and RM500,000, according to local media.
The enhanced conditions have sparked heated discussions among existing MM2H visa holders and stakeholders, who said the new rules are too stringent.
According to Bernama, the Penang state government had previously urged the Home Ministry to urgently review and revise the current MM2H conditions.
On Monday, Penang’s State Tourism and Creative Economy Committee chairman Yeoh Soon Hin said that after COVID-19, attracting long-term foreign residents has been hampered by these unneeded hurdles.
Mr Yeoh also cited the findings from MM2H Consultant Association (MM2HCA) which noted that since the conditions were introduced in 2021, the programme has seen a 90 per cent drop in the number of applicants.
“If such conditions persist, I believe many expatriates will no longer choose Malaysia and will seek our neighbouring countries, which are easier for them to meet the eligibility requirements to settle there,” he was quoted as saying by Bernama.
Previously, other local media outlets also reported MM2HCA president Anthony Liew as saying that the new rules were one of the main causes of the falling number of applicants because neighbouring nations did not impose similar restrictions.
In September 2021, the Johor sultan also criticised the tightened MM2H regulations, urging the government to revise the conditions as they would dampen foreigners’ interest in coming to Malaysia and forcing existing MM2H participants to leave the country.
According to Sultan Ibrahim Iskandar at that time, Johor is a popular MM2H destination and the potential loss of revenue to the state from this programme was enormous.