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What Does Malaysia Sees it Gets out of MM2H?

What Does Malaysia Sees it Gets out of MM2H?

Old Feb 20th 2018, 12:44 pm
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Default What Does Malaysia Sees it Gets out of MM2H?

I thought I'd open up a different thread on this topic...which is different from "What do you see are the benefits of MM2H" from an expats perspective.

According to these two articles the governments interest appears to be primarily financial, T&C Minister does not cite any social, cross-cultural or educational benefits in his remarks. My comments are in red.

Nazri: A million applied but only 33,000 here under MM2H | Free Malaysia Today

More than one million foreigners have applied for the Malaysia My Second Home (MM2H) programme since 2002 but only 33,300 applications have been successful. [That’s a success rate of only 0.03%...why so low? Were these provisional applicants that were misled about the requirements? Or were they rejected post-application submission?]

This was revealed today by Tourism and Culture Minister Mohamed Nazri Aziz, who said the rejections followed the stringent approval process by the government.
“Even Bukit Aman’s Special Branch needs to vet these applications,” he said at a press conference after a signing ceremony for the renewal of the Memorandum of Understanding between the ministry and Bank of China to promote the MM2H programme, here today.
Applicants for the MM2H programme must be 50 years old and above, have a clean record in their home country when it comes to security or crime, and have a strong financial standing.
Earlier, in his speech, Nazri said the successful MM2H applicants represent residents from 126 nations and their moving to Malaysia under the programme has contributed a total amount of RM12.8 billion to the economy.

“Their estimated monthly out of pocket expenses amount to RM10,000 a month per person. [If true, and participants were full-time residents then 33Kx10Kx12 = RM3.96bn/annum]

“This amount does not take into account the spillover effect of participants’ relatives and friends visiting Malaysia and spending on accommodation, food, travelling and shopping, among other things,” Nazri said. [This was one aspect I had not considered.]

He added that in terms of visa fees alone – including multiple entry, social pass and journey performance visa – those under the programme had paid a total of RM52 million. [These are probably not annual fees, but one time fees collected at the time of successful admission into the program, or renewal...so probably a small RM10m/year]

The programme collected RM4.9 billion from fixed deposits [this was calculated by taking the number of applicants x RM150,000...and the fixed deposit is not necessarily a permanent contribution to the economy as some portion of it will be lost when the applicant leaves/dies]

as well as RM148 million from the purchase of automobiles and properties [Of course the fixed deposit diminishes somewhat with such purchases, as these are generally approved withdrawals. Also note the variance of this figure with the estimate of property purchase benefits cited in the next article].


Most of the MM2H representation is from China with 8,714 participants. This is followed by Japan (4,225), Bangladesh (3,546), United Kingdom (2,412), Iran (1,336), Singapore (1,295), Taiwan (1,208), South Korea (1,266), Pakistan (973) and India (890).

The programme was introduced in 2002 to attract foreigners to come and stay in Malaysia, especially those who have already retired or some for business purposes as well.

Malay Mail Online (13/7/2017)

But Nazri said while the government is still campaigning to add the number of applicants for the programme, it has no specific target.

“We want quality, not quantity… I’m sure the association too don’t want any Tom, Dick and Harry to join them,” the minister said, referring to the MM2H Agents Association, the organisation that also has expatriates as members.

MM2H participants contributed RM4.9 bil in property purchases since 2012 | The Edge Markets

KUALA LUMPUR (July 13): The Malaysia My Second Home (MM2H) programme has contributed RM4.9 billion to Malaysia’s real estate sector over the past few years since 2012. [~5bn/year]

I should provide a scalar here. Tourism brings in an estimate RM70bn/annually. Comments? Have away!
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Old Feb 20th 2018, 10:55 pm
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

There was some discussion on this in another thread:-
http://britishexpats.com/forum/retir...cepted-899556/

This thread also is interesting, especially as regards Japanese MM2Hers:-
http://britishexpats.com/forum/retir...-35%25-871206/

Your suggestion that MM2Hers contribute nearly RM4bn each year to the Malaysian economy is a gross over estimation. Of the 33,000 accepted into the program quite a few have left, even more never came and a large number living here get by on their state pension.

I doubt the real figure is even a quarter of that amount.

I have a problem with the property purchases figure too. There must be some Chinese property investors on MM2H who are inflating that figure.
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Old Feb 21st 2018, 12:48 am
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

However you slice it, anyone who comes to Malaysia and spends their own money that they earned outside of the country is adding to GDP. Whether the cost to the Govt of running the MM2H scheme is worth it, only they would know.
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Old Feb 21st 2018, 3:16 am
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by InVinoVeritas View Post
Your suggestion that MM2Hers contribute nearly RM4bn each year to the Malaysian economy is a gross over estimation. Of the 33,000 accepted into the program quite a few have left, even more never came and a large number living here get by on their state pension.

I doubt the real figure is even a quarter of that amount.

I have a problem with the property purchases figure too. There must be some Chinese property investors on MM2H who are inflating that figure.
It wasn't MY suggestion. It was the Minister of Tourisms'. You'll notice that I said "If True, and participants were full-time residents". Nazri's total number is RM12.8bn for the last 5 years. If you add the RM4.9bn (Fixed Deposits)+ RM148m (Property+Vehicle purchases) + RM4bn (misc. spending) + RM52m [visas] you get about RM9.2bn. There's about RM3.6bn missing.

I tried to figure out Nazri's numbers in various ways. I considered the possibility that if you take his larger Real Estate purchase number and remove about 40-50% from the fixed deposit amount (for property purchases) that would get you close (RM12.2bn)...'course not everyone buys property. So that would add a bit into the fixed account section.

And one area that Nazri doesn't mention is the Agent fees. Using JoyStays lowest Plan charge (not including visa fees) that could bring in RM175million. Another factor might be income from Medical Insurance and spending on Health care.

My qualm is using the Fixed Deposit as more than money that is temporarily parked in the country. Unless it's used to obtain car, property, education, healthcare it's eventually going bye-bye. If I was an economics planner I'd be trying to figure out how to get MORE of that fixed deposit out into the economy. Let the MM2M folks spend it down to 10K before they leave

BTW Where do you get the numbers about those that "even more never came"? Or is that just a guess based on assumptions about Chinese applicants?

Still it would seem a bit odd that someone would hire an agent like Joy Stay for US$1500-2500 (or go through the hassle of going through the process themselves) and not show up to actually use the visa? Would that be just to be able to purchase a Malaysian property that they eventually would stay in, or re-sell? That's still money into the economy....just not the daily spending costs.

As I pointed out the MM2H is actually not that big of a chunk of the economy. RM2.6bn annually is just a sliver of the estimated RM70bn of the tourism revenues. But the overhead is likely pretty low. Most of the infrastructure is in place for work-visas, tourism, etc. Given the cost/benefit ratio I'm surprised they aren't promoting it more.

And I hope they've had a long and hard discussion with economic modelers before the increase the "proof of liquid assets" requirement to RM1million and the Fixed Deposit to RM500,000. In my view all that will do is cause numbers to plummet, particular those over 50 years of age. Do they really have that much problem with the behavior of middle class retirees?

Last edited by RedApe; Feb 21st 2018 at 3:20 am.
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Old Feb 21st 2018, 7:36 am
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by RedApe View Post
More than one million foreigners have applied for the Malaysia My Second Home (MM2H) programme since 2002 but only 33,300 applications have been successful. [That’s a success rate of only 0.03%...why so low? Were these provisional applicants that were misled about the requirements? Or were they rejected post-application submission?]
33,300 out of 1 million is 3%.
Beware that one application may cover more than one person (foreigner). One applicant could cover for his/her entire family (spouse, kids).

Edit: I would be very interested to see comments from other Ministries about the MM2H program. How do those others view this program?

Last edited by SushiFan; Feb 21st 2018 at 7:44 am.
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Old Feb 21st 2018, 7:41 am
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by RedApe View Post
Still it would seem a bit odd that someone would hire an agent like Joy Stay for US$1500-2500 (or go through the hassle of going through the process themselves) and not show up to actually use the visa? Would that be just to be able to purchase a Malaysian property that they eventually would stay in, or re-sell? That's still money into the economy....just not the daily spending costs.
An MM2H visa gives the possibility to certain individuals to stash away money and/or investments out of sight of certain tax offices. That could potentially compensate for the costs of obtaining the visa. Which is but a slight variation on the Chinese real estate property buyers.

By the way: I did use an agent for obtaining my MM2H visa. However this agent was not in Malaysia, but in the country where I lived when I applied. The money I paid to this agent therefore did not end up in Malaysia (unless they decided to transfer it to Malaysia).
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Old Feb 21st 2018, 12:38 pm
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by SushiFan View Post
An MM2H visa gives the possibility to certain individuals to stash away money and/or investments out of sight of certain tax offices. That could potentially compensate for the costs of obtaining the visa. Which is but a slight variation on the Chinese real estate property buyers.

By the way: I did use an agent for obtaining my MM2H visa. However this agent was not in Malaysia, but in the country where I lived when I applied. The money I paid to this agent therefore did not end up in Malaysia (unless they decided to transfer it to Malaysia).
Careful SushiFan, you're in danger of giving away our secrets, like the special MM2H handshake
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Old Feb 21st 2018, 10:07 pm
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Anyone who is keen to get a Malaysian view on MM2H should go along to the British Consul afternoon tea on 20th March at which Datin Sharifah Ikhlas (the current MM2H top gun) is giving a presentation.

Further details here:-
Attached Thumbnails What Does Malaysia Sees it Gets out of MM2H?-consul-tea.jpeg  

Last edited by InVinoVeritas; Feb 21st 2018 at 10:08 pm. Reason: Thanks to BakedBean for sharing this information
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Old Feb 21st 2018, 11:52 pm
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by InVinoVeritas View Post
There was some discussion on this in another thread:-
http://britishexpats.com/forum/retir...cepted-899556/

This thread also is interesting, especially as regards Japanese MM2Hers:-
http://britishexpats.com/forum/retir...-35%25-871206/

Your suggestion that MM2Hers contribute nearly RM4bn each year to the Malaysian economy is a gross over estimation. Of the 33,000 accepted into the program quite a few have left, even more never came and a large number living here get by on their state pension.

I doubt the real figure is even a quarter of that amount. ....
They may be using an economist's measure - that the money spent also generates more economic activity. Even if you're subsisting on a state pension you're buying food which generates profits for the grocer, who buys vegetables from the wholesaler, who buys them from the farmer, each of them making a profit and paying employees. The vegetables are transported by a lorry, so the lorry owner the the driver make money ..... etc. etc. So every ringgit spent creates more economic activity every time it is passed from person to person and business to business.
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Old Feb 22nd 2018, 3:47 am
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by InVinoVeritas View Post
Anyone who is keen to get a Malaysian view on MM2H should go along to the British Consul afternoon tea on 20th March at which Datin Sharifah Ikhlas (the current MM2H top gun) is giving a presentation.

Further details here:-

Too bad, only Brits are invited
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Old Feb 22nd 2018, 12:24 pm
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Default Re: What Does Malaysia Sees it Gets out of MM2H?

Originally Posted by SushiFan View Post
33,300 out of 1 million is 3%.
Beware that one application may cover more than one person (foreigner). One applicant could cover for his/her entire family (spouse, kids).
Maybe...but wouldn't they standardize the figures?? The implication is that almost nobody who applies gets in. How is that good publicity?

Alternatively, depending on the audience it could go well with the theme of "we are highly selective...only the best come to Malaysia".

If one million applied does that include everyone listed on the application (plus I think that you can add grandma, the new wife and the new baby later).

I suspect that the one million might be some measure of "inquiries" at the embassies and consulates or the MoT...people who picked up the wrong application or enquired by email. They wanted a married-Malaysian social visit visa. Or withdrew it realizing that they needed to get a work visa after finding work. Or sent an email asking about it, maybe several emails, then threw up their hands and said...off to Thailand!

Or maybe someone (in China or elsewhere) is acting as an agent, making all sorts of claims to unqualified applicants, taking fees, and scamming Chinese applicants who hit a roadblock somewhere? So application is withdrawn, minus a RM500 fee of course. Perhaps its similar to the maids and SRO's that are supposedly enrolled as students in non-credentialed schools.

Last edited by RedApe; Feb 22nd 2018 at 12:26 pm.
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