A Chinese developer giant has built a large-scale real estate complex in Malaysia, but the structure has now nearly become a “ghost town” following the Covid pandemic.
Forest City is an integrated residential development and private town located on the slopes of Gelang Patah, Johor Bahru District, Johor, Malaysia.
Forest City consists of residential buildings, rising from the ground on an artificial island in the Strait of Johor between Malaysia and Singapore.
The luxury complex is mainly developed by Chinese real estate giant Country Garden.
Initially, the project was expected to be home to about 700,000 people. It hoped to mainly attract wealthy Chinese who wanted to settle in Malaysia, and Singaporeans as well.
However, eight years after the construction began, an estimate of only 2,000 people have settled here. Most of them are the developer’s employees, international school students and family members.
According to BBC News, most of the buildings in Forest City are uninhabited, like a “ghost town.”
Chen Weitian is the research director of KGV International Consulting Company.
He said that Forest City has two main problems. One is the low occupancy rate. The other is the lack of commercial activities.
So Forest City itself “doesn’t have much vitality,” though the complex is located on the outskirts of Johor Bahru, and only a few kilometers from Singapore.
Forest City became controversial after former Malaysian Prime Minister Mahathir Mohamad criticized the project for creating an influx of immigrants.
In addition, the enthusiasm of home buyers weakened after China cracked down on capital outflows. Beijing’s travel bans also have bad impacts on the Chinese buyers.
However, Country Garden claimed that the slow sales of the project is normal, because the development progress would be completed in 20 years.
The developer said that it expects Forest City to flourish again as economic activities resume and travel bans are lifted.
Announced in 2006, Forest City project was pitched under China’s Belt and Road Initiative.
According to Liberty Times, it is lucky for Malaysia to retreat from the Chinese initiative.
The Times cited Xie Jinhe, chairman of Caixin Media, saying that former Prime Minister Mahathir Mohamad struggled to resist the Belt and Road Initiative in his second term.
Xie Jinhe said that if Mahathir hadn’t stepped on the brakes, Malaysia could be in trouble.
Under the Belt and Road Initiative, the East Coast Railway and the Star-Malaysia railway would be built in Malaysia with costs of billions of dollars.
Xie Jinhe said that Malaysia has a debt of $257 billion. If the country borrows a lot of money to complete these two projects, Malaysia may go into bankruptcy as a country with high debt.
Xie added that it is a lesson from those countries that participated in the Belt and Road Initiative.