(Aug 27): Malaysian Prime Minister Mahathir Mohamad on Monday declared that foreigners will not be granted visas to live in the giant Forest City real estate project on the country’s southern tip, a major threat to the marketing strategy for the development.

It is not his first broadside against the plan by Chinese developer Country Garden Holdings Co to create a new city that was envisaged to eventually house 700,000 people on reclaimed land near Singapore, but it could be his most damaging. The company has been targeting foreigners more than Malaysians for sales of the apartments.

A top official at the project told Reuters last week that in the weeks immediately after 93-year-old Mahathir came back into power, through a shock election victory in May, demand for the apartments had weakened, and that the uncertainty remained a concern.

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