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~Allocations Welcomed for Transitioning into A Sustainable Economy~ Kuala Lumpur: The budget announcement on 2 November 2018 by Finance Minister YB Lim Guan Eng followed the release of two major global environmental reports – the Intergovernmental Panel on Climate Change (IPCC) Special Report on Global Warming of 1.5 °C and the WWF Living Planet Report (LPR) 2018. Both reports underscored the necessity of immediate action to avoid catastrophic climate change and loss of wildlife. The reports also reminded decision-makers on the importance of natural ecosystems to human livelihoods and well-being, as they ultimately provide us food, clean water, medicines and security. The WWF Living Planet Report estimates that these ecosystem services are worth around US$125 trillion a year (140% of global GDP) globally.
Kuala Lumpur: The budget announcement on 2 November 2018 by Finance Minister YB Lim Guan Eng followed the release of two major global environmental reports – the Intergovernmental Panel on Climate Change (IPCC) Special Report on Global Warming of 1.5 °C and the WWF Living Planet Report (LPR) 2018. Both reports underscored the necessity of immediate action to avoid catastrophic climate change and loss of wildlife. The reports also reminded decision-makers on the importance of natural ecosystems to human livelihoods and well-being, as they ultimately provide us food, clean water, medicines and security. The WWF Living Planet Report estimates that these ecosystem services are worth around US$125 trillion a year (140% of global GDP) globally.
Therefore, rapid and dramatic changes within the next decade are crucial to preserve the world we live in today. Additionally, while these changes help to avoid catastrophic changes to our environment, they are also synergistic with the achievement of the other UN Sustainable Development Goals (SDGs) to which the government is aligning Malaysia’s development.
As the first to follow these landmark reports and accompanying recommendations, this budget is an opportunity for the government to respond to these challenges and start the crucial transition towards a sustainable economy.
One notable announcement was the allocation of RM60 million to States to protect and expand existing natural reserves. Many states rely on their natural resources to raise revenue. This initial allocation from the Federal government will therefore, to an extent, encourage states to conserve their natural resources. We call on this initiative to be institutionalised as part of the fiscal transfer mechanism, where natural forest and marine reserve coverage and protection is used as one of the criteria in the annual budget allocations to states. Apart from fiscal transfers such as this, other revenue generation methods such as Payment for Ecosystem Services and low-impact ecotourism should also be explored and enabling policies established to create income for the states that conserve their natural resources.
In this regard, the announcement that 50% of the tourism tax will be returned to States is indeed timely and much welcomed. Particular states in Malaysia, such as Sabah, are world-famous destinations for tourists who wish to see wildlife in their natural environments. Low impact ecotourism can be a revenue-generating activity for states that conserve their natural environment, and the revenue from this return of tourism tax can be used to further protect and restore their natural environments and enable their low impact ecotourism industries to grow further.
As well as being a major attraction for tourists, our biodiversity plays a crucial part in the provision of nature’s services to the rakyat, and as such, it is essential that we safeguard our nation’s biodiversity. One of the biggest threats to our biodiversity, including Malaysia’s majestic Malayan tiger, is poaching. It is somewhat ironic that we heard the word ‘tiger’ repeatedly in the budget announcement as an inspiration for our economy, but our nation’s own species of tigers are listed as Critically Endangered. It is now very likely that our iconic Malayan tigers are on the brink of extinction with as few as 250-340 left in the wild due to poaching. Thus, we are disappointed that the budget announcement did not touch on arresting the decline of biodiversity – including our Malayan tigers – through more effective enforcement. Increasing enforcement efforts to protect Malaysian wildlife is also a matter of national security, as there has been recorded evidence of foreign poachers who are armed, and therefore pose a danger to local communities and enforcement officers. Hence, even though specific allocations for enforcement was not announced, it is hoped that the government considers setting aside sufficient funds to effectively protect Malaysia’s natural heritage.
Our Orang Asli and Orang Asal communities are some of our most important stakeholders in protecting and managing the natural environment, and it is encouraging to hear that they will be supported through micro-grants to do so.
The fisheries industry in Malaysia is one of our main food producers. However, the stock is currently in very poor condition with declines of more than 90% since the 1970s due to poor management in the past. In addition to research on fruits, grains and seeds, the Agriculture Research and Development budget should also be used to explore sustainable fishing gears and techniques, ensuring viable fisheries industries for future generations. We are also keen to hear more about the RM98.5 million that has been allocated for the Fishermen Financing Incentive package, and hope this will contribute towards the sustainable management of our fisheries.
Besides protecting our natural environment, we need to develop towards a sustainable, circular economy that can provide a good standard of living for generations to come. We are therefore encouraged to see various financing schemes announced by the government to encourage green technology and green energy. We also note that the Sustainable Development Financing Fund has been announced to support the implementation of Agenda 2030 of the SDGs – as proper monitoring and impact measures have to be in place in ensuring its intended objectives are achieved, we look forward to hearing how it will drive and mainstream sustainable and inclusive development. Transitioning towards a sustainable, circular economy requires us to move towards more efficient transport options. We applaud the introduction of bus and rail passes within the Klang Valley and hope that these, together with the expansion of the free GoKL bus services and the revival of the LRT3 and MRT2 lines will help more commuters take public transport.
In developing infrastructure projects, nature-based solutions should be explored as they can be cheaper as well as provide multiple benefits to the rakyat. In the analysis of solution options, we hope that broader and longer-term values are included in the analysis of costs and benefits. Natural environments provide multiple economic benefits. When these benefits are not taken into account, as in regular cost-benefit analyses, the outcome could be loss of ecological functions and unforeseen high long-term costs to society. Methodologies such as natural capital valuation can be used to incorporate some of these otherwise hidden values into analysis to provide a more thorough understanding of long-term economic costs and benefits, thus leading to sustainable development in the long run while meeting current needs.
Safeguarding the environment is a responsibility we owe to our future generations, and in fact, even to the current generation in alleviating some of the regular hardships we are increasingly facing. It is a necessity not just for our continued wellbeing, but our survival as well. We are hopeful that the measures announced in this budget signal the first step to undertake the important transition called for by last month’s two landmark reports and look forward to many more.
Dr Henry Chan
Conservation Director, WWF-Malaysia
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For more information, please contact:
Sheena Wong Sin-Yee
Senior Communications Officer, WWF-Malaysia
Tel: +603 7450 3773 Ext. 6412