KUALA LUMPUR: Bluer skies, the central Titiwangsa mountain range visible from Klang Valley and the normally turbid Klang River clean enough for people to swim in it.
Such local news reports and similar photos of the environment “recovering” have gone viral, while the majority of the country abided by the movement control order (MCO) in an attempt to stem the COVID-19 infection rate in Malaysia.
However, with most businesses resuming operations and preparations being made for the MCO to be lifted on Jun 9, experts interviewed by CNA are contemplating the potential impact of economic recovery on Malaysias vulnerable ecosystems.
At the end of the first phase of the MCO on Mar 31, Environment and Water Minister Tuan Ibrahim Tuan Man was reported as saying that the Air Pollutant Index had gone down 14 per cent to record a “clean index”, while over a quarter of 29 automatic water monitoring stations nationwide recorded a real-time improvement in water quality.
The minister also reportedly said that particles analyses in the Klang Valley showed leading pollutant contributors trending down from Mar 18 to Mar 31, as compared to prior readings from Mar 1 to Mar 17.
Sulphur dioxide (SO2) and particles under 2.5 microns (PM2.5) had gone down by 27 per cent and 29 per cent respectively. Additionally, carbon monoxide (CO) and nitrogen dioxide (NO2) levels had dipped by 49 per cent and 70 per cent respectively.
READ: Asias fragile oceans at environmental tipping point, but COVID-19 provides window of opportunity for recovery, according to UN report
Other major cities and towns also showed similar dips, the minister said. Areas known to emit toxic gases, such as Pasir Gudang, were “stable”. All 25 monitoring stations recorded Total Volatile Organic Compounds readings at normal or below alert levels at 1 ppm (parts per million).
The latest piece of environmental good news is that of turtles beaching at Port Dickson beach in Negeri Sembilan, now off-limits during this period to lay eggs, as well as dolphin sightings in the same area.
STIMULUS PACKAGES, DIP IN OIL PRICES A STRAIN ON GOVERNMENT FINANCES
The federal government has announced several COVID-19 stimulus packages to rescue Malaysias sagging economy. However, with the decline in oil revenue due to falling petroleum prices, experts fear that some states might intensify the exploitation of natural resources to replenish their coffers.
Economics professor Yeah Kim Leng from the Sunway University Business School noted that the three stimulus packages totalled RM35 billion (US$8 billion) in direct government spending.
“This is a sizeable 2.3 per cent of 2019s GDP. This unplanned spending increase, together with the sharp drop in oil prices, has increased the likelihood of a mid-year budget revision, rather than a supplementary budget towards the year-end,” he said.
Petroleum prices have been declining since the start of March, as travel ground to a halt and people began staying at home.
The April price collapse of the West Texas Intermediate May futures is bad news for Malaysia, given its reliance on petroleum revenue.
The gross value output of Malaysia's oil and gas mining industry is believed to account for around one-fifth of the country's GDP.
For Malaysias 2020 federal budget, calculations were predicated on Brent crude at US$62 per barrel. Prices are now hovering around US$30.
In addition, state governments, which are allocated their annual budgets from the federal budget, are likely to require higher grants and transfers, Prof Yeah added, especially if these states had implemented complementary measures to further mitigate the pandemics impact.
“Moreover, a fall in state revenue due to the movement restrictions during the pandemic would require state governments to seek federal support to fund budget deficits,” the economist said.
States have likewise instituted their own stimulus packages, such as Selangor, which allocated RM272 million, or 11 per cent of its 2020 budget.
READ: Kuala Lumpur businesses open up cautiously on first day after government eases COVID-19 restrictions
RESOURCE EXTRACTION AS A SUPPLEMENT TO STATES' REVENUE
As petroleum prices plummet, both the federal government as well as states that are reliant on oil and gas revenue to supplement their expenditure might have to turn to other means to generate revenue.
States that are less developed but rich in resources have been increasing their exploitation of natural resources, particularly timber logging and agri-conversion to both raise revenue and step-up their local economic development, Prof Yeah noted.
In states such as Pahang and Kelantan, massive tracts of rainforest were cleared to make way for oil palm, and more recently, durian plantations, as the fruit became a massive hit in China in the past 2 years. Logging has also been a steady source of revenue for the Bornean states of Sabah and Sarawak.
“Increased logging of forests reserves and conversion of state land for oil palm and other agricultural crops will reduce the countrys natural forest resource base as well as impact negatively other uses such as wildlife conservation, water catchments, biodiversity and environmental protection,” Prof Yeah said.
Revenue-wise, the economist pointed out that state governments have been reliant on permits and other state-imposed fees derived from land-based activities and natural resource extraction.
“However, the total state revenue remains minuscule. In 2018, it amounted to RM10.6 billion, or 5.2 per cent of the RM203.9 billion collected by the federal government,” said Prof Yeah.
As it is, some states such as Perak have appealed for logging and quarrying to continue. On Apr 25, Peraks Chief Minister Ahmad Faizal Azumu appealed to the federal government for logging and quarrying activities in his state to be allowed to continue.
“The timber industry, if not allowed to operate, will cause damage to the sector. Also, there are orders, hence enabling the industry to contribute to the states revenue,” Mr Ahmad Faizal was quoted as saying by Bernama.
He also said that quarrying has been allowed to continue as it did not involve public interaction and the quarries were far from residential areas.
Meanwhile, Sabah's head of state Juhar Mahiruddin said the state would look at expanding its protected marine areas by up to 13 per cent by 2023. He reiterated that the objective is to increase totally protected land areas to 30 per cent by 2025, compared to the current 25 per cent of Sabahs total landmass.
According to Sabah's Deputy Chief Minister Christina Liew, who also holds the environment portfolio, current efforts are mainly on containing the spread of COVID-19 and mitigatRead More – Source