Malaysia at a crossroads: Balancing development and environmental resilience

Malaysia, a nation renowned for its rapid economic growth and rich biodiversity, finds itself at a critical juncture where the pursuit of progress intersects with the urgent need for environmental conservation.

As the country grapples with the dual challenges of maintaining economic momentum and preserving its natural heritage, it becomes evident that current development patterns are significantly impacting environmental vulnerabilities.

Malaysia’s impressive economic trajectory, characterised by rapid urbanisation and industrialisation, has come at a significant environmental cost. The nation’s rapid economic expansion, evidenced by a nearly 300 per cent increase in GDP from US$94.01 billion in 2000 to US$372.98 billion in 2022, has led to profound ecological consequences. The Klang Valley region, including Kuala Lumpur and other developed cities in the country, exemplifies this trend, with urban sprawl encroaching on natural habitats and agricultural lands. This urban expansion has not only led to the loss of valuable ecosystems but has also increased pressure on water resources, air quality, and infrastructure. Moreover, housing shortages and traffic congestion have become pressing issues in these urban centres, highlighting the need for more sustainable urban planning approaches.

While urbanisation poses significant challenges, deforestation remains one of the most pressing environmental issues facing Malaysia. The country’s reliance on palm oil and timber industries has resulted in extensive forest clearance, threatening biodiversity and contributing to climate change. Alarmingly, over 3.2 million hectares of Malaysian forests are currently at risk of deforestation, primarily due to concessions for timber and palm oil plantations. If this trend continues, Malaysia’s forest cover could drop below 50 per cent of its landmass, jeopardising its commitment to maintain 50 per cent forest cover as pledged at the 1992 Rio Earth Summit.

The environmental challenges facing Malaysia extend beyond deforestation to encompass broader climate vulnerabilities. Climate projections indicate a potential temperature increase of up to 2°C by 2050, exceeding the global target of limiting warming to 1.5°C. This warming trend poses severe risks to Malaysia’s extensive coastline and agriculture-dependent economy, with rice yields potentially declining by up to 60 per cent.

Furthermore, the threat of sea-level rise poses a significant risk to Malaysia’s coastal areas, which are home to approximately 40 per cent of the population. The Intergovernmental Panel on Climate Change (IPCC) projects global sea levels to rise between 0.26 and 0.77 metres by 2100, putting critical infrastructure and communities at risk.

Deforestation and land use change have been exacerbated by major infrastructure projects, such as the Pan Borneo Highway and the East Coast Rail Line (ECRL). While these projects are promoted as catalysts for regional development and economic integration, they have raised concerns about their environmental impacts, particularly in terms of habitat fragmentation and increased access to previously remote areas rich in biodiversity.

The controversial Bakun Dam project in Sarawak serves as a stark reminder of the environmental and social costs associated with large-scale infrastructure development in sensitive ecosystems. Additionally, agricultural expansion in highland areas, such as Cameron Highlands, has led to significant forest loss and increased vulnerability to climate-related risks.

In response to these multifaceted environmental challenges, the Malaysian government has implemented a range of policies and strategies. A significant step forward was the introduction of the Environmental Quality (Amendment) Bill 2023, approved on March 25, 2024. This legislation represents a substantial stride in combating environmental pollution, significantly bolstering enforcement capabilities and increasing penalties for various environmental offences.

Offenders now face fines of between RM5,000 and RM10 million, with the possibility of mandatory imprisonment of up to five years.

Building on this legislative framework, the development of the National Climate Change Bill, expected to be tabled in Parliament by 2025, further demonstrates Malaysia’s commitment to aligning its national policies with global climate action goals. This bill aims to accommodate various mechanisms needed to reduce the country’s emissions, including carbon pricing. However, the effectiveness of these policies in driving meaningful change will depend on their final form and the robustness of their implementation mechanisms.

In terms of mitigation strategies, Malaysia has set ambitious targets for renewable energy adoption and emissions reduction. The Malaysia Renewable Energy Roadmap (MyRER) aims to achieve 31 per cent of the country’s energy needs from renewables by 2035 and 40 per cent by 2035, with a goal of reaching net-zero emissions by 2050. While these targets are commendable, energy experts question whether the planned policies are adequate to achieve these ambitious goals, highlighting the need for more comprehensive and aggressive approaches.

Despite these policy initiatives, the implementation and enforcement of environmental regulations remain significant challenges. The persistent threat to Malaysia’s forests and biodiversity, evidenced by ongoing deforestation risks, suggests that current policies may not be sufficiently robust to counter powerful economic incentives for resource exploitation. This underscores the need for a more holistic approach to environmental protection that reconciles economic development with conservation goals.

Amidst these challenges, opportunities for sustainable development and environmental resilience are emerging. The concept of a nature-positive economy (NPE) is gaining traction, seeking to create a conservation market that channels capital towards conservation through innovative financing mechanisms, including a responsible carbon-trading system. The launch of the world’s first Syariah-compliant voluntary carbon exchange demonstrates Malaysia’s efforts to create market-based solutions for environmental challenges.

These initiatives have the potential to mobilise private sector resources for environmental conservation and climate change mitigation, positioning Malaysia as an innovator in green finance, but success will depend on developing clear regulatory frameworks and cultivating domestic expertise.

Looking ahead, Malaysia must focus on several key areas to enhance its environmental resilience while maintaining economic growth. Strengthening policy implementation and enforcement mechanisms is crucial, including enhancing institutional capacity and improving cross-sectoral coordination. The government’s adoption of a Whole-of-Government and Whole-of-Society approach to implementation represents a promising step towards more integrated and effective environmental governance.

Accelerating the transition to renewable energy and sustainable land use practices should be prioritised, facilitated through innovative financing mechanisms and stronger incentives for sustainable business practices.

Enhancing public awareness and education on environmental issues is essential for long-term sustainability. This includes integrating environmental education into school curricula and launching public awareness campaigns.

Promoting sustainable urban planning and green infrastructure development is vital, including implementing stricter zoning regulations and incentivising green building practices. Fostering innovation and research in environmental technologies and practices is crucial. Increasing investment in R&D for green technologies and supporting start-ups focused on environmental solutions can drive the transition towards a more sustainable future.

Malaysia stands at a pivotal moment with the opportunity to redefine its development trajectory. By embracing sustainable practices, leveraging its natural capital wisely, and fostering innovation, the country can chart a course towards enhanced environmental resilience. This transition will require a paradigm shift in how development is conceptualised and pursued, placing environmental sustainability at the core of economic planning and decision-making.

The path forward for Malaysia is challenging but filled with opportunities to create a more sustainable and resilient future, balancing economic progress with environmental conservation.

Colonel Engku Faizal Engku Mustaffa, RMAF, is a senior officer with the Royal Malaysian Air Force,  and currently attending the National Resilience Course at the National Resilience College, PUSPAHANAS.