The new marine park areas protect critically endangered hawksbill turtles, green turtles, dolphins, porpoises, and seagrass meadows for key dugong populations, according to the park’s website. The islands also harbour 114 coral species and 173 coral reef fish species, according to a 2024 report by WWF-Malaysia.

Johor’s BPEN said that under the scope of activities approved by NRES for the use of the 2021 to 2023 EFT funds, it had provided materials for programmes to restore marine life as well as conducted conservation, restoration, and enrichment works for riverine sources of fish, shellfish, turtles and endangered species.

The agency did not disclose how much it spent on each of these activities. 


Sabah – supporting communities and research
Meanwhile, Sabah, which is the top recipient of EFT funds, has added about 70,000 ha of new protected areas on land in 2021—2023. However, it is unclear exactly where these are. 

According to the Sabah Forestry Department’s annual reports, the state introduced 2 new protected areas in 2023. It also reclassified 51,265 ha across 9 locations as Totally Protected Areas (TPA) in the same year.

The Sabah Forest Enactment 1968 stipulates that changes to forest reserve classification must be published in a government gazette to be legally effective. But in 2021—2024, Sabah published only 4 gazettes under the Forest Enactment, none of which were on the changes to forest reserves. 

We also could not determine how Sabah used their EFT funds to increase or maintain the nearly 70,000 ha of new protected areas.

One would assume that much of the funds were channeled to the Sabah Forestry Department, as the new protected areas were entirely on land.

But the Sabah Forestry Department told Macaranga that it first received EFT funds only in October 2024. That tranche was RM6.8 million – just 19% of Sabah’s RM36 million EFT allocation that year.

The Sabah Forestry Department said it spent the 2024 EFT funds for community development in villages bordering TPA forest reserves. These were Kampung Ranggal and Kampung Rosob Contoh in the Pitas district and Kampung Dumbun and Kampung Pulutan in the Sook district.

The funds helped villagers to develop animal feed processing, quail farming, and hydroponic vegetable cultivation. The efforts sought to improve the villagers’ livelihood and reduce their need to exploit the forests, said Frederick Kugan, Sabah’s chief conservator of forests. The projects also build stronger ties between foresters and villagers, which help to protect the forest reserves.

The Sabah Forestry Department has also used EFT funds to update spatial data at a protected forest reserve and establish a permanent sample plot there.

Sarawak and Pahang – lacking data

While the government agencies in Johor and Sabah explained how they used their EFT funds – albeit only partially – the same cannot be said of Sarawak and Pahang.

Sarawak has received RM63 million in EFT funds since 2019. But we did not find any records of how the funds have been spent. Neither the Sarawak Ministry of Urban Development and Natural Resources nor NRES replied to questions on the matter.

However, Macaranga learned from news reports and state government data that Sarawak has been increasing the size of its protected areas. Since 2021, the state has expanded the Batang Ai National Park and the Fairy Cave Nature Reserve, and established the Burung Sarang National Park and the Bajoh-Ujong Murod Protected Forest. These added 20,230 ha of new protected areas.

The state proposes to gazette an additional 814,437 ha as permanent forest estates. However, permanent forest estates can be logged and are not necessarily protected areas.

As for Pahang, which received RM56.5 million by 2024, the state’s financial office did not respond to our enquiry on how it used the EFT funds.

In a press release in 2022, NRES announced that Pahang had spent RM4 million to improve the management of Tasik Chini, Malaysia’s first UNESCO Biosphere Reserve. But, the Pahang Forestry Department did not respond to our requests for more information.
 

Activities environmental groups say they could do with RM1 million a year

Data gaps and confusion
We had set out to check the effectiveness of EFT funds in conserving nature in Malaysia. Official data painted bright spots, especially the addition of 340,000 ha of protected areas. However, verifying the official narrative or tracking the outcomes of EFT-funded projects has been difficult. For example, the legal documents necessary to confirm the new protected areas in Sabah and Sarawak were not found. 

We could only demonstrate how state governments used RM25 million, or just 4.8%, of the total RM517 million disbursed in 2019—2024. 
 

Without further information from NRES and state government authorities, Macaranga could not determine the extent of the EFT’s effectiveness beyond increasing the size of protected areas in several states. None of the 10 environmental consultants and conservationists we spoke to have an answer.

Even state governments themselves have been confused over the allocations. A June 2024 report by the Institute of Strategic and International Studies Malaysia, a think tank, stated that “a pervasive lack of clarity on the eligibility, selection criteria, disbursement procedures and intended usage of the funds persists in most states.”

“Perak, for example, allegedly did not receive any funds at the time of writing. Conversely, Sabah reportedly found RM20 million in its coffers without prior notification, creating confusion about the purpose of these funds,” the report stated. 


More transparency and accountability, please
When asked if the increasing EFT allocations by the federal government have significantly motivated state governments to conserve nature, environmental lawyer Preetha Sankar said that accurate data is needed to demonstrate that has been the case. 

Preetha was a legal consultant with the United Nations Development Programme in 2018 when the EFTs were drafted for inclusion in the 12th Malaysia Plan.

“The addition of protected areas would indicate that the incentive has led to a quantitative trajectory, but as for natural resource management effectiveness, I’m not certain if the information is accessible,” she told Macaranga.

Preetha also pointed out that it is unclear if EFT funds have persuaded state governments to conserve nature instead of exploiting their natural resources.

“I think the jury is still out on that. We need honest discourse on the matter,” said Preetha.

RESCU’s report said that the EFT’s annual reporting requirements currently allow the federal government to maintain a national-level database of protected areas. “Such a database would provide an unprecedented opportunity to monitor the states’ progress towards the 20% protection target,” it said, referencing the proposed 20% of terrestrial areas and inland waters to be conserved under the National Biodiversity Plan.

Making this data available would “increase the accountability of decision-makers and allow civil society to assist in monitoring encroachment and verifying reporting.”

Preetha shared a similar view. “If we are committed to good governance, then surely more transparency in EFT at all levels would be ideal,” she said. This ranges from the Ministry of Finance explaining what factors or formulas it uses to decide on the total EFT allocation each year, to getting information at the sub-national level about what agencies and projects have received EFT funds.

“The list of projects fully or partly funded by EFT would be beneficial,” she said.


Source: https://www.macaranga.org/tracking-the-outcomes-of-malaysia-ecological-fiscal-transfers-eft-for-nature-conservation/