Biotechnology is a multi-billion ringgit industry worldwide with massive growth potential. Malaysia is well-placed to tap into this to develop medicines and other products based from biodiversity. The application of biotechnology can be the catalyst to generate new wealth for the country, but only if resources are sustainably managed. Advances in biotechnology, including modern methods of cultivating and propagating crops and livestock have been made possible largely because of genetic diversity of parent stocks. They could also result in the development of products such as pharmaceuticals, antibiotics and vaccines.

Plants and animals are the basis of most traditional medicines. Rural communities in many parts of Malaysia still depend on traditional medicines for their healthcare needs. It is estimated that about 1,200 species of higher plants in Peninsular Malaysia and 2,000 species in Sabah and Sarawak have potential medicinal properties and are used in traditional health care. Furthermore, many of these species are endemic to Malaysia, making them truly a natural asset worth conserving. Modern medicine also uses plants and plant products as the basis for many commercial drugs. Plants and herbs such as “Hempedu Bumi” (Andrographis paniculata), Bitter Melon "Peria" (Momordica charanthia) and White Leadtree "Petai Belalang" (Leucaena leucocephala) have shown potential for dengue treatment.

Tourism is the second highest foreign currency earner for the nation and around 25.7 million tourists visited Malaysia in 2015. Malaysia, with its outstanding biodiversity and scenic natural environment has been successfully promoted as an ecotourism and nature-oriented tourism destination in recent years. For example, recreational diving is a high value form of tourism that attracts tourists from all over the world. This type of tourism depends on the diversity of coral reefs and quality of the environment.

Sipadan, Layang-Layang and the oceanic islands in the South China seas are considered to be among the world’s best diving sites. Mulu National Park and Kinabalu National Park are UNESCO World Heritage sites with biodiversity of global significance. Taman Negara National Park annually draws over 80,000 tourists. These and many others help to drive Malaysia’s tourism industry.

Plants, animals and fish are our main sources of food. Biodiversity, through agriculture, is an important component of food security because species diversity provides the genetic material for food and agricultural crops.

Wild animals are also important for the healthy growth and pollination of cultivated plants. Many species of insects, birds and bats are pollinators and dispersal agents of fruits and other crops, besides playing an important role in maintaining rainforest dynamics. In addition, domestic animals may be improved by cross-breeding with wild relatives. Conservation programmes of indigenous farm animal genetic resources, such as Kedah-Kelantan cattle, are very important by providing broad gene pool and genetic improvement for future food security in terms of quality meat production.

Malaysia’s fisheries industry has grown significantly over the last two decades. Marine catches have been steadily rising from about 800,000 tonnes in 1980 to over 1.48 million tonnes in 2013. Mangrove swamps are feeding and nursery grounds for fisheries, as well as being the habitats of several of our important commercial fishes and shrimps.

Rice is an important staple food for Malaysians and many other Asian societies. Malaysia has many wild varieties and land races of rice including those that are uniquely cultivated by indigenous people. Currently, 12,258 accessions of rice from indigenous, wild and cultivated sources are conserved in genebanks as genetic materials for further improvement. Protection of such biological diversity is critical for food security.

FAO has estimated that about 10,000 to 50,000 plant species are edible. However, only about 150 to 200 species are cultivated as food. This means that there are many more species that can potentially be used and commercialised as food.

Over the period 1970 to 1992, natural forest in the whole of Malaysia was reduced by 19.3 percent, mainly in conversion to the agricultural crops, oil palm and rubber. The forests cleared, with irreversible loss of biological diversity, were predominantly lowland dipterocarp forests and, to a lesser extent, swamp forests, both peat and freshwater, and mangrove forests. Very little of the lowland dipterocarp forests, the largest reservoir of genetic variation of terrestrial flora and fauna, remain and these require total protection, as do the remaining swamp and mangrove forests. Loss of these habitats still continues as most development plans relegate the notion of conservation to low priority status.

The genetic base of our important agricultural crops is narrow. Malaysia relies on exotic germplasm, especially of rubber, oil palm, cocoa and pepper, for crop improvement. Further narrowing of the genetic base would lead to stagnation in the development of these commodity crops as well as require increased vigilance against pests and diseases.

In-situ Conservation

To protect and conserve the diversity of biological species in Malaysia, a number of in-situ measures have been instituted. These, to maintain plants and animals in their original habitats, have to take into consideration as many representative natural ecological habitats as possible to sustain breeding populations of flora and fauna.

The network of protected areas on land, as of 1992, includes 2.12 million hectares of National and State Parks, Wildlife Sanctuaries, Turtle Sanctuaries and Wildlife Reserves. Another 3.43 million hectares of natural forest within the Permanent Forest Estate of 14.28 million hectares are protected as water catchment areas. The network of Virgin Jungle Reserves in Peninsular Malaysia and Sabah protect a limited range of biological diversity in small forested areas as gene pools within larger (usually commercial) forest reserves or agricultural areas.

By the end of 1994, the surrounding marine waters of 38 offshore islands in Peninsular Malaysia and Labuan had been gazetted as marine parks. National Park in Sarawak, three in Sabah and one state park in Terengganu protect coastal and marine ecosystems.

These conservation efforts are inadequate for a number of reasons: (i) Several important habitats are under-represented. For example, wetlands such as mangrove forests, peat swamps and freshwater swamps are not adequately protected. Apart from being important as resting places for migratory birds, in regulating the hydrological regime, and in supporting fisheries, these habitats also support some unique flora and fauna because of their distinctive characteristics at the interface of terrestrial and aquatic systems. Limestone and quartz hills are other examples of unprotected habitats. (ii) Conservation efforts of individual species are targeted towards large animals, and to some extent birds. There is little emphasis on the conservation of individual species of plants, insects or fish (marine and freshwater). This is due mainly to the lack of adequate knowledge. (iii) Conservation is given low priority in existing land- use policies resulting in competition for land utilisation. (iv) The establishment of marine parks in Peninsular Malaysia focuses on aquatic considerations. Additional attention must be accorded to the adjoining terrestrial components as these too, if unduly disturbed, will have negative impacts on the marine ecosystem. (v) Common marine and terrestrial biological resources (e.g. in transboundary areas) lack adequate regional and international cooperation in their conservation and management. (vi) Efforts at conservation of landraces of indigenous plant species such as fruits and rice are inadequate, and these landraces are being eroded at a rapid rate.

Ex-situ Conservation

Ex-situ conservation maintains species outside their original habitats in facilities such as arboreta, zoological gardens, seed genebanksOverview Malaysia's location in the humid tropics provides a favourable climate to support rich and diverse life forms, from the microscopic organisms such as bacteria and plankton to macroscopic species such as fishes, birds and mammals. 2. Within the terrestrial ecosystems, forests are the major repository of biological diversity. Over 90 percent of terrestrial biological species in Malaysia occur within natural forests. In comparison, agricultural land, which supports a number of flora and fauna with commercia l values, is characterised by low species diversity. 3. Aquatic ecosystems include both freshwater and marine environments. Coral reefs and coastal mangroves have been identified as very important in terms of biological diversity. These are habitats which support diverse forms of life and are very productive. 4. , in vitro genebanks and field genebanks. Seed genebanks are considered safe and cost. Field and in vitro genebanks are particularly useful for species with seeds that are difficult to store.

Ex-situ conservation makes it easier for scientists to access, study, distribute and use plant genetic resources.

EXAMPLES OF EX-SITU CONSERVATION IN MALAYSIA

ARBORETA - medicinal plants fruit trees timber species ornamentals
SEED GENEBANKS - rice vegetables
FIELD GENEBANKS - rubber oil palm cocoa fruit trees coconut orchid sweet potato
IN VITRO GENEBANKS - cassava timber species
CAPTIVE BREEDING CENTRES - Sumatran rhinoceros seladang sambar deer
REHABILITATION CENTRES - orang-utan
TURTLE SANCTUARIES - marine turtle
TURTLE HATCHERIES - river terrapin marine turtle

Currently, ex-situ conservation of plants, including timber species, is solely in arboreta and small collection centres. Animals are being maintained in zoos, rehabilitation centres and captive breeding centres. Collections of specific microorganisms are deposited in univ ersities and research institutions.

EXAMPLES OF EX-SITU COLLECTION CENTRES IN MALAYSIA BY STATE

Johor : Research Station, Palm Oil Research Institute Malaysia, Kluang
Malacca : Zoo, Air Keroh
Penang : Botanic Gardens Rice Genebank, Malaysian Agricultural Research & Development Institute, Seberang Perai
Perak : Terrapin Hatchery, Bota Kanan
Sabah : Agriculture Research Station, Ulu Dusun Arboretum, Forest Research Centre, Sepilok Orang- Utan Rehabilitation Centre, Sepilok Orchid Centre and Agriculture Research Station, Tenom Sabah Parks Orchid Garden, Poring
Sarawak : Botanical Research Centre, Semengoh Sungai Sebiew Agricultural Park, Bintulu Wildlife Rehabilitation Centre, Semengoh
Selangor : Arboreta, Forest Research Institute Malaysia, Kepong Bukit Cahaya Agricultural Park, Shah Alam Captive Breeding Station, Sungai Dusun Experimental Station, Rubber Research Institute Malaysia, Sungai Buloh Medicinal Plant Garden, Universiti Pertanian Malaysia, Serdang Orchid Collection, Malaysian Agricultural Research & Development Institute, Serdang Taman Pantun, Universiti Kebangsaan Malaysia, Bangi Zoo Negara, Ulu Kelang
Federal Territory : Rimba Ilmu, Universiti Malaya, Kuala Lumpur
Terengganu : Turtle Sanctuary, Rantau Abang

Whilst there are a number of ex-situ plant collection centres distributed around the country, there is an urgent need for a national botanical garden.

Malaysia's location in the humid tropics provides a favourable climate to support rich and diverse life forms, from the microscopic organisms such as bacteria and plankton to macroscopic species such as fish, birds and mammals.

Among the terrestrial ecosystems, forests are the major repository of biological diversity. Over 90 percent of terrestrial species in Malaysia occur within natural forests. In comparison, agricultural land, which supports a number of flora and fauna with commercial values, is characterised by low species diversity.

Aquatic ecosystems include both freshwater and marine environments. Coral reefs and coastal mangroves have been identified as very important in terms of biological diversity. These are habitats which support diverse forms of life and are very productive.

Development activities in the various economic sectors have profound impacts on biological diversity. To minimize such adverse impacts and to promote the conservation of biological diversity and the sustainable development of its components, it is essential that such considerations are incorporated into development plans at the planning stage itself. Biological diversity considerations should be addressed as an important component in policy documents to ensure effective coordination and integration. The development plans concerned are the Five-year Development Plans and the Second Outline Perspective Plan (1991-2000) which embodies the New Development Policy.

The Legislative Framework

There is no single comprehensive legislation in Malaysia which relates to biological diversity conservation and management as a whole. Much of the legislation is sector-based, for instance, the Fisheries Act 1985 deals mainly with the conservation and management of fisheries resources, the Protection of Wild Life Act 1972 deals with the protection of wildlife, and the National Forestry Act 1984 deals with the management and utilization of forests alone. Some were legislated without specific consideration given to the issue of conservation and management of biological diversity as a whole. The legislation is also inadequate in that species endangered due to habitat destruction are not protected by way of a national law for endangered species.

The most distinct feature of the legislative framework relating to biological diversity is that under the Federal Constitution, the authority to legislate for matters relevant to biological diversity does not fall under one single authority. Although some responsibilities in respect of issues related to biological diversity conservation and management are shared between the Federal and State authorities, some others do fall under the responsibility of one authority alone, be it the Federal or State authority. This is specified by the Federal Constitution, under the Federal, Concurrent and State List of the Ninth Schedule. Thus there are some matters, for example, protection of wild animals and wild birds, and National Parks, which fall under the legislative authority of both the Federal and State Governments, in accordance with the Concurrent List of the Ninth Schedule, however, there are also some matters which fall under the legislative authority of the State alone, for example forest and agriculture. Furthermore, in respect of Sabah and Sarawak, the Concurrent and State Lists are modified.

To the extent that some laws are federal legislation and some are state enactments, in sum this means that not all legislation enacted will apply to the whole of Peninsular Malaysia, Sabah and Sarawak. Since this is the constitutional position, the question of how uniformity of laws may be promoted, particularly in respect of matters which fall under State jurisdiction alone, needs to be properly addressed.

As an example, among the legislation relevant to biological diversity, the Environmental Quality Act 1974 and the Fisheries Act 1985, being federal legislation, may apply to Peninsular Malaysia, Sabah and Sarawak as well. However, there are other relevant enactments which are specific either to Peninsular Malaysia, Sabah or Sarawak, covering for example, native peoples' rights, forestry, protected areas and wildlife.

From the viewpoint of effective conservation and management of biological diversity and in light of the above, it appears that the current legislative framework creates some restrictions, thereby causing some deficiencies.

Firstly, there is an absence of an integrative approach across the sectors, due to the limited scope of various enactments in relation to biological diversity conservation. There is also lack of consideration of the overall objectives of biological diversity conservation. Secondly, this results in a lack of comprehensive coverage of biological diversity issues. Finally, the areas of jurisdiction of Federal and State Governments as defined in the Constitution lead to non-uniform implementation between states.

PARTIAL LIST OF LEGISLATION RELEVANT TO BIOLOGICAL DIVERSITY

Federal

• Environmental Quality Act 1974
• Fisheries Act 1985
• Pesticides Act 1974
• Plant Quarantine Act 1976
• Customs (Prohibition of Exports Amendment No.4) Order 1993

Peninsular Malaysia

• Waters Act 1920
• Taman Negara (Kelantan) Enactment 1938
• Taman Negara (Pahang) Enactment 1939
• Taman Negara (Terengganu) Enactment 1939 (The State Parks from the above three Enactments constitute Taman Negara)
• Aboriginal Peoples Act 1954
• Land Conservation Act 1960
• National Land Code 1965
• Protection of Wildlife Act 1972
• National Parks Act 1980
• National Forestry Act 1984

Sabah

• Parks Enactment 198
• Forest Enactment 1968
• Fauna Conservation Ordinance 1963

Sarawak

• National Parks Ordinance 1956
• Wildlife Protection Ordinance 1958
• Forests Ordinance 1954
• Natural Resources Ordinance 1949 as amended by Natural Resources and Environment (Amendment) Ordinance 1993
• Public Parks and Greens Ordinance 1993
• Water Ordinance 1994

ECONOMIC TRENDS Habitat loss or conversion and economic exploitation of natural resources have been the primary cause of biological diversity loss in Malaysia to date. However, ongoing structural changes in the Malaysian economy present an alternative scenario to biological diversity loss. The bigger threats to biological diversity are now more likely to be industrial pollution rather than habitat loss.

The three major areas of Malaysia, Peninsular Malaysia, Sabah and Sarawak are all at different stages along the transition from a commodity-based to an industry-based economy, as are the various states within Peninsular Malaysia. In the states of Sabah and Sarawak, conversion of additional large areas of forest to agriculture can be expected.

The most prominent structural change in Malaysia's economy, as discussed in previous chapters, has been the shift from a dependence on agricultural and other commodities to a growing reliance on manufacturing. The manufacturing sector overtook agriculture in terms of GDP share for the first time in 1987, signalling the explosion in economic growth that was to follow. Increased economic opportunities in the manufacturing sector are demonstrated in a trend of declining employment in the agricultural sector and significant rural to urban migration, particularly among the younger population, as most of the manufacturing industries are located in the more urbanised areas. Increased importance and priority placed by government policies (i.e. the New Economic Policy 1970 and the Second Malaysia Plan 1971-76 onwards) on manufacturing have indirectly reduced the pressure for large-scale conversion of forested land for agricultural land use as was apparent in the 1960s and 1970s.

In addition, recent government policies (such as the New Agricultural Policy) advocate a moratorium on opening new forest lands for land development schemes in Peninsular Malaysia and to concentrate instead on in situ development. The agriculture sector is undergoing an intensive re-engineering process to achieve higher levels of efficiency through intensive commercial-scale agricultural practices. The NAP emphasises increasing land productivity through the modernisation and commercialisation of the sector, among the smallholders. The agriculture-related R&D institutions focus on improving crop productivity with proper management and use of fertilisers, pesticides and improved genetic strains.

Thus, it is predicted that loss of habitat to agricultural practices will be minimal in the future as Peninsular Malaysia pursues its vision of becoming an industrialised nation by the year 2020. The current high growth rates in the manufacturing sector have been accompanied by a steady decline in the growth of the agricultural sector. A recent study supports the theory that biological diversity loss, or change, in Malaysia is dependent upon the nation's economic structure by demonstrating that a 1% per capita change in agriculture production effects a 11.3 % increase in the demand for agricultural land use per capita. Conversely, a 1% per capital change in manufacturing production results in a 0.41% decrease in the demand for agriculture.

Inevitably, the industrial sector is rapidly emerging as the major threat to biological diversity in the country. Industrial wastes that are incorrectly or indiscriminately disposed of will alter the abiotic condition of the ecosystem and subsequently alter species composition in the area. The early industrialisation phase of developing the resource-based industries in the 1970s, primarily palm oil and rubber processing, resulted in the discharge of large amounts of organic effluents into the water systems in Malaysia. As industrialisation progressed and diversified, so too did the major sources of industrial water pollution. The Department of Environment identified the chemical, food and beverage, textile, metal finishing, animal husbandry, and the rubber and palm oil processing industries as the biggest water polluters in 1995.

Of the 119 rivers monitored for Water Quality Index (WQI), based on the five parameters of biochemical oxygen demand (BOD), chemical oxygen demand (COD), ammoniacal nitrogen, suspended solids and hydrogen levels, in 1995, 14 rivers were categorised as highly polluted and 53 as slightly polluted. A large percentage of the highly polluted rivers are located in highly urbanised or industrialised regions on the west coast of Peninsular Malaysia. The deterioration of water quality adversely affects the survival rates of aquatic biological diversity and the dependent food chains.

Industrial growth has also exacerbated air pollution, a typical urban-industrial problem in Malaysia. The Klang Valley routinely experiences a haze during the annual dry seasons, which is attributed to industrial air pollution, vehicular fumes, emissions from power stations, boilers, incinerators, and open burning activities.

Perhaps the most detrimental industrial threat is the increase of toxic and hazardous wastes generated in the country. Until recently, there was no established infrastructure for the safe treatment and disposal of toxic and hazardous wastes in Malaysia. Approximately 380,000 cubic metres of industrial waste are generated annually in Peninsular Malaysia alone. While environmentally-responsible industries store their waste in drums on site, for many years it has been common practice for small to medium industries to dispose of waste into surface drains or unsecured sites. The neglect of environmental concerns by certain industries was dramatically brought to public attention in 1995 when a chemical company disposed of 41 drums of cyanide waste in an unsecured landfill on Pulau Pangkor, causing extensive damage to the surrounding fisheries industry, and potentially serious damage to the environment and human health.

Industrial pollution alters the ecosystem's chemical balance, the biological diversity and its capacity to support biological forms. If pollution continues unabated within an ecosystem, it will eventually render itself unsuitable to all living forms. An example is the Klang River. Once flourishing with a myriad of fish and bird species, the river is now almost completely devoid of life-forms despite million-ringgit efforts to clean the river.

With the expected increase in pressure on biological diversity from the industrial sector, there should be an accompanying increase in the use of market-based instruments for environmental management. In addition to the polluter-pays principle currently in place with enforcement of the Environmental Quality Act by the Department of Environment , some additional forms of economic incentives could be introduced.

Tax relief or exemptions for industries that implement pollution prevention measures and technologies, favourable loans for environmental projects such as waste disposal or recycling plants, conversion of loans to grants in return for environmental commitments and protection of critical areas; and financial incentives for siting industries to minimise impact on the environment are some measures that could be implemented. As the ASSESSMENT has attempted to demonstrate throughout, economic analysis is also a valuable ally for conservation interests as it emphasises conservation as an integral part of economic development. Economic instruments should be used to integrate development and environment at the state level so that conservation and development are mutually supportive.