Economic benefits of the Muda Water Catchment
2010
Lee Kian Foh, Green Spider, 4 Jln. Badam 1, Taman Cheras, 56100 Kuala Lumpur (Malaysia)
This paper provides estimated values of the water resources of the Muda catchment particularly in terms of direct revenues to the Kedah and Penang State governments from the sales of treated water and also the values derived from rice production dependent on irrigation water sourced from the Muda catchment. In 2005, the Muda catchment contributed RM157 million to Kedah and RM139 million to Penang in terms of annual water supply for domestic and non-domestic use. Together, the contribution is approximately RM296 million. The water supply companies in Kedah and Penang made profits from these revenues. The benefits of clean and reliable supply of water extend beyond the valued amount of RM296 million because water is used as input for business and industry. In addition to the above, the forests of Ulu Muda also provide a clean and reliable sources of water to Kedah, Penang and Perlis for irrigation. In terms of benefits, the income for farmers in the MADA irrigation scheme is estimated at approximately RM776 million in 2006. Farmers incur costs of production such as labour, fuel and use of machinery. Water from the Muda catchment for irrigation has the potential to affect this value of approximately RM776 million annually. The forest of the Muda water catchment also provide values, some of which have not been estimated. These include the values for ecotourism with a potential value of RM13 million annually; educational and scientific purpose; non-timber forest products; medicinal and pharmaceutical values; cultural and heritage values; and the existence values of the diverse flora and fauna in the forests.
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