Economic Valuation of Forest Ecosystem for Watershed Services in Kelantan, Malaysia

Abstract

Preserving forest watershed areas has become crucial in capturing and storing water, contributing enough water supply for domestic and non-domestic purposes such as agriculture, recreation, and energy generation. Unlike primary goods such as food and fuel, most ecosystem services like watersheds do not have market values, where the protection of these services is barely considered in economic decisions. The study aims to estimate the value of the economic benefit of the forest ecosystem for watershed services in Kelantan by using the willingness to pay (WTP). The simple random method has been employed to collect the data via face to face to interviews with 1043 households in Kelantan. The finding of this study estimated the economic value of Kelantan’s forest ecosystem for watershed services amounted to RM48 million annually, which could be worthwhile for protection or conservation fees. The public’s interest in contributing to the forest watershed services in Kelantan indicates that relevant stakeholders need more collaborative effort, including non-governmental organisations and federal and state governments, to conserve and preserve the forest ecosystem in Malaysia, specifically for watershed services.