Economic Valuation of Nature Area of Sultan Ismail Petra Ecosystem Protection Park (Pergau Lake), Malaysia

The value of protected natural environments is important for policy-making in a world of increasingly scarce natural resources. The natural environment includes protected areas such as forest reserves and lake parks which are also areas with high potential for ecotourism. The increasing demand for tourism has led to the development of infrastructure and facilities, particularly the development for ecotourism. However, the economic benefits of natural ecotourism areas are not readily quantified because of the unavailable market price. This is true for the forest and lake resources where the potential and realised benefits for recreation purposes are not valuated. If valuation is not done, the allocation of the resources cannot be optimised and the natural resources may be converted for other purposes. Quantifying the economic value of natural environment resources can show where goods and services are currently underpriced by the market. It can also indicate whether there is potential to develop new markets, to charge prices for the use of natural resources, or to capture natural resource benefits in financial terms. Other than generating revenue, prices and market measures can provide an effective means of regulating the demand for resources and of providing incentives for sustainable management. The purpose of the study is to estimate the value of Sultan Ismail Petra Ecosystem Protection Park (Pergau Lake), in Malaysia, through non-users' willingness to pay (WTP). In this study, the dichotomous-choice contingent-valuation method (CVM) was employed to estimate the economic value of conserving the park through face-to-face interviews. The WTP was elicited from a total of 268 respondents. The respondents were asked whether they would be willing to contribute a conservation fee to preserve the park as a recreational site. The average WTP for all respondents was estimated to range between RM111.22 and RM293.12 annually, which translates to a contribution of between RM11.22 million and RM29.58 million in aggregate for the year 2019.