Coral reefs are a valuable economic and ecological resource. They have important ecosystem functions that provide crucial goods and services to hundreds of millions of people, mostly in developing countries. They are the foundation of a significant proportion of the global tourism industry, and are a major source of biodiversity.
Within Southeast Asia, the potential sustainable economic value of coral reefs is substantial, as is the potential economic loss if these resources are degraded. One estimate puts the value of coral reefs at US$115,740 per hectare per year. This places Malaysia's reefs, with a cover of 4,000 sq. km, at a value of RM145 billion per year.
Malaysia is part of the "Coral Triangle", an area recognised by scientists to have the world's highest marine biodiversity. Coral diversity is highest in East Malaysia, estimated at over 550 species while Peninsular Malaysia has over 360 species of coral. Coral reefs therefore represent an economically important ecosystem and are the foundation of a significant percentage of the country's tourism industry. Economically, coral reef-related businesses in Malaysia are worth approximately US$635 million annually in food, fisheries, tourism and even pharmaceuticals.