Malaysia PM Anwar open to Sabah and Sarawak demand for fair carbon trading revenue share

Malaysian Prime Minister Anwar Ibrahim has signaled openness to demands from Sabah and Sarawak for a fairer share of revenue from carbon trading. The two states, which hold large forested areas critical for carbon sequestration, argue they deserve a larger cut of proceeds from carbon credit sales. The federal government currently controls most carbon trading policy and revenue allocation. The dispute highlights a growing tension in carbon markets between national governments and regional authorities that control the actual land and forests generating credits. Sabah and Sarawak together account for a significant portion of Malaysia's forest cover, making them key players in any national carbon trading scheme. A clear revenue-sharing framework could unlock investment in forest conservation and restoration projects in both states. Observers note that resolving this revenue split is essential for Malaysia to scale its voluntary carbon market and attract international buyers. Without local buy-in, projects risk delays or opposition. The outcome could set a precedent for other countries where subnational governments control carbon-rich natural resources.