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Synthetic aperture radar (SAR) images are corrupted by multiplicative speckle noise which limits the performance of the classical coder/decoder algorithm in spatial domain. The relatively new transform of multiwavelets can possess desirable features simultaneously, such as orthogonality and symmetry, while scalar wavelets cannot. In this paper we propose a compression scheme combining with speckle noise reduction within the multiwavelet framework. Compared with classical set partitioning in hierarchical trees (SPIHT) algorithm, our method achieves favorable peak signal to noise ratio (PSNR) and superior speckle noise reduction performances.