Pour the coconut milk into a small saucepan, and heat over medium-high heat until boiling, about 5 minutes. Whisk regularly to prevent burning.
Reduce the heat, bringing the coconut milk to a simmer. Add the sugar, and whisk until completely dissolved.
Allow to simmer for 30-45 minutes, until the liquid is reduced by half.
Remove from the heat, and allow to cool completely before using in recipes.
Pour into a container, cover, and store in refrigerator for up to 1 week.