History of Modern Penang

The State of Penang, one of the most developed and urbanised Malaysian states, is located at the nation's northwest coast along the Malacca Strait. Unlike most Malaysian states, the history of modern Penang was shaped by British colonialism, beginning with the acquisition of Penang Island from the Sultanate of Kedah by the British East India Company in 1786. Developed into a free port, the city state was subsequently governed as part of the Straits Settlements, together with Singapore and Malacca; the state capital, George Town, briefly became the capital of this political entity between 1826 and 1832. By the end of the 19th century, George Town prospered and became one of the major entrepôts in Southeast Asia.

During World War II, Penang was conquered and occupied by the Japanese Empire from 1941 to 1945. At the end of the war, Penang was also the first state in the Malay Peninsula to be liberated by the British, under Operation Jurist. The Straits Settlements was dissolved in the following year and Penang was merged into the Federation of Malaya. In spite of a secessionist movement within Penang, the merger with Malaya went ahead and the federation attained independence from the British Empire in 1957. Malaya later evolved into the present-day Malaysia in 1963.

Following the revocation of George Town's free port status in the 1960s, the state suffered economic decline and massive unemployment. The state government at the time led a push to reorient the economy towards hi-tech manufacturing, successfully recovering Penang's economy and lending the state its moniker the Silicon Valley of the East. Growing recognition of George Town as a bustling tourist destination, particularly since the city's inscription as a UNESCO World Heritage Site in 2008, also boosted the state's services sector, and today, both the manufacturing and services sectors are the two strongest economic pillars of Penang. Moreover, the state enjoys one of the lowest unemployment rates and Gini coefficients within Malaysia, as well as the second highest gross domestic product (GDP) per capita within the country after Kuala Lumpur.

Ancient Penang

Evidence of prehistoric human settlement in what is now Penang has been discovered in Guar Kepah within Seberang Perai (formerly Province Wellesley), the mainland half of Penang. Human remains, dating back to about 5,000 to 6,000 years ago, have been found at the site south of the Muda River, along with seashells, pottery and hunting tools. These indicate that Seberang Perai had been inhabited by nomadic Melanesians from as early as the Neolithic era.

Seberang Perai also became part of the Bujang Valley civilisation. The Cherok Tok Kun megalith in Bukit Mertajam, discovered in 1845, contains Pali inscriptions, indicating that an early Hindu-Buddhist political entity in what is now Kedah had established control over parts of Seberang Perai sometime between the 5th and 6th centuries. The entirety of what is now Penang would later form part of the Sultanate of Kedah up until the late 18th century.

Meanwhile, Penang Island was first documented by Chinese sailors of the Ming dynasty in the 15th century. At the time, Ming Emperor Yongle was in the midst of launching naval expeditions that would eventually reach all the way to eastern Africa. The island, known as Bīnláng Yù (), was mapped by Admiral Zheng He's fleet in the ' Nautical Charts of Zheng He'.

One of the first Englishmen to arrive on Penang Island was the privateer James Lancaster who commanded the ''Edward Bonaventure''. He landed in June 1592 and remained on the island until September, pillaging every vessel he encountered.

Penang Island was also indicated as Pulo Pinaom in Portuguese historian Emanuel Godinho de Eredia's 1613 map of the Malay Peninsula.

In the early 18th century, ethnic Minangkabaus from Sumatra, led by Haji Muhammad Salleh (also known as Nakhoda Intan), landed on Penang Island, establishing a seaside settlement at Batu Uban in 1734. They were followed by the Arabs, who subsequently intermarried with the Minangkabau; this gave rise to the Arab-Minangkabau admixture now described as Malay, as they have assimilated into the local Malay community.

Founding of Penang

The history of modern Penang only began in earnest in the late 18th century. Up until then, the Sultanate of Kedah, which had control over Penang, had maintained turbulent diplomatic relations with Siam to the north. In the 1770s, the British East India Company instructed Francis Light to establish trade relations in the Malay Peninsula. Light subsequently landed in Kedah, which at that point was threatened by both Siam and Burma, as well as an internal Bugis rebellion.

Aware of this situation, Light formed friendly relations with the then Sultan of Kedah, Sultan Muhammad Jiwa Zainal Adilin II, and promised British military protection. As part of his promises, Light assisted in the quelling of the Bugis revolt by recapturing a Bugis-held fort for the Sultan. The Sultan reciprocated by offering Penang Island to Light. Light subsequently wrote to his superiors regarding the offer, arguing that Penang Island could serve as a "convenient magazine for trade" and its strategic location would allow the British to check Dutch and French territorial gains in Southeast Asia. He also made the case that, with the other ports in the region, such as Aceh and Phuket, riddled with piracy and despotic governments, the British East India Company could seize the opportunity to establish a tranquil harbour on Penang Island conducive for free trade, noting that if "Malay, Bugis and Chinese will come to reside here, it will become the Exchange of the East if not loaded with impositions and restrictions".

However, nothing transpired until 1786, when by that point the British were fighting the Thirteen American Colonies, which were backed by France and the Netherlands. Faced with the Dutch dominance of the East Indies (now Indonesia) and a growing French threat, Light, who by then had risen to the rank of captain, was ordered to acquire Penang Island from Kedah. The British East India Company sought control of Penang Island as a Royal Navy base, and a trading post between China and the Indian subcontinent.

Light negotiated with the new Sultan of Kedah, Sultan Abdullah Mukarram Shah, regarding the cession of Penang Island to the British East India Company in exchange for British military assistance and a lease of 6,000 Spanish dollars to cancel Kedah's debts to Siam. With the agreement between Light and the Kedah Sultan successfully concluded, Light and his entourage sailed on to Penang Island, where they arrived on 17 July 1786. Fort Cornwallis would later be built at the spot where Light first set foot.

The area where Light first landed was originally a mangrove swamp covered in thick jungle. Once enough land was cleared, creating what is now the Esplanade, a ceremony was held on 11 August, during which the Union Jack was raised for the first time. This signified the formal possession of Penang Island by the British East India Company in the name of King George III. The island was renamed the Prince of Wales Island after the heir to the British throne, while the new settlement of George Town was established in honour of King George III. Thus, George Town became the first British settlement in Southeast Asia and a springboard for future British territorial expansion in the region, while its establishment by the British East India Company marked the start of a period of British imperialism in the Malay Peninsula.

Unbeknownst to the Kedah Sultan, however, Light had acted without the authority or consent of his superiors in India. When Light reneged on his promise of British military protection against Siam, the Kedah Sultan in 1791 assembled an army in what is now Seberang Perai to retake the Prince of Wales Island. The Sultan's force was also assisted by a fleet of pirates. Fortunately for Light, his garrison on the island was reinforced by two companies from Calcutta. After failing to persuade the Sultan to disband his forces, the British East India Company launched amphibious assaults at night, destroying Kedah's military installations in Perai, and defeating both the pirates and the Sultan's army.

In 1800, the first Lieutenant-Governor of Prince of Wales Island, Sir George Leith, gained a strip of Seberang Perai from the new Sultan of Kedah. The treaty, negotiated by Leith's First Assistant George Caunter, superseded Light's earlier agreement and gave the British permanent sovereignty over both Prince of Wales Island and the newly ceded mainland territory, which in subsequent years was named Province Wellesley.

The newly acquired land, which included a five-kilometre stretch of coastline south of the Perai River, turned the river into the international border between Province Wellesley and Kedah. At the time, Province Wellesley was heavily forested and sparsely populated, with a total population of only 5,000. The treaty gave Prince of Wales Island the entire command of its harbour for the first time, as well as control of the vulnerable mainland coastline, home to pirates and brigands. It further gave the island a controlled source of food and increased the value of its opium and arack farms. It provided for the free flow of food and commodities from Kedah to Prince of Wales Island and Province Wellesley. For Kedah it provided a protective strip against enemy attack from the sea. In exchange for this acquisition, the annual payment to the Kedah Sultan was increased to 10,000 Spanish dollars per annum. To this day, the Malaysian federal government still pays Kedah, on behalf of Penang, RM10,000 annually as a symbolic gesture.

Following the original acquisition in 1800, Province Wellesley was gradually expanded up to its present-day boundaries in 1874, when the Pangkor Treaty, which included the delineation of Province Wellesley's southern borders, was signed between the British and the neighbouring Sultanate of Perak. Province Wellesley thus gained the town of Sungai Acheh from Perak.

Light died from malaria in 1794 and was buried within the Old Protestant Cemetery in George Town. To this day, Light is honoured as the founding father of Penang.

Early growth

Francis Light had established George Town as a free port, thus allowing merchants to trade without having to pay any form of tax or duties. In effect, this measure was intended to entice merchants from the Dutch ports in the region. As a result, the number of incoming vessels increased exponentially from 85 in 1786 to 3,569 in 1802; George Town's population had also risen to 10,000 by 1792. Immigrants came from various parts of Asia; in 1801, the then Lieutenant-Governor of the Prince of Wales Island, Sir George Leith, remarked that "there is not, probably, any part of the world where, in so small a space, so many different people are assembled together or so great a variety of languages spoken". A committee of assessors was also established for George Town in 1800, making it the first local government to be established within British Malaya.

The Prince of Wales Island, together with Province Wellesley, had been administered under the Bengal Presidency until 1805, when Penang was made a separate Presidency on par with Madras, Bombay and Bengal. By then, Penang also served as a penal station; in 1796, 700 Indian convicts were shipped in from the Andaman Islands. The practice of employing Indian convicts continued throughout the 19th century as a means to provide the necessary labour for public infrastructure works, such as the construction of roads, drains and public buildings.

In 1807, a Royal Charter to provide for the establishment of a Supreme Court and a police force in Penang was granted. The Supreme Court of Penang was first opened at Fort Cornwallis in George Town in 1808, with Edmond Stanley assuming office as its first Recorder (Judge). In the decades that followed, Penang's judiciary and the police force were progressively applied to the Straits Settlements, and later copied throughout British Malaya. Hence, Penang was the birthplace of the present-day Malaysian judiciary system, as well as the Royal Malaysian Police.

In the early 19th century, Penang became a centre of spice production and trade within Southeast Asia. The cultivation of pepper began soon after the founding of George Town in 1786. The production of spices, including nutmeg and clove, gradually grew more varied and the booming spice trade led to the opening of spice farms all over Penang. The export of spices through the Port of Penang also enabled the British East India Company to cover the administrative costs of Penang. Furthermore, the agricultural plantations would fuel the growth of several villages, such as Air Itam and Balik Pulau on the island, and Bukit Mertajam in Province Wellesley. Malay refugees fleeing the Siamese invasion of Kedah and Chinese immigrants formed the bulk of workers in these agricultural estates. Other areas, such as Bayan Lepas on the island and Kepala Batas in Province Wellesley, were founded as rice-producing estates.

Straits Settlements

In 1826, the British East India Company amalgamated the territories of Penang, Singapore (acquired from Johor in 1819) and Malacca (acquired from the Netherlands in 1824) into a single political entity, the Straits Settlements. George Town was made the administrative and judicial capital of the new entity. However, owing to Singapore's more strategic geographical location between the Malacca Strait and the South China Sea, the Port of Singapore rapidly surpassed the Port of Penang as the preeminent harbour in the region. Consequently, Singapore replaced George Town as the capital of the Straits Settlements in 1832.

Nonetheless, George Town continued to retain its importance as a vital British entrepôt by funneling the exports meant for global shipping lines which had bypassed other regional harbours. In the latter half of the 19th century, the tin mining boom within the neighbouring Sultanate of Perak and Siam brought more prosperity to Penang. Tin produced from within the Kinta Valley and southern Siam were transported to George Town for smelting, before being exported via the Port of Penang to European and American industries. The Port of Penang subsequently became a major tin-exporting harbour within British Malaya, directly challenging the Port of Singapore. The opening of the Suez Canal in 1869 and the advent of steamships further cemented the Port of Penang's importance as a major entrepôt within British Malaya. By the end of the 19th century, George Town also evolved into a leading financial centre of British Malaya, as mercantile firms and international banks, including Standard Chartered and HSBC, flocked into the city.

By then, Penang became home to a myriad of ethnicities and religious affinities. Aside from the sizeable Chinese, Malay, Indian, Peranakan, Eurasian and Siamese communities, the colony's multi-ethnic and multi-religious society included significant minorities of Burmese, British, Javanese, Japanese, Sinhalese, Jewish, German and Armenian origin.

At the time, each ethnic community had a tendency to specialise in specific trades and economic sectors. While the Europeans predominated in the various professional fields, as well as occupying managerial positions in mercantile and shipping firms, the Peranakans and the Eurasians tended to enter the nascent civil service as lawyers, engineers, architects and clerks. Some of the newer Chinese arrivals, labelled condescendingly by the Peranakans as Sinkheh (Chinese: 新客; meaning new guests), were coolies and agricultural farmers, although many eventually entered into commercial, trading and real estate enterprises within the city; certain dialect communities, such as the Cantonese and the Hakka, predominated as artisans, blacksmiths, carpenters and cooks. The Indians, who were first brought in as convict workers for public works, also began competing with the Chinese in commercial, trading and shipping stevedore activities. Ethnic Malays, meanwhile, were primarily engaged in agricultural occupations, including rice farming and fishing. Other ethnic communities, such as the Jews and the Armenians, were mainly engaged in mercantile and commercial ventures; the latter community was notable for the establishment of the Eastern & Oriental Hotel, for instance.

The rapid population growth that resulted from the booming economy led to several social problems, chiefly the inadequate sanitation and public health facilities, as well as rampant crime. The latter was brought about by an influx of Chinese immigrants, which led to the formation of feuding triads and secret societies. Turf wars between the triads worsened, and when the Straits Settlements authorities attempted to put a stop to the triad activities in 1857, the Chinese triads came into conflict against the British-led police force as well. This culminated in the Penang Riots of 1867 in the streets of George Town, when the Kean Teik Tong, led by Khoo Thean Teik and the Red Flag, clashed against the alliance of the Ghee Hin Kongsi and the White Flag. The resulting civil unrest lasted for 10 days, before the turf war was eventually quelled by the Straits Settlements authorities under newly appointed Lieutenant-Governor Edward Anson, who were assisted by European residents and reinforcements from Singapore.

Also in the same year, the Straits Settlements was made a British crown colony, thereby placing the administration of Penang, Singapore and Malacca directly under the Colonial Office in London. Direct British rule meant better enforcement of the rule of law, as Penang's police force was vastly beefed up and the secret societies that had plagued George Town during the preceding decades were gradually outlawed.

Meanwhile, in Province Wellesley, new railway lines were being constructed, with the first railroad being the Bukit Mertajam-Perai line in 1899. The town of Butterworth was also established in the mid-19th century as the transportation hub within Province Wellesley. In 1894, the first cross-strait ferry service between George Town and Butterworth commenced operations, and would eventually evolve into the present-day Rapid Ferry.

With improved access to education and rising living standards, Penang soon enjoyed substantial press freedom and there was a greater degree of participation in municipal affairs by its Asian residents. Penang's representatives in the Straits Settlements Legislative Council gained a reputation for their assertive contestation of the policies made by the Singapore-based British authorities, which sometimes went against Penang's interests.

On top of that, George Town, perceived as being more intellectually receptive than Singapore, also served as a magnet for well known English authors, Asian intellectuals and reformists. For instance, the Chinese revolutionary leader, Sun Yat-sen, chose to relocate his Southeast Asian base from Singapore to George Town, where he continued his efforts to reorganise and raise funds for the Chinese revolutionary movement against the Qing dynasty. These efforts culminated in the famous 1910 Penang conference, which paved the way to the ultimately triumphant Wuchang uprising that overthrew the Manchu imperial government of China.

World wars

World War I

On 28 October 1914, the Battle of Penang occurred, during which an Imperial German Navy cruiser, , covertly sailed into George Town and sank the Imperial Russian Navy cruiser, ''Zhemchug''. The French Navy destroyer, ''Mousquet'', set off in pursuit, before being sunk by SMS ''Emden'' as well off the northwestern tip of Penang Island. 147 French and Russian sailors perished, while the survivors were rescued by local Malay fishermen.

Aside from the naval battle, Penang, as well as the Straits Settlements, was largely unaffected by the events of World War I.

World War II

World War II, on the other hand, unleashed unprecedented social and political upheaval to Penang. The swift British retreat, coupled with the brutal massacres of Penang's Chinese residents, would severely dent British sense of prestige and dominance in the eyes of the locals.

From 9 until 18 December 1941, Japanese warplanes indiscriminately strafed and bombed George Town, in the process eliminating the obsolete Royal Air Force and Royal Australian Air Force squadrons based in RAF Butterworth and the Bayan Lepas Aerodrome (now Penang International Airport

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