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GEORGE TOWN is one of three great historic settlements along the Straits of Malacca. It was declared a World Heritage Site by UNESCO in July 2008. The other settlements are Malacca, also a World Heritage Site, and Singapore. The island of Penang, in north-west Malaysia, was the first of these three British colonies to be established, and George Town is its capital.

In 1786, Captain Francis Light established an English East India Company (EIC) trading post here. However, Light was not the first settler and his role as “founder” is much contested, for Penang was, until then, part of the ancient Kedah Sultanate.

Achenese traders had already settled along the Pinang River when Francis Light arrived. Chinese tombstones in Tanjong Tokong allegedly predate Light’s arrival. In those days, however, Penang Island was very sparsely populated. After Francis Light arrived, George Town soon attracted migrants from all over Asia and Europe, contributing to a rapidly burgeoning multicultural identity.

In 1805, the British government designated the colony as an Indian Presidency, under the administration of Bengal, and a multiethnic Committee of Assessors was established to set rates and help manage the city. This was the precursor to the George Town Municipal Council, and the first in Malaysia.

In its early days, George Town attracted traders from India and Indonesia because it was a major port for textiles and pepper within the region, and later nutmeg. These commodities were of great importance financially. But the big money was in the China trade that passed through the Malacca Straits. It was based almost entirely upon tea, but included silk and ceramics.

In the opposite direction, ships carried opium and silver, and sundry other items that were of interest to the Chinese. However, Penang never became the main port for the China trade, because its role was soon usurped by Singapore (est 1819), which was fast developing under the administration of Stamford Raffles, who had the ear of the British Government.

In 1826, George Town became the capital of the British Straits Settlements comprising Penang, Malacca and Singapore. But by 1832, Singapore had taken over George Town’s administrative role. With declining trade and disease threatening its pepper and nutmeg plantations, the city’s future was bleak.

This decline was stemmed 10 years later by the discovery of tin in the neighbouring Malay States. Migrants from south-eastern China soon arrived, adding to the city’s cosmopolitan character. The Triads, fighting men affiliated with Chinese clans and dialect groups, accompanied them.

In 1857, competition amongst the Chinese over the monopoly for opium and tin trading exploded into open warfare. The Penang Riots resulted in the end of indirect rule. Up till then, the British had ruled through local headmen called “Kapitans”. In their place, the British established an inspectorate of police that enforced British laws throughout the colony.

By 1869, the year the Suez Canal opened, George Town had developed into the region’s chief entrepot port. Wealth from trade, tin mining and commercial agriculture resulted in the largest conglomeration of pre-World War II architecture in Southeast Asia.

By the turn of the 20th century, George Town had become a regional education and intellectual centre through its English schools and lively modern press. It became a haven for religious reformers, revolutionaries and proto-nationalists. It was also a modern city with electric tram-cars and a funicular railway linking the city to the Penang Hills. As with so many major ports in the 1930s, George Town was a centre not just for trade and finance, but also for recreation, with its Great World Parks, jazz bands and cabarets.

In 1941, this cosmopolitan society was shattered by the bombing raids of the Japanese Imperial Air Force and nearly extinguished by the brutal three and a half year occupation that followed. Rebuilding went on in earnest after the war ended in 1945, but George Town’s role as an imperial port city was played out as the post-war British Empire was quickly dismantled, to be replaced by the looser affiliations of the Commonwealth.

On 1 January 1957, George Town was granted city status by HRH Queen Elizabeth II. It was now settling into its new role as the second city in the new Malaysian Federation. In the 1960s, as entrepot trade declined further, George Town also declined. A decade later, with a shift away from trade, manufacturing and mass tourism took over, creating new townships. Manufacturing concentrated in the south-west, with tourism to the north.

As George Town rapidly declined as a port, and Butterworth took over, people moved out to live in the newly-expanding suburbs, with modern flats and neighbourhoods. In 1966, the Rent Control Act was introduced. This froze rents in the city for social housing purposes. At the same time, landlords lost the incentive to spend on maintenance. One unintended outcome was the preservation of George Town’s unique architecture, albeit in a sorry and increasingly dilapidated state.

In 1986, a group of concerned Penangites established the Penang Heritage Trust to document and create awareness about this legacy. This soon developed to include the conservation of the city’s unique living culture. The State Government was brought into the picture, and after much work, George Town was nominated by Malaysia for UNESCO world heritage status.

Now a World Heritage Site, the people of George Town have an opportunity to inject new money into their town within the rapidly developing knowledge economy, which does not require sprawling factories or warehouses, and can co-exist with tourism.