Fort Cornwallis was built in 1786 to protect Penang Island from amphibious invasion.

In the 1770s, the British East India Company instructed Francis Light, a British Royal Navy captain, to form trade relations in the Malay Peninsula.[1][2] Light subsequently landed in Kedah, a Siamese vassal state threatened by both Siam and Burma, as well as an internal Bugis revolt.[1][3] 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, while the Sultan reciprocally offered Penang Island, then part of Kedah.[1][4][5]

Although Light subsequently reported on this offer to his superiors, it was only in 1786 when he was finally ordered to obtain Penang Island from Kedah.[6][1][4] The British East India Company sought control of the island as a Royal Navy base, and as a trading post between China and India.[2] To that end, Light negotiated with the new Sultan of Kedah, Sultan Abdullah Mukarram Shah, regarding the cession of the island to the British East India Company in exchange for British military aid.[6][1][7] After an agreement was signed between Light and the Sultan, Light and his entourage sailed on to Penang Island, where they arrived on 17 July 1786.[8][9]

The area where Light first landed, which is now the Esplanade, was originally a swamp covered in thick jungle.[1][2] Once the area was cleared, a simple ceremony was held on 11 August, during which the Union Jack was raised. Penang Island was renamed the Prince of Wales Island after the heir to the British throne, while the new settlement was given the name George Town.[10][11]

Light developed George Town as a free port, thus allowing merchants to trade without having to pay any form of tax or duties. The policy's intent was to entice traders from the Dutch ports in the region.[12] The number of incoming vessels rose from 85 in 1786 to 3,569 in 1802; George Town's population had also increased to 10,000 by 1792.[13][14][15]

A committee of assessors was established in 1800, making it the first local council to be established in British Malaya.[16] Meanwhile, a Supreme Court was established at Fort Cornwallis in 1808.[17][18]

 

A 1799 map of George Town

In the early 19th century, Penang Island became a centre of spice production within Southeast Asia. Spices such as nutmeg, clove and pepper, produced from the spice farms throughout the island, were exported via the Port of Penang in George Town.[19][20] The spice trade also allowed the British East India Company to cover the administrative costs of Penang.[21]

In 1826, George Town was made the capital of the Straits Settlements, an administrative polity that was also composed of Singapore and Malacca. However, the capital was then shifted to Singapore in 1832, as the latter had usurped George Town's position as the region's preeminent harbour.[22]

 

The Port of Penang at Weld Quay in the 1910s

Nonetheless, George Town retained its importance as a vital British entrepôt.[23][24] Due to the opening of the Suez Canal, the advent of steam ships and a tin mining boom in the Malay Peninsula, the Port of Penang became a major tin-exporting harbour.[25][26] By the end of the 19th century, as mercantile firms and banks, including Standard Chartered and HSBC, flocked into George Town, the city also evolved into a leading financial centre in Malaya.[9][26]

Throughout the century, George Town's population grew rapidly in tandem with the city's economic prosperity. A cosmopolitan, multi-cultural population emerged, comprising Chinese, Malay, Indian, Peranakan, Eurasian, Thai and other ethnicities. However, the population growth also created social problems, such as inadequate sanitation and public health facilities, as well as rampant crime.[27] The latter culminated in the Penang Riots of 1867, during which rival Chinese triads clashed in the streets of George Town.[28][29]

Also in the same year, the Straits Settlements was made a British crown colony, to be governed directly by the Colonial Office in London.[30][31] For George Town, direct British rule meant better law enforcement, as the police force was vastly improved and the secret societies that had previously plagued the city were gradually outlawed.[23][32] More investments were also made on the city's health care and public transportation.[27][33][34]

With improved access to education, a greater level of participation in municipal affairs by its Asian residents and substantial press freedom, George Town was perceived as being more intellectually receptive than Singapore.[23][34][35] The city became a magnet for well known English authors, Asian intellectuals and revolutionaries, including Rudyard Kipling, Somerset Maugham and Sun Yat-sen.[36][37][38]

 

The Cenotaph was built in honour of fallen Allied servicemen of World War I.[39]

 

British Royal Marines liberating George Town from the Japanese on 3 September 1945.

At the start of World War I in 1914, the Battle of Penang occurred, during which SMS Emden, an Imperial German Navy cruiser, sank two Allied warships off the coast of George Town. 147 French and Russian sailors were killed.[40]

World War II, on the other hand, brought unparalleled social and political upheaval to Penang. In early December 1941, Japanese warplanes indiscriminately strafed and bombed George Town, and wiped out the defending Allied air squadrons.[41][42] While the British Army had earlier designated Penang Island as a fortress, Lieutenant-General Arthur Percival then ordered a withdrawal from Penang. Not only did the British abandon the Batu Maung Fort south of the city, they also covertly evacuated Penang's European population, leaving the rest of the populace to their fates.[43] Some historians have argued that the withdrawal and the silent evacuation of the European population led to the loss of the British sense of invincibility, and that the collapse of British rule in Southeast Asia came not in Singapore, but in Penang.[44]

George Town fell to the Imperial Japanese Army on 19 December 1941, marking the start of a brutal period of Japanese occupation.[41][45] Penang Island was renamed Tojo-to, after the then Japanese Prime Minister Hideki Tojo.[44] This period was known for the Imperial Japanese Army's massacres of Penang's Chinese populace, known as Sook Ching to the locals.[46] Women in George Town were also coerced to work as comfort women by the Japanese.[47][48]

George Town's harbour facilities were also put to use as a major U-boat base by Nazi Germany.[49][50] Between 1942 and 1944, the Port of Penang was utilised by submarines of the Imperial Japanese Navy, the Kriegsmarine and the Regia Marina.[51][52]

Between 1944 and 1945, Allied bombers based in India repeatedly bombed George Town, seeking to destroy the naval facilities and administrative centres.[41] Several colonial buildings were destroyed or damaged, including the Government Offices, St. Xavier's Institution, Hutchings School (now Penang State Museum) and the Penang Secretariat Building.[26] The Penang Strait was also mined to impede Japanese shipping.[53]

Following the Japanese surrender on 15 August 1945, the Penang Shimbun, a Japanese newspaper, published the proclamation of surrender issued by the Emperor of Japan. Under Operation Jurist, the British Royal Marines accepted the surrender of the Japanese garrison in Penang and retook Penang Island on 3 September 1945.[41]

 

The Esplanade, where Francis Light had founded George Town in 1786, was also where George Town's city status was proclaimed in 1957.[54]

After a period of military administration, the British dissolved the Straits Settlements in 1946 and proceeded to merge the Crown Colony of Penang into the Malayan Union, which was then replaced with the Federation of Malaya in 1948. However, the absorption of the British colony of Penang into Malaya alarmed Penang's population over economic and ethnic concerns.[55] Between 1948 and 1951, the Penang Secessionist Committee was formed to avert Penang's merger with Malaya, but ultimately petered out due to British disapproval.[56][57][58]

The British government responded to the concerns raised by the secessionists by guaranteeing George Town's free port status, as well as reintroducing municipal elections in George Town in 1951.[56] By 1956, George Town had become the first municipality in the Malayan Federation to have a fully elected local council.[59]

On 1 January 1957, George Town was accorded city status by Queen Elizabeth II, becoming the first city within the Federation of Malaya, and by extension, Malaysia.[60][61][62]

In the following years, George Town retained its free port status, as guaranteed by the British colonial authorities before granting independence to Malaya. This was not to last, however – in 1969, the Malaysian federal government revoked George Town's free port status, sparking massive unemployment in the city.[35][57][63]

This also marked the start of George Town's decline, which lasted up to the early 2000s.[64] As the Malaysian federal government continued to develop Kuala Lumpur and nearby Port Klang, Penang began to suffer considerable brain drain.[35][65][66]

In a bid to revitalise George Town, the Komtar project was launched in 1974. Hundreds of shophouses, schools and temples, as well as whole streets, were demolished in order to make way for the construction of Penang's tallest skyscraper.[35] However, instead of arresting George Town's decline, Komtar itself became a white elephant by the 2000s.[67][68]

In 1974, the George Town City Council was merged with the Penang Island Rural District Council to form the Penang Island Municipal Council, sparking a decades-long debate over George Town's city status.[60][69][70]

 

The 2004 Indian Ocean tsunami hit the northern coastline of George Town.

The city's decline continued into the early 2000s. In 2001, the Rent Control Act, which had protected the low-income residents and smaller businesses within the city centre from arbitrary rental hikes, was repealed.[35][71][72] Consequently, residents moved out of the city's historical core, leaving its colonial-era buildings in disrepair. Meanwhile, an incoherent urban planning policy and poor traffic management led to worsening traffic congestion, while decades of brain drain also took its toll as the city lacked the expertise to regulate urban development.[7][73][74]

In response, George Town's non-governmental organisations and the national press galvanised public support and formed strategic partnerships for the conservation of the historic buildings, and to restore the city to its former glory.[74][75][76] As a result of the widespread resentment over George Town's decline, the then federal opposition coalition, Pakatan Rakyat (now Pakatan Harapan), was voted into power within Penang in the 2008 State Election.[7][77][78]

Also in 2008, George Town was inscribed as a UNESCO World Heritage Site.[79] Subsequent efforts to clean up the city, and measures to improve traffic flow, cultural and environmental aspects by the new state government led to George Town being ranked Asia's 8th most liveable city by ECA International in 2010.[80][81][82] The city's services sector has since been boosted by the private sector and an influx of foreign investors.[83][84][85]

The Indian Ocean tsunami which struck in 2004 hit the western and northern coasts of Penang Island, including George Town, claiming 52 lives (out of 68 in Malaysia).[86]

Whilst George Town had been declared a city by Queen Elizabeth II in 1957, the jurisdiction of the city was expanded by the Malaysian federal government to encompass the entirety of Penang Island in 2015.[87][88]