From its beginnings in the late eighteenth century, the vibrant colonial port of Penang attracted a diverse range of peoples, enabled pioneering commercial enterprises, and fomented inter-ethnic collaboration and inter-cultural borrowings. The island came to be known as the 'Pearl of the Orient', and for many travellers it was their first port of call in Southeast Asia. In the early nineteenth century, Singapore displaced Penang in international trade, but the island remained a major focus of regional trade. For this reason, the story of Penang's relations with the Malay Peninsula and other parts of Southeast Asia reveal a great deal about conditions within the region.

The story of Penang would be incomplete without the Big Five Hokkien families (the Khoo, the Cheah, the Yeoh, the Lim, and the Tan). It was the Big Five who played a preponderant role not only in transforming Penang into a regional entrepot and a business and financial base, but also in reconfiguring maritime trading patterns and the business orientation of the region in the nineteenth century. Departing from the colonial vantage point, this book examines a web of transnational, hybrid and fluid networks of the Big Five comprising of family relationship, sworn brotherhood, political alliance and business partnerships, which linked Penang and its surrounding states (western Malay states, southwestern Siam, southern Burma, and the north and eastern coasts of Sumatra) together to form one economically unified geographical region, having inextricable links to China and India. With these intertwining networks, the Big Five succeeded in establishing their dominance in all the major enterprises (trade, shipping, cash crop planting, tin mining, opium revenue farms), which constituted the linchpin of Penang’s and its region’s economy. By disentangling and dissecting this intricate web of networks, this book reveals the rise and decline of the Hokkien mercantile families’ nearly century-long economic ascendancy in Penang and its region. "Wong Yee Tuan’s study of the five clans of Penang represents a major breakthrough in the study of the Malayan Chinese. He documents an extremely important aspect of the nineteenth-century Asian diaspora, exposing the intricate links between families, businesses, secret societies, revenue farms and public life of some of the key groups of Chinese in Penang and northern Malaya. The book weaves together the various strands of overseas Chinese life not only in Malaya, but also in the Netherlands Indies, Siam and China. Most importantly, it shows the process by which the Chinese leaders gained political, economic and social power as well as the way by which these powers were lost." -- Carl A. Trocki, Emeritus Professor, Asian Studies, Queensland University of Technology, Australia "This volume can be situated within a growing historiographical current whereby regional studies of connections, networks and interactions are gradually transcending national histories. Incorporating commercial, ethnic and social elements, the history presented can be concurrently seen as a business case study, a sociological exploration, a political economy treatise and an inquiry into Hokkien networking. Wong Yee Tuan is to be congratulated on this signal study in how local, national and broader regional histories can be integrated." -- Geoffrey Wade, ANU College of Asia and the Pacific, Australian National University "By aligning family, socio-political and business interests, the leading Penang Hokkien clans centralized their 'home port' as a hub of regional commercial networks, thus successfully extending the trading colonies of Chinese diaspora westward to the edge of the Indian Ocean. Wong has fastidiously researched and compellingly proven this, with a clear eye for relevant cross-cultural collaborations with indigenous and international actors. The important legacy of the 'Big Five' clanhouses is now firmly embedded in the George Town World Heritage Site, inciting further inquiry into the cultural formation of collective entrepreneurship in Southeast Asia." -- Khoo Salma Nasution, Heritage Advocate and Local Historian, Penang

However impressive the economic success of Penang has been over the past four decades, structural conditions in the region call for a fundamental reconfiguration of this Malaysian state’s competitive advantage. In the 1970s, the ageing entrepôt transformed itself into a manufacturing hub for the electronics industry and a well-known tourist site. This outward-looking model of economic growth has underpinned Penang’s economic development up until the present. The question that now arises is whether Penang’s present mode of development will continue to be effective, or whether it will have to transform itself. First, Malaysia in general, and Penang in particular are caught in a middle-income trap. Second, while the evolving weight of the global economy is shifting towards Asia, many of its emerging powers are competing with Penang in areas where it formerly excelled. Third, Penang is a state within a federation, and its capital, George Town, is a secondary city. Neither can rival Kuala Lumpur in terms of size or facilities, and thus must offer investors other attributes. Effectively meeting these challenges while retaining Penang’s vibrant and living culture are the key issues that are dealt with in this second volume of the Penang Studies Series.

This study compares Melaka and Penang in the context of overall trends - policy, geographical position, nature and direction of trade, and morphology and sociology - and how these factors were influenced by trade and policies. Conclusions are drawn concerning where and how Melaka and Penang fit in the urban traditions of Southeast Asia and the significance of the fact that the period under study coincided with the shift from the height of the "Age of Commerce" towards a period of heightened imperialist activities.