Penang today is a portrait of progress and, as Jacqueline Toyad finds out, at the heart of the transformation is its people who have responded  enthusiastically to the winds of change sweeping across the state.

BLESSED with the ideal geography, Penang has enjoyed a long history as a trading hub. As far back as the late 18th century, it emerged as one of the first free trade ports in east Asia, resulting in the most unique cosmopolitan makeup in a single state, compared with the rest of Malaysia, thanks to the trading and cultural exchanges between East and West.

When it comes to lifestyle and culture, none can deny the vibrant and colourful palette that Penang off ers. Rich in culinary off erings, heritage and the arts, and complemented by a thriving economy built on tourism and manufacturing, Penang is a portrait of progress, and at its pulse, the people who are currently riding a wave of positivity and working towards the transformation of the once sleepy seaside state into an international destination driven by a high-income and knowledge economy.

According to the Malaysian International Development Agency (Mida), Penang has come out on top over the rest of the states in attracting capital investments for manufacturing projects in 2010 with a total of RM12.2 billion - more than RM2 billion were new investments and another RM9 billion plus were reinvestments.

How are they getting it so right? This new energy seems to have infected all Penangites alike, from the trishaw man and street hawker on Penang Road and the suits that fill the financial institutions off Jalan Sultan Ahmad Shah in George Town to the thousands of employees milling at the manufacturing plants in Butterworth and that of the multinationals in Bayan Lepas. Not even the dark cloud of the global economic crisis has managed to dull the island sun. Business as usual is the mantra, business better than ever is the goal.

The answer lies in two catalytic events in 2008, namely the general election in March and the listing of George Town as a Unesco World Heritage Site in July, which brought with them the winds of change and hope that the Pearl of the Orient could be polished to its original splendour.

The general election saw DAP injecting a new, people-centric administration that aimed to return Penang to its origins as an international hub in a way that is defined and driven by the people. At the same time, the Unesco listing boosted the state's tourism industry and restored pride among Penangites, which saw them to embrace the new state government's agenda of progress.

"It's still a work in progress, but at least we're moving in the right direction," says Penang Chief Minister Lim Guan Eng. "It's not easy to work off 18 years of sloth and inertia. We slept for 18 years and that's too long. It's not easy to shake the lethargy off your body." Lim refers to Penang's second wind back in the 1960s, when then chief minister Tun Dr Lim Chong Eu revived the state's economy after it lost its free port status. A visionary, the late Lim went on a mission to transform the state's lackluster agriculture-based economy into a booming electric and electronics manufacturing hub.

Through the setting up of the Penang Development Corporation in November 1969 and the establishment of Malaysia's first free trade zone in Bayan Lepas, the state enticed the likes of Advanced Micro Devices Products Sdn Bhd, Agilent Technologies Sdn Bhd, Clarion (M) Sdn Bhd, Fairchild Semiconductor Sdn Bhd, Hitachi Semiconductor (M) Sdn Bhd, Intel Malaysia Sdn Bhd, Osram Opto Semiconductor (M) Sdn Bhd and Robert Bosch (M) Sdn Bhd to set up their off shore bases in Penang, all of which continue to thrive there today. Soon, other free trade zones were set up in Prai and Bukit Minyak, and companies like Motorola, Seagate, Dell and Western Digital also made Penang their base, which gained it recognition as "Silicon Valley of the East". It was during this time that Penang began to landmark its successes, first with the 65-storey Komtar (Kompleks Tun Abdul Razak, the tallest building in Southeast Asia back when it was completed in 1986) and the 13.5km Penang Bridge.

Blame it on a combination of being sidetracked by politics and settling into complacency, Penang's development then went into slowdown by 1990 though the state managed to continue riding the strength of its electrical and electronics industry and nothing else.

But since 2008, it seems that the Pearl of the Orient is in the midst of a great polishing up. This includes tourism, which continues to be the other major component of Penang's economy, making up 70% of Malaysia's tourism receipts. Having long ago lost its appeal as a beach destination due to poor maintenance, heritage and culture have proved to be the main drivers over the last couple of years. Last year, it was projected that 2010 would see a revenue of RM10.8 billion from tourism alone.

Overall, Penang's GDP has grown from about RM1.3 billion in 1970 to a projected RM45 billion by 2020, and this increase is largely due to the expanding manufacturing sector that now accounts for 39% of Penang's economy, with the services sector contributing 57%. Penang contributes nearly 25% to Malaysia's imports and exports, both in value and volume. From March 2008 - when Pakatan Rakyat took power - until February 2010, Penang has attracted investments worth RM9 billion.

Strength of the people
What has been amazing to observe is the way the people of Penang have accepted the call to arms. During its lackluster years, it was hopelessness that hindered many from participating in the progress, with most of the Penang talent pool looking outwards for opportunities in shinier cities like Kuala Lumpur or Singapore, and even beyond.

The level of community participation that one sees in Penang these days is astounding. From the organisation of arts festivals and participations in "gotong royong" activities on Sundays to the personal investments in the restoration of heritage buildings and channeling trust funds so as to make higher education accessible to everyone, the people of Penang are indeed getting things done.

Getting things done could very well be a trait ingrained in the Penangite DNA. Some have put it down to sea breeze, but Penang has for some reason been the birthplace of a great many doers, movers and shakers. There was Malaysia's founding father Tun Abdul Rahman as well as legendary actor/singer/director Tan Sri P Ramlee. There is also luxury shoe couturier Jimmy Choo, squash world champion Nicol David and Tan Twan Eng, author of The Gift of Rain, nominated for the 2007 Man Booker Prize.

It must be for this reason that the state government is returning development focus on human resources, on "training, retraining, retaining and attracting" talent. The concept isn't novel or groundbreaking. It's down to common sense and making the best use of what already exists.

And just like in its Golden Age, when Penang island beckoned to modern China's founder Sun Yat Sen and novelists Somerset Maugham and Rudyard Kipling, it is now attracting talents to come invest and/or stay, while Penangites who had moved away are coming back.

Penang native Christopher Ong, a retired fund manager, has returned to Penang and has been involved with a few major restoration works such as Clove Hall and most recently, Seven Terraces - seven dilapidated shophouses on Stewart Lane. Another Penang son, Joe Sidek, is taking the state's arts scene to another level with George Town Festival, launched last year. From the outside, there's Angela and Hijjas Kasturi, who've converted a cluster of 15 pre-war terraced and shophouses into a stunning heritage boutique hotel.

City infrastructure: Getting back to basics
There is a style of living that is quintessentially Penang. It's the right balance of being laidback and bustling; very relaxed, yet very cosmopolitan. The timing is right, what with everything falling into place - Penang is being primed to be the destination for the young, educated and creative.
 
Just recently, it was announced that Penang ranked No 8 on the "Best place to live in Asia" list by ECA International. Says Lim Guan Eng, "Three years ago, we were No 10; now we're No 8. We want to keep on doing things right. Those things that we've been doing right, we'll keep on doing it right and also improve on them. I always say that the three main problems that Penang faces are the three Cs - crime, cleanliness and congestion - so we're working on that."

These days the link between quality of life and economic performance is getting stronger. People are little bit worldlier, a little more learned, so beyond a livelihood, they have become pretty discerning when it comes to the liveability of a city.

Liveability includes quality public services, good medical care, lower stress, open spaces, cultural events, sports and social facilities, safety and security, waste disposal, education, heritage sites and so on. The people are after the whole package, and Penang is being primed to deliver.

The Penang Transport Council has been tasked with "moving people, not cars", and are about to launch a huge traffi c management study that will take into account the implementation of water taxis and innovative bus systems to improve mobility. Implementation of solutions will run concurrently with the study as and when the consultants appointed are able to make their recommendations, based on their findings.

Currently, there are 10 major infrastructure projects that have been identified for implementation, including the RM250 million expansion of the airport that is expected to be completed in June 2012; Penang Port; the construction of the second bridge, which is well underway; as well as the creation of a multimedia super corridor in the state. Even Prime Minister Datuk Seri Najib Razak concurs that the state is well-positioned to become a hub for the northern corridor and the growth triangle that comprises Indonesia, Malaysia and Thailand.

Another area the government will be focusing on aims to realise density and reduce distance in Penang, particularly between the island and mainland - the Penang Sentral project.

An international city
While many may equate progress with monster structures and other types of physical high-rise development, in Penang, the focus remains on the people. Any kind of physical development will be mainly to improve on what already exists.

Even Komtar, once the icon of modern Penang in the 1980s, and now a dull, grey eyesore, will be given a rejuvenation to "elevate the building in its function and aesthetics". Probably inspired by the restoration projects of the heritage buildings surrounding the tower, Penang Development Corp will oversee the project, which entails rejuvenating the Geodesic Dome and more than 1.6ha of open space on the fifth floor. It will also upgrade facilities for the public, including the auditorium for concerts and functions, and maybe a "restaurant in the sky" on the 59th and 60th floors.

Mindsets are changing. If anything, the celebration of Penang's heritage has taught us that all of the state's former and now emerging glories have been achieved through intellect and creative economies. As Tun Lim Chong Eu once said, "It is indeed the people of Penang who have made us what we are today."

The government's focus on human resources to propel Penang forward as an international city and a high-income and knowledge economy is definitely a move in the right direction. Working from the inside out, Penang is cleaning up its streets and shaping a new living heritage that will offer stress-free and environmentally conscious approaches to life.

Ultimately, Penang's future will be determined by its people, its cities and its economy. With the economy in a state of vibrancy, the people hopeful again and the city moving towards increased liveability, and all these elements working in harmony, Penang is paving the way for other states to follow.

** Republished with permission. This article first appeared in a special focus on Penang in the Options section of The Edge of January 24, 2011.

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