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Articles, Penang Institute, Penang Monthly [formerly Penang Economic Monthly]

A Synergic Platform is Something Penang Almost Already Has to Build Back Better

EDITORIAL, May 2021, by Ooi Kee Beng

THE COVID-19 PANDEMIC has obliged us to rethink the personal, the present and the proximate.

Shaken by the arresting of our ambitions, stirred by disruptions to our daily habits, and stumped in our reasoning by the pressing demands of public safety, each of us has had to reconsider our situation very seriously over the past year. And since the crisis drags on, threatening health and wealth alike, we are forced to reflect more than plan, and to review more than plot.

It is at such times that creativity is broadly born; and being broadly born, we may expect changes to appear in the near future, and on a societal scale. The more individual interests can be coordinated for impact, the better the chances for society as a whole to take proper advantage of the lessons collectively learned from this profound crisis.

Penang has been badly hit by the sharp drop in international travel, and by the insecurities caused by supply chain shifts. Thus, knowing in practical and honest terms Penang’s socio-economic strengths and weaknesses, and synergising its material and human assets in order to secure for it a new and effective economic trajectory, is vital to its capacity to build back better.

Penang’s Socio-economic Assets

  1. Penang’s economy used to rely on its strategic location as an entrepot port. It imported, it value-added, and then it re-exported. Around this key chain of activities grew other supportive industries, and its success as a freewheeling regional trading port spawned cultural products that came to define the socio-economic reality of Penang more permanently than its port would. On this basis, Penang has been able to lead in Malaysian modernisation.
  2. The ending of local elections after the founding of Malaysia, and the removal of Penang’s free port status as part of federal nation-building and fiscal centralisation had devastating effects on the socio-economic and socio-cultural fabric of the state, causing political disruptions in 1969.
  3. The founding of free trade zones in Penang in the early 1970s, and the quid-pro-quo entry of the ruling Gerakan party into the newly formed federal coalition, Barisan Nasional, led to a much-needed political and economic stabilisation in Penang. In the process, a large part of Penang’s population became factory workers even as many relocated to the Klang Valley, and overseas. This altered the tenor of Penang’s cultural orientation and sensitivities.
  4. Penang’s cultural, geographical and historical assets nevertheless presented it with a strong basis to become an international tourism destination.
  5. Since then, Penang’s tourism industry at large, with its supporting services has been able to mirror the strength of its internationally significant manufacturing sector, though without integrating with it in any significant manner. George Town’s listing as a UNESCO World Heritage Site in 2008, alongside Melaka, turbo-charged the appeal of its unique history.

In this brief description of Penang’s economic journey can be found most of the major factors relevant to any attempt it now makes to emerge stronger from the pandemic.

From Penang Paradigm to Penang2030

If Penang can leverage its strengths; if it can connect, upgrade and transform its manufacturing sector and its services sector… then the pandemic can yet turn out to be a blessing in disguise.

The state government, began to envisage a vision for the economic development of the state – first in the shape of the Penang Paradigm, publicised in January 2013, which with the promising change in government at the federal level in 2018, matured into Penang2030, launched in August that year. Penang2030 was then socialised into the workings of the public service, and into public discourses over the following months. When Covid-19 hit, Penang State had fortunately just managed to establish Digital Penang, a body meant to oversee, inspire and stimulate digitalisation of the state’s economy, governance and community.

The socio-economic situation in 2020, already darkened by the outbreak of the Covid-19 pandemic, was greatly worsened by the fall of the Pakatan Harapan government at the federal level around the same time.

With signs appearing at the end of 2020 that the pandemic might be coming to an end, the need to unlock and to concentrate productive and progressive energies in the state towards a realignment of its economic, social and political energies – and creativity – has become evident and pressing.

Unlocking Potentials through Digitalisation

The strategical assets and tools that Penang had already put into place before the pandemic broke, when considered together with its vibrant and living socio-economic history that has given it a strong manufacturing sector on the one hand, and a rich network of services in the tourism industry on the other, present some obvious answers for how the state is to advance as the pandemic recedes.

Digitalisation – fervent digitalisation, in fact – is the answer. If Penang can leverage its strengths; if it can connect, upgrade and transform its manufacturing sector and its services sector, not to mention its governance in general, then the pandemic can yet turn out to be a blessing in disguise.

Harnessing the creative powers of its people and its businesses should be the main concern of Penang’s policymakers today, and this they can do through digitalisation initiatives aimed at drawing government departments and agencies away from their vertical and introverted habits and structures, towards becoming horizontally-orientated, extroverted and confident organisations synergising with each other, and with local and international private sector players.


About Ooi Kee Beng

Dr OOI KEE BENG is the Executive Director of Penang Institute (George Town, Penang, Malaysia). He was born and raised in Penang, and was the Deputy Director of ISEAS - Yusof Ishak Institute (formerly the Institute of Southeast Asian Studies, ISEAS). He is the founder-editor of the Penang Monthly (published by Penang Institute), ISEAS Perspective (published by ISEAS) and ISSUES (published by Penang Institute). He is also editor of Trends in Southeast Asia, and a columnist for The Edge, Malaysia.


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