The World Heritage listing of George Town, a British colonial town in Malaysia’s north, should have ensued protection of its unique heritage. Instead it has brought a string of developers quick to cash in on the town’s new-found fame.

Wind your way through Penang, in Malaysia’s Straits of Malacca, and you will soon understand this is a place that has for centuries been both a cultural and religious melting pot.

A centre of the tin-mining industry in the days of the British East India Company of the 18th century, the region drew a cosmopolitan mix of Indians, Chinese, Arabs, Thais, Malays and Europeans to its shores. Many stayed, creating the energetic and eclectic Georgetown- a place of narrow streets lined with Sino-Portuguese shop-fronts and dotted with shrines, temples and churches.

A trifle down-at-heel nowadays, Georgetown still moves to the same rhythm it did 200 years ago. Its cultural and architectural legacies were recently rewarded with Unesco listing, which has spurred a flurry of restoration and gentrification and has triggered something of a tourism boom, although there are also fears that the whole conservation process could destroy the island’s unique essence.

Penang was given to the British East India Company in 1786 by the Sultan of Kedah in return for protection from Thai and Burmese insurgents. Legend has it that the British commander, Captain Francis Light of the Royal Navy, needing to clear the jungle in front of Penang’s Fort Cornwallis to prevent surprise attacks, had his gunners load cannons with silver coins then fire them out into the thick undergrowth, allowing the local people to do the rest of the work.

The island and its sheltered port were Britain’s first possessions in South-East Asia. The British declared the island a free port and encouraged migrant labourers, in particular Chinese from Guangdong and Fujian and Indians from Kerala and Tamil Nadu. Penang became a staging post for the opium trade between China and India, the drug soon accounting for around 60 per cent of colonial Penang’s revenue.

All the nationalities left their mark. Georgetown was soon a place of Taoist temples, Hindu shrines and colonial edifices such as Suffolk House and the glorious Eastern & Oriental Hotel (known as the E&O), which was built by the Armenian Sarkies brothers who later established Singapore’s Raffles Hotel. Although it has seen better days, with its water-front pool, four-poster beds and sweeping staircase the E&O is still the best place to stay in Georgetown.

Free from the class- and caste-systems that shackled them in their own countries, the Indians and Peranakan (as Chinese who came to live in the British colony were called) created a more egalitarian society, respecting each other’s traditions while also intermingling elements of culture and religion. Even today, it is not unusual to see someone of Indian origin offering joss sticks to a Taoist effigy during the Chinese festival of the Hungry Ghost. Peranakan grandparents, meanwhile, take their grandchildren for curries at South Indian restaurants.

One of Penang’s most enduring legacies of multiculturalism is its food. This is a place where the visitor can enjoy satay- Malay-style chicken or pork with a spicy-sweet peanut dipping sauce, char guaytiao- stir-fried flat rice noodles with seafood and bean sprouts, and dosa- flat, South Indian crepes with sambal and chutney. All are plentiful, delicious and sold for under $1.

George Town, along with the old trading port of Malacca, further down the coast, are Malaysia’s first monuments to be given World Heritage listing for heritage value and each has seen a corresponding increase in international investors and visitors.

Dr Gwynn Jenkins, a cultural anthropologist who has lived in Georgetown for the past 10 years, sounds a note of warning, however. ‘The biggest fear associated with the Unesco listing is ramped gentrification to cater to the tourism industry. Almost every World Heritage monument in Asia has been ruined, its heritage value destroyed by mass tourism and the money that can be made out of it. Places such as Lijiang in China, Borobodur in Indonesia and Angkor Wat in Cambodia have all suffered in this way.World Heritage listing is like a Louis Vuitton stamp for the tourism industry.’

Jimmy Lim, one of Malaysia’s top architects (and born in Penang) also believes lack of historic skills may be an issue.

‘I’d say the biggest problem facing Penang is that there are no young architects trained in what to do with heritage buildings and there’s nobody in government who knows how to look after a heritage town. There are no plans or designs for the houses they want to restore and many of the architects restoring treat the places as if they were built of concrete.’

His words resonate with the historical facts. Penang has already lost a significant number of its colonial-era buildings. In the 1980s and 1990s many heritage sites were pulled down to be replaced by anonymous high-rises. Even in more recent years, where the government started encouraging heritage preservation, many owners merely kept a build-ing’s façade and then built up and around it. One example of this is the Wawasan University, a grand white colonial mansion that now has a blue-glass high-rise protruding clumsily from its back.

Champion of Penang’s architectural heritage is Dr Choong Sim Poey, who founded non-government organisation the Penang Heritage Trust in 1987, when Penang’s colonial-era architecture was obviously under threat. He has been fighting ever since for World Heritage listing.

‘We lobbied hard for many years to get Unesco listing,’ says Choong. ‘But it’s now that the work will really begin.’ He points out that property prices increased more than 30 per cent in the month after World Heritage status was achieved, with an accompanying exodus of locals and influx of outsiders bargaining on an emerging tourism market.

‘Primarily, we need Georgetown to be inhabited by locals, so the unique social culture doesn’t deteriorate further, and the trades will be saved. Joss-stick makers, shoemakers, embroiderers, coffee-roasters: in many of these trades, this is the last generation,’ he adds. ‘Unesco recognition is a big boost for Penang, and done properly, it can provide the money to help restore the buildings. The problem is that it’s a long-term commitment and the government only looks for short-term gains.’

Danny Law Heng Kiang, chairman for tourism development in Penang, and a government officer, admits his office has no knowledge of restoration or how exactly to manage a heritage site. ‘We have good ideas, but finding the money to restore what we have, and then enforcing and implementing our plans is difficult,’ he says.

The best example of a restored heritage building in Georgetown is Cheong Fatt Tze Mansion, nicknamed the Blue Mansion after its vivid exterior. Known as the Rockefeller of the East, Cheong Fatt Tze had a typical rags-to-riches career. Born in Canton in China he went to work in the British tin mines in the early 19th century then carved out a fortune selling commodities- tea, opium, pepper, rubber- before adopting a colonial lifestyle that included all things extravagant- wine, concubines, European fashions and, of course, a remarkably bright blue mansion.

The Penang-born Lawrence Loh found the dilapidated mansion in 1990 and set about the painstaking process of restoration. He flew in Chinese artisans, used organic paints and searched out tiles, wood and glass that were in keeping with the original.

‘I have been pushing for heritage for the past 24 years, constantly battling to win the hearts and minds of the local people, while all along, time has been running out. Restoring Cheong Fatt Tze Mansion was a trial,’ says Loh. ‘I had to do something.’

We are sitting in the central courtyard of Cheong Fatt Tze Mansion, now a small hotel. The place has become a conservation icon for Malaysia, recognised as a Most Excellent Project by the Unesco Asia Pacific Heritage Awards. It is proof heritage conservation can be achieved if the will and funding are there.

This article was published in the November 2008 issue of CNN Traveller, global edition.