The following essay by Dr Cheah Boon Kheng was published in the book Multiethnic Malaysia – Past, Present and Future under the title ‘Race and Ethnic relations in Colonial Malaya during the 1920s and 1930s’.
Dr Cheah is visiting professor at the National University of Singapore. He was previously history professor at USM, and has been visiting professor at the Australian National University and ISEAS. He is also author of several books.
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‘Race and Ethnic relations in Colonial Malaya during the 1920s and 1930s’By Cheah Boon Kheng
 From the end of the First World War to the beginning of the 1929-1932 Depression, British Malaya experienced an “era of internal peace and unbounded prosperity” and “racial relationships were a model of harmony and good feeling for all the world,” observed American political scientist Rupert Emerson, in his book Malaysia, published in 1937.[1]
But the collapse of Malaya’s boom economy and trade followed the crash of the American stock market in 1929. Malaya’s markets for rubber and tin and other products soon wiped off their staggering gains and fell almost to stagnation. Mines and rubber estates slowly came to a standstill. The tide of immigration, which had flowed so strongly into Malaya from China and India to meet the labour demands of economic production, was now reversed.
Social, economic and political turmoil set in inevitably in the swift transition from prosperity to poverty, and began to arouse latent ethnic hostilities and suspicions among the races, which just stopped short of open conflicts and bloodshed.
As Emerson noted:
“When all classes of all races were being warmed by the golden sun of the boom there was no occasion to bicker either among themselves with the ‘heaven-born’; but when the sun was obscured and the chill rains began to fall it became necessary to crowd for space under the limited space.” [2]
This paper demonstrates that the politics of race influenced the colonial government’s intervention during the worldwide depression. In trying to favour the economic interests of one group against another, its policies aroused rather than defused racial antagonisms and generated ethnic animosity and ethnic consciousness.
This is a much-discussed topic in Malaysian economic history. What I present here are the major issues that raised ethnic tensions, but which did not lead to open violent conflict and bloodshed. At the end, I offer an assessment of the impact of these issues on Malaysian history.
Race and ethnic relations in colonial Malaya
Emerson repeatedly uses the terms ‘race’ and ‘racial’ to refer to the different communities in British Malaya, as these terms were in vogue then and refer particularly to physical characteristics, specific types or groups of peoples, and the colour of their skins. Ethnicity, however, is sociologically a broader term and encompasses not only physical characteristics but also identities and other aspects such as language, culture, religion and place of origin. We should bear these differences in mind.
In the colonial society of the 1930s, race and the colour of one’s skin determined the status of a person. Caucasians and whites regarded themselves in a position of superiority, and they looked down on Asians and others.
The colour bar was maintained intact in the Malayan Civil Service[3] and used to prohibit Asians and others from entering exclusively “white” areas in racecourses, clubs and even railway carriages.[4] Within the social and economic structures of colonial society in Malaya, British administrators and traders and other Western entrepreneurs were at the top of the social hierarchy. Rich and influential Asians and Malay rulers and aristocratic Malays would fall within a level below them and may even occasionally be allowed to mix with them at social functions.
The British had acquired and opened up the ports of Singapore, Malacca and Penang in the Straits Settlements in the interests of British capital and Western enterprise and later they extended their control into the troubled peninsular Malay states for the purpose of creating political stability and ordered government of a Western type. Under treaty obligations with Malay rulers, British administrators offered them advice and later accepted Malay chiefs into state councils. Later, other Malays were taken into a special Malay administrative service, but they were relegated to junior positions.
The Malays came to play little part in the shaping of their lives, as British officials took all the major decisions. To all appearances, the form and substance of the Malay states was preserved, alongside the Western political system, administrative structure and economic growth. The bulk of the Malay population remained largely as peasant cultivators in the rural areas within the framework of traditional Malay society and behind the walls of British protection. But Malays were treated no differently from other Asian peoples when it came to the matter of social norms.
Cheap immigrant labour was imported from China, India and elsewhere for manual labour and services in jobs, which the Caucasians or whites or even the Malays were reluctant to undertake.
The British adopted an open door policy on immigration, so that large numbers of immigrant labour poured in, initially into the Straits Settlements, and later into the tin mines and rubber estates of the peninsular Malay states. In the Straits Settlements, where the population was predominantly Chinese, the British administrators attempted to accommodate Chinese interests by according them slight representation on the Legislative Council, and later into the lower rungs of the Straits Settlements Administrative Service. They also met their demands for higher education in Singapore by setting up the King Edward VII Medical College and the Raffles College.
Because the peninsular states remained legally ‘Malay states’ in character, the British refused to take into account the tendencies towards permanent settlement of the Chinese and Indians by granting them citizenship or other rights beyond the normal safeguards to life and property for fear of arousing Malay opposition.
The British thereby even avoided integrating the locally born and domiciled Chinese and Indians with the Malays as it viewed racial integration as a troublesome responsibility. The British as ‘protectors’ of the Malays preserved the distinctions between the separate communities based on the criteria of economic functions, ethnic origin and culture.[5]
The dominant British attitudes of superiority and racial hierarchy led it to adopt a policy of favoritism. In awarding government contracts, loans, and lands and in the protection of legal rights, they frequently favoured British and Western business interests over Asians and other non-Westerners.
 These attitudes gradually forced the development of a certain level of ethnic consciousness within each of the three major races in Malaya. Ethnic relations in Malaya during this period, while harmonious, need to be viewed within the context of a colonial framework of a segmented, plural society within which these communities maintained a separate, parallel existence, united by the colonial political system, and which met only in the marketplace.[6] Each racial group kept to itself and performed mutually exclusive functions and received appropriate rewards. Most members of the different races were not in economically competitive roles, and therefore not directly in conflict with each other.
Given the constant flow and uneven nature of immigration from different parts of China, India, and Arabia and also from the Malay archipelago, including the Netherlands East Indies, the Malays, the Chinese and the Indians were themselves more culturally diverse and different than united in the early years of the 20th century. But largely owing to British communal policies and the competition for scarce resources, they began to move towards group formations and a common group ethnic identity. These processes were geared to safeguarding and protecting group interests and rights, requiring communities to close ranks and to de-emphasize their sub-racial, linguistic and cultural differences by adopting a common but larger ethnic ‘Malay’, ‘Chinese’ and ‘Indian’ identity.
For instance, the Chinese in Malaya came from different clans, guilds and provinces of China, and spoke different dialects. Except for those with formal education, few could hardly read, write or speak the official Chinese language, Mandarin. Hakka and Hokkien came from Fujian province, Cantonese from Guangdong province, and Shanghainese from Shanghai, but they were not close to one another as each kept to his own clans or guilds, and intermarriage between these sub-groups was even frowned upon. But for the sake of survival in Malaya these immigrant Chinese gradually began to break down their racial and cultural barriers and develop a sentiment of ‘Chineseness’ to unite and build up a larger ethnic ‘Chinese’ identity.
A similar meaning, understanding and development of ‘Malayness’ and ‘Indianness’ also began to occur among the Malays and the Indians.
This is not the place to go into complexities of ethnic identity in great detail. Suffice it to say that ethnicity in colonial Malaya became a primary source of group loyalty and consciousness for most non-European peoples and served as a strong catalyst for competition and conflict. As American sociologist Martin N. Marger notes: “In no society do people receive an equal share of the society’s rewards, and in multiethnic societies, ethnicity serves as an extremely critical determinant of who gets ‘what there is to get’ and in what amounts.” [7]
As the economic depression worsened in Malaya, the British administration realized it had to juggle the economic interests of the respective groups. Exclusive preference to any one group would fuel ethnicity and communalism, but accommodation and integration of everyone would reduce ethnic tensions. But what began to aggravate and worsen ethnic relations in the early 1930s was a series of ‘pro-Malay’ policies, which the British initiated to help Malays cope with the economic depression and to meet the demands of rising Malay nationalism based on treaty obligations.
These policies were not aimed at instigating Chinese hostilities towards Malays as such, or vice versa, but they had this effect. They polarized ethnic identities and intensified ethnic consciousness among the various ethnic communities.
Ethnicity, it has been said, is the mother of nationalism, which is the mother of nationalism which is the desire to build a nation or a ‘nation state’. A nascent Malay nationalism began to emerge before 1941, demanding an exclusive “Malaya for the Malays”. A multi-ethnic “Malayan” nationalism was absent. What existed in Malaya were rival and different strands of nationalist sentiment in each of the ethnic communities with conflicting interests and different viewpoints that prevented the emergence of a united Malayan nationalist movement.
Curbing Immigration: A ‘Pro-Malay’ and ‘Anti-Chinese’ Policy
Due to large-scale unemployment brought about by the economic depression, the first target of British colonial policies was to repatriate surplus labour, especially those unemployed or displaced Chinese and Indian labourers in the rubber estates and tin mines.
The colonial government refused them unemployment benefits, as it did not accept that it had any responsibilities towards their welfare and regarded the immigration of alien labour as being regulated merely by the economic conditions of the country. The ebb and flow of immigration was tied to the fluctuating world prices of rubber and tin, so it held that alien labour should be prepared to bear the brunt of adverse economic conditions.
While thousands of unemployed or displaced workers accepted offers of free repatriation back to their homelands, thousands more on the estates and tin mines accepted wage cuts and even refused offers of free repatriation as they regarded themselves as permanent settlers in Malaya. Those who accepted repatriation had totally been unable to find employment. Estates and other employers were determined to cut operational costs by displacing workers, or by reducing their wages, although Western enterprises had no hesitation in retaining and maintaining the services of European staff without any pay cuts.
The administration, however, aroused ethnic resentment among the Chinese when it introduced several pieces of legislation towards the control of immigration of aliens which were seen to be discriminatory towards them. The Immigration Restriction Ordinance of 1928 was administered for nearly four years and was then replaced by the Aliens Ordinance on 1 April 1933.
The restriction reduced the quotas drastically of aliens allowed to enter Malaya each month. It applied to all aliens, but since the Chinese were the most affected by this measure, it was represented not only in China but also in Malaya as discrimination against the Chinese race.[8] In the immigration debates in the federal legislative council, Tan Cheng Lock, a Malayan Chinese leader, said “the Bill is part and parcel of an anti-Chinese policy, probably with a political objective….”[9]
What Tan had referred to was a provision in the ordinance, which allowed for the banishment of any alien who was considered “undesirable already in the country”. This was seen as a warning to all Chinese, including the local-born Chinese or those who were British subjects to toe the line or be deported, despite the administration explaining it was aimed at communist elements in the trade unions, who were spreading “subversive political ideas” and stirring up anti-British agitation.
The British were for the first time distinguishing aliens from ‘Malayans of all races’. But the local-born Chinese felt forced to make common cause with the aliens, and to close ranks, thereby strengthening Chinese ethnic unity. According to one source, in so doing, they “played directly into the hands of the pro-Malay faction among the British officials”.[10]
But this British policy was also meant to appease the demands of Malay nationalism. Malay rulers had earlier voiced opposition to increased immigration of Chinese and Indians, and they greeted the new legislation with satisfaction. In the 1931 census, the number of Chinese alone was reported to have exceeded that of the Malays and that in all except the four northern unfederated Malay states they had come to outnumber the Malay population.
The issues soon developed along the lines of ‘Malaya for the Malays’ and ‘Malaya for the Malayans’, with the Malay press and many pro-Malay British officials advancing the former argument. Local-born Chinese leaders like Tan Cheng Lock appealed for British protection for Chinese and those local-born who were British subjects.
In 1929, the last year of free immigration, the number of adult Chinese male labourers entering the Straits Settlements was 195,613, but in 1930 the number dropped to 151,693 and in 1931 to 49,723. No restriction, however, was placed on the immigration of women and children.
By 1933, however, when the economy started recovering, the administration realized that repatriation and the quota restrictions had created serious labour shortages for the mines and other industries. Trade unions, some under communist influence, took advantage of the labour shortages to demand wage increases and improvement in working and living conditions.
Protecting Malay lands and Malay rubber smallholders
 The impact of the economic depression on the Malay peasantry and the rural population generally was less severe than it was on the immigrant labour force which depended on either rubber or tin exports, as most Malays were able to grow food on their lands and feed themselves.
But a sizeable number of Malays who planted rubber suffered badly, as their incomes fell sharply and widespread indebtedness was incurred. Smallholding land, outside and even inside the Malay reservations, was mortgaged and sold on an increasing scale and to an extent that aroused serious anxieties on the part of both the British and Malays. The total debts incurred by Perak smallholders alone to creditors (mainly Chettiars) in 1930 increased by 48 percent over the previous year.
As British Residents and European members in the Federal Council urged the government to protect Malay smallholders, the British administration finally decided to take “drastic action… not only in the interests of the Malay peasant himself, but also for the sake of the political well-being of the country”.[11]
As a result, in 1931, the government enacted in the Federal Council a Small Holders (Restriction of Sale) Bill that prohibited the sale of land in any smallholding without the consent of the ruler. Two years later a new Malay Reservations Bill was introduced to close the loopholes in the 1913 enactment and to “make dealings in land in Malay reservations as unhealthy as possible”.[12] The main concern of the government was to prevent Malay lands from passing into the hands of non-Malays, especially Chinese and Indians.
The amendments made irrecoverable all money paid by non-Malays for dealings in reservation, and it was estimated some $5 million in debts were secured on reservation land. However, according to one author, the long-term effect of the amendments was to impede Malay economic development by denying them an important source of capital.[13]
On the other hand, the British administration was not averse to putting aside the reservation land policy in favour of British and other Western economic interests. Statistics revealed that the Europeans owned more than 43 per cent of alienated land in the Malay states, the Malays 27 percent and the Chinese and Indians between them only 23 per cent. In the mid-1930s when Western mining companies pressed to be allowed to mine in Malay reserves said to be rich in tin ores, the government gave in despite opposition from the sultans.[14]
Roff, in his study of Malay nationalism, says these measures to protect Malay smallholders led to growing demands among locally-domiciled Chinese for “equal rights and privileges with the Malays, for a greater share in government and administration than they had hitherto enjoyed, and, quite simply for the right to regard Malaya as their home and not simply their halting place”.[15]
Recent British repressive measures such as arrests and banishment against elements of the Communist Party and the Kuomintang (Nationalist Party of China) had worried the domiciled Chinese, who regarded these British actions as ‘anti-Chinese’.
 The greatest threat to Britain’s continued presence in Malaya was the rising Malay nationalism during the several decades prior to Merdeka. To neutralize this threat, the British rulers chose to appease Malays with pro-Malay policies that protected the community while at the same time discriminating against Chinese and Indians – a strategy known as ‘divide and rule’.
The British colonial rulers prioritized the maintenance of white prestige and profits but they also sought to accommodate Malay interests in various ways due to their treaty obligations with the sultans.
As for the Chinese and Indian labour force, the British left them to fend for themselves during the severe economic depression. The Colonial Office and owners of capital felt no responsibility towards the welfare of these workers even when they were on the verge of starvation after having lost their jobs.
Instead of relief measures, restrictions were imposed by the British on non-Malay socio-economic mobility and advancement. Among the measures were exclusion from the administrative service and discouragement of agricultural and land settlement. These steps taken by the British rulers displayed “distinct racial overtones because they discriminated against the Chinese and Indians as races”.
Nor did British assistance to Malays go far enough in bringing them into the fold of the modern economy, or involvement in commerce and business.
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The decentralization policy: A ‘pro-Malay’ policyby Cheah Boon Kheng
 The Chinese were further alarmed when alongside this legislation – the Federal Council a Small Holders (Restriction of Sale) Bill in 1931 that prohibited the sale of land in any smallholding without the consent of the ruler – Governor Sir Cecil Clementi announced in the same year a programme of reforms towards the formation of a Malayan union and the decentralization of the Federated Malay States (FMS), which comprised the states of Negri Sembilan, Selangor, Perak and Pahang.
The idea behind these reforms was to loosen the “overcentralization” of authority in the FMS, which was largely in the hands of British officials, so that the FMS states could be put on a similar constitutional basis as the “unfederated” Malay states of Johor, Perlis, Kedah, Kelantan and Trengganu, which enjoyed greater autonomy in administration than the FMS states.
The reforms would involve the transfer of powers and responsibilities such as posts, telegraphs, customs, lands, surveys, agriculture, and education, which were in federal hands, mainly in the hands of the federation’s Chief Secretary, to each of the respective FMS states. This would in turn mean eventually the abolition of the post of the Chief Secretary itself. The reforms, which were announced by Clementi at the durbar of the four FMS Malay rulers in Sri Menanti (Negri Sembilan) on 18th August 1931 were warmly welcomed and endorsed by the Malay rulers themselves.
The debates that ensued highlighted the strong “pro-Malay” and “anti-Chinese” features of the reforms.
They aroused “a resentment the unanimity, bitterness, and intensity of which are unparalleled in Malayan history,” wrote Emerson.1
Opposition to the reforms now came not only from Chinese community leaders but also from the British/European business groups, while British Residents and other officials argued that the reforms were necessary otherwise “the Chinese would cut off the Malays from even the small share in their country which remained to them”. 2
The European unofficial members of the Legislative Council who argued against the reforms stated that the FMS states should not be returned to Malay rule as Malays “were not fitted to receive them, not much interested in getting them, and not able to hold them when they had them”. 3 They wanted the centralized and elaborate European administration to continue; otherwise they feared the reforms would undermine large-scale Western enterprise.
According to Roff, the Chinese representatives in the Federal and Straits Settlements legislatures “attacked the decentralization and pro-Malay policies, pressed for the inclusion of non-Malays in the Malayan Civil Service, and urged more rapid political development in a unified Malaya.”
One of the Legislative Council members, Lim Cheng Yan, of Penang, spoke in terms “scarcely calculated to soothe Malay breasts” by declaring, “Who said this is a Malay country?” 4 The Malay press, while they did not challenge the right of local-born Chinese in the Straits Settlements to become British subjects, strongly opposed the granting of citizenship or other political rights in the peninsular states.
Padi cultivation policy: Further racial polarisation
Two other issues relating to the padi cultivation policy indicated further the political and racial considerations of the British policymakers. Besides creating the problem of unemployment, the depression brought about a severe shortage of food. Food production, especially the supply of rice, was needed to feed the local population, especially the labour force in the mines and estates. Although the administration in 1932 made a concession by issuing more than 50,000 temporary occupation licences for use of lands in the states to Chinese market gardeners to relieve their unemployment, it refused to go further by alienating land for Chinese and Indians to cultivate padi.5 Although the Chinese had earlier shied away from padi cultivation owing to the poor economic returns, the colonial government itself had been reluctant to allow the Chinese to cultivate padi, as they feared the Chinese would intrude into what was seen as a Malay preserve and arouse Malay resentment against the British.
The issue was debated n the Rice Cultivation Committee but the committee decided that “in any policy for the extension of rice cultivation due and full regard should be paid to the requirements, immediate and future of the Malay inhabitants of the Malay States whose interests should be adequately safeguarded by the decisions of the State Council in each state”.6
The Malay leaders had also put pressure on the British not to alienate land to the Chinese for padi cultivation. The Raja Muda of Selangor in a speech in the Selangor State Council said, the Malays were “a padi cultural people who could not do well in business or commerce and that the Malay people, unlike the Chinese, had nowhere else to go.”7
The second issue related to the imposition of duty on imported rice, which was approved by Governor Clementi, an idea that originated from the Sultan of Pahang and was supported by the other Malay rulers. The duty was to be used for financing padi development schemes and it was a means to boost local padi cultivation by making the price of local padi more competitive with imported rice. Even some British Residents and unofficial members of the Federal Council, Chinese and Europeans, spoke against this policy and argued that that the duty would not affect the consumers of local rice and non-rice foodstuffs but only the Chinese and Indian rice consumers. They stressed that it would cause hardship for the non-Malay masses whose standards of living were affected by the economic depression and who were already spending one-third of their income on the purchase of rice.
“What appeared to emphasize the racial overtones implied in the imposition of the duty,” reveals a detailed study of this controversy, “was that the money ‘levied from one section of the community’ was ‘to be expended in assisting another’.8 Despite the strong opposition, Governor Clementi pushed through the policy as he decided not only to accommodate Malay interests, but he was also short of funds to pursue an extensive programme to help Malay padi cultivators.
Conclusion
The depression years marked a bleak period in the country’s economic history and highlighted the hardships that the various communities had to endure, but by 1935 the economic slump had lifted and ethnic tensions gradually diminished. The tensions did not lead to any outbreak of inter-ethnic violence and bloodshed, but they revealed fully how British policies came into play for each of the respective communities.
The British adopted a laissez-faire attitude towards non-Malays as they felt that they had no responsibilities towards their welfare. This very materialistic view was based on the assumption that immigrant labour chose to come into the country of their own free will and should be prepared to look after themselves when economic disaster struck. No unemployment relief or measures were introduced to accommodate the unemployed or displaced immigration workers except to provide them with free repatriation. Some 50,000 Chinese market gardeners were allowed lands with temporary occupation licences to plant food, but for a limited period only. Even in the case of the domiciled Chinese and others who were British subjects, the British attitude was one of indifference.
On the other hand, their ‘pro-Malay’ policies, such as decentralization, Malay lands reservations and padi cultivation, reflected the limited trusteeship roles the British were prepared to discharge towards the Malays. These worked against the best interests of the non-Malays, especially the Chinese, who were now able to see a policy of favoritisms, and the arguments the British used to defend the ‘pro-Malay policies” clearly showed bias and discrimination, causing resentment and hostility to build up.
The demands of a rising Malay nationalism were evident as not only Malay rulers, but also the Malay press and voluntary associations began pressing the British administration to do more to improve the Malays’ welfare and economic position and to grant them greater participation in administration and government.
The Chinese position was particularly acute, as repressive measures had been taken against Chinese communist and nationalist elements, followed by a tightening up of British control, censorship and supervision, resulting in several thousands being banished back to china. These raised the anxieties of domiciled Chinese who wished to escape from this fate.
They and those who were British subjects continued to be alarmed by the implications of the decentralization programme and continued British attacks on Chinese political and economic ambitions from which the British claimed the Malays needed protection. Domiciled Chinese saw the decentralization programme as a further discrimination towards non-Malays especially their exclusion from the administrative services.
In his major study of the colonial economy, Lim argues that the British administration’s economic ‘pro-Malay’ policies – especially on land reservations, padi cultivation and protection of Malay rubber smallholders – did not go far enough to assist the Malays.9 The British attempted to shield the Malays from the dynamic sectors of the modern economy, and did not involve them in commercial and industrial projects or provide them with sufficient capital, loans and assistance, even in the field of rural agriculture.
 They segregated the Malays from other communities instead of encouraging their fuller integration into a modern society. Lim concludes, “Furthermore, the colonial government, by its cynical use of Chinese interests to divert attention from its own shortcomings and as a scapegoat to explain the economic impoverishment of the Malays, was guilty of contributing to racial polarization and discord.”10
In a similar vein, Abraham’s The Roots of Race Relations in Malaya views the ‘pro-Malay’ policies of the 1930s as having “distinct racial overtones because they discriminated against the Chinese and Indians as races” and led to group formations along lines of racial identity and racial consciousness between groups. 11
As a contemporary observer, Rupert Emerson was one of the strongest critics of British policies during the economic depression, viewing them as excellent opportunities for the application of the maxim of “divide and rule”.12 He argued that such policies were bound to come into play so long as the British administrators were not prepared to adopt policies of racial integration and political programmes for the subject peoples to move towards self-government.
Given the structure of colonial society being divided between two groups of masters and subject peoples, the exploitative nature of colonial rule, its denial of freedom, and its maintenance of white prestige and profits, it is not surprising that the British administration in Malaya had adopted such lopsided policies during the economic depression which resulted in racial polarisation.
In view of its treaty obligations, which formed the basis of its rule in Malaya, it could not ignore the demands of a rising Malay nationalism, as it feared that Malay opposition would increase further; and consequently, it attempted in a limited way to accommodate some of their demands.
It saw no necessity to balance the social, economic and political interests of the various communities equitably in the interests of all, but instead attempted to pander and appease Malay nationalism, which it considered as the ultimate threat to its continued presence in Malaya. The colonial structure of its government militated against it adopting racial integration and allowing the other races equal rights to participate in administration and government. For them to do otherwise, as Emerson rightly pointed out, would have meant that colonial administrators were working “toward their speedy supercession”.13
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