Tin, a non-renewable natural resource, was the initial driver that propelled early economic development on the Malay Peninsula. It accounted for a significant proportion of export earnings for much of the 20th century.

The discovery of large tin deposits in the Peninsula’s west coast states of Perak and Selangor in the first half of the 19th century led to significant investments of capital by wealthy Chinese merchants living in the Straits Settlements and the influx of migrant workers from mainland China to develop the industry. By 1904 Malaya was producing 50,000 tons of tin annually, more than half of world output, to meet the growing demand from Europe.

While initially Malaya’s tin mining industry was essentially in Chinese ownership, this situation changed markedly when, with the support of the British colonial administration and in a context of rising wage rates of miners, Europeans injected large amounts of capital, managerial expertise, and technology into the industry, including hydraulic sluicing and other scientific methods in dealing with the alluvial tin deposits.
Labour intensive tin mining in Malaya
Source: National Archives Malaysia - 2001/0025947
The introduction of the dredging machine in 1912 and the gravel pump transformed the industry while at the same time establishing British control over it. The government of the Federated Malay States invested heavily in rail and road infrastructure that helped lower production costs and also provided land concessions to new companies. The net result was that whereas in 1912 some 80 per cent of Malaya’s tin production was under Chinese management, by 1931 British firms accounted for more than 65 per cent of total tin production.

The remarkable ascendency of the tin industry resulted from the increasing use of tinplate cans in the preservation of food, with American consumption accounting for about a quarter of world demand. Malaya’s tin production and its share of world output increased dramatically in the last three decades of the 19th century when it overtook Britain as the world’s largest producer. 

Malayan tin production continued to grow steadily to reach a peak of 52,000 tons in 1904, thereafter levelling at around 50,000 tons per year. Production declined during World War I as a result of export controls and shipping disruptions. With economic recovery tin output expanded and by 1937 Malaya achieved its largest ever production.
Open cast mining in Kinta Valley employing the lampan or sluicing method
Source: National Archives Malaysia - 2001/0025947
The Great Depression saw a severe worldwide economic collapse during the early 1930s in which most countries, the USA in particular (which was Malaya’s main trading partner), experienced devastating economic declines. International trade slumped as countries imposed import tariffs and quotas.

Growth output in other tin-producing countries, particularly in Bolivia and also in Indonesia, Thailand and China, contributed to a secular decline in Malaya’s share of world output. Although still substantial, by 1930 its share had fallen to 37 per cent compared to over 50 per cent at the turn of the century.

World War II again severely disrupted Malaya’s tin industry but a massive post-war rehabilitation programme brought production back to 55, 000 tons in 1949, and it increased further in the 1950s and 1960s. However, during the last thirty years of the 20th century tin’s relative importance to Malaysia’s economy steadily declined as the country’s exports increasingly diversified. Tin exports accounted for about 20 per cent of gross export earnings in 1970, declining to less than 10 per cent in 1980, and by the late 1990s contributed less than one per cent.
Malaysia’s Share of Global Tin Production
Note: Data for years before 1963 relate to Malaya.
Sources of data: Lim Chong Yah, Economic Development of Modern Malaya. Kuala Lumpur: Oxford University Press: International Tin Council. 1968. Statistical Year Book: International Tin Council, Annual Report 1967-68: International Tin Council. 1970-1980. International Tin Statistics. 1996. Bulletin, No.1, July 1991 and No. 16-17, January and October 1996

Further reading:
Yip, Y. H. 1969. Development of the Tin Mining Industry of Malaya. Kuala Lumpur: University of Malaya Press.
Wong, L. K. 1965. The Malayan Tin Industry to 1914. Tucson: University of Arizona Press.
Sultan Nazrin Shah. 2017. Charting the Economy: Early 20th Century Contemporary Malaysian Contrasts. Kuala Lumpur: Oxford University Press.
Thoburn, J. T. 1994. Tin in the World Economy. Edinburgh: Edinburgh University Press. 

c/o Asia-Europe Institute
University of Malaya,
50603 Kuala Lumpur
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