Sitiawan grew from a small settlement with
rubber tapping and
latex processing as its main economic activities. The town was flanked by various Chinese settlements composed mostly of the descendants of immigrants from the
Kutien district of
Fuzhou, China. The original settlers were encouraged by the British to plant rice. The settlers, however, found that paddy-planting is not suited to the soil of the region and so they switched to livestock farming before discovering that the land was much better suited for rubber plantations. The rapid development of urban settlements saw the plantation and estate areas develop, and eventually converted into residential and commercial areas. In the 1980s, a large remainder of the
rubber estates underwent mass conversions into
oil palm plantations, due to better yield and profits compared to rubber sheets and latex. Oil palm is less labour-intensive crop compared to rubber, as rubber needs to be tapped regularly. Tourism has not been a major economic activity, but the town centre derives some economic advantages from its close proximity to
Pangkor Island which is a famous niche tourist destination. The development of the town had been rapid in the 1990s. One of the main reasons was the establishment of the
Royal Malaysian Navy's Naval Base in
Lumut, approximately 10 km from the town centre. The Naval Base is currently the largest in Malaysia. The base has acted as a catalyst for the development of commercial activities in the town, serving both the residents of the base and sailors visiting from other countries. Located at the western coast of Perak with direct access to the Straits of Malacca, it is no surprise that port-related activities, marine services and industries play a major role. Its main port,
Lumut Port consists of the Lumut Maritime Terminal (LMT) and Lekir Bulk Terminal (LBT) and it serves the surrounding regions and the state of Perak. LMT, a Royal Malaysian Customs Gazetted Port, is a river port, located along the banks of the Dindings River. The Terminal is an integrated common user port facility, and is International Ship Port Security code compliant. Since 1995, the Terminal has been improved and upgraded and its facilities have been extended to include additional open and covered storage. The main berth has been extended for another 280m in 2001, with the alongside depth of 12m ACD, resulting in a total overall linear berth length of 510m. LBT is a deepwater seaport, and with a natural depth of 20 metres, LBT is currently South-East Asia's largest dry bulk unloading facility. The terminal is capable of berthing an entire range of vessels in Panamax and Capemax ships up to 165,000 DWT. LBT is designed to handle dry bulk cargoes. It currently is a dedicated terminal to handle coal for Station Janakuasa Sultan Azlan Shah (TNBJ) in Seri Manjung. An industrial zone, Lumut Port Industrial Park (LPIP), located within Lumut Port itself with direct sea, trade access, is home to various industries and companies. LPIP is home to companies such as Sapura Kencana Petroleum Berhad, an oilfield service company, Kencana Torsco Sdn. Bhd., B.I.G. Industrial Gas Sdn. Bhd., IMPSA, etc. In recent years, bio-diesel, oleo and
palm oil based companies have been set up due to the proximity to its raw material source. A secondary jetty, located at Teluk Rubiah is built and managed by Vale Malaysia Minerals Sdn Bhd, a Brazilian mining giant. It was built as a transshipment hub for iron ore. The raw material is brought in from Brazil in gigantic 400,000 DWT bulk carriers some 360 metres in length. The Vale Jetty serves a maximum 90 million tonnes per annum of iron ore and functions as entry and exit points for all material including iron ore, sinter pellets, blast furnace pellets and pelletizing plant additives. The jetty is designed to bring in incoming iron ore from the largest bulk carrier of 400,000 DWT Valemax, and to export it with a maximum of 80,000 DWT panamax size vessel. The project has been controversial due to environmental concerns. Fears expressed by civic groups and local residents concern the destruction of the environment, the livelihood of locals, particularly fishermen, and beach-side tourism. Nevertheless, the nearby Outward Bound School has alleged that part of the jungle is inaccessible to its teams. Other education and training institutions are also barred from entering the area. Consumer and environmental groups have joined in the condemnations with claims that the ecosystem of the area, formerly gazetted as a forest reserve, would be destabilised. The plant is located on a 450-acre site which was originally a Permanent Forest Reserve but the state government re-gazetted it to an ‘Industrial Zone’. The Perak Department of Wildlife and National Parks said that the area is rich in flora and fauna and protected under the Wildlife Protection Act 1972. The site is surrounded by mature and regenerating natural primary forest whilst the bird life and mammals are protected by national and international laws. The area is also home to leopards, white-bellied eagles and the endangered palm plant,
Phoenix paladosa. Another major industry is its rich rubber latex resource, YTY Industry Sdn Bhd, a world leader in Nitrile Gloves production for examination and surgical use, TNB JanaManjung Sdn Bhd an independent power generation company, TNB's Sultan Aziz Shah Coal-Fired Power Plant and several other industrial manufacturing and mining companies. ==Education==