Penang's modern history began in 1786, upon the establishment of George Town by Francis Light. Penang formed part of the Straits Settlements in 1826, which became a British crown colony in 1867. Direct British rule was only briefly interrupted during World War II, when Japan occupied Penang; the British retook Penang in 1945. Penang was later merged with the Federation of Malaya (now Malaysia), which gained independence from the British in 1957. Following the decline of its entrepôt trade towards the 1970s, Penang's economy was reoriented towards hi-tech manufacturing.