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Myanmar Shan a global production hub for illegal drugs, says security think tank

JOHN GRAFILO The Myanmar Times Tuesday 8 January2019

A Wa State soldier in Shan State performing the ceremonial destruction of illegal drugs in their headquarters in 2017.

Conflict-ridden Shan State in eastern Myanmar is a global hub for illegal drug production, ranging from heroin to methamphetamine tablets, an international security think tank said in a report released today.

The report also stated that the main source of precursor chemicals used to manufacture the drugs is China.

The Brussels-based International Crisis Group (ICG) report warned that profits from the illegal trade “are now so vast that they dwarf the formal sector of Shan State and are at the centre of its political economy”.

“This greatly complicates efforts to resolve the area’s ethnic conflicts and undermines the prospects for better governance and inclusive economic growth in the state,” according to the report entitled Fire and Ice: Conflict and Drugs in Myanmar’s Shan State.

The report said the key production centres are in areas controlled by ethnic armed groups and pro-government militias.

It added that, if left uncontrolled, the illicit trade could hamper the resolution of the decades-old conflicts in many parts of the country, particularly in Shan State, “and undermines the prospects for better governance and inclusive economic growth”.


“There is comparatively little direct violence between drugs trade actors, who prefer stability. But lucrative revenues earned by various armed actors are helping to fund and sustain Myanmar’s 70-year-old civil conflicts,” the ICG report said.

“The more a political economy based on illicit activities and organised crime becomes entrenched, and the greater the profits it generates, the harder it will be to dislodge,” it added.

The report said the illegal trade has attracted transnational crime groups that bribe officials for protection, resulting in the culture of graft flourishing.

ICG called on the Myanmar government to focus its anti-drug efforts on organised-crime operations and on going after corrupt officials involved in protecting crime syndicates.

It also called on the Myanmar military, locally known as Tatmadaw, to exert greater control of allied militias and paramilitary forces involved in the drug business, with the ultimate call of disarming and disbanding them.

“The impunity that these groups enjoy, and the requirement that they mostly fund themselves, has pushed them to engage in lucrative illicit activities,” the ICG report said. “The military should also investigate and take concerted action to end drug-related corruption within its ranks, focusing on senior officers who facilitate or turn a blind eye to the trade.”

The report also underscored the need for international action, especially China, in curbing the flow of chemical precursors used in the manufacture of drugs into Shan State.

“China has a particular responsibility to crack down on this trade taking place illegally across its southwestern border,” it said.


“It should also use its influence over the Wa and Mongla armed groups controlling enclaves on the Chinese border to end their involvement in the drug trade and other criminal activities.”

It also expressed grave concern over the likely impact of the China-Myanmar Economic Corridor (CMEC), “which in the short term could increase opportunities for illicit profiteering”.

CMEC is an estimated 1,700-kilometre-long corridor that will connect Kunming, the capital of China’s Yunnan Province, to Myanmar’s major economic hubs – first to Mandalay in central Myanmar, and then to Yangon and to the Kyaukphyu Special Economic Zone (SEZ) in Rakhine State.

The report conceded that targeting major crime groups involved in the billion-dollar trade would not be easy and could result to violent retaliations, but if left unattended Shan could become a safe haven for large-scale criminal enterprises.

“The more such a system becomes entrenched, and the greater the profits it generates, the harder it will be to dislodge and the longer conflicts in that area are likely to persist,” the ICG report said.

“The people of Shan State, and Myanmar as a whole, will pay the highest price.”


From: THE MYANMAR TIMES (Myanmar) Tues January 8, 2019

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