Jane's Intelligence Review

October 1, 1998

SECTION: ASIA; Vol. 5; No. 10; Pg. 10

LENGTH: 889 words

HEADLINE: NARCOTICS - Burma's military implicated

BYLINE: Bruce Hawke

BODY:

ALTHOUGH the Burmese government claims to be trying to clamp down

on the flourishing heroin and amphetamine trades, evidence on the

ground suggests that military units in Shan State are playing a

significant and increasing role in the business. It is the patriotic

duty of military commanders to raise money for the Tatmadaw (armed

forces of Burma), according to a well-placed Thailand-based

intelligence source. Providing cash for the army as a means of

ensuring promotion has been institutionalised since 1991, and

informally expected since at least 1989. In Shan State, the fastest

and easiest source of money comes from taxing the drug trade.

Production and sales taxes on opium are levied off farmers. Heroin

refineries are also taxed monthly according to their size, and how

many vats they are operating. A mid-sized lab on the Thai border

would generally be taxed 150,000-200,000 baht per month

(US$3,800-5,000). Heroin and amphetamine consignments to Thailand,

China and India are also taxed, ensuring uninterrupted passage to

the border. The intelligence source's allegations are backed up by

ethnic minority leaders in Shan State and a considerable weight of

circumstantial evidence from inside Burma. Off-the-record, a number

of Rangoon-based diplomats have asserted the Burmese government has

financed a considerable portion of its military build-up by taxing

the drug trade. Leading Burma Army top brass, including the current

army Chief, General Maung Aye, former Eastern Region (southern Shan

State) commander, who during his tenure never fought a single

engagement against Khun Sa's Mong Tai Army, owe their rapid

promotions to their ability to provide money for the army fund.

Wei Hsueh-kang, the Chinese-born southern military commander of the

United Wa State Army (UWSA) and co-ordinator of much of the

organisation's heroin refining and amphetamine production, was

indicted for narcotics trafficking by an Eastern New York Federal

Court in early June and had a $2 million bounty put on his head.

According to intelligence sources, Wei quickly concluded an immunity

deal with senior members of the Burmese government where they

guaranteed his freedom from arrest or extradition. What he offered

in exchange is not immediately clear. Wei Hsueh-kang is chairman of

a government-sponsored local anti-narcotics committee. He has in the

past met with United Nations Drug Control Program (UNDCP) personnel

where they discussed drug eradication programs, introduced at the

meetings by Burmese government officials as a "leader of the

National races." Wei Hsueh-kang was born in China and has never held

Burmese citizenship, and he is believed at various times to have had

both Thai and Taiwanese passports.

In March last year Lei Wei-ming, a board-member of the Mongla Action

Committee on Narcotics, another government-endorsed drugs

suppression group, was caught in a Drugs Enforcement Agency

(DEA)-Thai police sting operation. He was extradited to New York,

where he is in jail waiting to face narcotics charges. The chairman

of the Mongla Action Committee on Narcotics is Lin Ming-xian, aka

Sai Lin, a China-born Red Guard volunteer to the Communist Party of

Burma (CPB) in the late 1960s. In 1989, Lin rebelled, set up the

National Democratic Alliance Army, more commonly known now as the

Eastern Shan State Army (ESSA), and discovered capitalism. Burmese

troops have virtually unrestricted access to his fiefdom, which

borders China and Laos. His 3,500-4,000 man army has taken on the

appearance of a large narcotics-trafficking government militia. Lin

is a special advisor to the constitutional convention in Rangoon.

Though he has never formally taken Burmese citizenship, he is

described as a leader of the National races by the government. He

was introduced by the US State Department International Narcotics

Control Strategy Report (INCSR) this year as one of the top figures

believed to be involved in the heroin trade. Mongla, a town on the

Chinese border, is the headquarters of the ESSA and is home to a

Drug Suppression Museum which was visited by diplomats and UNDCP

officials at its official opening in 1996. During the opening

ceremony Lin Ming-xian was presented with an award from the Burmese

government for his part in narcotics suppression. Further to the

north in Kokang District, a silent coup took place in mid-1997. Yang

Mo-liang, the former head of the Myanmar National Democratic

Alliance Army (MNDAA) and defacto governor of Kokang was forced out

after the UWSA withdrew their support for him following allegations

he had short-changed his allies on a heroin deal. His army was

disbanded and Peng Jia-sheng, the head of the district up until

1994, retook control. Peng Jia-Sheng brought in with him a permanent

Burmese army garrison, as repayment to the Burmese government for

past favours. Peng chairs the government-endorsed Kokang

anti-narcotics committee and has regularly met with officials from

the UNDCP. Yet even with such a presence, there has been no

appreciable drop in heroin production. Also, in spite of a number of

heavily publicised and suspiciously large busts by Burmese

authorities over the past 12 months, seizures remain at below one

percent of potential production.

GRAPHIC: Photograph 1, 770kg of opium and 430kg of heroin is set ablaze on 30 January in the Burmese capital, a ceremonial burning convincing few international observers. PA News

LANGUAGE: ENGLISH