BURMA'S COUNTERNARCOTICS REPORT CARD

UNCLAS SECTION 01 OF 05 RANGOON 001355

SIPDIS

STATE FOR EAP/BCLTV AND INL/AAE
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E.O. 12958: N/A
TAGS: SNAR KCRM BM
SUBJECT: BURMA'S COUNTERNARCOTICS REPORT CARD

REF: A. (A) STATE 190339

B. (B) STATE 157297

C. (C) 01 RANGOON 1747


1. (U) Summary: Burma has responded well to the criteria
outlined in our certification demarche. It has continued to
enforce its counternarcotics laws, increased pressure on
cease-fire groups such as the United Wa State Army, and
sharply reduced the production of opium and heroin within its
territories. It has also improved its counternarcotics
cooperation with China and other states, contributing to the
arrest of several major drug traffickers wanted abroad.
Seizures of opium, heroin, and other narcotics have also
increased in 2002, though ATS seizures have lagged. In
addition, Burma enacted new money laundering legislation in
2002 and should open up its first cases under the new law
before the close of the year. It also continued to prosecute
corrupt police and military officers. Between 1995 and May
2002, a total of 248 police and military officers were
disciplined for narcotics-related corruption and drug abuse.
Finally, in cooperation with UNDCP and several international
NGOs, Burma has maintained a simple, but apparently effective
demand reduction program that has held drug abuse in Burma to
one of the lowest levels in the region. End Summary.


2. (U) The paragraphs below are keyed to the criteria
outlined in our certification demarche.


3. (U) Drug Dealers: Comply with the provisions of UN Drug
Conventions by taking demonstrable and verifiable actions
against high level drug traffickers and their organizations,
such as arresting and convicting leading UWSA drug producers
and traffickers

The GOB has continued to enforce its counternarcotics laws.
While its reach was limited in the past by the special
dispensation it had given several major cease-fire groups on
the Chinese border, nevertheless, over the past fourteen
years, it has made almost 90,000 arrests on drug-related
charges. Of those arrested, 42 were eventually sentenced to
death, 37 were given life imprisonment, and an additional
12,500 were given prison terms of more than 10 years. During
the first eight months of 2002, Burma has arrested another
4,148 suspects. It has also continued with prosecutions. In
the five months up to May 2002, 850 drug dealers were given
prison terms in excess of ten years.

Several of these arrests and convictions were directly the
result of cooperation with the United States, Australia,
China, Thailand, and other states. These included:

-- Cooperation with the United States Drug Enforcement
Administration and the Australian Federal Police in the
seizure of 357 kilograms of heroin in Fiji in October 2000.
Death sentences were eventually handed down in Yangon for two
drug kingpins connected with this case.

-- Cooperation with Thailand in the seizure of 116 kilograms
of heroin and 7.8 million methamphetamine tablets in February

2002. Two of the principals behind this shipment were also
eventually convicted in Yangon and sentenced to "indefinite"
(i.e., unending) terms in prison.

-- Cooperation with China in a series of arrests and seizures
that have continued throughout 2001 and 2002 all along the
Chinese border following the signature of a Chinese/Burmese
MOU on counternarcotics operations in January 2001. Since
then, Burma has turned over 22 separate fugitives to China,
including members of one group (Tan Xiao Lin and company)
which China described as the "largest armed drug-trafficking
gang in the Golden Triangle."

-- Cooperation with the United States Drug Enforcement
Administration and the Chinese police on a seizure of 12.5
kilograms of heroin in Hong Kong on July 11, 2002. Evidence
collected in that case will provide the basis for one of the
first prosecutions in Burma under the GOB's new money
laundering law.

-- Cooperation with Thailand and the United States in the
arrest of Yang Chia-ho, a United Wa State Army officer and a
confederate of the notorious Wa chieftain, Wei Hsueh Kang.
Yang Chia-ho was taken into custody together with more than 5
million methamphetamine tablets and 41 kilos of heroin in
Tachileik, Burma on October 4, 2002.

Burma has also ratcheted up the pressure on cease-fire groups
like the Wa and the Kokang Chinese, who were originally left
relatively free to develop the narcotics trade in their
self-administered areas along the Chinese border. Starting
in September 2001, the GOB has mounted a series of joint
operations in cooperation with the Chinese which resulted in
a series of major arrests in Laukkai, the capital of Kokang
Chinese Special Region No. 1. In March, 2002, it also
demanded that new counternarcotics decrees be issued by the
Wa, the Kokang Chinese, and other cease-fire groups. Those
decrees outlawed participation in any aspect of the narcotics
trade. The GOB also demanded and received cooperation from
the United Wa State Army in bringing to heel several
fugitives wanted by China in April and May 2002. In
addition, it has begun a campaign to close down the liaison
offices of armed groups like the United Wa State Army, and of
companies associated with those groups in Tachileik,
Myawaddy, and other towns on the Thai/Burmese border.
Finally, the GOB has continued to hold all of the cease-fire
groups to their pledges to end opium production in their
territories. U Sai Lin's Special Region No. 4 around Mong La
has been opium-free since 1997 and the Wa are, thus far, on
track to eliminate opium by 2005. The Kokang Chinese missed
their opium-free target (scheduled for the year 2000),but
have paid a heavy price for that failure in terms of
increased attention from both the Burmese and the Chinese
police.


4. (U) Narcotics Elimination: Increase opium eradication and
provide location data for verification purposes;
significantly increase seizure rates for opium, heroin, and
methamphetamines; control the diversion of precursor
chemicals; and destroy significantly more heroin and
methamphetamine laboratories.

Opium production in Burma declined for the sixth straight
year in 2002. According to the U.S./Burma Joint Opium Yield
Survey, the maximum potential yield for opium in Burma in
2002 totaled only 630 metric tons, down 235 metric tons (or
27 percent) from 2001. Over the past six years (i.e., since
1996),opium production in Burma has declined by more than 75
percent, dropping from an estimated 2,560 metric tons in 1996
to 2002's total of only 630 metric tons. Approximately half
of this decline reflects a decline in acreage under
cultivation (which dropped by more than half to only 78,000
hectares in 2002). The remainder was due to lower yields
(now only about 8 kilograms/hectare) throughout Burma.

The results in regard to methamphetamine production are
harder to measure. While figures for the production of
methamphetamine production in Burma are batted about (e.g.,
400 million, 600 million, or 800 million pills),the basis
for these estimates is unclear. As a result, it is difficult
to judge on the basis of current information to what degree
Burma is or is not making progress in controlling
methamphetamine production.

It is clear, however, that narcotics seizures in Burma have
increased during 2002, at least in regard to opium and
heroin, most of which is trafficked through China. During the
first eight months of 2002, the GOB seized 1,563 kilograms of
opium and 213 kilograms of heroin. This compares with
seizures of 1,629 kilograms of opium and 96 kilograms of
heroin during all of 2001. In contrast, seizures of
methamphetamine tablets were lower during the first eight
months of 2002, totaling only 3,605,615 pills. This may
reflect a complete disruption of the ATS trade out of Burma
as a result of the tensions with Thailand, poor Burmese
enforcement efforts or simply new methods and routes of
trafficking that the Burmese have yet to uncover. Whatever
the reason, recent large seizures by Burmese forces in
Tachileik (see above) have begun to make up the deficit.

GOB eradication efforts have also continued. Altogether, the
GOB appears to have eradicated slightly less than 7,400
hectares of opium poppy during the 2001/02 crop year, a total
approximately equal to 10 percent of the acreage under opium
cultivation. It also provided the United States with
information on the states, townships, and villages within
which these eradication campaigns were conducted and has
agreed to provide GPS coordinates for verification purposes
during the coming crop year.


5. (U) International Cooperation: Continue cooperation with
China and Thailand and Expand Cooperation to other
neighboring countries such as India.

Burma has been able to recruit strong allies in its efforts
to eliminate drugs. Since 2001, Burma has signed MOUs with
China (in January) and Thailand (in June). The MOU with
China laid down the ground rules for joint operations, which
in turn led to a series of arrests of major traffickers
during the spring and summer of 2001 (see above).

Burma's MOU with Thailand committed both countries to closer
police cooperation on the border. This was firmed up during
an August 2001 meeting of police chiefs from both sides of
the border who agreed to share information and establish
joint "narcotics suppression coordination stations" in the
Chiang Rai/Tachileik, Mae Sot/Myawaddy, and Ranong/Kawthoung
border areas. During Secretary 1 Khin Nyunt's September 2001
visit to Thailand, Thailand also offered a 20 million baht
(about $440,000) alternative development project in Burma. In
May 2002, tensions on the Thai/Burmese border disrupted this
nascent cooperation, but, with the resolution of those
problems, both governments have committed themselves to
renewed cooperation.

Burma also participated actively in multilateral meetings on
narcotics control. These included a regional ministerial
meeting (organized in cooperation with UNDCP) on drug control
in Rangoon in May, 2001, and a quadrilateral ministerial
meeting involving Burma, Laos, China, and Thailand in August

2001. In November 2001, Burma agreed to contribute to the
ACCORD plan of action, which serves as an umbrella for a
variety of global programs aimed at strengthening the rule of
law, promoting alternative development, and increasing civic
awareness of the dangers of drugs. It has also supported the
1993 Memorandum of Understanding that was signed among the
six regional states -- Burma, China, Thailand, Laos, Vietnam,
and Cambodia -- to control narcotics production and has
participated in all meetings of that group. Put simply,
Burma is part of every major multilateral narcotics control
program in the region.

Finally, Burma has signed drug control cooperation agreements
with virtually all states in the region. These include
agreements with Laos, Cambodia, Vietnam, the Philippines,
India, and the Russian Federation, in addition to China and
Thailand.


6. (U) Money Laundering: Enforce existing money laundering
laws, including asset forfeiture provisions, and fully
implement and enforce Burma's new money laundering
legislation.

The GOB enacted new and relatively powerful money laundering
legislation in June 2002. That legislation criminalizes
money laundering in connection with virtually every kind of
serious criminal activity and levies heavy responsibilities
on banks in regard to reporting. Penalties are also
substantial. The police, in cooperation with the Central
Bank and the Attorney General's office, have developed rules
and regulations to implement the law, which should be
published shortly. The government has also held training
seminars on money laundering and financial investigations in
Mandalay and other cities. Investigations have started, and
it is expected that the first prosecutions under the new law
will take place before the close of 2002. The GOB's goal now
is to establish a record of enforcement over the coming year
that will justify Burma's removal from the Financial Action
Task Force's list of non-complying countries.

The GOB is also drafting new Mutual Legal Assistance
legislation which should be enacted in 2003. Once enacted,
that legislation will facilitate the negotiation of Mutual
Legal Assistance Treaties and greater legal and judicial
cooperation in pursuing money laundering and other cases.


7. (U) Corruption: Prosecute drug-related corruption,
especially corrupt government and military officials who
facilitate drug trafficking and money laundering.

In 2001, the GOB indicated that 32 Burmese police officers
have been punished for narcotics related corruption since the
beginning of 2000. Punishments took the form of
imprisonments, terminations, demotions, and forced
retirements. Jail sentences have been imposed on 17
officers, including 1 police major and 2 police lieutenants.
Four officers have been terminated, including 2 police
lieutenants, and six officers were forced to retire,
including 4 police lieutenants. Over the same period of
time, they said, 7 Burmese army soldiers, including 1 major
and three other officers, were charged with narcotics-related
corruption.

In 2002, the GOB expanded this list of prosecutions to
include over 200 police officials and 48 Burmese Army
personnel who were punished for narcotics-related corruption
or drug abuse between 1995 and May 2002. Of the 200 police
officers, 130 were imprisoned, 16 were dismissed from the
service, 7 were forced to retire, and 47 were demoted.


8. (U) Demand Reduction: Expand demand reduction, prevention
and drug treatment programs to reduce drug use and control
the spread of HIV/AIDS.

If the level of drug use is the measure of success in demand
reduction, then Burmese programs have been a success. The
overall level of drug abuse is low in Burma compared with
neighboring countries. According to the GOB, there are only
about 70,000 "officially registered" drug abusers in Burma.
While this is undoubtedly an underestimate, even UNDCP
estimates that there may be no more than 300,000 people
(still less than 1 percent of the population) who abuse drugs
in Burma. Most, particularly among the older generation, use
opium, but use of heroin and synthetic drugs is rising,
particularly in urban and mining areas.

Burmese demand reduction programs are in part coercive and in
part voluntary. Addicts are required to register and can be
prosecuted if they fail to register and accept treatment.
Altogether, more 21,000 addicts were prosecuted for failing
to register between 1994 and April 2002.

Demand reduction programs and facilities are strictly
limited, however. There are six major drug treatment centers
under the Ministry of Health, 49 other smaller detox centers,
and 8 rehabilitation centers which, together, have reportedly
provided treatment to about 55,000 addicts over the past 9
years. There are also a variety of narcotics awareness
programs conducted through the public school system.
According to UNDCP, approximately 1,200 high school teachers
participated in seminars, training programs, and workshops
connected with these programs in 2001. In addition, the
government has established demand reduction programs in
cooperation with INGOs. These include programs with CARE
Myanmar, World Concern, and Population Services
International, all of which focus on injecting drug use as a
factor in the spread of HIV/AIDS.
Martinez