ASEAN’s drug trade rakes in profits despite strict laws

Photo:Labib Ittihadul

Southeast Asia’s drug trade is booming—seizures of meth in ASEAN have tripled in the last five years. The region’s drug problem is shaped by ineffective law enforcement and wealth inequality and now threatens sustainable development.

By Skylar Lindsay

The UN Office on Drugs and Crime (UNODC) recently released its most in-depth study of organised crime in Southeast Asia in over five years. According to the report, Southeast Asia’s crime syndicates have expanded their activities in the global trade of illicit goods, driving corruption in the region and heavily influencing the economies of areas where they operate.

Jeremy Douglas, the UNODC regional representative for Southeast Asia and the Pacific, says organised crime now threatens to destabilise the region and presents a major barrier to sustainable development. 

The growth of organised crime stems largely from the success of the ASEAN drug trade. The methamphetamine trade is now worth an estimated US$61.4 billion per year across the Asia-Pacific. The Southeast Asian market alone accounts for US$25.7 billion of that— more than the GDP of Cambodia. Heroin trafficking has decreased but still generates an estimated US$10.3 billion per year across the Asia-Pacific, with Southeast Asia contributing US$6.3 billion to the figure.

Crime syndicates are moving operations to Southeast Asia

The region’s governments have yet to build a cohesive strategy to address ASEAN’s drug problem. Many crime syndicates have ramped up operations in ASEAN in recent years as China has more stringently enforced drug laws. 

Syndicates have adapted by shifting production operations to Southeast Asia. Unlike opium farms, synthetic drug labs are easy to move. Infrastructure projects to support China’s Belt and Road Initiative (BRI) are also reportedly making it easier to move precursor chemicals into drug-producing areas.

Law enforcement within ASEAN has also stepped up its drug operations, especially in northern Thailand near the border with Myanmar. Drug seizures have skyrocketed: in 2018, authorities across Southeast Asia seized at least 120 tons of methamphetamine—more than triple the amount they seized five years before. 

Drug syndicates are consolidating their operations in border areas and areas with weaker governance, including the north of Shan State in Myanmar and the Wa Self-Administered Division. They’ve also re-routed drug trafficking corridors, sending shipments via Laos to Thailand, Cambodia and Vietnam or to southern Myanmar and then on to southern Thailand or abroad.

Even though drug busts are increasing, authorities in Southeast Asia are having a tougher time stemming the flow of drugs at its source. The number of methamphetamine production facilities shut down by authorities has been dropping since 2015, suggesting that regional governments are leaving most of the region’s drug production rackets untouched.

Cheap drugs come at a high cost

The growth in the ASEAN drug trade is also shaped by wealth inequality within the region.

Poverty and economic pressures drive drug production, especially opium. As one opium farmer put it at the Myanmar Opium Farmers’ Forum in May: “Rich people don’t grow opium, only poor people grow it!”

According to the International Drug Policy Consortium (IDPC), 72% of poppy growers surveyed in Myanmar said they farm and sell opium to secure their basic needs including education and housing.

Drug production offers communities a chance at economic development because of extremely high profit margins. A kilogram of crystal methamphetamine might be worth US$3,000 in Myanmar’s Shan State, where it’s manufactured, but in Australia, that same kilogram is sold for US$600,000. 

With a strong international market and vast revenues coming in, drug traffickers are always looking for more product and drug producers can rapidly scale up their operations. Crime syndicates then bring economic opportunities to local communities in production areas and along smuggling routes, offering them a higher income than they might otherwise have access to.

But as the illegal drug trade becomes the engine of economic development, it ties communities to the illegal and unregulated world of crime syndicates. It draws local residents away from subsistence or community-driven livelihoods and into an industry dependent on corruption, addiction and a weak rule of law. 

The regional drug trade is also expanding because of cheap, ubiquitous synthetic drugs, primarily “yaba” or “yama”—methamphetamine tablets that are much cheaper and generally less concentrated or potent than crystal meth, known as “ya ice” or “shabu” in the Philippines.

Yaba or yama- a methamphetamine tablet that is often smoked.
Photo Credit: Steve Long/YouTube

Southeast Asian drug syndicates now manufacture about two billion yaba pills per year, most of which are sold and consumed within the region. The drug is most popular among manual labourers in the construction, agriculture and manufacturing industries. It’s also prominent in the sex industry, used both by sex workers trying to work longer hours and by customers.

Drug policies could soon shift

Southeast Asia’s governments have yet to develop a collaborative, effective approach to curbing either the methamphetamine or the heroine trades. In some cases, local communities have stepped in to control the drug trade in their areas through vigilante justice. 

Hardline militant Christians in Myanmar’s Kachin State, known as Pat Jasan, are waging their own, sometimes-violent, drug war against the area’s addicts and dealers. As author Patrick Winn describes in Hello, Shadowlands, his book on the underworld of Southeast Asia and what he calls the “meth fiefdoms” of the region, Pat Jasan kidnap drug users, beat them, coerce them into rehabilitation centres and destroy farmers’ poppy fields. Though the militants sometimes collaborate with local police, they also offer their own hardline vision of justice and reform for their community.

Earlier this year, the IDPC released a report analysing the last decade of drug policies across Asia. 

“Harsh and draconian policies have failed to reduce the scale of the drug market and in parallel have had devastating impacts on people and communities,” the report stated.

Poppyseed pods.
Photo: Zyance

The Philippines’ approach is well-known and widely condemned: President Rodrigo Duterte’s drug war has killed at least 12,000 people. The U.N. Human Rights Council recently voted to investigate the killings and U.N. High Commissioner for Human Rights Michelle Bachelet will conduct an inquiry over the next year. 

Most of ASEAN opts for mass incarceration. As much as 70% of Thailand’s prison population is serving time for drug charges. Last year over 50% of Malaysia’s inmates were in prison for non-trafficking drug crimes.

But the region is beginning to explore new solutions. In late June, Malaysia’s Health Minister Dzulkefly Ahmad introduced legislation to decriminalise the possession and use of small amounts of illegal drugs in order to treat users as patients rather than criminals.

Though the legislation may not succeed, the move signals a dramatic departure from the traditional regional approach to drug policy and a willingness to explore new lines of thinking. Malaysian law currently mandates the death penalty for anyone caught in possession of over 200 grams of marijuana or 15 grams of heroin.

“It definitely helps to open conversations about alternative approaches to drug use,” said Gloria Lai, IDPC’s Asia director.

Myanmar also endorsed the possibility of decriminalising drug use in its first National Drug Control Policy in 2018, though its current drug laws are somewhat contradictory and remain strict.

Decriminalisation alone won’t help bring the drug trade under control. ASEAN leaders also need new strategies to give those involved in the drug trade alternative livelihoods. Sustainable development depends on supporting local communities to build their own livelihoods separate from the profits of organised crime. Thailand has had great success in supporting opium farmers to transition to coffee and other crops in recent decades and Myanmar has growing initiatives to do the same. 

As the opium farmer in Myanmar said, local communities often get involved in drug production because there’s no other way to support their families. But if the status quo of incarceration and piecemeal enforcement continues, the drug trade will remain a major barrier to sustainable economic development.