Asia’s drug syndicates are becoming increasingly sophisticated as the region’s narcotic trade continues to expand despite the pandemic, major arrests and record drug seizures.
Southeast Asia’s synthetic drug trade continues to grow as drug manufacturers find new ways to scale up trafficking, despite recent arrests of prominent drug kingpins.
The UN Office on Drugs and Crime (UNODC) said in early February that drug manufacturers in Southeast Asia are now producing the precursor chemicals needed to make methamphetamines and other synthetic drugs, allowing them to increase their output regardless of import restrictions or other supply problems.
The UN says this production of precursor chemicals shows a new level of sophistication in the region’s illegal drug labs, most of which are believed to be located in northeastern Myanmar.
“It is increasingly clear organized crime are using pre-precursors and have particularly impressive capacities in place to produce their own precursors—something nobody understood until recently,” said Jeremy Douglas, UNODC representative for Southeast Asia.
This change, along with Myanmar’s military coup, will make it more difficult for authorities to directly target drug producers. Harm reduction, prevention and rehabilitation are now, as ever, the most effective strategies.
Cheap synthetic drugs have flooded the Asia-Pacific in recent years and the region’s drug trade is now worth an estimated US$70 billion per year. Southeast Asia’s drug economy has grown dramatically as the opium and heroin trade has declined and the trafficking of synthetic drugs like methamphetamines has increased.
Cheap synthetic drugs are produced on an unprecedented scale and sold for massive profit margins in the Asia-Pacific’s wealthier countries. A kilogram of meth worth US$1,800 in Myanmar can be sold in Australia for as much as $298,000 or in Japan for $588,000. The boom in meth production floods Myanmar, Thailand, Laos and Cambodia with cheap pills.
The laboratories that produce these drugs usually rely on precursor chemicals like pseudoephedrine and ephedrine imported or smuggled into northeastern Myanmar, primarily from China. Much of this sourcing is done via ethnic armed groups and militias. The shift to manufacturing these chemicals “in-house” allows crime syndicates to move increasing volumes of drugs without relying as heavily on outside sources. As a result, some armed groups in the Golden Triangle involved in smuggling chemicals may see their finances impacted.
The production of precursor chemicals within Myanmar also signals yet another shift in the local economies of the Golden Triangle. Efforts to support livelihoods that meet local communities’ needs will become increasingly important.
As Benedikt Hofmann, UNODC country manager for Myanmar, said in a statement in early February, “Alternative development programs that offer viable, sustainable sources of legitimate income and assistance to communities in Shan and Kachin [states] are critical to the country’s future.”
Expanding drug production and Myanmar’s coup present a complex challenge
Efforts to police the expanding drug trade will require increasing cooperation with Myanmar’s government—a fraught prospect given the recent military coup. The coup has shifted dynamics in Myanmar’s borderlands dramatically as armed groups reassess. Many have endorsed the growing civil disobedience campaign against the junta government, including the Ta’ang National Liberation Army (TNLA) and the Restoration Council of Shan State (RCSS), both active in the areas where drug labs are believed to be located.
Myanmar’s new junta may continue efforts to combat the drug trade, in part as a ploy to appear legitimate in the eyes of foreign governments. The junta may also use anti-narcotic campaigns as justification to increase military presence in the territories of ethnic armed groups.
Whether the junta takes a more combative approach to the drug trade or is simply indifferent, cooperating with Senior General Min Aung Hlaing’s illegal government is problematic for the UN and foreign governments. Any government or agency that works with the military will be seen as legitimizing the coup, alienating ethnic armed groups and possibly worsening Myanmar’s civil wars.
High-profile arrests may have little impact
The news that drug syndicates are consolidating production is consistent with the trends of the ongoing synthetic drug boom. Despite the pandemic and record drug seizures, the UN believes the meth trade continues to grow—even as authorities have arrested two key syndicate leaders.
Last October, Thai narcotics police arrested drug kingpin Lee Chung Chak, a Hong Kong citizen, in Bangkok. The arrest came following a decade-long investigation by Australian Federal Police into the Sam Gor syndicate, the criminal organization that has led the new wave of drug trafficking and is allegedly responsible for smuggling “substantial quantities of heroin and methamphetamine” into Australia. Police say Sam Gor is behind 70% of the illegal drugs coming into Australia.
In a 2018 report, Australian police referred to Lee as a “senior project manager” for drug trafficking. Authorities seized a laptop and multiple phones during the arrest, representing a potential major resource for investigators. Lee is currently being held in Thailand as he appeals an extradition request from the Australian police.
In January, police in the Netherlands arrested Tse Chi Lop, the leader of Sam Gor, following a request by the Australian police. Tse remained largely unknown to the public until a 2019 Reuters investigation, despite his leadership of one of the world’s largest criminal organizations. He is now being held in the Netherlands and Australia has requested he be extradited.
According to an op-ed written by Jeremy Douglas of the UNODC for CNN, Tse’s eventual trial may reveal evidence that is “problematic for governments in Southeast Asia” as it shows the full extent of Sam Gor’s trafficking.
The Golden Triangle’s economy evolves
In today’s Golden Triangle drug trade, the majority of drugs are produced in Myanmar and trafficked through Laos, Thailand or China’s Yunnan province. The economy of Myanmar’s north and northeast has been shaped by the drug trade for decades.
In the 1950s, opium farming spread as authorities in Bangkok and Saigon, as well as the US Central Intelligence Agency, turned a blind eye. Farmers built their livelihoods on this economy, while ethnic armed groups and other political actors became dependent on the opium and heroin trade for financing. With the shift to methamphetamines, the borderland economy is in flux yet again.
While still present, opium farming in Myanmar continues to drop, according to an annual survey by the UN Office on Drugs and Crime, published February 11. In 2020, farmers in Myanmar produced around 405 tons of opium, around half the yield recorded in 2013 and down 11-12% from 2019. The majority of this, at 84%, was produced in Shan State.
Despite the decline, the opium and heroin trade remains a significant industry in Myanmar, with 3 million users in East and Southeast Asia and Australia buying around US$10 billion of opium per year.