Myanmar struggles to tackle illegal drug trade that has morphed from traditional to modern drugs

17 August 2019
Myanmar struggles to tackle illegal drug trade that has morphed from traditional to modern drugs

Myanmar is caught in a conundrum as the government attempts to clean up the country’s illegal drugs trade. The country stands alongside Afghanistan as one of the top illegal drug producers in the world. And the illegal drug cartels have kept up with the times as they shifted the emphasis away from opium and heroin to the modern-day methamphetamines including the strong drug Ice.

The fact that the Myanmar authorities are struggling to tackle this illegal trade comes down to the limited control Nay Pyi Taw has over the ethnic areas where the drugs are produced – primarily Shan and Kachin states – and the challenge of corruption and the state actors involved, as well as “men of influence” who benefit from the trade.

But if real change is to come then Myanmar’s neighbours, China and Thailand, armed ethnic groups, and the international community need to join hands with Nay Pyi Taw to clamp down on the drug epidemic.


The scale and depth of the problem can be seen in reports from the United Nations Office on Drugs and Crime (UNODC), the International Crisis Group (ICG), and the Economist Intelligence Unit (EIU).

According to a new report by ICG, entitled “Fire and Ice: Conflict and Drugs in Myanmar’s Shan State,” Myanmar’s neighbours should stop illicit flows of precursors, the chemicals used to manufacture drugs, into Shan State. As the main source of such chemicals, China has a particular responsibility to end this trade taking place illegally across its south-western border. 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.

As the EIU points out, Myanmar sits at the bottom of the Asian pile when it comes to the governments’ ability and willingness to tackle the illegal trade, lagging behind Laos and Cambodia. Only war-torn Afghanistan is a harder drugs theatre for the authorities to deal with.

Crucial to our understanding of Myanmar’s challenge is how it has changed over the years and how it differs from the “classic” drug problem found in Afghanistan.

In many ways, the Myanmar drug problem has grown more complicated. Unlike Afghanistan where the opium poppy, opium and heroin are the traditional drugs of choice and trade, Myanmar has seen a significant shift from opium to synthetic drugs. A recent UNODC opium survey shows a decrease in opium production. But there has been an upswing in synthetic drug production due to a growing international market for such pills as Yaba and Ice.

What this essentially means is the lures that worked so well in countries such as Thailand to deal with cracking down on the drugs trade “at source” are far less likely to work. Over the last five decades Bangkok’s anti-drug policies evolved in part due to the late Thai King Bhumibol Adulyadej’s crop substitution schemes focused on hill tribe farmers that saw coffee and fruit trees replace opium poppy growing at the grassroots.

The farmers were encouraged and incentivized to swap to equally lucrative crops because they gained limited financial income from a skewed drug production chain that saw the traffickers and drug lords make the most money, the growers the dregs. As a result, Thailand has all but eradicated opium poppy growing through a “carrot and stick” approach. While no scheme will be perfect, the Thai king’s hill tribe programmes, ran parallel to tough drug interdiction efforts, and counter communist insurgency measures, saw Thailand-based drug production largely dry up.

Today, the core problem for Bangkok is the deluge of methamphetamines coming over the border from Myanmar and to a lesser extent Laos and how to deal with the middlemen – like former Khun Sa aide Laota Saenlee, now 79, who together with his wife was jailed by a Thai court for life in December 2017 for trafficking methamphetamines.

For Myanmar, a core challenge is the current focus of anti-drugs efforts being on the drug runners and mules rather than getting to grips with the “people at the top” and the endemic corruption that allows the trade to thrive.

According to the ICG, the military should root out corruption, including among top brass, and disarm complicit paramilitaries, a suggestion easier said than done.


The illicit drugs trade thrives in areas of instability and is deeply embedded in the hills of Myanmar, aided and abetted by people in positions of power.

When taking a bird’s eye view of Myanmar, Shan State is clearly the hub of the country’s illegal drugs trade. But other states, including Kachin, Rakhine and Chin, are also severely affected.

Shan State has long been a centre of conflict and illicit drug production – initially heroin, then methamphetamine tablets and most people tuned to Myanmar have heard of the late drug king Khun Sa who thrived in the 1980s and 1990s. Things have moved on since his day. Good infrastructure, proximity to precursor supplies from China and safe havens provided by pro-government militias and in rebel-held enclaves have all helped to make the state a major global source of high purity crystal meth.

According to the recently-released ICG report, the state is caught up in a vicious vortex - drug production and profits 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.

A crucial challenge in tackling the drug trade is the need to provide a path to alternative livelihoods for local people in Myanmar.  The opium farmers are also facing tough times because of new market trends in China and they are in need of alternative crops or industry.

While market dynamics make clear that heroin is no longer China’s drug of choice and that Myanmar’s opium farmers are suffering as a result, it should be easier to find ways to provide them with an alternative source of viable income, possibly following the substitution template used by Thailand over the last half century.

That the area in Myanmar currently under the poppy cultivation, the plant that yield opium, is getting smaller is as far as many drug experts are willing to agree with the UNODC’s most recent opium survey.

The main threat posed today cannot be excised by simply cutting down opium poppy plants.


The focus today is on methamphetamines and their variations, including powerful and highly addictive Ice, that make up a lucrative industry in Shan State.

Gram-for-gram, crystal meth is worth more than heroin, and the total value of the Mekong drug trade is estimated at over $40 billion per year and rising, according to ICG.

Precursor chemicals, required in massive quantities given the scale of production, are being brought in from China. That there have been almost no precursor seizures at the border indicates that the traffickers can move freely across the national boundaries.

This is not to suggest there have been no efforts to tackle the drug trade on the Myanmar side. There have been a number of high profile seizures.

In January 2018, the Myanmar army and police raided an abandoned house in Kutkai township in northern Shan State, seizing 30 million yaba pills, 1,750kg of crystal meth, more than 500kg of heroin and 200kg of caffeine powder. According to the authorities, it was the country’s largest-ever drug bust, with a domestic value of some $54 million. The following month, a joint army and police team raided two major crystal meth labs in the same area, seizing some seven million dollars’ worth of advanced laboratory equipment, twelve state-of-the-art generators, huge quantities of precursor chemicals, and unused branded packaging sufficient for ten tonnes of product – suggesting that the labs were gearing up for a production run of that volume.

The Kutkai raids were revealing in a number of ways, according to ICG research.

First, the location was not a remote, rebel-controlled part of Shan State beyond the authorities’ reach. Rather, it was relatively close to Lashio, not far from the main road to the Chinese border at Muse – Myanmar’s biggest overland trade route – in an area controlled by a militia allied with the Tatmadaw. The Tatmadaw thus had access to the area, even if law enforcement personnel did not. International Crisis Group researchers could drive to the area and talk to local people there, passing through checkpoints manned by the militia and visiting the village where the abandoned house was located.

Second, authorities described both the house and the laboratories as “abandoned”. This suggests that those responsible were tipped off and fled in advance of the raids – which were triggered by Myanmar authorities being given precise coordinates of the locations and a description of the activities taking place there so that officials apparently felt that they had no alternative but to act. There were apparently no consequences for the militia that controls the area, which has maintained a ceasefire with the military for nearly 28 years and has a large compound in Lashio town centre that ICG researchers visited.

Seizures of crystal meth, as well as yaba, have increased significantly in recent years. Each massive haul tends to be presented as an interdiction victory. However, these record seizures represent the tip of an iceberg and are therefore evidence of the scale of the problem rather than of any genuine success in addressing it. Despite massive seizures, prices of crystal meth have remained stable, a clear indication that they are a small proportion of total volumes.

The UNODC’s opium survey has shown a decrease in poppy cultivation in Shan and Kachin states by almost 25 percent.  The majority of drug production is under the control of the United Wa State Army, which has close ties to China from which it not only receives precursors to make drugs, but the military equipment including helicopters and armoured vehicles. The UWSA has complete control of two special administration areas in Shan State, one bordering China and another bordering Thailand, which allows for the unabated flow of money, supplies, equipment and technical expertise that have allowed Myanmar to produce the type of drugs demanded abroad.


Myanmar exports have ratcheted up. Myanmar Ice has turned up on the streets of New York, London and Sydney, with the global reach of this illegal trade growing more apparent. Authorities have regularly captured huge quantities of crystal meth with its origin in Shan State. These included 1.2 tonnes seized in Western Australia in December 2017 and 0.9 tonnes in April that year in Melbourne; almost 5 tonnes in Thailand over the course of 2017 and 15 tonnes from January-July 2018; 1.6 tonnes in Indonesia in February 2018; and 1.2 tonnes in Malaysia in May 2018. What is clear is 2018 figures, still being tabulated, will exceed those for 2017, according to ICG.

Key export markets for Shan State crystal meth are Japan and Australia, which have among the highest street prices in the world for the drug; a tonne has a wholesale value in Australia of at least $180 million, and street prices several times higher. Crystal meth is also exported to China, the Philippines, Malaysia, Indonesia, South Korea and New Zealand, according to the ICG report.

The trade is becoming increasingly professionalized, dominated by transnational criminal syndicates operating at huge scale. Crystal meth is now packed in branded tea packets, both to facilitate concealment and to give it a specific product identity. Increasingly, local production in destination countries is being displaced by imports: China has been effective in cracking down on illicit meth laboratories on its territory, but in practice that has meant displacing them across the border into Shan State. Australian biker gangs have opened up chapters in South East Asia as they have shifted from cooking meth in Australia using smuggled precursors, to procuring the final product in the region and smuggling that instead, according to ICG.

In this sense, Myanmar is a producer and distributor and acts as a sieve – illegal drugs leaking over the borders and being transported far afield.

Seizures in Myanmar range from a small number of tablets for personal use to large wholesale shipments of tens of millions of pills. Crystal meth, on the other hand, is produced mostly for export – it is rarely used in Myanmar, though is starting to become more widely available. It is typically seized in one-tonne lots or larger.


Across the border in China the country’s wider development into a more modern nation, where “old” drugs like opium and heroin are no longer in vogue heralds a consumption shift, according to experts.

That also apparently includes rising demand for South-American-made cocaine. Last year, Chinese police seized more than 1.3 metric tons of cocaine in a raid in Shenzhen situated opposite to Hong Kong.

The China Daily newspaper reported on September 14, 2018 that cocaine was being smuggled from South America to major ports on China’s east coast before being moved to Guangdong, Hong Kong and Macau by sea.

Experts have voiced concern about how the Myanmar drug trade will play under China’s Belt and Road Initiative. This grand scheme set to link China with the rest of Asia, Europe and Africa, currently lacks legal agreements and police cooperation and the establishing of rules for good border controls. In simple terms, increased trade will also allow increased movement of drugs along the arteries of this mammoth road and rail scheme.

Underlying these changes there are questions over whether Beijing is doing enough to clamp down on the illegal drug trade. It’s a mixed picture. On the one hand, there have been high profile arrests of drug traffickers and officials caught up in drug-fueled corruption, providing a veneer that the Xi Jinping regime is tough on crime. But on the other hand, there is little to indicate that Beijing is serious in seeking to staunch the flow of precursors to Myanmar or put anti-drug trade conditions on its support for militias in Shan State. There have been few interdictions.

Most of the necessary precursor chemical flow comes from China, but an absence of serious anti-drug checks on the China-Myanmar border might suggest Beijing is turning a blind eye to the need for a comprehensive approach to the Golden Triangle drug scourge.


Over the border, Myanmar’s failure to seriously tackle the illegal meths trade is also helping to poison its own people. It is important to point out that areas controlled by Ethnic Armed Groups particularly UWSA and KIA and the areas where the drugs are produced have seen increased drugs addiction and treatment of local people, particularly youth.

Myanmar ability to stem the flow of drugs has been limited as the majority of laws has focused on low level arrests – not the king pins. Myanmar prisons are full of drug related offenders but this has done little to stem the wave of drugs consuming the country and the region.

The local addiction crisis is proving a tough nut to crack. Mobs of stick-wielding church-goers in Shan State used to descend on dealers and addicts in a desperate effort to save their communities from the meth-induced health crisis sweeping the country. But anonymous death threats brought the vigilante operations to a halt.

“It simply became too dangerous for us,” says Zau Man, leader of the local Baptist church in Kutkai, speaking recently to AFP in a town in Shan State scarred by addiction.

Heroin and meth use here are rampant. Zau Man says nearly every household has at least one drug user, dealers work out in the open and often violent meth addicts have turned parts of Kutkai into no-go zones.

“In some areas, you can only get food until 10pm, but you can get drugs 24/7,” he says.

Myanmar is facing a “public health disaster” because of meth and few villages in the country are left unscathed, says Jeremy Douglas, regional representative of the UN Office on Drugs and Crime.

Yaba is distributed to Myanmar’s neighbours, particularly Thailand and Bangladesh. But the pink pills are increasingly being dumped at rock-bottom prices on a domestic market in what Douglas called a “smart and ruthless” strategy to build demand.

“It’s a nasty business and they’re really pushing it out into the population,” he says.

Users and health workers in three different towns in Shan state – Lashio, Kutkai and Muse – told AFP that pills go for just 500 kyat for three, or around 10 cents each. As the price falls, so does the user age, with reports of children as young as nine taking yaba.

Many miners, long-distance drivers and shift workers mix narcotics – smoking meth to keep them awake, and injecting heroin to bring them down.

Many addicts are caught up in a cycle of poverty and violence in the badlands of Myanmar.

For some, there are rudimentary treatment options, such as methadone provided by some local hospitals to wean people off heroin. Yet the problem is not just limited to the poor.

Among Myanmar’s urban elite, addiction to high-grade crystal meth is already taking root.

Usually in powder or crystal form, Ice is commonly snorted or smoked. It can also be injected, which increases the threat of disease transmission through needle-sharing.

A UNODC-backed policy launched in February 2018 champions depenalising users and treating drugs as a health issue while tackling the trade’s kingpins. But the law has yet to catch up – anyone caught with even one yaba pill still faces a minimum of five years behind bars.

What appears to be happening is the kingpins run free while the addicts fall foul of the law. It is estimated that around half of Myanmar’s prison inmates are jailed for minor drug offences and arrests of drug users are rising.

A lack of funding for prevention work and treatment means Myanmar’s meth problem may only get worse.


At its heart, Myanmar’s serious drug problem is intertwined with conflict. According to the UNODC and ICG, they have evolved alongside political alliances between the central government and ethnic armed groups, and with market shifts in drug production. Key to changing patterns in drug production over the last several years, however, has been the end of a period of relative stability that northern Shan State experienced between the early 1990s and 2011 and the tactics the Tatmadaw have used to quell violence.

Attitudes amongst EAO toward illegal drugs are not uniform. The conflict in northern Shan includes armed groups with very different historical involvement with, and stated policies on, illegal drugs. Even within the northern alliance, there are groups such as the MNDAA that were notorious for their involvement in drug production and trafficking prior to their defeat and expulsion from the Kokang region in 2009; the Arakan Army, which is alleged to fund its operations in part through yaba trafficking; and the TNLA, which has an avowedly anti-drug policy, according to ICG.

There are clearly direct links between conflict and drugs, specifically around occasional eradication efforts and clashes between actors in the drug trade. The illicit economy allows these armed groups to generate revenue from taxation or extortion, helping to fund and sustain Myanmar’s seventy-year-old civil war, according to the UNODC.

Drugs are big business and so the immensely profitable trade attracts transnational criminal organisations and promotes corruption that deepens the grievances of ethnic minority communities that underpin the civil war. That civil war, in turn, provides a justification for the Tatmadaw’s militia strategy, creating the conditions for a corrosive political economy dominated by armed actors operating with impunity, according to the ICG.


What’s the way out? According to the ICG, the Myanmar government should redouble its drug control and anti-corruption efforts, focusing on major players in the drug trade. Education and harm reduction should replace criminal penalties for low-level offenders. The military should reform – and ultimately disband – militias and other pro-government paramilitary forces and pursue a comprehensive peace settlement for the state.

Again, the challenge of bringing peace to the ethnic states under the current Myanmar government’s peace initiative provides a flicker of light at the end of the tunnel.

Is Myanmar providing enough of a budget allocation to its police force for better equipment to handle the drugs? There is a need for sophisticated equipment for drug detection. And how can border controls be improved to deal with the inflow of precursors from China and Thailand and the outflow of drugs?

Clearly, the jailing of local drug users does not help tackle the drug kingpins who get off scot free.

But few are holding their breath over gaining a lasting peace deal any time soon. And, likewise, it is hard to see the authorities making significant inroads into the massively lucrative drugs trade in the near future. 

Additional reporting by AFP