|Kaung Kha People Militia Force.|
His phones contained pictures of the vehicles to be used to transport the meth, the spot where the meth was to be dropped off, and the fishing boat. The police reconstruction of Cai’s dealings in Myanmar led to another major revelation: The epicenter of meth production had shifted from China’s southern provinces to Shan State in Myanmar’s northeastern borderlands.
Operating in China had provided the Sam Gor syndicate with easy access to precursor ingredients, such as ephedrine and pseudoephedrine, that were smuggled out of pharmaceutical, chemical and paint factories in the Pearl River Delta Economic Zone. Shan gave Sam Gor the freedom to operate largely unimpeded by law enforcement.
Armed rebel groups in semi-autonomous regions like Shan State have long controlled large tracts of territory and used drug revenues to finance their frequent battles with the military. A series of detentes brokered by the Myanmar government with rebel groups over the years has brought relative calm to the region - and allowed illicit drug activities to flourish.
“Production facilities can be hidden from law enforcement and other prying eyes but insulated from disruptive violence,” analyst Richard Horsey wrote in a paper this year for the International Crisis Group. “Drug production and profits are now so vast that they dwarf the formal sector of Shan state.”
Along the road to the village of Loikan in Shan State, there is evidence of drug-fueled prosperity. The two-lane road skirts a deep ravine known as the “Valley of Death,” where ethnic Kachin rebels from the Kaung Kha paramilitary group clashed for decades with Myanmar’s army. Now, high-end SUVs thunder past trucks carrying building materials and workers.
The Kaung Kha militia’s immaculate and expansive new headquarters sits on a plateau nestled between the steep green hills of the jagged Loi Sam Sip range. About six kilometers away, near Loikan village, was a sprawling drug facility carved out of thick forest.
Police and locals say the complex churned out vast quantities of crystal meth, heroin, ketamine and yaba tablets - a cheaper form of meth that is mixed with caffeine. When it was raided in early 2018, security forces seized more than 200,000 liters of precursor chemicals, as well as 10,000 kg of caffeine and 73,550 kg of sodium hydroxide - all substances used in drug production.
|Drug bust at the Village of Loikan.|
The Loikan facility was “very likely” to have been the source of much of the Sam Gor syndicate’s meth, said the Yangon-based AFP officer. “Some militia were involved in the lab,” said Oi Khun, a communications officer for the 3,000-strong Kaung Kha militia, in an interview. He paused, then added: “But not with the knowledge of senior members” of the militia.
One person in Loikan described how workers from the lab would come down from the hills. The men, like most of the villagers, were ethnic Chinese. But they dressed better than the locals, had foreign accents, and had a foul smell about them. “I asked them once. ‘Why don’t you bathe?’” the person said. “They said they did, but there was nothing they could do about the smell.”
The rank chemicals used to cook the meth had seeped into the skin of the men, who seemed unperturbed that the signature stench might reveal their illicit activities. “We all knew,” the person said. “We just didn’t talk about it. That just brings you danger.”
Meth lab managers and chemists are mostly Taiwan nationals, say Thai police. So, too, are many of the crime network’s couriers and boat crews who transport the drugs across the Asia-Pacific. Shan’s super-labs in Burma produce the purest crystal meth in the world, the senior Chinese counter-narcotics official told Reuters. “They can take it slow and spread (the meth) out on the ground and let it dry.”
The UNODC estimates the Asia-Pacific retail market for meth is worth between $30.3 and $61.4 billion annually. The business model for meth is “very different” to heroin, said the UNODC’s Douglas. “Inputs are relatively cheap, a large workforce is not needed, the price per kilo is higher, and profits are therefore far, far higher."
The wholesale price of a kilo of crystal meth produced in northeastern Myanmar is as little as $1,800, according to a UNODC report citing the China National Narcotics Control Commission. Average retail prices for crystal meth, according to the UN agency, are equivalent to $70,500 per kilo in Thailand, $298,000 per kilo in Australia and $588,000 in Japan. For the Japanese market, that’s more than a three-hundred-fold mark-up.
The money the syndicate is making “means that if they lose ten tonnes and one goes through, they still make a big profit,” said the Chinese counter-narcotics official. “They can afford failure. It doesn’t matter.”
|Triads' Meth labs are now on the famous Loi-sam-sip Range.|