Opium (41 page)

This control was consolidated further because of the Burmese political scene. As a federation of states, tribes and races with no common language, religion or political centre, Burma was (and still is) hard to govern. The Shan states especially have always been difficult to govern from outside. Even the experienced British colonial authorities were essentially impotent, the tribes owing allegiance to feudal
sawbwas,
tribal chiefs who controlled every aspect of local life but especially commerce. Faced with such localised power bases, the British gave the
sawbwas
responsibility for internal Shan state affairs: by so doing, they set the seal on the future of the opium trade. It was placed beyond external law and became a major source of revenue for the
sawbwas
who levied their own tax upon it. In 1948, when Burma gained independence, these local rulers were cajoled into accepting a place in the new Union of Burma by being promised autonomy by secession in ten years. This assurance was reneged upon in 1958 when the prime minister, U-Nu, repealed the promise, thereby setting the scene for the growth of nationalist movements.

The diversity of Burmese society has also had the country in turmoil for decades. The minority Kachins, Shans, Karens, Lahu, Wa, Mons and others have long been waging a guerrilla war against the central government. Furthermore the Burmans, who barely make up 50 per cent of the population, only hold 40 per cent of the area of the country, none of it opium growing land. Even if they wished to control opium, they could not: and the income from it furthers the separatist ambitions of the minorities.

Most opium in Burma is grown along the Chinese border in Shan- and Kachin-controlled regions, with hardly a vehicular road cutting through impenetrable, mountainous jungle. The population has no other source of income other than opium which, since 1959, the various Shan separatists parties have used to obtain arms to fight the Burmese government and sometimes each other. The leading groups, amongst many others, have included the Kachin Independent Army (KIA), the Kachin Liberation Army (KLA), the Lahu National Liberation Army (LNLA), the Mon National State Army (MNSA), the United Wa State Army (UWSA), the Karen National Union (KNU), the Shan State Army (SSA), the Shan National Army (SNA), the Shan National United Front (SNUF) and the Shan United Army (SUA). To say the situation has been chaotic and anarchic is a gross understatement. The rebels have fought each other, forged treaties, broken them and reforged others on a frequent basis whilst still attacking the Burmese forces.

In many respects, opium has been the underlying cause of Burmese upheaval but the official government too has never lost sight of its economic value. When, in 1964, it sought to become a world exporter in pharmaceutical provision, a UN mission concluded it could not endorse the proposal to allow controlled opium production. It was clear the Burmese were not in command of the country.

By the end of the 1960s, the mission's conclusion was further proven. The opium highlands were occupied by over 100 separate, capricious, armed groups. The fabric of society had collapsed with only the opium trade flourishing. To try and gain some control over – others would suggest gain a foothold in – the opium trade, the government had set up local militia groups, the Ka Kwei Yei (KKY), in 1963, to organise some aspects of the trade whilst at the same time fighting the rebels and undermining their financial base. All that happened was the situation was further confused. KKY troops saw the financial advantages of opium and several warlords were created from their ranks. In effect, all the government could do was allow the trade to continue because, even if they could not control or tax it, it was at least a huge national foreign currency earner.

Originating as an internal matter, by the 1970s outside interests in the form of the KMT, the CIA and the government of Thailand were all concerned with the instability in the Shan states. The KMT were satisfied to be sending their opium collectors throughout the Shan states, unhindered by the Burmese, who were kept busy with the separatists, and the CIA was similarly content. The confusion provided cover for American intelligence gathering along and over the Chinese border. As Thailand was Burma's traditional enemy, the Thais provided arms for the rebel bands, ensuring a buffer zone between the countries.

Prior to the KMT's move into Burma, some opium had been sent out through Thailand but the trade was insignificant. However, as the power of the KMT increased so too did the trade, with opium being transported by mule or light aircraft to Chiang Mai then freighted on to Bangkok with the connivance of Thai police, on occasion on CAT or Air America flights.

Like Burma, Thailand regarded opium as a major, if illicit, export commodity. It had been an important part of the economy for over a century. As Siam, the country legalised opium in 1851, the Chinese population of Bangkok being keen customers: the King of Siam and later rulers became immensely rich on the revenues. When Thailand was occupied by the Japanese in the Second World War, the national army hid out in the Shan states where it was quick to establish contact with the local warlords and the KMT Nationalist Chinese army in Yunnan. When the war ended, the Thai government had in place not only a protective shield against Burma but all the contacts it needed in the opium trade which became a major source of military funding. For four decades, the Thai authorities assisted the opium traders of the Golden Triangle, took an informal tax on opium crossing into Thailand and used the proceeds to finance political aims and many a private income: it must be remembered corruption was, and to some extent still is, endemic throughout Indo-China.

From the 1940s, the Thais increased their own poppy production and, with KMT-owned Burmese opium entering the country as well, it was not long before the capital, Bangkok, became an important opium distribution centre.

The military rulers of Thailand, who came to power in a coup in 1947, survived on opium. It financed their take-over and bankrolled their armed forces, successive military administrations increasing their hold on the Thai economy including the trade in, and smuggling of, opium. General Phao, head of the CIA-equipped and -trained national police force, took personal control of the opium trade and, in exchange for CIA support, furthered KMT political aims, protecting their supply lines and opium business interests and establishing what is considered the Burma to Bangkok opium corridor. He consequently became one of the most powerful men in the country. By 1955, Phao's police force was the largest, best organised trafficking syndicate in Thailand, pivotal to every aspect of the business. By now, Bangkok was the main centre for international opium trafficking in South-east Asia, with Thailand the world's primary distribution hub. Phao's power was not to last. Press exposure of police corruption in 1955 undermined his position and, after a coup two years later, he fled the country, a very rich man indeed.

At first, the new Thai government seemed no better: it entered into the opium trade to swell the exchequer. Then, in 1959, opium use was forbidden with opium production and sale outlawed. This was all very well but, like the Burmese, the Thais had little control over the remote Golden Triangle and poppy farming continued.

The ban caused a new development. Heroin began to appear. The Thai addict population rose from 71,000 opium smokers in 1959 to around 400,000 heroin addicts in 1976. Due to indigenous corruption, little effort was made to halt the trade or the transport of opiates through Thailand by the syndicates of Chinese who had come to operate it. Military commanders and government officials continued to cream off their cut and accepted protection money from the Chinese traffickers based in Bangkok. Despite the law, it was business as usual.

The situation altered in 1961. Fed up with the KMT in the Shan states, the Burmese joined with the Communist Chinese People's Liberation Army (PLA) and drove the KMT into Laos and Thailand where the Thais, having successfully concealed their opium entanglements, classified the soldiers as civilian refugees. At the same time, the Taiwanese Nationalist Chinese government reduced the financial support it had given the KMT since 1949 which forced it to become even more reliant upon the opium business to survive.

From northern Thailand, the KMT carried on sending buying missions into the Shan states, where their middlemen – Yunnanese traders – bought opium in exchange for everyday consumer goods. The opium was collected at a number of central rendezvous points then transported by armed mule trains into Thailand. The KMT trade increased and their hold grew not only on opium production in Burma but in northern Thailand where they took over from local officials who had left the opium trade after the 1959 ban.

The mule trains were enormous with over 100 mules – on occasion as many as
600
– carrying up to 20 tons of raw opium protected by 300 heavily armed troops trained in jungle warfare. So efficient were the troops that Shan state rebel and private merchants' mules sometimes travelled with them, paying for the service. Those who did not seek protection were charged a KMT levied import duty to enter Thailand.

Despite such power, the KMT did not have it all their own way. There was a potential usurper in their midst. His name was Chan Chi-fu, sometimes given as Chan Shee Fu. He is best known today as Khun Sa:
khun
is a Shan word meaning ‘lord' whilst
Sa
is the name of his stepfather, a Shan prince. In the usual way of Oriental names, it has an alternative interpretation for
Sa
may also mean wealthy: therefore Khun Sa can also mean Lord of Prosperity.

At that time, Khun Sa was the only well organised, highly proficient warlord smuggler in the Shan states. Half Chinese and half Shan, he is descended from a Chinese Yunnanese merchant family although he has claimed descent from a noble Shan family. He was born in the Shan states in 1933 and joined the KMT at the age of eighteen when he was military trained and tutored in the finer points of the opium trade. At the age of thirty, he began trading in opium on his own, supported by his own unit of KKY members. Very carefully, he consolidated his power base, gained territory and earned the respect of local hill tribes. Aware of the difficulties of transporting bulky opium, he astutely set up a simple refinery turning out morphine bricks. Within three years, he commanded a private army of 2000 and was the most important opium warlord in the Shan states.

His rapid rise caused a KMT backlash. In 1967, there was fought a local opium war between Khun Sa's forces and the KMT in loose alliance with the Royal Laotian Army. A Khun Sa controlled caravan set off from the Shan states for Ban Houei Sai in northern Laos carrying 16 tons of raw opium. KMT soldiers went to head off the caravan, concerned that Khun Sa was challenging their long-standing domination of the opium trade with Burma. As the fighting warmed up, the Laotian General Ouane Rattikone arrived with a government force, attacked both the KMT and Khun Sa's men, defeated them both and seized the opium.

This was not, however, all it seemed for Ouane Rattikone had ordered the opium from Khun Sa in the first place: he was to become one of the most important heroin manufacturers in the Golden Triangle, operating laboratories around Ban Houei Sai to process Burmese opium.

Khun Sa was beaten, his force considerably reduced and his power removed. Two years later, he was captured by the Burmese Army whilst visiting Taunggyi, a town on the western extremity of the Shan states. He was held in solitary confinement for five years, but his supporters maintained command of several opium districts. It was not the end of his career.

Regardless of the 1967 war, the KMT further tightened its hold on opium. When Hmong tribesmen revolted between 1967 and 1971, the Thai government employed the KMT to eradicate guerrilla bases. Claiming the Hmong to be Communist, the Thais also enlisted the support of the CIA. By 1972, the KMT purchased opium from virtually the whole of the Shan states and dealt in 90 per cent of the region's produce. They also established heroin factories at several places in the Golden Triangle.

The only area in the region not to produce opium in any substantial quantity at the time was French Indo-China, now Vietnam, yet the colonial and post-colonial governments were still deeply involved in the trade. Like other colonial administrations, the French ran an opium monopoly which they organised very effectively and which engendered substantial revenue. In 1939, opium accounted for 15 per cent of taxes collected, catering to over 100,000 addicts, but the costs of addiction were high. The labouring classes, mostly Chinese and Vietnamese Chinese, upon whom the predominantly agriculturally based economy relied, spent much of their earnings on opium. Families starved to death, disease was widespread and the drug undermined workers' abilities. The French-trained native civil service élite were most of them addicts and corrupt. When anti-colonial, nationalist sentiments began to be voiced, the opium monopoly was cited as the worst aspect of French domination and one of the linch-pins of Ho Chi Minh's anti-colonial propaganda.

It was the French who enticed the Hmong hill tribes of northern Laos to change their cash crop to opium during the Second World War, obtaining their co-operation by promising political support. Production rose by 800 per cent from 7.5 tons in 1940 to 60.6 tons in 1944 and the Hmong tribes, arguing over opium rights and revenues, split into factions which caused a quarter of a century of civil war. In neighbouring Tonkin, the French politically sided with Tai feudal leaders who purchased Hmong opium but double-crossed them when it came time to pay, causing the Hmong to take sides with the Viet Minh against the French. The Viet Minh and, therefore, ultimately the Viet Cong, had their struggle partly aided by the opium trade they detested.

The French stopped the opium monopoly in 1946 but, upon losing the revenue from it, unofficially sanctioned French intelligence organisations to take over the trafficking of opiates to fund covert operations in the First Indo-China War of 1946–54.