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TO RUEHC/SECSTATE WASHDC IMMEDIATE 9071
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHBK/AMEMBASSY BANGKOK 2931
RUEHBJ/AMEMBASSY BEIJING 2293
RUEHBY/AMEMBASSY CANBERRA 2024
RUEHKA/AMEMBASSY DHAKA 5215
RUEHLO/AMEMBASSY LONDON 2138
RUEHNE/AMEMBASSY NEW DELHI 5499
RUEHUL/AMEMBASSY SEOUL 9095
RUEHTC/AMEMBASSY THE HAGUE 0769
RUEHKO/AMEMBASSY TOKYO 6672
RUEHCN/AMCONSUL CHENGDU 1805
RUEHCHI/AMCONSUL CHIANG MAI 2183
RUEHCI/AMCONSUL KOLKATA 0653
RHHMUNA/CDR USPACOM HONOLULU HI
RUEKJCS/JOINT STAFF WASHDC
RUCNDT/USMISSION USUN NEW YORK 2475
RUEHGV/USMISSION GENEVA 4482
RUEATRS/DEPT OF TREASURY WASHDC
RUEKJCS/DIA WASHDC
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHDC
RUEKJCS/SECDEF WASHDC

UNCLAS SECTION 01 OF 07 RANGOON 000337 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/MLS, INR/EAP, INL/PC 
PACOM FOR FPA 
 
E.O. 12958: N/A 
TAGS: SNAR PINR PREL BM
SUBJECT: BURMA: REPORT CARD FOR 2010 NARCOTICS MAJORS LIST 
 
REF: A. STATE 28306 
     ¶B. 08 RANGOON 861 
     ¶C. 08 RANGOON 890 
 
RANGOON 00000337  001.6 OF 007 
 
 
¶1.  (U) This message responds to Ref A request for a report 
on the Government of Burma's cooperation on narcotics control 
objectives in the context of the 2010 Narcotics Majors List. 
 
¶2.  (SBU) Begin Text of 2008 Certification Report Card: 
 
¶A. The USG asked the Government of Burma to take verifiable 
actions against high-level drug traffickers and their 
organizations, such as investigating, arresting, and 
convicting leading drug producers and traffickers. 
 
Embassy Rangoon Assessment: Limited cooperation. 
 
For internal political reasons, the GOB has to date taken no 
direct action against the eight leaders of the United Wa 
State Army (UWSA) indicted in January 2005 in a U.S. federal 
court, although authorities have taken action against other, 
lower-ranking members of the UWSA syndicate.  Two members of 
UWSA Chairman Bao Yu Xiang's family were sentenced to death 
and remain in detention after their arrest and conviction 
October 1, 2005 in connection with the September 2005 GOB 
seizure of a UWSA-related shipment of approximately 496 kgs 
of heroin bound for China via Thailand. 
 
The GOB continued to cooperate with DEA and the Australian 
Federal Police (AFP) to monitor and disrupt the flow of 
illegal narcotics by the UWSA and associated international 
trafficking syndicates that have ties throughout Asia, the 
Pacific region, and North America. 
 
During 2009, the following significant enforcement activity 
was noted: 
 
-- Summary statistics provided by Burmese officials indicate 
that from January 2009 to April 2009, Burmese counter 
narcotics officials have seized 417.543 kilograms (kgs) of 
opium, 433 kgs of low quality opium, 184.4341 kgs of heroin, 
4,529,276 tablets of methamphetamine, 326.4089 kgs of 
methamphetamine powder, 114 kgs of methamphetamine ICE, 534 
liters of precursor chemicals, 352 kgs of precursor chemical 
powders, 132 kgs of Ephedrine, 61.88 kgs of Psuedo-ephedrine, 
and 93.5 kgs of Morphine. 
 
-- On January 22, 2009, the Central Committee for Drug Abuse 
Control (CCDAC) seized 160 Units of Heroin (1 unit equals 700 
grams) at a residence in Rangoon, Burma.  This was the 
largest seizure of heroin ever to occur in Rangoon, Burma. 
On January 25, 2009, CCDAC, while following leads related to 
the January 22, 2009 seizure of 160 Units of heroin, seized 
an additional 37 Units of heroin concealed in a shipment of 
containerized wood products.  The container was already 
embarked on a merchant vessel bound for Singapore.  This 
represented the first seizure of narcotics at the Port of 
Rangoon.  In addition, this investigation was an example of 
outstanding international cooperation among counter narcotics 
officials from Burma, China, Thailand, Taiwan, and the United 
States.  This investigation resulted in numerous arrests, 
including a regional Thai fugitive hiding in Nam Tit, Special 
Region Number Two (UWSA).  This investigation is ongoing and 
has been sourced by CCDAC counterparts to high-level 
officials within the UWSA.  DEA Rangoon is cooperating with 
 
RANGOON 00000337  002.6 OF 007 
 
 
CCDAC on this investigation. 
 
-- On April 23, 2009, CCDAC seized 114 kilograms of 
methamphetamine ICE at a vehicle checkpoint near Keng Tung, 
Burma.  The ICE shipment had been manufactured and originated 
in Special Region Number One, which is controlled by the 
Myanmar National Defense Alliance Army (MNDAA) and led former 
Burmese Communist Party (BCP) leader Peng Chia-sheng.  The 
capital of Special Region Number One (MNDAA) is located in 
Laukhai.  This shipment transited Special Region Number Two 
(controlled by the United Wa State Army, UWSA) and Special 
Region Number Four (controlled by the Eastern Shan State Army 
or ESSA, led by led by former BCP leader Sai Lin a.k.a. Lin 
Ming-hsien.  Sai Lin is the son-in-law of Peng Chia-sheng) 
prior to its seizure.  The ESSA is the Eastern Shan State 
Army According to CCDAC the shipment was supposed to cross 
into Thailand from the UWSA Southern Military Region (SMR). 
This investigation is ongoing.  DEA Rangoon is cooperating 
with CCDAC on this investigation. 
 
¶B. The USG asked the GOB to continue good efforts on opium 
poppy eradication and to provide location data to the U.S. 
for verification purposes; increase seizures of opium, 
heroin, and methamphetamine and destroy production 
facilities; and adopt meaningful procedures to control the 
diversion of precursor chemicals. 
 
Embassy Rangoon Assessment: Limited cooperation. 
 
It has been five years since the last U.S.-Burma joint opium 
yield survey.  During 2008, CCDAC expressed an interest in 
reviving the survey but did not make this interest known in 
time for the two sides to organize a survey.  DEA continues 
to urge the GOB to revive the U.S.-Burma Opium Yield Survey. 
UNODC continues to conduct its own annual survey. 
 
According to the UNODC opium yield survey, in 2008 the total 
land area under poppy cultivation in Burma was 28,500 
hectares, a 2.9 percent increase from the previous year. 
UNODC estimated that the potential production of opium 
decreased by 11 percent, from 460 metric tons in 2007 to 410 
metric tons in 2008.  Average opium yields in 2008 were 14.4 
kilograms per hectare.  The largest areas under cultivation 
were located in Southern Shan State, where 53 percent of 
cultivation in Burma occurred.  UNODC determined that 33 
percent of cultivation in Burma occurred in Eastern Shan 
State.  In Northern Shan State, poppy cultivation comprised 
three percent of the total cultivation in Burma.  In Kayah 
State, which was first surveyed in 2006, UNODC noted that 
poppy cultivation is increasing.  The same trend was observed 
in Kachin State.  According to UNODC, Kachin State accounted 
for 5 percent of the total poppy cultivation in Burma.  A 
UNODC survey of Special Region Number 2 (UWSA) revealed no 
appreciable poppy cultivation.  The same was true for Special 
Region Number One (MNDAA) and Special Region Number Four 
(ESSA). 
 
The decrease in potential opium production in the 2008 UNODC 
estimate reflects a decrease in overall yield despite an 
increase in hectares under cultivation.  Nevertheless, Burma 
maintained favorable growing conditions in the major opium 
poppy growing areas. 
 
GOB seizures of illicit drugs increased considerably during 
the past three years due to closer cooperation with 
 
RANGOON 00000337  003.8 OF 007 
 
 
neighboring countries and stepped-up law enforcement 
investigations.  During 2008, the GOB seized approximately 
1.2 million methamphetamine tablets, compared with 1.6 
million methamphetamine tablets seized in 2007.  In 2008, the 
GOB seized approximately 3.8 metric tons of methamphetamine 
powder, 1464 kgs of opium, 2452 kgs of low quality opium, 
approximately 88 kgs of heroin, and 724 kgs of ephedrine. 
 
Burma does not have a domestic chemical industry, but its 
porous borders and endemic corruption facilitate the 
diversion and trafficking of precursor chemicals, primarily 
from China and India, to drug labs in country.  The GOB 
recognizes the threat, but has been unable to establish 
effective countermeasures to date.  The GOB's Precursor 
Chemical Control Board has identified 25 chemical substances 
(including caffeine and thionyl chloride) and prohibited 
their import, sale, and use. 
 
During 2008, the GOB seized approximately 1922 kgs of 
precursor chemical powder, 9335.45 liters of precursor 
chemicals, and approximately 1378 kgs of caffeine. 
 
¶C. The USG urged the GOB to establish a mechanism for the 
reliable measurement of methamphetamine production and 
demonstrate progress in reducing production (e.g., 
destruction of labs) and increasing seizures, particularly 
focusing on increased illicit drug seizures from gangs on the 
border with China, India, and Thailand. 
 
Embassy Rangoon Assessment: Limited cooperation. 
 
While poppy cultivation remains well below historic levels, 
there has been a sharp increase in the production and export 
of synthetic drugs. 
 
Burma remains a primary source of amphetamine-type substances 
(ATS) produced in Asia.  While the GOB has significantly 
increased the quantity of methamphetamines seized, 
trafficking efforts disrupted, and narcotics labs destroyed 
in 2008, international drug enforcement agencies see 
indications that ATS production levels continue to rise. 
 
Traffickers continue to use clandestine labs inside Burma to 
make ATS, using chemical precursors smuggled from India and 
China, and to smuggle narcotics across the Thai and Chinese 
borders for distribution within Thailand and China and for 
transshipment, primarily to other Asian countries and 
Australia. 
 
There is no mechanism regionally or within Burma to measure 
ATS production. 
 
¶D. The USG asked the GOB to continue cooperation with China 
and Thailand and expand cooperation to other neighboring 
countries, such as India, Laos, and Vietnam, to control the 
production and trafficking of illicit narcotics and the 
diversion of precursor chemicals. 
 
Embassy Rangoon Assessment:  Adequate cooperation. 
 
The GOB maintains a regular dialogue on precursor chemicals 
with India, China, Thailand, and Laos.  As a result, India 
and China have taken steps, including the creation of 
exclusion zones, to divert precursors away from Burma's 
border areas.  The GOB has also cooperated with these 
 
RANGOON 00000337  004.6 OF 007 
 
 
countries on a variety of counter-drug law enforcement issues. 
 
GOB cooperation with China and Thailand has been the most 
productive, yielding arrests, seizures, and extraditions. 
The law enforcement relationship with India has been less 
productive.  Nonetheless, GOB counter-drug officials meet on 
a monthly basis with Indian counterparts at the field level 
at various border towns. 
 
Burma and Thailand jointly operate border liaison offices. 
In 2008, Thailand maintained a drug enforcement liaison 
officer on its embassy staff in Rangoon.  Burma and Laos, 
with the assistance of the UNODC, conduct joint anti-drug 
patrols on the Mekong River. 
 
Burma became a member of the Asia/Pacific Group on Money 
Laundering in January 2006, and is a party to the 1988 UN 
Drug Convention.  Over the past several years, the Government 
of Burma has expanded its counter-narcotics cooperation with 
other states.  The GOB has bilateral drug control agreements 
with India, Bangladesh, Vietnam, Russia, Laos, the 
Philippines, China, Indonesia, and Thailand.  These 
agreements include cooperation on drug-related money 
laundering issues. 
 
¶E.  The USG requested that the GOB enforce existing 
money-laundering laws, including asset forfeiture provisions, 
and fully implement and enforce Burma's money-laundering 
legislation passed in June 2002. 
 
Assessment:  Adequate cooperation. 
 
In October 2006, the Financial Action Task Force (FATF) 
removed Burma from the FATF list of Non-Cooperative Countries 
and Territories (NCCT), but advised the Burmese Government to 
enhance regulation of the financial sector.  The Government 
of Burma continues to submit progress reports to FATF on its 
anti-money laundering program.  In October 2007, due to 
progress on anti-money laundering measures, FATF ended formal 
monitoring of Burma.  FATF continues to monitor Burma on an 
informal basis. 
 
The U.S. maintains the separate countermeasures issued by the 
Financial Crimes Enforcement Network of the Treasury 
Department, adopted in 2004 under Section 311 of the 2001 USA 
Patriot Act, which found the jurisdiction of Burma and two 
private Burmese banks, Myanmar Mayflower Bank and Asia Wealth 
Bank, to be "of primary money laundering concern," and which 
requires U.S. banks to take special measures with respect to 
all Burmese banks, with particular attention to Myanmar 
Mayflower and Asia Wealth Bank. 
 
Burma is a party to the UN Convention against Transnational 
Organized Crime and ratified the UN Convention on Corruption 
in December 2005 and the UN International Convention for the 
Suppression of the Financing of Terrorism in September 2006. 
The GOB now has in place a framework to allow mutual legal 
assistance and cooperation with overseas jurisdictions in the 
investigation and prosecution of serious crimes. 
 
In 2005, the GOB instituted an on-site examination program 
for financial institutions and closed three major banking 
institutions (Asia Wealth Bank, Myanmar Mayflower Bank, and 
the Myanmar Universal Bank) for violations of banking 
regulations.  The banks were allegedly involved in laundering 
 
RANGOON 00000337  005.4 OF 007 
 
 
money linked to the illicit narcotic trade.  In August 2005, 
the GOB, with the assistance of DEA, seized assets of the 
Myanmar Universal Bank and arrested its Chairman, Tin Sein, 
and sentenced him to death for laundering UWSA drug proceeds. 
 The total value of seized bank accounts, property, and 
personal assets exceeded USD 25 million. 
 
As a result of the promulgation in 2004 of the Mutual 
Assistance in Criminal Matters Law (MACML) and subsequent 
measures to address money laundering and terrorism financing, 
Burma gained membership in the Asia Pacific Group on Money 
Laundering in March 2006.  In July 2005, Burma and Thailand 
signed an MOU on the exchange of information relating to 
money-laundering. 
 
With the exception of the Myanmar Universal Bank case, the 
GOB has not made public the results of its investigations 
into private banks, nor made explicit connections between the 
banks and money laundering.  In 2006-2007, the Burmese 
Government amended its "Control of Money Laundering Law" to 
expand the list of predicate offenses.  As of August 2008, a 
total of 1,495 Suspicious Transaction Reports (STR) had been 
received.  In 2007, nine cases were identified as potential 
money laundering investigations.  As of August 2008, the 
Financial Investigation Unit (FIU) received 444 STRs, of 
which seven cases were identified as potential money 
laundering investigations.  The FIU has investigated four 
cases to date, two of which were sent to the courts for 
prosecution.  Since 2006, the FIU has investigated 20 money 
laundering cases and submitted eight cases for prosecution. 
Fifty-four people have been convicted under the "Control of 
Money Laundering Law." 
 
Since August 2005, there have been no significant 
prosecutions of banking or government officials in cases 
related to laundering of drug money, and administrative and 
judicial authorities lack resources to investigate and 
enforce the anti-money laundering regulations at all levels. 
The government continues to award contracts for construction 
and other major infrastructure projects to corporations 
established by or linked to suspected major drug traffickers. 
 
¶F. The USG urged the GOB to prosecute drug-related 
corruption, especially corrupt government and military 
officials who facilitate drug trafficking and money 
laundering. 
 
Embassy Rangoon Assessment:  Inadequate cooperation. 
 
Burma is ranked 178 out of 180 countries in the 2008 
Transparency International corruption index.  Some GOB 
officials, particularly those posted in border areas, are 
suspected of being involved in or facilitating the drug trade. 
 
According to the GOB, between 1995 and 2003, officials 
prosecuted and punished over 200 police officials and 48 
Burmese Army personnel for narcotics-related corruption or 
drug abuse.  There is no evidence that the GOB took any 
similar actions over the past five years.  The GOB has never 
prosecuted a Burmese Army officer over the rank of full 
colonel.  However, during 2008, Lt. General Ye Myint, Chief 
BSO 1, was forced to resign following the May 28, 2008 arrest 
of his son Aung Zaw Ye Myint for narcotics trafficking. 
 
¶G. The USG asked the GOB to expand demand-reduction, 
 
RANGOON 00000337  006.4 OF 007 
 
 
prevention, and drug treatment programs to reduce drug use 
and control the spread of HIV/AIDS. 
 
Embassy Rangoon Assessment:  Limited cooperation 
 
Although drug abuse levels remain low in Burma compared to 
neighboring countries, the addict population could be as high 
as 300,000 abusers based on estimates by UNODC, including a 
growing number of injecting drug users (IDU) and regular 
consumers of ATS.  The Government of Burma maintains that 
there are only 65,000 registered addicts.  The World Health 
Organization estimates there are between 60,000 and 90,000 
IDUs in Burma. 
 
The HIV epidemic in Burma, one of the most serious in Asia, 
continues to expand .  UNAIDS estimates that 34 percent of 
officially reported HIV cases are attributable to intravenous 
drug use, one of the highest rates in the world.  HIV 
prevalence among injecting drug users was 46.2 percent in 
¶2008. 
 
The GOB's prevention and drug treatment programs suffer from 
inadequate resources and a lack of high-level government 
support.  Demand reduction programs are in part coercive and 
in part voluntary.  There are six major drug treatment 
centers under the Ministry of Health, 49 other smaller detox 
centers, and eight rehabilitation centers which, together, 
have provided treatment to about 70,000 addicts over the past 
decade.  Burmese authorities have also collaborated with 
UNODC in expanding anti-drug campaigns as well as 
establishing treatment and rehabilitation programs.  The 
GOB's Myanmar Anti-Narcotic Association, for example, has 
supported UNODC drop-in centers in Northern Shan State and 
Kachin State, which treated more than 6,000 addicts in 
2007-2008.  The GOB also conducted several outreach projects 
through the public school system. 
 
In 2006, the Ministry of Health began to treat heroin addicts 
with Methadone Maintenance Therapy (MMT) in four drug 
treatment centers found in Rangoon, Mandalay, Lashio, and 
Myitkyina.  The Ministry of Health also began dispensing 
methadone treatment in three additional sites, two in Kachin 
State and one in Rangoon Division.  By August 2008, the 
Ministry of Health had treated more than 300 patients using 
MMT.  Several international NGOs have effective demand 
reduction programs, including CARE International, World 
Concern, and Population Services International (PSI). 
 
Although the GOB, working with partners, has maintained the 
above-mentioned programs, Burma has failed to expand 
demand-reduction, prevention, and drug treatment programs to 
reduce drug use and control the spread of HIV/AIDS.  The 
Global Fund, which had a budget of $98.5 million to fight 
HIV/AIDS, TB, and Malaria in Burma, withdrew in 2005.  In 
2006, foreign donors established the Three Diseases Fund 
(3DF) to provide humanitarian assistance for HIV/AIDS, 
Tuberculosis, and Malaria.  The 3DF, with its budget of $100 
million over five years, supports the work of local and 
international NGOs, the United Nations, and the Ministry of 
Health.  In 2007, the 3DF supported HIV/AIDS programs such as 
HIV surveillance and training on blood safety.  The 3DF also 
provided funds for anti-retroviral therapy and the MMT 
program. 
 
End Text of 2008 Certification Report Card. 
 
RANGOON 00000337  007.6 OF 007 
 
 
 
 
DINGER