#Ep 5: The Consistent Compounders Show :Stay tuned to catch Saurabh Mukherjea in conversation with Sohini Andani, Fund Manager, SBI Mutual Fund.

To India’s east, the surreal rise of a narco-nightmare

The surreal history of East Asia’s narco-kingdoms, as dark as any opium nightmare, teaches us what happens when authoritarianism, corruption and underdevelopment collude to bring about the implosion of polities.

January 30, 2021 / 08:28 AM IST
An anti-drug exhibit is seen at the Drug Elimination museum in Yangon, Myanmar.

An anti-drug exhibit is seen at the Drug Elimination museum in Yangon, Myanmar.

“Loyalty to the Heavens”, read the banner; beneath it, a man cried in pain as a blowtorch was held to his feet, hammer-blow jolts from an electric cattle-prod occasionally thrown in to punctuate his agony. It wasn’t personal: The man had dumped three hundred kilograms of high-grade crystal meth into the sea, claiming to have mistaken an approaching speedboat for law-enforcement. The cartel’s human-resources department had been asked to make be sure the man hadn’t helped himself to the cargo and made up the story; their clinically precise work was then circulated for the edification of other potentially careless employees.

Earlier this month, at the end of a years-long hunt involving at least twenty police forces and intelligence services, police at Amsterdam’s Schipol airport held the man who had that video made. Tse se Chi Lop—known to his rank-and-file as Sam Gor, Cantonese for Brother Number 3, and chief executive of what is simply called ‘The Company’—is alleged to have run networks that made upwards of $20 billion each year from its methamphetamine sales alone.

Tse has been called Asia’s own Joaquin ‘El Chapo’ Guzman, a metaphor that’s fitting in more ways than one: Like in Mexico, the elimination of a high-profile cartel head is, more likely than not, just the beginning of a new, even uglier story. The stage for this particular story, though, lies just next-door to India.

WATCHED over by his sixteen grandchildren, four daughters, four sons, and wife, the Emperor of Poppies was laid to rest in a glass coffin in the summer of 2013. As monks prayed to ease the passage of his soul into heaven, a procession of top government officials and business leaders lined up to pay their respects. From his infamous days as Southeast Asia’s biggest heroin trafficker, Lo was brought into the system, emerging at the head of one of Myanmar’s biggest industrial conglomerates.

The surreal history of East Asia’s narco-kingdoms, as dark as any opium nightmare, teaches us what happens when authoritarianism, corruption and underdevelopment collude to bring about the implosion of polities.

Close

In the 1950s, Olive Yang, the convent-educated daughter of a notable from Kokang—on the borders of Myanmar’s Shan state and Yunnan, in China—set up militia with some 1,000 members. Her militia was part of a tapestry of warlord fiefdoms with emerged in wake of independence. The new organisation was backed by the Kuomintang, which had been thrown out of China by Mao Zedong’s People’s Liberation Army, Yang funded her militia by running truckloads of opium to the Thai border.

In 1962, Yang was arrested, only to be released two years later. In the 1980s, she was to emerge as a key broker of peace accords with insurgents, working with Myanmar intelligence chief General Khin Nyunt.

Following an extraordinary colourful life, which included bisexual relationships with some of Myanmar’s top movie artistes, Yang eventually renounced the world and became a nun. Her story, however, became a template for warlordism in Kokang. Yang was succeeded by her brother Jimmy Yang, co-founder of the East Burma Bank. In turn, Jimmy Yang gave way to Lo.

Lo’s ascendance was built on striking a deal with Myanmar’s army, giving him the right to run opium convoys on major roads without hindrance in return for making his troops available to fight ethnic insurgents. His brother, Lo Hsing Ko, was — conveniently — appointed police chief for Kokang.

From the mid-1970s, Pheung Kya-shin emerged as a competitor — backing the Communist Party of Burma, instead of the government, in return for support for his heroin-running operations. In the 1980s, when the Communist Party of Burma split, its remnants signed a ceasefire deal with the government. In return, it was allowed a free run of the heroin trade. Feud followed feud, until Pheung was forced out of the region in 2009 — only to strike back in February.

From 2015, ‘till his death in December, Pheung’s intermittently waged war against Myanmar’s armed forces through the eastern Kokang . Fighting, at its peak, involved artillery and combat jets, forcing tens of thousands of local people out of their homes.

His successors were, by then, already in place. Tse, according to a profile by the journalist Tom Allard, had been born in Guangzhou in 1963, growing up in a landscape shaped by Mao’s forced labor camps, massacres of political opponents and mass starvation. He is believed, as a teenager, to have joined a crime cartel set up by formerly imprisoned Red Guards, jailed after the fall of the despot, called the Like many other members of the Big Circle Gang, Tse first moved to Hong Kong; later, in 1988, he immigrated to Canada.

Through the 1990s, Tse shuttled between North America, Australia and East Asia, working as mid-ranking operator sourcing heroin from the Golden Triangle, the largely lawless opium-producing region at the intersection of Myanmar, Thailand, China and Laos.

In 1998, Tse was convicted with drug-trafficking in New York, and faced a potential life sentence. His lawyer pleaded for clemency. Tse’s ageing parents, his petition claimed, needed care; his son, then 12, had a lung condition. He expressed “great sorrow” for his crimes. Nine years later, Tse was out of prison. His great sorrow, event show, soon waned.

At his peak, Allard has said, Tse was “protected by a guard of Thai kickboxers”. “He flies by private jet. And, police say, he once lost $66 million in a single night at a Macau casino”.

TSE’s rise coincided with a significant turn in the structure of the narcotics business in East Asia: From a single-point reliance on opium, began to shift increasingly to synthetics, often manufactured from chemicals sourced from Yunnan. The United Nations Office on Drugs and Organised Crime has documented a gradual reduction in opium acreage in Myanmar, as well as farm-gate prices for the crop. However, it noted, cartels “significantly scaled up the production of methamphetamine and other synthetic drugs for the regional market”.

Acting against the cartels, necessarily, need the warlords of the Golden Triangle to be displaced with viable State structures. That is, however, easier said than done.  Ever since 2011, Myanmar has entered into ceasefires with over 15 ethnic insurgent groups, working towards a negotiated political settlement. In practice, however, many of the groups have used the ceasefire periods to expand narcotics fiefdoms.

Law enforcement agencies in Myanmar have told UNODOC that they were “restricted in their ability to undertake interventions in the special regions because of the inaccessibility of the areas controlled by the ceasefire groups”. The military and political elite, hollowed out by drug revenues, has little reason to seek a transformation in the status quo. In essence, the poppy empires are stupefying Myanmar’s state, addicting powerful elements in its polity to the cash from drugs.

Transnational Crime_001

In 2015, journalist Salai Thant Zin visited the village of Kanzam on Myanmar’s border with Manipur on New Year’s Eve. He came back with a grim vision of the future. The chapel, the heart of the village community, was locked; the priest had long fled. The village, he reported, had just three men, the rest having died because of their opium addiction. There were also just three children in the local school, whose mothers busied themselves tending to poppy fields and brewing rice beer.

Local police chief Myint Lwin told Salai that dealers from Moreh, in India, regularly arrived across the Sagaing division’s mountains to buy raw opium, to be processed into heroin for tens of thousands of addicts in the Northeast.

Further complicating counter-narcotics efforts is the fact that Asia’s drug cartels—unlike their Latin American counterparts—are remarkably resilient. The scholar Bertil Lintner has noted that most are “run by loosely and informally organized networks, and not by an over-arching, all-powerful ‘kingpin’”. “As one alleged ‘kingpin’ falls, others are left still standing and conveniently in place to take on the misnomer mantle”.

The druglord is not a modern invention. The great financial house of Jardine Matheson was, after all, founded by the opium-traders William Jardine and James Matheson—men, who author Richard Harris has wryly observed, “both Calvinist in the stiff religious way, both scrupulous in financial and personal matters, both indifferent to moralistic reflections on contraband and drugs”.

India’s steadily rising substance-abuse rates should tell us the threat isn’t virtual: Ever since 1842, when Imperial Britain bombarded China to assert its right to sell Indian-grown opium there, engendering a century of social devastation and war, we’ve known drugs can, quite literally, shape the course of history. Tse’s story might seem like a good weekend Netflix watch in the making; it should be something, though, that New Delhi takes deadly seriously.
Praveen Swami
first published: Jan 30, 2021 08:28 am

stay updated

Get Daily News on your Browser
Sections