THE BURMA - SINGAPORE ASIS (Part I

[brelief@xxxxxxx]

Subject: THE BURMA - SINGAPORE ASIS  (Part I) Globalizing  The Heroin Trade 

The Kyoto Journal # 38
Perspectives on Asia

THE BURMA ? SINGAPORE ASIS  (Part I)
Globalizing The Heroin Trade 

Leslie Kean and Dennis Bernstein

"Singapore's economic linkage with Burma is one of the most vital factors
for the survival of Burma's military regime," says Professor Mya Maung, a
Burmese economist based in Boston. This link, he continues, is also central
to "the expansion of the heroin trade.''  Singapore has achieved the
distinction of being the Burmese junta's number one business partner?both
largest trading partner and largest foreign investor. More than half these
investments, totaling upwards of $1.3 billion, are in partnership with
Burma's infamous heroin kingpin Lo Hsing Han, who now controls a substantial
portion of the world's opium trade. The close political, economic and
military relationship between the two countries facilitates the weaving of
millions of narco-dollars into the legitimate world economy. 

Singapore has become a major player in Asian commerce. According to Steven
Green, U.S. Ambassador to Singapore, free market policies have "allowed this
small country to develop one of the world's most successful trading and
investment economies."  Singapore also has a strong role in the powerful
132-member country World Trade Organization. Indeed, the tiny China Sea
island of three and a half million people is known far and wide as the blue
chip of the region ?  a financial trading base and a route for the vast sums
of money that flow in and out of Asia. 

If the brutal Burmese dictatorship's international pariah status is of any
concern to its more powerful partner, Singapore shows no sign of it.
Following the March 24 visit of Singapore's Prime Minister Goh Chok Tong to
Rangoon, a Singapore spokesperson proclaimed, "Singapore and  Myanmar should
continue to explore areas where they can complement each other."  As both
countries continue to celebrate their "complementary" relationship, the
international community must take note of the powerful support this
relationship provides both to Burma's illegitimate regime and to its booming
billion dollar drug trade.

DRUGS ?R' US

The Burmese military dictatorship ? known by the acronym SLORC (State Law
and Order Restoration Council) until it changed its name to the State Peace
and Development Council (SPDC) last November ? depends on the resources of
Burma's drug barons for its financial survival. Since it seized power in
1988, opium production has doubled,  equaling all legal exports and making
the country the world's biggest heroin supplier. Burma now supplies the U.S.
with 60 percent of its heroin imports and has recently become a major
regional producer of methamphetamines. With 50 percent of the economy
unaccounted for, drug traffickers, businessmen and government officials are
able to integrate spectacular profits throughout Burma's permanent economy.

Both the Burmese generals and drug lords have been able to take advantage of
Singapore's liberal banking laws and money laundering opportunities. In
1991, for example, the SLORC laundered $400 million through a Singapore
bank, which it used as a down payment for Chinese arms. Despite the large
sum, Burma's foreign exchange reserves registered no change either before or
after the sale.  With no laws to prevent money laundering, Singapore is
widely reported to be a financial haven for Burma's elite, including its two
most notorious traffickers, Lo Hsing Han and Khun Sa (also known by his
Chinese name Chang Qifu).

SLORC cut a deal with Khun Sa for his "surrender" in early 1996, allowing
him protection and business opportunities in exchange for retirement from
the drug trade. Khun Sa now bills himself as "a commercial real estate agent
who also has a foot in the Burmese construction industry.''  Already in
control of a bus route into the northern poppy growing region where the
military is actively involved in the drug business, he is now investing $250
million in a new highway between Rangoon and Mandalay, an SPDC cabinet
member confirmed. "The Burmese government says one thing but does another,"
according to Banphot Piamdi, director of Thailand's Northern Region's
Narcotics Suppression Center. "It claims to have subdued Khun Sa's
group...However the fact is that the group under the supervision of...Khun
Sa's son has received permission from Rangoon to produce narcotics in the
areas along the Thai Burmese border."

Khun Sa's son is not the only trafficker reaping benefits in the Shan State
area, which borders Thailand and China and serves as Burma's primary poppy
growing area. Field intelligence and ethnic militia sources consistently
report a pattern of Burmese military involvement with drug production in
these remote areas. Government troops offer protection to the heroin and
amphetamine refineries in the area, in exchange for payoffs and gifts such
as Toyota sedans, pistols and army uniforms.. The only access to the
refineries is through permits issued by Burmese military intelligence ?
without this, the heavily guarded areas surrounding the refineries are too
dangerous to approach. The military is also involved in protecting the
transport of narcotics throughout the region, which the authorities have
sealed off from the outside world.

"There are persistent and reliable reports that officials, particularly army
personnel posted in outlying areas, are involved in the drug business,"
confirms the March 1998 U.S. government narcotics report. "Army personnel
wield considerable political clout locally, and their involvement in
trafficking is a significant problem.''   Intelligence sources, working for
ethnic leaders combating both the drug trade and the military dictatorship,
report that the pattern of government involvement extends all the way to the
top. The central government in Rangoon demands funds on a regular basis from
regional commanders, who in turn expect payoffs from the rank and file. The
soldiers get the money any way they can ? through smuggling, gambling or
selling jade ? 
with drugs being the most accessible source of revenue in Shan State. The
officers in the field also "tax" refineries, drug transporters, and opium
farmers.

At great risk, the intelligence sources ? who go under cover to infiltrate
troops in the field ? collect painstakingly detailed data including names,
dates and places, such as these delivered in March 1998 from Shan State: "On
l0th Jan. 98, SPDC Army no. 65 stationed at Mong Ton sent 40 troops to Nam
Hkek village, Pon Pa Khem village tract, collected 0.16 kilo of opium per
household or [collected payment of] Baht 600. Then the troops sold the
collected opium to the drug business men at the rate of Baht 6000 for 1.6
kilos" Another report states: "Troops from SPDC battalion nos. 277 & 65
stationed at Mong Ton are still protecting heroin refineries situated at
Hkai-lon, Pay-lon & Ho-ya areas, Mong Ton township. Those who can pay
B.200,000 per month are allowed to run the heroin refineries." And: "On 3rd
of Jan. 98, SPDC Army no. 99 collected opium tax in Lashio township. They
charged 0.32 kilo per household. They arrested and beat seriously those who
failed to give." 

These sources also report that Ko Tat, Private 90900 from SPDC battalion no.
525 stationed in Lin Kay, recently defected from the Burmese army and said
that his company had been giving protection to the opium fields around Ho
Mong. While the lower-ranked officers struggle to meet their quotas in the
field, the highest levels of the government in the capital city strike deals
with Burma's two top traffickers, one of whom is the prosperous partner of
Singapore.

LO HSING HAN: AT HOME IN SINGAPORE 

With massive financial ties to Singapore, Lo Hsing Han is now one of Burma's
top investors. He, along with Khun Sa, the former "king of opium," is a
major player in the Burmese economy. In the early 1990s, Lo Hsing Han
controlled the most heavily armed drug-trafficking organization in Southeast
Asia. 16 He was arrested in 1973 and sentenced to death, but was freed under
a general amnesty in 1980. Now, like Khun Sa, he wears the public persona of
a successful businessman in Rangoon ? where no one does business without
close government cooperation. Although he still oversees rural drug
operations with the status of a godfather, according to U.S. narcotics
officials, the notorious Lo currently serves as an advisor on ethnic affairs
to Lt. Gen. Khin Nyunt, the military intelligence chief and the junta's
powerful "Secretary 1."

Lo Hsing Han is the chair of Burma's biggest conglomerate, Asia World,
founded in 1992. His son, Steven Law, is managing director and runs three
companies in Singapore that are "overseas branches" of Asia World. Although
Singapore is proud of its mandatory death penalty for small time narcotics
smugglers and heroin addicts, both father and son travel freely in and out
of the friendly island nation. "The family money is offshore," said a high
level U.S. narcotics official."The old man is a convicted drug trafficker,
so his kid is handling the financial activities."

In 1996, when Law married his Singaporean business partner in a lavish,
well-publicized Rangoon wedding, guests from Singapore were flown in on two
chartered planes. According to a high-level U.S. government official
familiar with the situation, Law's wife Cecilia Ng operates an underground
banking system, and "is a contact for people in Burma to get their drug
money into Singapore, because she has a connection to the government." The
official said that she spends half her time in Rangoon, half in Singapore;
when in Rangoon, she is headquartered at Asia Lite, a subsidiary of Asia
World.  The husband-wife team are also the sole officers and shareholders of
Asia World subsidiary, Kokang Singapore Pte Ltd. Founded in Singapore in
1993 with $4.6 million, the company "engages in general trading activities
in goods/products of all kinds/descriptions."

Singapore's ventures with Asia World include both government and private
investments. Kuok Singapore Ltd., a partner with Asia World in many
ventures, was Burma's largest single real estate investor as of late 1996,
with over $650 million invested.  Other Singaporean companies are mentioned
in Asia World's company reports. Sinmardev, another major Singaporean
project linked to Lo's company, is a $207 million industrial park and port
on the outskirts of Rangoon, which broke ground in 1997. Singaporean
entrepreneur Albert Hong, head of Sinmardev, described the project as the
largest foreign investment in Burma outside the energy field. The
Singaporean consortium leads the joint
venture along with the Burmese junta, Lo's Asia World, and a slew of
international shareholders 

Kuok Singapore Ltd., Lo Hsing Han's Asia World, and the Burmese junta are
also partners in the luxury Traders Hotel. The hotel's November 1996 opening
ceremony was attended by the Singapore ambassador, the president of Kuok
Singapore, and briefly by Lo Hsing Han himself. The presiding Burmese
minister publicly thanked Steven Law and the government of Singapore
"without whose support and encouragement there would be very few Singaporean
businessmen in our country."

While government and business connections in Burma and Singapore have
boosted Asia World's prospects, other factors have contributed to the
company's extraordinary growth. In the last six years, Asia World has
expanded from a modest trading company to become Burma's largest and
fastest-growing private sector enterprise with interests in trading,
manufacturing, property, industrial investment, development, construction,
transportation, import and distribution, and infrastructure. "How is it that
a company that has a humble beginning trading beans is suddenly involved in
$200 million projects?" a U.S. government official said, requesting
anonymity. "Where did all that start-up capital come from?"

The U.S. government ventured a guess in 1996: it denied Asia World's CEO
Steven Law a visa to the U.S. "on suspicion of drug trafficking."  Asia
World's operations now include a deepwater port in Rangoon, the Leo Express
bus line into Northern Burma, and a $33 million toll highway from the heart
of Burma's poppy-growing region to the China border.  On December 20, the
conglomerate opened a wharf with freight handling, storage, and a customs
yard for ships carrying up to 15,000 tons.  "If you're in the dope business,
these are the types of things that you've got to have to be able to move
your product," said a high level U.S. narcotics official. "They have set up
institutions to facilitate the movement of drugs. And in all probability,
they are using laundered drug proceeds, or funds generated from investments
of drug trafficking proceeds, to build this infrastructure," he added.

The activities of Lo's company Asia World have triggered an international
narcotics investigation led by Washington. U.S. investigators allege that
Asia World's relationship to Singapore paves the way for the narcotics trade
to be woven into all legitimate investments between the two countries.
"Singapore's investments in Burma are opening doors for the drug
traffickers, giving them access to banks and financial systems," said one
government official with the situation.

ONE-STOP SHOPPING: INTELLIGENCE TO REPRESSION

The Burmese junta's control of its impoverished population through crude
methods such as torture, forced labor, and mass killings leaves it open to
international condemnation. In contrast, Singapore takes a more
sophisticated approach to repression, both at home and abroad. While the
island nation's citizens have material benefits and the appearance of rule
of law, they live in fear of an Orwellian government that closely monitors
every aspect of their lives. The ruling party often sues on trumped up
defamation charges those who dare to oppose it, forcing many into bankruptcy
or exile.

The FBI is investigating complaints by U.S. citizens of harassment by
Singapore's Internal Security Department (ISD). One California academic, a
widely respected specialist on Southeast Asian affairs who asked not to be
identified, says ISD agents broke into his home because he was working to
bring leading Singaporean opposition figure, Tang Liang Hong, to an American
university. The operatives tore out his door handle to get in, then searched
his computer and desk. A week later, an Asian man, hiding in a tree,
photographed and videotaped him while he walked in the park.  After
temporarily blinding the academic with his bright flash, the man jumped from
the tree and made a getaway in his car. Tang ? who is facing a $4.5 million
defamation lawsuit
by Singaporean senior ministers ? was not surprised by the burglary. "I've
been followed everywhere, whether I was in Hong Kong, Malaysia, Australia or
in London," he said in a phone interview from Australia.

Singapore has been more than willing to share its expertise in intelligence
with its Burmese counterparts. The Singapore - Myanmar Ministerial - Level
Work Committee was set up in 1993 in Rangoon to "forge mutual benefits in
investment, trade and economic sectors." The committee includes intelligence
chief Lt. Gen. Khin Nyunt, other top Burmese ministers, and high-level
Singaporean officials. At the December 23 meeting, Khin Nyunt urged his
ministers to give priority to projects arranged by the Singaporean
Government. "Pilot projects are being implemented to transfer knowhow to
Myanmar," said Khin Nyunt in his address.

One such project is a state-of-the-art cyber-war center in Rangoon. Burma's
military leaders can now intercept a range of incoming communications ?
including telephone calls, faxes, emails and computer data transmissions ? 
from twenty other countries.

The high-tech cyber-war center was built by Singapore Technologies, the
city-state's largest industrial and technology conglomerate, comprising more
than 100 companies.

This government-owned company also provides on-site training at Burma's
Defense Ministry complex, and reportedly passes on its "sophisticated
capability" to hundreds of Burmese "secret police" at an institution in
Singapore.

Burma has no external enemies, but the ruling junta goes to extremes to
terrorize the population through its elaborate intelligence network.
Intelligence officials have already used their newly-acquired talents from
the cyber-war center to arrest pro-democracy activists,  and it is well
known that Burma's feared military intelligence ohen tortures its victims
during lengthy interrogations.

Singaporean companies have also helped suppress dissent in Burma by
supplying the military with arms to use against its own people. The first
shipment of guns and ammunition was delivered on October 6, 1988.
Throughout the month, hundreds of boxes of mortars, ammunition, and other
supplies marked "Allied Ordnance, Singapore" were unloaded from vessels in
Rangoon. Allied Ordnance is a subsidiary of Chartered Industries of
Singapore, the arms branch of Singapore Technologies ? the same government
owned company that built the cyber-war center. The shipments also included
rockets made by Chartered Industries of Singapore under license from a
Swedish company and sold in violation of an agreement with Sweden requiring
authorization for re-exports.

These shipments from Singapore arrived only weeks after the 1988 military
takeover in Rangoon, in which the new leaders of the SLORC massacred
hundreds of peaceful, prodemocracy demonstrators in the street. These
killings followed another wave of government massacres earlier that summer,
when longtime dictator Ne Win struggled to keep power in the face of
nationwide strikes and demonstrations for democracy. He eventually stepped
down but, operating behind the scenes, installed the puppet SLORC. As the
killings continued, thousands of civilians fled the county fearing for their
lives. When numerous countries responded by suspending aid and Burma's
traditional suppliers cut shipments, the SLORC became desperate. Singapore
was the first country to come to its rescue.

Singapore companies have continued to supply Burma's military, sometimes
acting as middlemen for arms from other countries. In 1989, Israel and
Belgium delivered grenade launchers and anti-tank guns via Singapore.  In
1992, Singapore violated the European Commission arms embargo on the Burmese
regime by acting as a broker and arranging for a $1.5 million shipment of
mortars from Portugal.

"It is highly unlikely that any of these shipments to Burma could have been
made without the knowledge and support, of the Singapore Government," wrote
William Ashton in Jane's Intelligence Review. "By assisting with weapons
sales, defense technology transfers, military training and intelligence
cooperation, Singapore has been able to win a sympathetic hearing at the
very heart of Burma's official councils." 

http://www2.gol.com/users/brelief/Index.htm