US embassy cable - 03RANGOON1598

C O N F I D E N T I A L SECTION 01 OF 03 RANGOON 001598 
 
SIPDIS 
 
BEIJING PASS CHENGDU 
STATE FOR EAP/BCLTV, EB, DRL, OES, INL 
COMMERCE FOR ITA JEAN KELLY 
TREASURY FOR OASIA JEFF NEIL 
USPACOM FOR FPA 
 
E.O. 12958: DECL: 12/14/2013 
TAGS: SOCI, EAID, SNAR, ECON, SCUL, PHUM, KHIV, KWMN, PREL, PGOV, BM, CM, NGO, Human Rights, Ethnics, Economy 
SUBJECT: A VISIT TO CHINA'S BURMESE PROVINCE: MONGLA AND 
KYAINGTONG 
 
REF: RANGOON 1339 
 
Classified By: COM CARMEN MARTINEZ FOR REASONS 1.5 (B,D) 
 
1. (C) Summary: Some clear themes emerged from a trip to the 
Burmese corner of the Golden Triangle.  The area's cities are 
relatively affluent, thanks to border trade.  However, this 
affluence, combined with low education levels, poor 
healthcare, and very little international attention, has 
helped this region to become a locus of social problems such 
as prostitution, HIV/AIDS, and trafficking of women.  Though 
the region is notorious for opium, it seems narcotics 
production is waning, though peddling and drug use remain a 
problem.  Finally, the increasing influence of China, to 
include a renminbi-denominated border economy, is a trend 
that will remain for the long term. End summary. 
 
Background: The Wild East 
 
2. (U) In an effort to assess the social and economic 
conditions in Burma's border regions, in early December two 
Embassy officers visited a mountainous corner of eastern Shan 
State, the country's largest administrative region, smack in 
the middle of the Golden Triangle near the Chinese, Thai, and 
Lao borders.  This part of Shan State is still primarily wild 
and inaccessible, with few roads and very little other 
infrastructure.  It is also a region with close ethnic ties 
to Thailand and China.  Though its largest single ethnic 
group is Akha, the majority of people are of various Tai 
subgroups or ethnic Chinese.  The area is also quite diverse 
religiously, with Christians comprising approximately 40 
percent of the population.  There is also a small Muslim 
community and many animists in the hills. 
 
3. (U) As with other border zones in Shan State (see reftel), 
this area of eastern Shan State -- made up of Kyaingtong, 
Tachileik, and Mongla townships -- relies far more on its 
foreign neighbors than on the Burmese regime in Rangoon.  The 
road west to the Shan capital of Taunggyi and the main 
Mandalay trade route is long and hard, passing through very 
rough, mountainous, and dangerous terrain.  The roads east to 
China and south to Thailand are, to the contrary, very good. 
Thus it is no surprise that it is its geographic, not legal, 
identity that defines this region.  In fact as we reached 
Mongla, the absence of ethnic Burmans, the almost exclusive 
use of spoken and written Mandarin, and the renminbi economy 
suggested that we had crossed the border into China. 
 
Affluence But Many Social Problems 
 
4. (U) Kyaingtong, the hub of the three townships, is more 
affluent than most towns of equivalent size elsewhere in 
Burma.  Tachileik, to the south, is the major point in Shan 
State for legal Thai-Burma border trade.  Although Mongla, to 
the northeast, is not yet an official China border trade 
crossing point, many products, primarily consumer goods, come 
in illicitly through the extremely porous and rugged 
frontier.  Farmers bringing their produce to market in 
Kyaingtong find they can get somewhat better prices because 
traders there are often buying for export to China and 
Thailand.  Likewise, border towns Tachileik and Mongla enjoy 
regular electricity and phone service, a luxury in the rest 
of Burma, purchased from over the border. 
 
5. (C) However, the region's comparative affluence, and 
proximity to international borders (which attract many 
jobless from around the country), combined with the region's 
remoteness, generally poor infrastructure, and low education 
levels have led to some serious social consequences. 
Religious, UN, and NGO officials all point to this Golden 
Triangle area as a hot zone for HIV/AIDS and trafficking in 
women.  Unfortunately, though, there has not yet been much 
international attention to this area.  A Catholic priest in 
Kyaingtong told us he had been unable to raise even US$10,000 
from international charities he'd contacted for grassroots 
HIV/AIDS care and income generation projects to dissuade 
women from going to Thailand for sex work.  Currently only 
U.S.-based NGO World Vision and a skeleton UNDP office 
provide humanitarian aid out of Kyaingtong, and their 
operations were criticized by locals for having too much 
overhead and too little grassroots impact. 
 
6. (C) Anecdotes from community leaders in Kyaingtong and 
UNDP officials in Rangoon indicate that movement of young 
women, voluntarily or otherwise, through Tachileik into 
Thailand for sex work is a serious problem.  Interestingly, 
these girls are not primarily local, but originate from the 
poorest parts of Burma and travel or are trafficked to the 
Thai border area to work in brothels on both sides of the 
frontier.  Prostitution, and HIV/AIDS, are also present in 
Mongla, though the girls are generally imported from Yunnan 
Province.  The consensus was that the trafficking and 
prostitution situation would worsen if the Rangoon government 
continued to tighten border trade restrictions, hurting local 
economic prospects, and if the country's general economic 
situation continued to decline, enticing girls to make the 
long trek to look for work. 
 
Drug Free Zone? 
 
7. (C) Though the Golden Triangle region is historically 
notorious for cultivation of opium poppies, we heard mixed 
reports on the extent of current drug production and use. 
According to UN officials and local businessmen in Mongla, a 
boomtown built with drug proceeds in the mid-1990s, poppy 
cultivation in the immediate region has decreased and 
methamphetamines have not caught on.  Both pointed north, to 
the Wa region, when discussing current centers for opium and 
methamphetamine production.  However, community leaders in 
Kyaingtong asserted that drug use and peddling were a growing 
problem in town.  A Catholic priest noted he had expelled in 
2002 two boarders at his mission's orphanage for selling 
drugs in the dormitory.  The priest added that low-level drug 
pushing is an increasingly common fall-back profession for 
young men who lose their jobs in construction or trading. 
 
8. (SBU) Poppy-substitution agricultural projects, in early 
stages of development, were evident outside poverty stricken 
villages along the 60-mile Kyaingtong-Mongla road.  As in 
northeastern Shan State (reftel), the crops produced along 
this stretch (mangoes, rubber, lychees, and other cash crops) 
are destined for the Chinese market.  Other non-drug economic 
potential in the region is not so clear.  Mongla's 
incongruous and flashy casinos and hopping nightclubs are 
surely generating some cash, though not for locals since 
nearly all the employees in these joints are short-term 
Yunnanese migrants.  Furthermore, business is terrible 
because of a recent Chinese government effort to keep its 
citizens out of the casinos by limiting tourists to short day 
trips.  Thus hundreds of Chinese tourists per day visit Thai 
transvestite revues, a shocking pink anti-drug museum, a 
Thai-owned jade emporium, and an atrocious zoo, but are 
steered clear of the casinos.  We heard claims of other 
economic benefits coming from nearby jade and manganese 
mines, and an ore processing factory in Mongla -- though 
these seem marginal. 
 
Politics: Let's Just Make Money 
 
9. (C) There is an interesting political mixture in this 
region.  Though Kyaingtong and Tachileik have more dealings 
with China and Thailand, they are still ostensibly under the 
control of the Rangoon government and its military.  Mongla 
and the surrounding cease-fire-delineated Special Region 
Four, on the other hand, are squarely the domain of the 
National Democratic Alliance Army-Eastern Shan State 
(NDAA-ESS) and its long-time leader Lin Minxiang (aka U Sai 
Leun, aka U Sai Lin).  For the last thirty miles to the 
border, and throughout Mongla, we did not see a single 
Burmese government entity, including at the Chinese border 
checkpoint, other than a ramshackle immigration office in 
Mongla and two public schools.  In contrast, there was a 
modern, multi-story building housing the Chinese PLA border 
presence.  The Chinese operation was very professional in 
appearance, with several uniformed PLA soldiers in evidence 
on their side of the checkpoint, including one standing at 
attention on a raised dais. 
 
10. (C) The political temperature in both Kyaingtong and 
Mongla was low, with people focused more on border trade than 
politics in Rangoon.  Locals we approached were willing to 
speak openly and at length about regional economic and social 
conditions.  Religious affairs appeared in relatively good 
shape.  The Christian leaders with whom we spoke told us 
while they were officially constrained by Burma's 
pro-Buddhist regulations, they were nonetheless able to 
operate quite freely on the sly to renovate buildings, build 
small new structures, and provide religious education.  A 
priest told us that the Ministry of Religious Affairs had, a 
decade ago, even ruled in the Catholics' favor in a boundary 
dispute with a neighboring Buddhist temple.  In the early 
morning hours we heard the call of the muezzin from 
Kyaingtong's mosque. 
 
11. (C) Our contacts had little to say about the upcoming 
SPDC-managed National Convention.  An FBIS-translated article 
from a Shan opposition group's news agency claimed that the 
leadership of Mongla was in a low-level dispute with Rangoon 
authorities over the make up of Special Region Four's 
delegation to the new Convention.  We also learned that in 
the first Convention in 1993 Mongla's delegation had pushed 
for autonomy.  However, the central government refused, 
citing an obscure regulation requiring an autonomous zone to 
have at least two townships -- Mongla has only one. 
Apparently this request will be raised again in the new 
Convention, though the same result is expected. 
 
Comment: The Long Arm of China 
 
12. (C) The most notable aspect of these trips to the Shan 
border is how quickly the bonds of central Burmese control 
are slipped, and how easily these ostensible Burmese towns 
identify with their foreign neighbors.  This is most 
noticeable in the ethnic cease-fire zones that have some 
legal autonomy.  However, even the towns under Burmese 
control -- like Kyaingtong, Tachileik, and Muse in the north 
-- identify osmotically with the booming markets across the 
border rather than the depressed markets of central and lower 
Burma.  This reality makes it clear that Rangoon's relations 
with ethnic groups along the border now and in the future 
will not just be about political-military issues, but also 
about economic influence. 
Martinez