*EPF408 03/02/00
Text: 1999 International Narcotics Report Statements of Explanation
(Burma, Cambodia, Hong Kong, Laos, Taiwan, Thailand, Vietnam) (3490)

Editor's Note: The full 1999 narcotics report is available on the State Department Web site at:

http://www.state.gov/www/global/narcotics_law/narc_reports_mainhp.html

Following are the statements of explanation concerning the drug certification decisions for Burma, Cambodia, Hong Kong, Laos, Taiwan, Thailand and Vietnam as released by the Department of State's Bureau for International Narcotics and Law Enforcement Affairs March 1:

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STATEMENT OF EXPLANATION

BURMA

Burma is the world's second largest source of illicit opium and heroin, exceeded only by Afghanistan, and currently accounts for approximately 80 percent of the total production of Southeast Asian opium. Largely due to severe drought conditions in poppy growing areas, production and cultivation continued to decline significantly in 1999 for the third year in a row. In 1999 there were an estimated 89,500 hectares under opium poppy cultivation, down 31 percent from 1998. This hectarage yielded a maximum of 1,090 metric tons of opium gum, 38 percent lower than in 1998 and less than half the average production during the last decade. The Government of Burma (GOB) maintained most of its opium crop-eradication efforts and expanded the program to an additional 9,800 acres.

Seizures of methamphetamine in 1999 exceeded 1998's record figures, although opium and heroin seizures were well below 1998 levels. Burma made its first airport seizures of illicit drugs in 1999. While there were cases of drug interdiction and arrests of members of some cease-fire groups for drug trafficking, the GOB has been unwilling or unable to take on the most powerful groups directly. Cease-fire agreements with insurgent ethnic groups dependent on the drug trade implicitly tolerate continued involvement in drug trafficking for varying periods of time. The ethnic armies, such as the United Wa State Army and the Myanmar National Democratic Alliance Army, remain armed and heavily involved in the heroin trade.

The GOB expressed support for eradication efforts, crop substitution, and development assistance, but allocated few resources to such projects. GOB policy is to force the leaders in the ethnic areas to spend their own revenues, including from the drug trade, on social and physical infrastructure. The approach limits the GOB's ability to continue or expand its counter-drug efforts.

Burma's 1993 Narcotic Drugs and Psychotropic Substances Law conforms to the 1988 UN Drug Convention and contains useful legal tools for addressing money laundering, seizing drug-related assets, and prosecuting drug conspiracy cases. GOB officials, claiming they lack sufficient expertise, have been slow to implement the law, targeting few, if any, major traffickers and their drug-related assets. Money laundering in Burma and the return of drug profits laundered elsewhere are thought to be significant factors in the overall Burmese economy, although the extent of this problem is impossible to measure accurately. The cease-fire agreements condone money laundering, as the government encouraged these groups to invest in "legitimate" businesses as an alternative to trafficking, thus extending to them the opportunity to sanitize past illicit proceeds with investments in hotels and construction companies, for example.

The Burmese continued to refuse to render drug lord Chang Qifu on grounds that he had not violated his 1996 surrender agreement. The 1988 U.N. Drug convention obligates parties, including Burma, to prosecute such traffickers.

The GOB's counter-drug efforts in 1999 showed progress in a number of areas: methamphetamine and ephedrine seizures increased; crop eradication continued with modest expansion; anti-drug forces conducted more vigorous law-enforcement efforts; and members of some cease-fire groups were arrested for drug trafficking. Such efforts must be stepped up, however, if they are to have a significant impact on the overall trafficking problem.

On balance, the USG remains concerned that Burma's efforts are not commensurate with the extent of the drug problem within its borders. Large-scale poppy cultivation and opium production continue, decreasing in the last few years largely because of severe drought conditions rather than eradication programs. The GOB's effective toleration of money laundering, its unwillingness to implement its drug laws, and its failure to render notorious traffickers under indictment in the United States all continue to be serious concerns.

STATEMENT OF EXPLANATION

CAMBODIA

In view of Cambodia's geographic location and general state of lawlessness, it is likely that drugs transited Cambodia en route the West, including the United States. For that reason, Cambodia was designated a major drug transit country in 1999. Political turmoil in Cambodia has effectively precluded a fully credible anti-drug effort for the last two years. Although Cambodia has taken some positive steps to improve drug enforcement in 1999, these steps were insufficient to qualify for full certification.

Steps forward included increased emphasis on eradication of illicit marijuana plantations. Prime Minister Hun Sen and others have publicly threatened provincial governors with dismissal if they tolerate marijuana cultivation. At least one large (160 hectare, or about 400 acre) plantation was eradicated as the deadline for certification approached. There were also several first-time drug seizures at Phnom Penh's international airport. The President and the Chief Prosecutor of the Phnom Penh Municipal Court were removed for corruption; other judges are under investigation. A police commander, suspected of dealing in illicit drugs was removed, and Cambodia reorganized a supervisory coordinating agency called the National Drug Policy Board, replacing officials generally viewed as ineffective with more respected officials. High level government officials made statements emphasizing their opposition to synthetic drug production in Cambodia, and pressed efforts to confiscate unauthorized weapons, both positive steps in countering a drift towards lawlessness. Cooperation with the U.S. Drug Enforcement Administration (DEA) was excellent.

Corruption remains an endemic problem in Cambodia, however, and this problem adversely affects drug law enforcement. Poorly paid and ill-trained police and judicial officials have frequently looked the other way in drug and other criminal cases. Cambodia remains a refuge for criminal elements because enforcement is ineffective and corrupt officials can be paid to release those that may be apprehended. The combination of incompetence and venality, even at high levels in government and the police, pose an ongoing challenge to improved drug law enforcement. In short, there has been no fundamental institutional reform to meet the law enforcement challenge Cambodia faces from drug traffickers and other lawless elements.

Thus, despite some improvements, Cambodia still failed to meet the legal standards for full certification.

A vital national interests certification is necessary this year in order to protect U.S. vital national interests in Cambodia, including promoting democracy in Cambodia and stability in the region. Democracy in Cambodia is not yet firmly established. The democratically-elected coalition government, which came to power in Cambodia last year continues to face enormous challenges on all fronts, including the formation of an international tribunal to try former leaders of the Khmer Rouge. Cambodia also remains vulnerable to drug trafficking and other crime upsurges. Should counter-drug sanctions be imposed, it would not be possible for the United States to provide strategically-placed assistance to respond to potential crises or to strengthen Cambodia's economic and institutional bases for a democratic system. On balance, the risks to U.S. interests in promoting democracy and stability in the region if counter-drug sanctions were imposed would outweigh the risks Posed by Cambodia's failure to fully implement effective drug control.

STATEMENT OF EXPLANATION

HONG KONG

Although the USG continued to view Hong Kong as a major drug transit center in 1999 because of its location and developed infrastructure, Hong Kong's role as a major transit/staging area for the shipment of heroin and methamphetamine to the United States appears to have diminished over the last three years.

In 1999 Hong Kong continued its exemplary efforts to stop illicit drugs from being trafficked across its border with China and through its port. Through October 1999, Hong Kong officials seized 205 kilograms of heroin (nearly the amount seized in all of 1998), 35.8 kilograms of cannabis, 16.7 kilograms of cocaine, and 9,811 kilograms of methamphetamine. In the same period, 7,620 individuals were arrested for drug-related offenses. Drug-detection capabilities were enhanced in several important areas: the number of drug-sniffing dogs at the border and airport increased from 124 to 133; and high-tech equipment was procured to detect illicit drugs in packages, facilitate the inspection of baggage and cargo, and use in clearing air and sea cargo.

With respect to precursor chemicals, Hong Kong amended legislation to tighten control of the transshipment, removal, awl storage of potassium permanganate and to require a license from the Commissioner of Customs and Excise before potassium permanganate can be imported, exported, or manufactured. Control of several additional chemicals was also tightened in 1999 in response to resolutions passed by the U.N. Commission on Narcotic Drugs. The legislature also began working to amend legislation to enhance control of norephedrine.

Hong Kong also introduced new legislation to strengthen the anti-money-laundering regime and laws affecting drug profits and organized crime. New reporting requirements for financial transactions went into effect, and sentences for money laundering have been lengthened.

Hong Kong and U.S. law enforcement agencies continued to cooperate effectively on investigations into the movement of illegal drugs and on money-laundering cases. The Mutual Legal Assistance Agreement received legislative approval in Hong Kong arid will enter into force in early 2000. The Transfer of Sentenced Persons Agreement with the United States and with Sri Lanka came into force. Hong Kong also concluded similar agreements with other countries and the European Union.

In 1999 Hong Kong continued to implement new initiatives to strengthen its already outstanding counter-drug efforts, and Hong Kong authorities at ail levels continued their close cooperation with the United States and other countries to defeat drug trafficking.

STATEMENT OF EXPLANATION

LAOS

Laos is a major drug-producing country; it remains the world's third largest producer of illicit opium, behind Afghanistan and Burma. Although opium cultivation fell 16 percent in 1999, the USG estimates Laos' opium production for that year at 140 metric tons, identical to the 1998 estimate. Somewhat improved weather conditions increased estimated average yields, allowing total production to remain unchanged. Crop substitution project areas funded by the USG continued to show no commercial opium cultivation, only low level production sufficient for some local addict consumption.

Laos cooperates with the USG and the UNDCP on crop control/substitution projects designed to eliminate opium cultivation. The administration of Phongsali Province is providing enthusiastic support for the new USG-funded project there. The province administration assigned support personnel, held a meeting of district directors from throughout the province, and is expressing full support for the project to village headmen. In May 1999, the Government of Laos (GOL) agreed to a joint goal with the UNDCP to eliminate opium cultivation in Laos within six years; efforts to raise the estimated $80 million needed to reach this goal are underway. The highland farmers who grow opium now have no other viable option. Even if the farmers understood how to grow other crops and had the wherewithal to do so (neither of which is the case), they would lack accessible markets for their products. An ambitious project, requiring years of careful planning and implementation, is essential to create an alternative to opium. Such a plan would need alternative development, law enforcement, and demand reduction elements. Once developed, the plan would replace the previous GOL counter-drug master plan, which dates from 1993 and was also developed with UNDCP assistance.

Law enforcement efforts continue. USG-funded counter-drug offices law enforcement offices were opened in two more provinces. These offices, now in six provinces, along with other provincial police offices, reported 143 drug-related criminal cases in 1999, resulting in the arrests of 348 suspects (including 10 foreign nationals). Most arrests were of small-scale traffickers. These cases involved the seizure of 14.7 kilograms of heroin, 225.8 kilograms of opium, 806,700 methamphetamine tablets, and 2.2 metric tons of marijuana. Opium and heroin seizures fell significantly from record 1998 levels, as there was no case to match the 1998 destruction of a heroin laboratory. The number of arrests and quantity of opium seized are roughly equal to last year's totals, but the quantity of heroin seized has fallen significantly from the past two years. Methamphetamine seizures rose slightly. The quantity of heroin has dropped, in part, because none of the seizures was a very large shipment. Furthermore, it is believed traffickers have changed their routes and methods. For example, seizures in the United States of opium-filled parcels from Laos have jumped.

The GOL works very closely with its foreign assistance partners to combat drug trafficking and has registered steady progress this past year. The GOL also continues its important efforts to address the socio-economic problems underlying poppy cultivation. Corruption and inefficiency remain significant challenges to Lao counter-drug efforts. The GOL should continue to work with its foreign assistance partners to improve the administration of justice and to find alternatives to growing poppy.

STATEMENT OF EXPLANATION

TAIWAN

The United States considers Taiwan a major transit point for drugs affecting the United States due to its geographic location, its role as a regional transportation/shipping hub, and the activities of organized crime groups. Taiwan in 1999 continued its aggressive domestic counter-drug program and its effective cooperation with the United States, through the American Institute in Taiwan (AIT). Through October 1999, Taiwan authorities investigated 68,612 new drug cases, an increase of 48.9 percent over the same time period in 1998. The authorities seized more illicit drugs, primarily methamphetamine-type stimulants, in the first ten months of 1999 than all of 1998. Although indictments and convictions for drug-related offenses on Taiwan continued to fall in 1999, the decline reflects the first full year in which a law, allowing first-time addicts to participate in drug treatment programs in lieu of imprisonment, has been in force.

Taiwan cannot be a signatory to the 1988 Drug Convention because it is not a U.N. member. Taiwan authorities, nonetheless, have passed and implemented laws bringing Taiwan into compliance with the Convention's goals and objectives. Taiwan also continued to expand counter-drug cooperation with U.S. law enforcement agencies, through AIT.

Encouraged by AIT and DEA, Taiwan authorities passed two key drug laws to control both the manufacture and sale of phenylpropanolamine (PPA). The laws allow pre-export notification on shipments of PPA to other countries and establishes a new agency to monitor the production, use, and sale of drugs. Taiwan has continued to strengthen its efforts to stop drug trafficking and is addressing domestically and in conjunction with the international community the problem of money laundering.

Through AIT, Taiwan and U.S. law-enforcement agencies cooperated closely on investigations and joint operations concerning drug trafficking and related crimes. Taiwan authorities worked with the United States and other countries on anti-money laundering efforts. Taiwan is an active participant in the Asia-Pacific Group on Money Laundering and the Egmont Group.

STATEMENT OF EXPLANATION

THAILAND

At the time that the List of Major Drug Producing and Transiting Countries was prepared at the end of last year, information then available indicated that in excess of 1000 metric tons of opium was cultivated in Thailand. However, success with eradication programs during the current crop year seems to have reduced cultivation to well under that figure. Thailand remains a major drug transit country as a significant amount of heroin transits Thailand on its way to the United States. Indeed, Thai authorities recently made a number of large seizures of heroin headed for the United States.

Thailand continued its long tradition of cooperation with the United States and the international community in anti-drug programs. The Royal Thai Government (RTG) added to its leadership role in transnational crime issues by co-managing the International Law Enforcement Academy (ILEA) with the USG in Bangkok. Thailand is one of the top three countries in the world in cooperating with the United States on extradition requests. Additional defendants arrested in 1994's operation "Tiger Trap" were extradited and extensive cooperative law enforcement programs continued to bear fruit.

Thailand has one of the most effective crop substitution and opium eradication operations in the world. 1999 poppy cultivation was down 38 percent from 1998 and opium production was down 62 percent. Eradication destroyed 50 percent of the crop leaving an estimated 6 metric tons remaining. Cultivated acreage has been slashed 91 percent since the onset of the eradication program in 1984. With DEA support, the Royal Thai Police (RTP) established the second in a series of specially-trained drug law enforcement units to target major trafficking groups. Overall, RTG efforts to target trafficking organizations have proceeded well, with numerous cases involving organizations with trafficking links opened in 1999.

More elements of the new Constitution came into force further strengthening rule of law and the judicial system, and providing a firm basis for further modernization and institutionalization of Thai society. Thai civil society is developing rapidly and a press with few restraints and the plethora of NGOs bring increasingly strong public attention to official corruption. A significant number of low and middle-ranked officers in the military and police were disciplined for corruption, although arrests for corruption continued to focus on lower-ranking officers and officials.

The RTG is close to deciding whether to accede to the 1988 U.N. Drug Convention. Passage of money laundering legislation was the last main requirement. Passage is expected in the March 2000 parliamentary session.

The USG considers Thailand an important ally in combating the production and flow of illicit drugs. Our two countries have been working together to fight production and trafficking of narcotics with great success for over three decades, and DEA considers its cooperation with Thailand to be one of its most successful overseas partnerships anywhere in the world.

STATEMENT OF EXPLANATION

VIETNAM

As a national priority in Vietnam, the fight against illicit drugs is second only to poverty reduction. In 1999 Vietnam fought on two fronts: against the production and use of drugs as well as against cross-border trafficking of drugs. Vietnam, with 2,100 hectares under poppy cultivation and a potential of 11 metric tons of opium production, intensified efforts to eradicate poppy crops. Authorities also successfully eradicated 860 of an estimated total of 1,000 hectares used for cannabis cultivation in 1999.

The Government of Vietnam (GOV) instituted an augmented prevention campaign to reduce domestic drug use and abuse. Also in 1999 Vietnam stiffened law-enforcement campaigns against drug traffickers and toughened prosecution to achieve a record number of arrests and convictions. Authorities prosecuted 3,310 drug-related cases involving 4,952 defendants. Of cases brought to trial, 35 received a death sentence and 21 were sentenced to life imprisonment. A high-profile anti-corruption campaign was implemented and included public trials of high-ranking government and party officials involved in illicit drug and other smuggling.

Due, in part, to its location so close to the "Golden Triangle," Vietnam is a major transit point for opium and heroin. To address this problem, the GOV set up special task force units to combat drug trafficking along the borders, and police, customs and border forces arrested 19,010 drug criminals, an increase in arrests of 31 percent over last year. Drug interdictions increased by 32 percent, with seizures of 51.8 kilograms of heroin, 314 kilograms of opium, and 369 kilograms of cannabis. In its first year of operation (September 1998-September 1999), the marine police force began patrols to detect drug trafficking. Vietnam also tightened oversight and control of precursor chemicals, transferring responsibility for monitoring to the Ministry of Public Security, Ministry of Public Health, and Department of Customs, and set up a Precursor Chemical Control Force in the Ministry of Health.

In 1999 GOV began work on preparing draft counter-drug legislation to modernize organized-crime statutes and techniques, enhance law-enforcement efforts, and strengthen compliance with the 1988 U.N. Drug Convention, to which Vietnam is a party. Vietnam is negotiating counter-drug agreements with China and several EU countries, has cooperated with Interpol, and has worked closely with U.S. law-enforcement agencies. In April 1999 the Vietnamese Police joined the ASEANOPOL Criminal Information System. UNDCP is assisting Vietnam revise its Master Plan against drugs and craft its new counter-drug legislation. Vietnam supports UNDCP projects targeting demand reduction, crop substitution and suppression of drug trafficking.

The United States and Vietnam have not yet concluded a counter-drug agreement. The GOV has not fully eradicated poppy crops, and farmers reverted to poppy cultivation in some high-poverty rural areas, bringing an additional 645 hectares under cultivation in 1999 and increasing the total to 2,100 hectares devoted to poppy crops. Vietnam's National Assembly approved penal code revisions that criminalize money laundering for the first time. The provisions will take effect on July 1, 2000. Vietnam is working with the World Bank to develop a money-laundering section in draft banking legislation.

Despite some notable shortcomings, Vietnam has made a vigorous effort to combat drug production and trafficking. There is no question that the GOV at the highest levels fully realizes the threat drugs present to their own people and society and is doing everything possible to counter the availability and use of illicit drugs.

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(Distributed by the Office of International Information Programs, U.S. Department of State. Web site: usinfo.state.gov)

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