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08/25/1995 LAW AND DISORDER
A Growing Torrent of Guns and Narcotics Overwhelms China

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LAW AND DISORDER
A Growing Torrent of Guns and Narcotics Overwhelms China

By Anthony Davis

WHEN WANG WEIDI PULLED up at a checkpoint outside Funing township in China's southwestern Yunnan Province on June 9, he wasn't expecting trouble. His tanker truck was already three days' drive clear of the Myanmar border, one of hundreds of vehicles grinding west toward Guangxi on National Route 323.

It was an irregularity on his ID card that first attracted the attention of an alert traffic cop. Wang and his companion Li Xiaodong did the rest themselves. Visibly nervous, they began pressing expensive cigarettes on the police, then volunteered to pay a stiff fine if they could drive on - and no need to bother with a receipt.

Increasingly suspicious, the police finally searched the seemingly empty truck. They found a pair of American pistols, a stack of cash and a massive 108 kg load of top-grade No. 4 heroin. In New York City that shipment might have sold for something over $13 million. In China it will cost Wang and Li each a bullet in the back of the neck.

The bust was a small victory in an escalating war that China is in danger of losing. From across the country's southwestern and southern borders a flood of narcotics and weapons is fueling an unprecedented crime wave. Riding on the back of get-rich-quick economic reform, crime is not just back: it's armed, organized and already disturbingly well-entrenched at virtually all levels of society. Chinese mobsters have never had it so good since the Roaring Twenties when godfather Du Yuesheng and his Green Gang ruled the Shanghai waterfront and parlayed as equals with Nationalist generals and colonial police.

Raw statistics reflect only part of the story. But they're bad enough. Between 1993 and last year, nationwide violent crime jumped a sharp 15.6%. Robbery was up 14.9%, fraud by 26.3% and theft by 17.7%. In the free-wheeling south those figures look tame. Crime in the Shenzhen Special Economic Zone, next to Hong Kong, rose a dizzying 66% over that period; prostitution, gambling and drug-abuse convictions were up 92%.

Against a background of loosening social controls, rampant corruption and a crisis of moral values, old constraints are crumbling. "Everything is now money-oriented with the emphasis on consumerism and entertainment," says Ngai Ngan Pun, a lecturer at the Chinese University of Hong Kong and an expert in juvenile crime. "The golden rule of young people is to be comfortably off, but not everyone can get what they want."

Beijing is clearly alarmed - albeit belatedly - both by the galloping crime statistics and more specifically by the booming drug and weapons trade. Says a diplomat in Guangzhou: "There is a sense of great concern over social disorder, and arms trafficking is a growing worry." Goaded into action by Beijing, authorities in the southern provinces of Guangdong, Guangxi and Yunnan have cracked down hard. Recent police offensives have targeted narcotics, arms trafficking, a flourishing vice trade, gambling, chronic hooliganism and petty crime. Thousands of suspects have been rounded up and hundreds of convicts executed.

In the economic powerhouse of Guangdong, an unprecedented three-month anti-crime drive has stressed education campaigns in schools and the workplace. There have also been public photo exhibitions, drug-burning ceremonies, amnesties for addicts and a stepped-up drug-rehabilitation drive. The sharp end saw 4,800 suspects rounded up by late June with over 300 kgs of narcotics seized. On one day in mid-May, 51 convicts, mostly drug traffickers, were executed in various cities after ritual public denunciations. In Nanning, capital of neighboring Guangxi, Public Security Bureau (PSB) men rounded up 1,245 offenders on a single night and busted 24 prostitution joints, seizing weapons and drugs.

In Yunnan, which is bearing the brunt of the narcotics epidemic - and faces a growing AIDS problem - Anti-Narcotics day on June 26 was celebrated with executions as usual. Last year over 400 traffickers were dispatched with a bullet to the back of the neck. "More than 10g (of heroin) and we'll have their heads now," says a Yunnan PSB officer grimly. "We're fighting a war and in a war you kill the enemy."

But the real enemy is alive and well in sanctuaries in the rugged hills across Yunnan's border with Myanmar. In 1989 the break-up of the Communist Party of Burma (CPB) - earlier beholden to Beijing - produced a sharp increase in the volume of heroin moving through China. In March 1989 the insurgents - since 1968 dug in along the Yunnan border - ousted a geriatric Maoist leadership and split along ethnic lines into four pocket armies. Subsequent cease-fire deals with the government permitted Yangon to turn its guns to other rebel armies, while allowing the ex-CPB groups - officially termed "Special Police Forces" - the autonomy to step up heroin production.

Today, the volume of heroin coming from districts along the Yunnan border far outstrips the production of labs north of the Thai-Burma border controlled by the Sino-Shan warlord Khun Sa. "Khun Sa is relatively small-time compared with these guys," notes one western analyst.

Secreted in teak logs, blocks of jade, sacks of agricultural produce and secret compartments in vehicles, tons of heroin are being trucked across what has become an all-but-open frontier. Passing through Yunnanese border towns such as Ruili, Wanding, Mangshi and Jinghong, the drug is transported east under the noses of the People's Armed Police (PAP).

The sheer volume of heavy-goods traffic and buses moving east along key routes makes interdiction a matter of either pure luck or hard intelligence. At Gazhong, one of four checkpoints between the notorious Ruili salient and Kunming, anything up to 500 laden trucks and buses can pass through in one day. "Sometimes we strike it lucky; more often, we don't," explains a young PAP officer. "To search one truck thoroughly you'd need half a day." He points to the line of backed-up vehicles and shrugs hopelessly. "Just look at it."

The traffic speaks for itself. China's economic opening has shifted the drugs trade from a trickle of opium a decade ago to tons of heroin today. Over the last four years a staggering 14 tons of heroin have been seized in China (4 tons in 1994) along with 9.7 tons of opium and 3.1 tons of marijuana. The establishment of special trading zones has triggered a booming trade along its southern border and a virtual dismantling of controls along what was once a tightly sealed frontier. Across the Myanmar border Chinese traders venture as far as Mandalay while the streets of Ruili are thronged with Myanmar gem dealers and prostitutes.

Corruption in China has also undermined the effectiveness of the security forces to tackle the threat. "China is notoriously corrupt," notes one senior anti-narcotics officer in Hong Kong. "There are occasional crackdowns. But for the most part, we've found from informants, traffickers and defendants that China's wide open. The right amount of money to the right official can fix anything."

Graft and guanxi (connections) have been especially pervasive along the Myanmar border itself. Ties established between former CPB commanders and local Chinese officials have survived the death of Maoism. Take Liu Guoxin, for example. An ethnic-Chinese from Myanmar's Kokang district near the Chinese border, Liu today is widely alleged to have a stake in a complex of heroin refineries on the west bank of the Salween river. But you're more likely to bump into Liu in the lobby of the White Peacock Hotel in the Chinese town of Mangshi: he's a co-owner of the place.

Or there's Li Mingxian. Another ethnic Chinese ex-CPB commander, Li heads a 13-man committee running the CPB's old 768 and 815 Zones - a 5,000 sq km patch north of Kengtung in Shan state - and oversees the production of several heroin refineries near the border. Lin, who has enjoyed close contacts with Chinese military intelligence, also happens to own a large house on the edge of Jinghong in Yunnan's scenic Xishuangbanna prefecture and is known to travel to Kunming.

But as China confronts the immensity of the heroin epidemic, old loyalties may be wearing thin. To the surprise of most observers, in May last year Chinese police seized Yang Maoxian, a well-established heroin smuggler. His elder brother, Yang Maoleng, heads the Myanmar National Democratic Alliance Army, now dominant in the Kokang region. The 48-year old younger Yang was arrested in the Chinese town of Zhenkang. Investigators from Kunming didn't need to go far to find him: at the time he was drinking with some police buddies in the Zhenkang PSB offices. In the crackdown that followed, well over 100 Yunnanese PSB men were arrested and two executed. Following the rejection of an appeal Yang himself was executed last October. In a grim twist reflecting the harder mood on the border, his brother had to pay 701 yuan ($84) to get the body back for burial: 700 yuan for transportation and 1 yuan for the cost of the bullet.

From the border, drugs move across southern China through what Yunnan police chief Feng Jiacong describes as the "Black Corridor." Passing across the Salween and Mekong rivers, much of the narcotics is shipped through Baoshan to Dali and the provincial capital of Kunming. Excellent air and road links lead east to Nanning. From there some heroin moves south across the Vietnamese border to Indochina, but the bulk is shipped to Guangdong.

Chinese officials like Feng contend that most of the drugs still transit Hong Kong on their way to the lucrative markets of North America, Australia and Europe. Western experts disagree. They believe most high-quality 'China White' heroin is shipped from ports in China like Guangzhou and Shanghai. "Hong Kong is no longer a major transshipment point," argues an anti-narcotics officer based in Hong Kong. "There's stuff coming in here for local consumption, but we're talking consignments of 5 kg, 10 kg, 20 kg at most." And the bulk of that is still shipped to the territory by Thai trawlers.

Startling quantities of heroin from China, however, are reaching Taiwan. Transferred from Fujianese to Taiwanese fishing vessels, much of it may be moving on to the United States. But growing quantities are being consumed on the island. "Suddenly heroin is everywhere in Taiwan," notes one western analyst. Official estimates put the republic's addict population at 30,000 to 40,000. But many independent analysts believe it could be double that figure.

Contrary to Hollywood mythology, the masterminds behind the east Asian heroin crisis are not Hong Kong crime syndicates, the Triads. Or at least, not directly. "Major international trafficking may have affiliations with Triads, but it's not Triad-sponsored," says one western drug-enforcement officer with years of experience in the region. "Major traffickers operate loosely in confederations or syndicates which call on contacts to put together major deals." But the fluid and temporary nature of the syndicates, often financed by brokers and dealers in Hong Kong and Bangkok, makes cracking them a difficult task.

While the brains, money and international connections may originate in Thailand and Hong Kong, it's the Chinese mainland that provides the foot soldiers of organized crime. Men like Wang Weidi and Li Xiaodong are what one law-enforcement officer calls "facilitators." Their job was to move the 108 kg of China White from inside Myanmar to Guangzhou. There, Li was to contact three Hong Kong dealers, all of whom were later arrested in a police sting.

Playing an increasingly pivotal role on the mainland as facilitators are new Fujianese gangs. Among the most dynamic and outward-looking of Chinese, the clannish Fujianese have long been well established in Myanmar, Thailand and Malaysia. And their Diaspora is growing. Attracted by the prospect of commerce on and over China's frontiers, Fujian settlers are moving to border economic zones such as Ruili in Yunnan and Pingxiang opposite Vietnam in Guangxi. Thousands are moving south to Mandalay. Links thus extend from northern Myanmar to the fishing ports and cities on the Fujian coast opposite Taiwan.

The spill-over effect of China's role as a key transit state in the international narcotics trade has been catastrophic. A country which prided itself on having stamped out the scourge of opium imposed on it by British colonialism is now facing a renewed addiction crisis of frightening proportions. "The latest official figure for drug users nationally was 380,000," says a Kunming PSB officer. "In actual fact, we know it's at least 500,000." Yunnan, where the epidemic began, alone has an addict population of 100,000, with 20,000-30,000 users in Kunming. Some foreign estimates put China's total addict population at well over 1 million. And despite the executions and education campaigns, numbers are still rising.

It's not difficult to see why in places like San Yuan Li. An inner city suburb of Guangzhou, San Yuan Li's jostling backstreets and low-income housing blocks are wedged between clogged highways not far from the main railway station. Overhead, jets roar in on the flight path to Baiyun airport. One-room lodgings and tiny apartments are crammed with transient workers and drifters from across southern and central China. Noise, dust and the sheer pressure of moving humanity are unremitting. In Guangdong, with a population of 66 million, there's an estimated "floating population" of some 12 million. Police blame them for 60% of the province's crime.

The city's Uighur community - Turkic migrants from the far-western Xinjiang autonomous region - has made San Yuan Li a kind of home. There are mosques and Muslim restaurants. And in the city's narcotics trade the Uighur mafia has carved out for itself a sizable share of the street-level action. Much of the heroin and hashish comes through Xinjiang from Pakistan and the poppy fields of southern Afghanistan.

Sayyid is a tousled, street-wise dealer in his late 20s whose home was once Urumqi, the capital of Xinjiang. Today he mostly hangs out on the quarter's main thoroughfares. Shirt open to the waist, he squats amid a knot of fellow Uighurs and Chinese toughs outside a small barber shop that doubles as a brothel.

Here he's a king of sorts, watching the stream of passersby, constantly alert for a deal. Others approach - money and cigarettes change hands. When a running fight erupts between a stoned Uighur and a Han Chinese youth, cops from the nearby police box don't show: Sayyid and his cohorts settle it. In May, several other Uighurs were taken in a police round-up, a couple executed. But out of bravado or fatalism, Sayyid is still ready to close a deal. And the PSB? His habitual, lop-sided grin widens into an open laugh: "Mei wen-ti!" - No problem.

Sayyid's weapon of choice is a small Uighur knife brought from Kashgar. But in the murky netherworld of urban crime, many of his Han counterparts are looking to more formidable hardware - and are willing to pay. Increasingly, Chinese criminality is armed and not slow to pull the trigger.

Last year seizures of illegal arms were up nearly 30% over 1993. That reflected both increasing availability of guns and rising official alarm. In September, a monthlong crackdown netted some 120,000 illegal weapons - a quantity described by a PSB official as just "the tip of the iceberg." And while military handguns are the hottest item, gun-running syndicates are also marketing grenades and sub-machine guns. In May, Guangdong police seized anti-tank rocket launchers.

But the poor-man's end of the arms bazaar is supplied by backyard workshops mainly in central Hunan and western Sichuan provinces. China's cottage arms-smiths have not, as yet, achieved the sophistication of their cousins in Pakistan's tribal areas. Their crude one-shot pistols and even flint-lock style weapons are as likely to maim their users as intended victims. Other guns are emanating from the arsenals of the People's Liberation Army. But by far the largest numbers of weapons are moving north across the Vietnamese and Myanmar borders. These weapons are generally bought by organized crime syndicates within China.

Ironically most of the imported weaponry is of Chinese manufacture - once supplied by Beijing either to the CPB in its campaigns against Yangon, or to the Vietnamese communists in their anti-colonial wars. Today, profits are considerable. A Type 54 army automatic pistol that in Ruili can be bought for around 1,500 yuan ($180) will more than double in price by the time it reaches Kunming. Further north the price is higher still.

Nanning was once the main staging area for military aid to Vietnam. More recently the city of tree-lined avenues and gleaming new high-rise towers has been ambitiously projecting itself as a regional communications hub linking Vietnam and Indochina with China's southwest and the booming southeast. Its geographical advantages have long been obvious to the criminal fraternity: the city is already a nodal point in both the weapons and narcotics trade.

The side effects have been palpable. In the first months of this year the local press reported a 30% to 40% jump in crime involving drugs, prostitution and gambling. A one-day swoop in May picked up 761 suspected traffickers and addicts, large quantities of heroin and three pistols. In one bizarre reflection of the decline in law and order, provincial authorities recently established a fund for those "disabled or injured" in brushes with "hooligans."

Five hours drive to the south amid the jungled crags along the Vietnamese border is Pingxiang. The surge in cross-border trade has transformed the once-sleepy train stop into a cowboy town of seedy hotels, honky-tonk karaoke bars and neon-lit "barber shops." Staffed by Hunanese and Sichuanese, prostitution is big business. The arms trade is rather more discreet; but here and in Ningming to the east, smuggled guns from Vietnam are available.

"The gun-running started as soon as relations with Vietnam improved," says Huang Yi, a local entrepreneur. "There are more weapons coming from Vietnam now as controls are easier here than on the Burmese border." The favored Type 54 automatic sells for something over 2,000 yuan ($240); grenades for a fraction of that. The right connections can produce assault rifles. "Every household has weapons left over from the war to sell," he adds. "Some are bought from Vietnamese army units."

The smuggling is mostly piecemeal, say locals. But worryingly for the authorities, larger consignments also appear to be slipping in. Early last year, the Chinese coast guard intercepted two vessels from Vietnam off the Guangxi coast, sparking a two-hour firefight before the smugglers were captured. Each boat was carrying arms shipments apparently from a Vietnamese army unit

At sunset off-duty policeman Tian Zhiming (not his real name) lounges at a street-side Sichuanese restaurant sipping a beer and watching the town come to life. Around him tables are filling up. Giggling hookers trip past heading toward the winking lights and blaring karaoke joints. "The biggest problem here?" Tian laughs. "My pay, to start with. Try living on 700 yuan ($84) a month. Aside from that - robbery, gambling, dope. There are a couple of gangs: nothing serious - we know who their bosses are." So why aren't they behind bars? He grins weakly, his chopsticks hovering over a dish. "Well actually, there's not a lot we can do about it. They've bought up some of the big officials."

The extraordinary events that took place in the Yunnanese district of Pingyuan illustrate dramatically what can happen when "they" start buying up officials. Situated in southeastern Wenshan prefecture near the borders with Guangxi and Vietnam, Pingyuan consists of a market town and seven outlying villages. Its population is largely Hui, Chinese Muslims who have a history of truculent independence and - as the traditional masters of the Golden Triangle's caravan trade - a disdain for borders.

Over the 1980s, weakening governmental controls and spreading official corruption saw Pingyuan quietly re-emerge as a smuggling center. By the end of the decade, opium-trafficking had been overtaken by far more lucrative trade in heroin and weaponry. "At first they needed guns to protect the drug caravans," notes a Yunnanese observer. "Later guns became a commodity in themselves with drug traffickers bringing them across the border and selling them from Pingyuan."

By 1990 local drug barons and arms traders had established a private fiefdom where outside officialdom was unwelcome. Key local government and party heads on the other hand were well in on the action. As the Chinese saying goes: "The mountain was high and the emperor far away." Bigger drug bosses built air-conditioned mansions fitted out in marble, with swimming pools, dance floors, bars and Persian carpets.

But criminality was scarcely an elite pursuit. According to later police estimates, by 1992 at least 30% of the men in three villages were involved in the narcotics and weapons trade. The impact was felt nationwide: most weapons used in criminal activities across 24 of China's 31 provinces that year originated in Pingyuan. "In effect, the place had become a semi-open arms bazaar," noted one Chinese insider. It was also the biggest narcotics distribution point in the country, attracting buyers from Guangdong and Hong Kong.

Provincial authorities stalled and fumbled. There were perennial worries over the implications of a crackdown in a sensitive ethnic minority area; there was also corruption and sheer inertia. In July 1991 an ideological "work unit" was dispatched from Kunming to re-educate the locals in "real socialism." Two of its members were killed in a grenade attack; nervous PAP men began sleeping with pistols under their pillows.

Still, it was months before authorities finally moved decisively - on orders from Beijing. On Aug. 31, 1992, Pingyuan's population awoke to find the area sealed off by a 3,000-strong PAP force backed by armored vehicles and PSB special action units. The clean-up lasted 80 days. Armed police squads seized over 1 ton of narcotics, 964 assorted firearms, along with grenades and land mines. They arrested 210 suspects while a further 640 surrendered. Two major drug barons were killed in shoot-outs.

Even before Pingyuan, central authorities were not short of evidence that crime was becoming increasingly organized. Home-grown crime syndicates of the size, sophistication and resilience of Hong Kong's larger Triads may still be on the horizon. But PSB proclamations now refer routinely, if vaguely, to gangs with "mafia-like characteristics."

Most of these are gangs of young hoodlums, say observers. Harking back to secret societies of China's past, some have their own initiation rituals or identity symbols. In Guangxi, for example, the Junmao Dang (Army Cap Party) emerged recently in several cities with a proclivity for muggings, robbery and burglary. In many cases, young offenders are financing a heroin habit. Notes Chinese University of Hong Kong's Ngai: "The average age of young offenders has fallen and there are more girls involved in crime."

But it is the better organized gangs run by older, more professional criminals that are of greater concern. Many of this "lost" generation acquired a taste for armed violence during the upheaval of the Cultural Revolution, but found themselves ill-equipped to deal with the China of Deng Xiaoping. "In the 1980s, society was opening up and getting more competitive," Ngai says. "But many of these former Red Guards didn't have any formal education. They had no skills, no knowledge."

One shadowy group active in Guangxi is the Qibing Shi (Cavalry Division), a gang reportedly involved in protection rackets, extortion and gun-running. The center of organized crime, though, is undoubtedly Guangdong. The province presents all the ingredients for runaway crime: galloping economic growth, massive social dislocation and a sharp disparity between rich and poor. Nowhere is that more starkly illustrated than in Shenzhen.

A high-rise metropolis of over 3 million, the special economic zone is a mecca for migrant workers - and regiments of prostitutes - from across China. While underpinning the economic success of the zone, and Guangdong generally, the floating population has a stark downside. Around 80% of local crime is committed by outsiders. "Most of that is committed against others like themselves," notes a diplomat. "But there's enough spilling over into the local population to give everyone the sense things are spinning out of control."

The enthusiastic arrival of Hong Kong Triads from across the border has scarcely improved the situation. Shrugs Ma Chenzhou, a trader from Shantou on the Guangdong coast: "They're all here now: the Chaozhou mob, the 14K, the Wo Hop To." Shenzhen and the Pearl river delta offer excellent investment opportunities as well as rest and anonymity. "Guangdong's attraction is partly as a sort of safe-haven," notes a diplomat. "In Hong Kong they're fish in a gold-fish bowl. So why not dive into a lake?"

The situation is not without irony. Three short years ago police in Australia and North America were bracing for an invasion of organized crime as Triad bosses were said to be taking flight in fear of a draconian post-1997 communist crackdown. Opinions have since been revised. "Nothing could be further from the truth than the Triads having to flee Hong Kong," reflects a Western law-enforcement official in Hong Kong. "They are looking at China with an almost Gold Rush mentality. These are their own people, their own culture, with no hang-ups over laws. Anything goes."

Indeed with organized crime still in a tempestuous infancy, the mainland offers almost unlimited possibilities for joint-venture criminality. Hong Kong's godfathers stand to bring experience, skills and sophistication to fledgling enterprises. Fastest off the mark have been the mobsters of Hong Kong's Sun Yee On, the leading Triad of the Chaozhou group and one of the most active in the British territory. Already well-entrenched in Shenzhen, the Sun Yee On (Xin Yi An in Mandarin, or New Righteous Peace) last year attempted to set up a Guangzhou off-shoot, the Hei Tai Yang or Black Sun, and even began recruiting in secondary schools. In Shanghai, meanwhile, the Sun Yee On has reportedly been investing in the entertainment industry, particularly night clubs on Yen'an Rd. - with the People's Liberation Army providing semi-official backing.

The Da Quan Bang or Big Circle, however, has cast a far wider net. Former Red Guards from Guangzhou and elsewhere on the mainland, the group's founders moved to Hong Kong in the latter years of the Cultural Revolution. With many of its members familiar with weaponry, they soon hacked out a notoriety for armed violence that exceeded anything local Triads were capable of.

In returning to the mainland, the Big Circle have utilized a nationwide web of contacts established with other ex-Red Guards who have since turned to crime. This has given them a reach that Hong Kong's Cantonese and Chaozhou Triads can hardly match. Says one Western law enforcement officer in the territory: "The Big Circle is the only Triad that really does operate in the People's Republic and can move more or less freely."

Alarmist scenarios of an ungovernable China sliding into criminal anarchy have been overplayed in some recent commentaries. Despite extraordinary pressures, China's major cities are relatively stable and safe compared to Los Angeles, Rio de Janeiro or Moscow.

But grounds for optimism are few. As China continues along the road of economic reform the social and demographic pressures behind crime are likely to increase. While periodic crackdowns may make inroads into street-level petty crime, their longer term impact is dubious. Meanwhile, corruption spawned by rapid economic development and fast-rising expectations is shooting up as well.

Against that background, entrenched organized crime of the Big Circle type is almost certain to grow and exert a far more significant impact on China and the region. Internationally, real cooperation between China's law-enforcement agencies and those of other regional states is embryonic or non-existent. "In terms of contacts and cooperation, the bad guys are decades ahead," notes one analyst.

Perhaps more disturbingly, the capacity of China's own police apparatus to deal with the looming threat posed by organized crime is questionable. In forming dedicated anti-narcotics and economic crime units, important steps have been taken at both provincial and central levels. But despite determination among central authorities to crush it, graft remains the principal problem and the rule of law a goal rather than a reality.

"Corruption has been a very significant factor in the growth of organized crime in China - at all levels but especially in the Public Security Bureau," reflects a Chinese analyst in Hong Kong. "They really need to build up a clean police force." As China confronts the challenges of its growing prosperity, that one task will be critical to both its stability and well-being.

Anthony Davis is a contributing reporter based in Bangkok

From Asiaweek

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