REFINING AND TRAFFICKING

The World Opium Survey of 1972 under the supervision of the Cabinet Committee on International Narcotics Control concluded that the Southeast Asian network would only become a major concern of the United States if the primary smuggling route were to falter. The primary complex to which they referred was Turkey to Marseilles to the United States. As we know, there has been a ban on the growing of poppies in Turkey for 2 years, and the only heroin which was smuggled out of that region was that which had been stored before the ban went into effect. Even with the Turks reentering the poppy market with their poppy straw, the success of their control effort, which, hopefully, will live up to expectations, will only maintain the major void which the illicit Turkish opium used to fill. Southeast Asian poppy fields have combined with the Mexican regions to more than fill this previous quota. There will clearly continue to be a major demand by illicit dealers on the Southeast Asian producers if the curbs placed on the Turkish farmers are only moderately successful. At the time of our last visit 2 years ago, most of the opium grown in the Golden Triangle was moved down to the Thai-Burma border in huge mule caravans transporting more than a ton of raw opium or morphine base at a time. The opium or morphine base was then distributed for local consumption or smuggled through Thailand to Bangkok for trawler shipment to Hong Kong. In Hong Kong, the opium would be refined and either consumed locally or prepared for worldwide distribution. This whole network and pattern has changed. No longer is there a permanent large refinery operating in the Tachilek area. Heroin production is now being carried out in the north in small, mobile and temporary laboratories on an order by order basis. The caravans which used to pass through the Golden Triangle under the armed guard of the rebel traffickers no longer have free reign in the area. The first-rate Thai enforcement effort has brought a halt to this type of traffic. They are far more successful at disrupting the part of the traffic which passes through Thailand for consumption in lower Thailand and for worldwide distribution than they are at combating the production and refining in the north. Their pressure has led the traffickers to refine the opium nearer to the fields, which reduces the bulk by 90 percent. Then the heroin is moved by body pack to distribution centers. This is the so called "human wave strategy" where a larger number of smugglers each carry a smaller amount of heroin. In January of 1974, there was one incident where 18 heroin smugglers were arrested on a single commercial jet flight which originated at Kuala Lumpur, Malaysia, and was destined for Amsterdam. The traffickers are also making greater use of airplanes to transport the refined product from the north to lower Thailand and to other distribution points.

These modifications have many serious implications. First of all, narcotics enforcement operations against the increasingly mobile refinery targets require more manpower, materiel, planning and coordination than ever before. When one realizes how easy it is to set up a refinery, the scope of the problem becomes obvious. Even when a refinery is discovered by enforcement officials, by the time they are able to make their way through the inaccessible highlands to the refinery, the operatives are usually able to flee. As one example, when the Thailand's Special Narcotics Organization (SNO) forces arrived at a refinery near the Burmese border, the operators fled across the Burmese border and the SNO team could not pursue them. (See appendix for details of SNO.)

On an overcast day when the ceiling was only 300 feet, we were able to travel by helicopter from Chiang Mai up to the area where several refineries have been located. The helicopter is the only real way to move enforcement units into these inaccessible areas, and when one considers that there are ridges of 3,500-4,000 feet shrouded in a heavy cloud or fog, it is often not even very safe to try to reach these areas by helicopter. Nevertheless, we were able to fly into the border region north of Chaing Mai and see one of the refineries which, before it was raided, was producing 100 pounds of heroin a day. We were made very much aware of how difficult it is to move in an armed group to drive the traffickers away from their refineries, especially when one knows how well armed they are. We do not want to give the impression that the traffickers are able to gain sanctuary in Burma with the permission of the Burmese Central Government. A more realistic assertion is that the Burmese do not have control of the northern part of their country. In Northeastern Burma, the territory is controlled by the traffickers, mostly by the Shans, and in the Northwest, it is under the control of the Communists. We are at a great disadvantage if we try to rely solely on the Central Burmese Government to control the affairs which go on within their national borders. They simply cannot control the trafficking and production in their highland areas.

The second implication of the modifications in trafficking and refining is that the interception of traffickers does not significantly disrupt the flow of narcotics because of the small amount which is being individually carried and intercepted. As long as we cannot focus on the supply side of the equation, the law enforcement authorities are aiming at a policy of disruption and interception. They admit that they will only be able to seize 5 to 10 percent of the illicit flow. What the enforcement efforts have done is to maintain the high price of opium in the illicit channels because of the high risk and, secondly, to change the consumption and financing patterns in Southeast Asia. As raw opium becomes rarer outside the hill regions, No. 3 and No. 4 heroin is all that is available; the opium smokers become heroin smokers and heroin injecting addicts. This consumption modification is having serious ramifications and will be discussed in a later section of this report. (No. 3 and No. 4 heroin is the type which is consumed in the United States.)

Another major change in the trafficking patterns relates to the trawler traffic. Several years ago, two or three trawlers a month were making their way to Hong Kong and Macao with tons of raw opium and morphine base on board. There were three major seizures off the coast of Vietnam by the Vietnamese whose narcotics people are

now doing a good job of interdiction and the Thais too were able to apprehend several vessels while they were in port. These enforcement actions have altered the trawler traffic so that it is no longer a dependable route for the professional smuggler. The authorities estimate that now there is only about one trawler every 6 weeks which heads up toward Hong Kong and Macao. There is increased air and water surveillance, and there are plans to provide more pursuit boats because the current level is insufficient to really affect the traffic materially. Interdictions have forced prepayment for the trip before the traffickers will leave the Thai port. Furthermore, they now go farther off the coast of Vietnam before heading for Hong Kong, and the trip takes 3 weeks instead of 2. To avoid the Hong Kong enforcement efforts, the trawlers stop before entering the territorial waters of Hong Kong and either dump the cargo overboard for pickup by local junks or transfer it to a number of small ocean going vessels which have freer play inside the port of Hong Kong and are less noticeable. The traffickers are making use of the territorial waters of the People's Republic of China in their maneuvers and the lack of cooperation from the PRC is clearly hindering surveillance because Hong Kong authorities cannot enter the waters which are under PRC control and the traffickers can. The PRC may be more willing to help in the near future in combating the international narcotics patterns as it begins to influence their own people. It is clear that each of these modifications makes the law enforcement job more difficult.

The smaller vessels are able to pass in and out of the Hong Kong port freely and do not have to report to any customs point. In Hong Kong, the customs must come to the boat rather than the boat reporting for inspection before being able to anchor. With the number of boats passing in and out of Hong Kong daily and the number of places in which opium, morphine base or heroin can be secreted, it is small wonder that little of the traffic is intercepted.

The anti-trawler efforts, however, have led to traffickers' reliance on air transport for opium and heroin destined for Hong Kong and other worldwide distribution points. It has also led to the creation of new smuggling routes. Malaysia and, more specifically, the port of Singapore have become major centers for worldwide distribution. With the heroin already refined by the time it reaches the Thai-Burma border, the need to pass through Hong Kong has been removed. Thus, a large active international port like Singapore becomes an excellent spot from which traffickers transit. Malaysia does not produce a significant amount of opium and its consumption problem is minimal, but because of its geographic location, it is becoming a key spot for worldwide distribution. An international enforcement effort should make provisions to deal with this.

To obtain a perspective on the problems which Singapore may present, one should realize that the free port of Singapore is the fourth largest in the world, with about 400 ocean-going merchant ships in harbor on any given day. Some of these ships carry narcotics from Singapore to Hong Kong and Indonesia, as well as to other Asian and international ports. Some vessels have been known to depart Singapore for Penang where naroctics are picked up by the traffickers and subsequently delivered to Indonesian locations. Hundreds of small boats also traverse the waters around Singapore and the Straits of

Malacca. Sea-borne smuggling is endemic in the whole of the Singapore Malaysia/Indonesia/Philippine archipelago.

The Singapore Central Narcotics Bureau, which works closely with the DEA District Office, recently reported that there are approximately six major syndicates involved in narcotics trafficking between Thailand, Malaysia, Singapore and Indonesia. While two of the syndicates have been eliminated or disrupted, there are an additional 250-500 small scale rackets or drug trafficking entrepreneurs involved. Another distribution point is the Philippines. Philippine addicts are now supplied from Hong Kong but as enforcement in Hong Kong continues to improve, the Philippines may become more and more of a central distribution center. The thousands of islands and geography of the Philippines make it capable of becoming a major problem area for enforcement personnel.

Another trafficking pattern to be looked at, is eastward from the growing fields through Afghanistan. We do not have much information on this route at present but as the southern route becomes riskier this could become a major problem.

One other aspect of the trafficking which is of central concern is the actual traffickers themselves. A majority of the heroin which is smuggled from Southeast Asia is done by overseas Chinese seamen. They are often recruited for only one trip and thus do not build up a pattern or a record. Sometimes, they are affiliated with the KMT forces which did not return to China in 1949, or they are from either Taipei or Hong Kong.

The central observation concerning production and refining is that the improved narcotics enforcement efforts centered in Hong Kong and Thailand have forced the traffickers to change their mode of operation, but this has not led to a decrease in the amount of illicit opium products which are released for local and worldwide consumption. As long as we concentrate on narcotics solely in the law enforcement framework, we will only take 5-10 percent of the narcotics out of the illicit pipeline. We will disrupt the trade, but get at only the branches of the tree of narcotics trafficking. If we are to get at the roots of the problem, we must seriously consider innovative answers.

HONG KONG ENFORCEMENT EFFORTS

The role of Hong Kong in the Far Eastern narcotics traffic, although still major, is no longer as central as it was 2 years ago. The major changes are in the aspects of refining and distribution. Hong Kong still imports and exports opium and its derivatives but the major part of its opium is used for local consumption. However, Hong Kong is still used as a transshipment point for Europe, Canada, and the United States directly. Hong Kong is still the financial center of the narcotics trade.

Our enforcement personnel and the British authorities recognize that by the time opium reaches Hong Kong, the problem is almost insurmountable. Hong Kong now stresses the need to focus on the growing areas, and it now has a liaison official working in Thailand. To understand the nature of the enforcement problem which faces the British and Hong Kong forces, one should realize that 4 million people pass through Hong Kong during the course of a year; 12 million tons

of cargo move through Hong Kong each year and there are 1.7 million air passengers. The harbor is open 24 hours a day and there are 15,000 small craft operating in the harbor daily.

Even with this immense task before them, the narcotics enforcement forces have been able to make significant inroads into the traffic. Much of the opium and morphine which used to come from Thailand is now bypassing the Colony. We were able to meet with the senior British narcotics official in the Colony, Norman G. Rolph. He is very responsive, and the cooperation between United States and other narcotics authorities in Hong Kong has improved substantially. During Mr. Wolff's last visit to the Colony, he was very critical of the efforts of the British and did not feel they were seriously committed to the narcotics fight. Since then, the British and Hong Kong authorities have openly recognized the problem and have actively joined the effort to eradicate the traffic. They have made the greatest progress in police activities, namely, the interception and disruption of trafficking and the refining. Less progress has been made in the treatment and rehabilitation programs for the local population. There is greater exchange of personnel and information between American and British authorities. Furthermore, our congressional visit demonstrated to the Hong Kong forces that we are committed and that we do appreciate their work. Future congressional trips to this area will serve to reaffirm our continuing interest and commitment to the goal of suppressing narcotic traffic.

Last year, there were five major syndicates operating in Hong Kong. The enforcement effort arrested the heads of two of them in October on conspiracy charges. This is the first time that conspiracy charges have been used in narcotics prosecutions. The enforcement officials feel that they have broken the financial back of the third by immoblizing and seizing three of their heroin factories. This has not ended the narcotics traffic but has thrown it into a state of disorder.

We were informed that the reason the police were able to break up the syndicates now and not previously was the removal of a high police official. This person seemed not as interested in going after the syndicates as he was in statistics, so he focused his efforts on the addicts and the small pushers. Furthermore, the pressure for Hong Kong to take decisive action was not as active as it could be. This is one place where congressional visits and reports helped, especially in that they were complemented by international pressure to do something about the narcotics traffic. Now that new officials are in office, the top DEA official in Hong Kong is able to get all of the cooperation he needs. Furthermore, we now have people in the Hong Kong narcotics effort to whom we can channel our information and of whom we can expect action.

Hong Kong authorities have known about the syndicates for some time, but they have not used their information effectively in the past. We are very aware that although the traffic is down, prices are up. Even though normal distribution channels have been disrupted, the profit motive is too high to assume that the traffic will end. Hong Kong traffickers are clearly rebuilding. In the interim, some of the chemists who operated in Hong Kong are now working in remote inaccessible. areas in northern Thailand, and some of the couriers are picking up the finished product directly in Thailand to avoid Hong Kong com