Drugs, violence & graft mar jade industry amid insatiable China demand for the gem.
DAN LEVIN, NYT 05 December 2014
At 16, the gem trader’s son set out for the jade mines to seek his fortune in the precious stone that China craves. But a month in, the teenager, Sang Aung Bau Hkum, was feeding his own addiction: heroin, the drug of choice among the men who work the bleak terrain of gouged earthen pits, shared needles and dwindling hope here in the jungles of northern Myanmar.
Three years later he finally found what he had come for - a jade rock “as green as a summer leaf”. He spent some of the US$6,000 that a Chinese trader paid him on a motorcycle, a mobile phone and gambling.
“The rest disappeared into my veins,” he said, tapping the crook in his left arm as dozens of other gaunt miners in varying states of withdrawal passed the time at a rudimentary rehabilitation clinic here. “The Chinese bosses know we’re addicted to heroin, but they don’t care. Their minds are filled with jade.” Mr Bau Hkum, now 24, is just one face of a trade - like blood diamonds in Africa - that is turning good fortune into misery.
Driven by an insatiable demand from the growing Chinese middle class, Myanmar’s jade industry is booming and should be showering the nation, one of the world’s poorest, with unprecedented prosperity. Instead, much of the wealth it generates remains in control of elite members of the military, the rebel leaders fighting them for autonomy and the Chinese financiers with whom both sides collude to smuggle billions of dollars’ worth of the gem into China, according to jade miners, mining companies and international human rights groups.
Such rampant corruption has not only robbed the government of billions in tax revenue for rebuilding after decades of military rule, it has also helped finance a bloody ethnic conflict and unleashed an epidemic of heroin use and HIV infection among the Kachin minority who work the mines.
The drug and jade trades have become a toxic mix, with heroin - made from opium poppies that long ago turned Myanmar into a top producer of illicit drugs - keeping a pliant workforce toiling in harsh conditions as the Myanmarese authorities and Chinese business people turn a blind eye.
At a time when Myanmar is experimenting with democratic governance after nearly 50 years of military dictatorship, its handling of the jade industry has become a test of the new civilian leaders and their commitment to supporting human rights and rooting out corruption, as well as an early check on whether they will reject the former junta’s kleptocratic dealings with China.
So far, experts say, they have failed.
Washington is so much worried about the link between jade and violence - and the effect on democratic change - that it kept in place a ban on the gem from Myanmar even after it suspended almost every other sanction against the country since the civilian government came to power in 2011. But critics say the sanctions are useless because China attaches no such conditions.
“The multibillion-dollar jade business should be driving peaceful development in Kachin and Myanmar as a whole,” said Mike Davis from Global Witness, an anti-corruption organisation. “Instead it is empowering the same elite that brought the country to its knees and poses the biggest threat to peace and democratic reform.”
The fountainhead of Myanmar’s jade wealth is here in the mountains of Kachin state, which is rich in natural resources and poor in just about everything else. The country’s northernmost territory, Kachin shares a long border with China and is home to the Kachin ethnic group, a largely Christian minority with ambitions to gain autonomy from majority-Buddhist Myanmar.
Myitkyina, the down-and-out state capital, is the gateway to the most active mining region, containing what experts say is the world’s biggest and most valuable trove of jade.
With its broken footpaths, stray dogs and cemeteries littered with syringes, Myitkyina is a potent symbol of the region’s ills. The city’s tea shops have a thriving illegal side business in selling heroin, one of the few trades that have grown alongside the jade industry.
“In every house, there is an addict,” said Gareng Bang Aung, a local heroin user.
The city is the closest Westerners can get to the mining area, Hpakant. The government says it keeps the area closed because of sporadic fighting with the Kachin rebel army, but activists see a darker purpose: to hide the illegal jade and drug trades flourishing there. The only foreigners allowed past the military checkpoints, they say, are the Chinese who run the mines or go there to buy gems.
The lack of access adds to the mysteries of the jade industry, whose inner workings are deliberately obscured. Even the simplest information is not publicly available - including which companies operate the mines and how many are Chinese-run or financed despite laws banning foreign ownership. But interviews with jade miners and executives in Myitkyina, and with gem traders, diplomats and non-governmental organisations elsewhere, reveal a dizzyingly corrupt and brutal industry funded almost completely by Chinese trade.
Their descriptions of the harsh conditions at the mines were corroborated by rare footage filmed there by a local journalist hired by The New York Times.
The video from inside the checkpoints shows lush rolling hills scarred by craters that descend for hundreds of feet into pits. There, hundreds of men worked in the searing heat, picking through rocks with rudimentary shovels, or their hands, in search of the gem.
In some cases, the miners shoot water from high-powered hoses to break up the rock walls, a dangerous practice that sometimes triggers landslides. Also visible in the footage: an open-air heroin shooting gallery, hard up against a mine.
RAGING BATTLE
Myanmar’s jade industry took off in the 1980s after the introduction of market reforms in China. For the first time since Mao Zedong began banning private enterprise in 1949, entrepreneurs betting that the gemstone would become big business in China started jumping into the gem trade. Their financing helped build an industry that churns out the Buddha figurines and thick bracelets that have become status symbols for China’s middle class.
The burgeoning market transformed the Kachin insurgency, which had started in 1961 as a fight mostly about political independence, into a raging battle that extends to natural resources. A 1994 cease-fire stopped the violence, but gave the Myanmarese junta and its Chinese backers control over the best tracts in Hpakant.
The ceasefire fell apart in 2011, with jade fuelling the conflict by funnelling money to both sides. Local news media say about 120,000 people have been displaced by the fighting that included military air strikes in Kachin; the death toll remains in dispute.
In an interview, Dau Hka, a senior official with the political wing of the rebel Kachin Independence Army (KIA), described a sophisticated revenue collection system in which mining companies that want to operate in areas under the rebels’ control “donate” money to them, providing half their operating budget.
“The donations aren’t exactly legal,” he acknowledged.
The KIA also makes money by working with Chinese companies to smuggle jade through the jungle into China, according to activists and a Chinese jade importer. “They’ll call us beforehand, and we’ll come in a convoy to pick up the goods,” said the trader, who would give only his surname, Chun. The rebels, he added, demand cash on delivery.
Yet the fighters’ spoils pale in comparison to those enjoyed by the powerful Myanmarese military elite, whose companies receive the choicest tracts of mining land from the government, according to miners and international rights groups. Like the KIA, some military officers are also involved in smuggling, extracting bribes to allow the illicit practice, activists say.
“The top dogs are the Myanmarese military,” said Davis of Global Witness, which has investigated the Myanmarese jade trade.
Perhaps half or more of the jade that is mined, those who study the industry say, vanishes into the black market. The Ministry of Mines denied that smuggling is a major problem. Although official jade sales generate significant tax revenue, David Dapice of Harvard University’s Ash Center for Democratic Governance and Innovation, which did an extensive study of the jade trade, estimated that the government is losing billions a year to illegal trading.
Possibly the greater tragedy, however, is the heroin epidemic ravaging a new generation of Kachin. For decades, heroin was rare in Kachin state. The surge in the jade trade changed all that, creating a market for drugs among the thousands of Kachin labourers who flocked to the mines seeking an escape from poverty.
But Ze Hkaung Lazum, 27, said the mines proved to be a trap. Heroin, he said, is sold in bamboo huts “like vegetables in a market” for between US$4 and US$8 a hit. Miners squat in the open, next to piles of used needles, with syringes hanging from their arms. If the drug fails to take the workers’ meagre earnings, the prostitutes waiting nearby are happy to oblige for US$6 per 20-minute session. Within months, Ze Hkaung Lazum was a frequent customer of both.
Some miners, like Mr Bum Hkrang, a 24-year-old recovering addict, say they need the drug to steel themselves for the backbreaking and dangerous work their Myanmarese and Chinese bosses demand; others say they simply fell into addiction because the drug was so available, with some heroin dealers accepting jade as payment.
“Try digging all day with an iron rod and see how you feel,” he said, adding that he had abandoned his university studies for the promise of fast riches. Heroin, he discovered, gave him enough energy to work 24 hours straight.
Miners say at least four out of five workers are habitual drug users. Users who overdose are buried near the mines, amid groves of bamboo.
Over time, heroin abuse spilled into the broader population.
Like many locals, Tang Goon, who works on an anti-drug project, believes the government is distributing heroin to weaken the ethnic insurgency, with the military allowing pushers past their checkpoints. “Heroin is their weapon,” he said.
But whether the trade is driven by politics or simple greed, the toll has been devastating.
Kachin activists estimate that a sizeable majority of Kachin youths are addicts; the World Health Organization has said about 30 per cent of injecting drug users in Myitkyina have contracted HIV. With virtually no funding from a central government focused on other priorities, the Kachin rely on church rehabilitation centres that preach a spiritual, if controversial, solution to addiction.
At one, the Change in Christ centre outside Myitkyina, the founder, Thang Raw, runs a treatment programme based on rapturous hymnal sessions and baptismal-like dunks in a concrete water tank that are meant to soothe the agony of withdrawal.
The treatment did little to help Mung Hkwang, 21, who despite the sweltering heat lay shivering recently inside the centre’s thatch-roofed dormitory. His ankle, tattooed with a marijuana leaf, was shackled to his bed to keep him from running away to feed his habit.
“It ruined my life and destroyed my education,” he said. Just weeks later, he ran away and died from a heroin overdose.
There are plenty of culprits in Myanmar’s illicit jade and drug trades. But many human rights activists reserve their harshest criticism for China, which they say is content to profit from the mounting chaos that has engulfed Myanmar’s jade industry.
“China prioritises naked greed over any concern for the local population or how the jade is extracted,” said David Mathieson, a senior researcher on Myanmar for Human Rights Watch.
Jade has fired the Chinese imagination for thousands of years. According to legend, the birth of Confucius was prophesied by a unicorn who gave his mother a jade tablet heralding his destiny. To this day, many Chinese believe the stone wards off misfortune and heals the body.
“Jade, from ancient to modern times, is a symbol of grace to Chinese people,” said Zhi Feina, 34, a civil servant and repeat customer at the Beijing Colorful Yunnan Co, an opulent three-story jade emporium in Beijing where she was trying on bracelets.
The state-affiliated Gems & Jewelry Trade Association of China estimates that annual sales of jade are as high as US$5 billion, more than half of which comes from Myanmarese jade.
In a rare admission, China’s ambassador to Myanmar, Yang Houlan, confirmed that some Chinese are breaking Myanmarese laws, but he said Beijing was trying to clamp down.
“There are some businessmen engaged in illegal activities who, attracted by outsize profits, cross the border to mine or smuggle jade,” he said, adding that the two nations have stepped up cooperation on border controls and money-laundering investigations. “But there are some parts of this illicit trade that, like drugs, can’t be stamped out.”
Activists dispute the notion that the governments are serious about cracking down. Without a stronger push for reform from China, they say, they have little hope that conditions will improve.
So far, there does not appear to be an appetite for major change. During an interview, Shi Hongyue, vice-secretary-general of the Gems & Jewelry Trade Association of China, refused to even discuss the ills plaguing the Myanmarese jade trade.
When pressed about the heroin epidemic at the mines, Mr Shi was dismissive. “Honestly, the amount of drugs they’re using isn’t really that much,” he said.
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Myanmar mine workers search for jade, find misery
Drugs, violence & graft mar jade industry amid insatiable China demand for the gem.
DAN LEVIN, NYT
05 December 2014
At 16, the gem trader’s son set out for the jade mines to seek his fortune in the precious stone that China craves. But a month in, the teenager, Sang Aung Bau Hkum, was feeding his own addiction: heroin, the drug of choice among the men who work the bleak terrain of gouged earthen pits, shared needles and dwindling hope here in the jungles of northern Myanmar.
Three years later he finally found what he had come for - a jade rock “as green as a summer leaf”. He spent some of the US$6,000 that a Chinese trader paid him on a motorcycle, a mobile phone and gambling.
“The rest disappeared into my veins,” he said, tapping the crook in his left arm as dozens of other gaunt miners in varying states of withdrawal passed the time at a rudimentary rehabilitation clinic here. “The Chinese bosses know we’re addicted to heroin, but they don’t care. Their minds are filled with jade.” Mr Bau Hkum, now 24, is just one face of a trade - like blood diamonds in Africa - that is turning good fortune into misery.
Driven by an insatiable demand from the growing Chinese middle class, Myanmar’s jade industry is booming and should be showering the nation, one of the world’s poorest, with unprecedented prosperity. Instead, much of the wealth it generates remains in control of elite members of the military, the rebel leaders fighting them for autonomy and the Chinese financiers with whom both sides collude to smuggle billions of dollars’ worth of the gem into China, according to jade miners, mining companies and international human rights groups.
Such rampant corruption has not only robbed the government of billions in tax revenue for rebuilding after decades of military rule, it has also helped finance a bloody ethnic conflict and unleashed an epidemic of heroin use and HIV infection among the Kachin minority who work the mines.
The drug and jade trades have become a toxic mix, with heroin - made from opium poppies that long ago turned Myanmar into a top producer of illicit drugs - keeping a pliant workforce toiling in harsh conditions as the Myanmarese authorities and Chinese business people turn a blind eye.
At a time when Myanmar is experimenting with democratic governance after nearly 50 years of military dictatorship, its handling of the jade industry has become a test of the new civilian leaders and their commitment to supporting human rights and rooting out corruption, as well as an early check on whether they will reject the former junta’s kleptocratic dealings with China.
So far, experts say, they have failed.
Washington is so much worried about the link between jade and violence - and the effect on democratic change - that it kept in place a ban on the gem from Myanmar even after it suspended almost every other sanction against the country since the civilian government came to power in 2011. But critics say the sanctions are useless because China attaches no such conditions.
“The multibillion-dollar jade business should be driving peaceful development in Kachin and Myanmar as a whole,” said Mike Davis from Global Witness, an anti-corruption organisation. “Instead it is empowering the same elite that brought the country to its knees and poses the biggest threat to peace and democratic reform.”
The fountainhead of Myanmar’s jade wealth is here in the mountains of Kachin state, which is rich in natural resources and poor in just about everything else. The country’s northernmost territory, Kachin shares a long border with China and is home to the Kachin ethnic group, a largely Christian minority with ambitions to gain autonomy from majority-Buddhist Myanmar.
SYMBOL OF ILLS
Myitkyina, the down-and-out state capital, is the gateway to the most active mining region, containing what experts say is the world’s biggest and most valuable trove of jade.
With its broken footpaths, stray dogs and cemeteries littered with syringes, Myitkyina is a potent symbol of the region’s ills. The city’s tea shops have a thriving illegal side business in selling heroin, one of the few trades that have grown alongside the jade industry.
“In every house, there is an addict,” said Gareng Bang Aung, a local heroin user.
The city is the closest Westerners can get to the mining area, Hpakant. The government says it keeps the area closed because of sporadic fighting with the Kachin rebel army, but activists see a darker purpose: to hide the illegal jade and drug trades flourishing there. The only foreigners allowed past the military checkpoints, they say, are the Chinese who run the mines or go there to buy gems.
The lack of access adds to the mysteries of the jade industry, whose inner workings are deliberately obscured. Even the simplest information is not publicly available - including which companies operate the mines and how many are Chinese-run or financed despite laws banning foreign ownership. But interviews with jade miners and executives in Myitkyina, and with gem traders, diplomats and non-governmental organisations elsewhere, reveal a dizzyingly corrupt and brutal industry funded almost completely by Chinese trade.
Their descriptions of the harsh conditions at the mines were corroborated by rare footage filmed there by a local journalist hired by The New York Times.
The video from inside the checkpoints shows lush rolling hills scarred by craters that descend for hundreds of feet into pits. There, hundreds of men worked in the searing heat, picking through rocks with rudimentary shovels, or their hands, in search of the gem.
In some cases, the miners shoot water from high-powered hoses to break up the rock walls, a dangerous practice that sometimes triggers landslides. Also visible in the footage: an open-air heroin shooting gallery, hard up against a mine.
RAGING BATTLE
Myanmar’s jade industry took off in the 1980s after the introduction of market reforms in China. For the first time since Mao Zedong began banning private enterprise in 1949, entrepreneurs betting that the gemstone would become big business in China started jumping into the gem trade. Their financing helped build an industry that churns out the Buddha figurines and thick bracelets that have become status symbols for China’s middle class.
The burgeoning market transformed the Kachin insurgency, which had started in 1961 as a fight mostly about political independence, into a raging battle that extends to natural resources. A 1994 cease-fire stopped the violence, but gave the Myanmarese junta and its Chinese backers control over the best tracts in Hpakant.
The ceasefire fell apart in 2011, with jade fuelling the conflict by funnelling money to both sides. Local news media say about 120,000 people have been displaced by the fighting that included military air strikes in Kachin; the death toll remains in dispute.
In an interview, Dau Hka, a senior official with the political wing of the rebel Kachin Independence Army (KIA), described a sophisticated revenue collection system in which mining companies that want to operate in areas under the rebels’ control “donate” money to them, providing half their operating budget.
“The donations aren’t exactly legal,” he acknowledged.
The KIA also makes money by working with Chinese companies to smuggle jade through the jungle into China, according to activists and a Chinese jade importer. “They’ll call us beforehand, and we’ll come in a convoy to pick up the goods,” said the trader, who would give only his surname, Chun. The rebels, he added, demand cash on delivery.
Yet the fighters’ spoils pale in comparison to those enjoyed by the powerful Myanmarese military elite, whose companies receive the choicest tracts of mining land from the government, according to miners and international rights groups. Like the KIA, some military officers are also involved in smuggling, extracting bribes to allow the illicit practice, activists say.
“The top dogs are the Myanmarese military,” said Davis of Global Witness, which has investigated the Myanmarese jade trade.
Perhaps half or more of the jade that is mined, those who study the industry say, vanishes into the black market. The Ministry of Mines denied that smuggling is a major problem. Although official jade sales generate significant tax revenue, David Dapice of Harvard University’s Ash Center for Democratic Governance and Innovation, which did an extensive study of the jade trade, estimated that the government is losing billions a year to illegal trading.
Possibly the greater tragedy, however, is the heroin epidemic ravaging a new generation of Kachin. For decades, heroin was rare in Kachin state. The surge in the jade trade changed all that, creating a market for drugs among the thousands of Kachin labourers who flocked to the mines seeking an escape from poverty.
But Ze Hkaung Lazum, 27, said the mines proved to be a trap. Heroin, he said, is sold in bamboo huts “like vegetables in a market” for between US$4 and US$8 a hit. Miners squat in the open, next to piles of used needles, with syringes hanging from their arms. If the drug fails to take the workers’ meagre earnings, the prostitutes waiting nearby are happy to oblige for US$6 per 20-minute session. Within months, Ze Hkaung Lazum was a frequent customer of both.
Some miners, like Mr Bum Hkrang, a 24-year-old recovering addict, say they need the drug to steel themselves for the backbreaking and dangerous work their Myanmarese and Chinese bosses demand; others say they simply fell into addiction because the drug was so available, with some heroin dealers accepting jade as payment.
“Try digging all day with an iron rod and see how you feel,” he said, adding that he had abandoned his university studies for the promise of fast riches. Heroin, he discovered, gave him enough energy to work 24 hours straight.
Miners say at least four out of five workers are habitual drug users. Users who overdose are buried near the mines, amid groves of bamboo.
Over time, heroin abuse spilled into the broader population.
Like many locals, Tang Goon, who works on an anti-drug project, believes the government is distributing heroin to weaken the ethnic insurgency, with the military allowing pushers past their checkpoints. “Heroin is their weapon,” he said.
But whether the trade is driven by politics or simple greed, the toll has been devastating.
Kachin activists estimate that a sizeable majority of Kachin youths are addicts; the World Health Organization has said about 30 per cent of injecting drug users in Myitkyina have contracted HIV. With virtually no funding from a central government focused on other priorities, the Kachin rely on church rehabilitation centres that preach a spiritual, if controversial, solution to addiction.
At one, the Change in Christ centre outside Myitkyina, the founder, Thang Raw, runs a treatment programme based on rapturous hymnal sessions and baptismal-like dunks in a concrete water tank that are meant to soothe the agony of withdrawal.
The treatment did little to help Mung Hkwang, 21, who despite the sweltering heat lay shivering recently inside the centre’s thatch-roofed dormitory. His ankle, tattooed with a marijuana leaf, was shackled to his bed to keep him from running away to feed his habit.
“It ruined my life and destroyed my education,” he said. Just weeks later, he ran away and died from a heroin overdose.
ILLICIT TRADES
There are plenty of culprits in Myanmar’s illicit jade and drug trades. But many human rights activists reserve their harshest criticism for China, which they say is content to profit from the mounting chaos that has engulfed Myanmar’s jade industry.
“China prioritises naked greed over any concern for the local population or how the jade is extracted,” said David Mathieson, a senior researcher on Myanmar for Human Rights Watch.
Jade has fired the Chinese imagination for thousands of years. According to legend, the birth of Confucius was prophesied by a unicorn who gave his mother a jade tablet heralding his destiny. To this day, many Chinese believe the stone wards off misfortune and heals the body.
“Jade, from ancient to modern times, is a symbol of grace to Chinese people,” said Zhi Feina, 34, a civil servant and repeat customer at the Beijing Colorful Yunnan Co, an opulent three-story jade emporium in Beijing where she was trying on bracelets.
The state-affiliated Gems & Jewelry Trade Association of China estimates that annual sales of jade are as high as US$5 billion, more than half of which comes from Myanmarese jade.
In a rare admission, China’s ambassador to Myanmar, Yang Houlan, confirmed that some Chinese are breaking Myanmarese laws, but he said Beijing was trying to clamp down.
“There are some businessmen engaged in illegal activities who, attracted by outsize profits, cross the border to mine or smuggle jade,” he said, adding that the two nations have stepped up cooperation on border controls and money-laundering investigations. “But there are some parts of this illicit trade that, like drugs, can’t be stamped out.”
Activists dispute the notion that the governments are serious about cracking down. Without a stronger push for reform from China, they say, they have little hope that conditions will improve.
So far, there does not appear to be an appetite for major change. During an interview, Shi Hongyue, vice-secretary-general of the Gems & Jewelry Trade Association of China, refused to even discuss the ills plaguing the Myanmarese jade trade.
When pressed about the heroin epidemic at the mines, Mr Shi was dismissive. “Honestly, the amount of drugs they’re using isn’t really that much,” he said.
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