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INTERNATIONAL NARCOTICS CONTROL STRATEGY REPORT, APRIL 1993
US DEPARTMENT OF STATE
BUREAU OF INTERNATIONAL NARCOTICS MATTERS

DEPARTMENT OF STATE PUBLICATION 10047
RELEASED APRIL 1993

The Report is for sale by the Government Printing Office, 
Superindendent of Documents.  Stock No.:  044-000-02370-9

This segment of the INCSR represents individual reports for the 
Asian Nations


SOUTHWEST ASIA
  Afghanistan
  Bangladesh
  India
  Iran
  Nepal
  Pakistan
  Sri Lanka

SOUTHEAST ASIA AND THE PACIFIC
  Australia
  Brunei
  Burma 
  China
  Hong Kong
  Indonesia
  Japan
  Korea
  Laos
  Malaysia
  New Zealand
  Philippines
  Singapore


  Taiwan
  Thailand
  Vietnam
  Other Asia and Pacific



[EDITOR'S NOTE:  Charts referenced to in brackets [ ] are 
available only in hard copy of report.]

SOUTHWEST ASIA

AFGHANISTAN

I. Summary

Afghanistan remains the second largest producer of illicit opium, 
after Burma.  According to USG estimates, the area of opium poppy 
cultivation in Afghanistan in 1992 increased some 12 percent to 
19,470 ha which would yield a potential 640 mt of opium.  If all 
of this potential opium were refined, it would equal 64 mt of 
heroin.  About 20 percent of the heroin consumed in the U.S. comes 
from Southwest Asia, particularly Afghanistan and Pakistan; most 
of the heroin exported from the region goes to Europe.  Since the 
end of the Soviet occupation, the Government of Afghanistan (GOA) 
has publicly stated its opposition to drug production, trafficking 
and abuse.  Preoccupation with other issues and a lack of control 
of large areas of the country by the GOA, however, has prevented 
it from taking effective concrete measures against the illegal 
narcotics trade.  For the same reason, Afghanistan has not made 
any significant progress in implementing the provisions of the 
1988 UN Convention, which it ratified in February 1992.  The USG 
has official contacts with the government in Kabul in accord with 
efforts to promote a stable government.  The lack of central 
authority, however, has permitted only extremely limited USG 
initiatives in support of Afghan counternarcotics efforts.

II. Status of Country

Afghanistan, with poppy cultivation in 14 of its 30 provinces, is 
second in the world to Burma in potential opium production.  Two 
provinces, Nangarhar and Helmand, traditionally have accounted for 
75 percent of the country's total.  In 1992, Nangarhar Province 
alone accounted for over 60 percent of Afghan cultivation, while 
the Helmand Valley accounted for an additional 20 percent.  
Increases in opium poppy cultivation in 1992 may be attributed 
primarily to deteriorating economic conditions which encourage 
farmers, and returning refugees, to produce opium as a cash crop.

A significant portion of Afghanistan's raw opium production is 
shipped to laboratories in Pakistan's Khyber Agency and 
Baluchistan Province, where it is refined into heroin and morphine 
base.  Much of this is consumed as heroin and opium by a regional 
addict population which extends from Iran to India;  the remainder 
is exported, primarily to Europe but to North America as well.  
Afghan opiates are also exported in large quantities to Iran for 
transshipment to illicit heroin laboratories in Turkey.  There is 
increasing international concern, too, that Afghan traffickers are 
transporting opiates into and through Tajikistan, Turkmenistan and 
the Caucuses.

II. Country Actions Against Drugs in 1992

Policy Initiatives.  During its first meeting with U.S. officials 
in June 1992, GOA officials promised to formulate a strong anti-
narcotics policy, stating that narcotics control is in 
Afghanistan's own interest.  Then Interim-President Rabbani 
publicly pledged that "by fully observing international 
commitments, and in order to wage an extensive and comprehensive 
struggle, the Islamic State will prevent drug trafficking,  
production, smuggling and use."  In October, the GOA issued a 
decree on its campaign against the production, trafficking and 
illegal use of narcotics.  It creates an inter-ministerial 
Counternarcotics Commission headed by the Minister of Interior and 
affirms Afghanistan's "duty to eradicate this illegal drug and 
fight against it with all the available resources and fully 
cooperate with all countries of the region, the world and related 
international organizations."  The first mandate of the Commission 
was to develop a national counternarcotics strategy.  The USG 
doubts, however, that sufficient planning has taken place to 
ensure that those elements of the decree which advance objectives 
of the 1988 UN Convention can be implemented as proposed by the 
GOA under current circumstances.

Afghan representatives reiterated this policy against illegal 
narcotics at two UN conferences:  the September Technical 
Consultations on Drug Issues in Southwest Asia, held in Islamabad, 
and the October Ministerial Conference on Illicit Drug Traffic and 
Related Matters in the Middle and Far East, held in Tehran.  
During the Islamabad meeting, the Afghan delegation solicited 
international assistance to stem the drug problem and assured the 
delegates that, once the political situation in Afghanistan is 
more stable, the government would seek to develop remedial 
programs.  Similarly, media coverage of the Tehran meeting 
reported the Minister of Repatriates' assertion that his country 
is determined "to adopt measures at national, regional and 
international scenes to combat narcotics."

Accomplishments.  Political instability in Afghanistan prevented 
any major counternarcotics achievements, but a number of events 
signaled an interest in beginning to tackle the problem.  In 
October, Nangarhar Province Governor Hajji Akdul Qadir announced 
the start of an anti-opium poppy campaign throughout the province.  
As part of this effort, the official "Nangarhar Daily" initiated a 
series of articles on the problem and efforts to deal with it, 
including programs undertaken by the UNDCP aimed at eliminating 
illicit crop cultivation.  Sample headlines from August through 
November read, "Drug Abuse is an Un-Islamic Activity and the 
Struggle Against it is Necessary," "Nangarhar Jehadi Council 
Launches Struggle Against the Fatal Disease of Illicit Drugs," and 
"All Mujahideen and Muslims Are Obliged to Completely Prevent Drug 
Abuse."

In other antidrug activity associated with Nangarhar Province, 
officials of the Pakistan-based Afghan Narcotics Control 
Organization (ANCO) NGO reported to USG officials in December that 
ANCO, with UNDCP funding, had achieved considerable success in 
reducing poppy cultivation in Hesarak District of Nangarhar 
Province.  A reduction in poppy cultivation from 35 to 5 percent 
of the arable land was achieved as a result of an ANCO irrigation 
project in Hesarak District, according to these NGO officials.

Despite indications of increased GOA political will to combat 
drugs, and signs of fledgling regional counterdrug programs, 
Afghanistan has not seriously begun to curb opium production.  
Further, it will be difficult for leaders in Kabul to pursue 
significant counternarcotics operations soon, given their lack of 
influence beyond the Afghan capital.  The lack of central 
government control over much of Afghanistan's drug producing 
regions has fostered the rise of several warlords, such as Mullah 
Rosoul Akhundzada in the Helmand Valley, who have reportedly 
amassed political power and wealth through drug trafficking.

Corruption.  The GOA, as a matter of policy, does not encourage or 
facilitate illicit production or distribution of drugs or other 
controlled substances.  However, recurrent reports allege 
involvement of narcotics production and trafficking by some 
regional and provincial leaders.

Cultivation and Production.  Opium poppy cultivation and yield 
estimates for Afghanistan are based on USG satellite imagery 
surveys.  The 1992 cultivation total of 19,470 ha represents a 
moderate increase over 1991's cultivation of more than 17,000 ha 
of opium poppy with a potential production of some 570 mt of 
opium.  While a significant increase, the 1992 potential yield of 
640 mt is still well under the 1988 high for Afghanistan of 750 mt 
of opium produced from some 23,000 ha.  Favorable weather 
prevailed throughout the country during the 1991-92 opium poppy-
growing season and the resulting yields were better than normal.

There was a slight increase in opium poppy production in the 
Helmand Valley in 1992 as growers continued to recover from the 
low of only five mt of potential production in 1990 when a major 
cultivation ban was in effect.  Helmand cultivation has increased 
since the ban was lifted in 1991, to 3,630 ha in that year and to 
3,740 ha in 1992, but it still remained considerably below the 
1988 high for the valley of 7,870 ha.

Ranking far behind Nangarhar and Helmand are Bamian, Kemar, 
Oruzgan, Paktia and Herat provinces, each of which cultivated 
between 500-700 ha of opium poppy in 1992.  Cultivation continued 
to grow dramatically in Bamian and Herat, increasing over 500 
percent in these provinces since 1990.  The growers in the Herat 
area, while not returning in large numbers during the 1992 growing 
and harvesting season, may have returned temporarily to sow and 
harvest opium poppy as a first step toward reestablishing their 
lives in Afghanistan.

Opium poppy yields in Afghanistan are among the highest in the 
world.  Poppy can be grown on a variety of terrains with or 
without irrigation, and the opium can be stored indefinitely and 
easily transported, making this crop ideal for the primitive 
conditions of Afghanistan.  A bumper opium poppy crop is likely in 
1993 as returning refugees look to opium to rebuild their lives.  
Major increases are likely not just in the major growing areas, 
but also in Konar, Kandahar, Herat and Bamain, as local tribal 
leaders struggle to support the swelling numbers of returning 
refugees and rebuild the rural infrastructure shattered by the 
devastating guerrilla war.

Agreements and Treaties.  Afghanistan is a party to the 1961 UN 
Single Convention on Narcotics Drugs, but not to the 1972 UN 
Protocol amending the Convention.  It is also a party to the 1971 
UN Convention on Psychotropic Substances, and, on February 14, 
1992 became a party to the 1988 UN Convention.  In October, the 
Iranian press claimed the government had signed an antidrug 
cooperation agreement in Kabul, which included a mutual exchange 
of liaison officers. 

IV. U.S. Policy Initiatives and Programs

Bilateral cooperation in narcotics control with Afghanistan is 
problematic because of limited USG contact with the central 
government.  It is also hampered by the GOA's lack of authority 
much beyond the capital.  Nevertheless, the USG undertook several 
initiatives in 1992, especially to persuade other donor nations 
and international organizations to take an active interest in 
narcotics control in Afghanistan.  While waiting for the political 
situation to stabilize, initial USG goals and objectives for 
Afghanistan are:

--With approval of the GOA, to seek opportunities for 
decentralized narcotics control cooperation with local leaders who 
can enforce commitments to take action against drug production and 
trafficking.

--To encourage donor nations, particularly Europeans who are the 
key targets of the Afghan drug trade, to enter into cooperative 
agreements with Afghanistan to control narcotics.

--To find ways to ensure that international developmental support 
to Afghanistan is linked to reducing and eliminating poppy 
cultivation by including opium poppy clauses in all project 
agreements.

--To help Afghanistan evaluate the extent of its narcotics 
problem, recommend concrete counternarcotics programs and begin 
compliance with the 1988 UN Convention.

The USG provided financial support for UNDCP's September Technical 
Consultation on Drug Issues in Southwest Asia which was held in 
Islamabad.  The USG also backed the range of findings of the 
conference, attended by more than 20 nations and international 
organizations.  The conferees agreed that in Southwest Asia:

--UNDCP operational activities should provide resources to 
facilitate law enforcement and demand reduction initiatives.

--Drug issues must be tied to the UNDP's programs and funding 
associated with Afghanistan's reconstruction and rehabilitation.

--Existing international bodies, such as the Economic Cooperation 
Organization, should be used to advance narcotics control in the 
region.

--Governments and the UN should share opium poppy crop production 
estimates for systematic monitoring and updating.

--Nations in the region should exchange information on the broad 
range of crop control law enforcement, drug abuse and demand 
reduction issues.

--Joint training should be organized for narcotics law 
enforcement, drug rehabilitation and demand reduction.

--Support should be provided for a subregional "joint working 
group" to develop a master plan for narcotics control.

The USG also was able to initiate a small, cross-border narcotics 
control project in 1992 in Kandahar Province.  The narcotics 
letter of agreement, signed with the Kandahar NGO, Relief 
Institution for the Reconstruction of Afghanistan, provided 
$164,000 for various agricultural and infrastructure projects in 
the province, but tied to agreements of local authorities not to 
permit cultivation of poppy or other illicit crops, and to combat 
narcotics manufacture, trafficking and abuse.  The USG provided 
matching funds to UNDCP which will also be used in Kandahar, 
making a U.S. drug control contribution to the area of more than 
$300,000.

The Road Ahead.  As the political situation settles in 
Afghanistan, the USG will seek to expand gradually policies and 
programs designed to help Afghanistan implement effective 
narcotics control measures.  A first objective would be to 
conclude an umbrella bilateral narcotics control agreement.  The 
USG might also consider bilateral funding, principally to help 
Afghanistan start to build effective institutions.  Possible 
programs include training, equipment procurement and technical 
assistance, such as help with the establishment of a 
counternarcotics police unit.  The USG will also continue to 
encourage European and other donor nations, as well as 
international organizations, to help Afghanistan combat its 
illicit drug problem.

[Chart - Afghanistan 1993 Statistical Tables]
(###)

BANGLADESH

I.  Summary

Bangladesh is not a significant producer of narcotics, but  has 
the potential to become a significant transshipment point for 
heroin because of its proximity to producing areas and its 
extremely limited interdiction capability.  The Bangladesh 
Government's (BDG) Department of Narcotics Control (DNC) takes the 
lead on narcotics issues, but law enforcement is hampered by 
inadequate resources and a lack of coordination between government 
departments.  Thus far, international support for the BDG's 
fledgling narcotics control efforts has been limited.  However, a 
proposed $1.7 million UNDCP project for Bangladesh, along with 
increased bilateral assistance, should enhance the BDG's 
capabilities.  Bangladesh is a party to the 1988 UN Convention.

II.  Status of Country

As international enforcement efforts focus on traditional transit 
drug routes in the region, Bangladesh is becoming an attractive 
alternative for Southeast Asian heroin destined for international 
markets.  In addition to past cross-border smuggling, unconfirmed 
reports indicate that Muslim Rohingya refugees from Burma are 
smuggling small quantities of heroin into Bangladesh.

The BDG is also concerned that acetic anhydride (AA), a precursor 
for heroin manufacture, is moving from India through Bangladesh to 
mobile heroin laboratories in Burma.  There are an estimated 
100,000 drug addicts in Bangladesh, principally users of "brown 
sugar" heroin, usually from India.  The only illicit drug 
cultivated in Bangladesh is cannabis, which was declared illegal 
in 1983.  The DNC estimates that in 1984, the last year of legal 
cultivation, 34 mt of marijuana were produced.  No recent 
estimates for production are available.  Most marijuana is sold 
for local consumption.

III.  Country Action Against Drugs in 1992

Bangladesh has signed and ratified the 1988 UN Convention, the 
1961 UN Single Convention on Narcotics Drugs Act, and the 1990 
SAARC Convention on Narcotics Drugs and Psychotropic Substances.  
Bangladesh has signed a number of protocols that include pledges 
for increased bilateral narcotics cooperation.  The 1990 Narcotics 
Control Act updated drug laws and brought them into accord with 
the 1988 UN Convention.

BDG narcotics control efforts are hampered by limited material and 
human resources, and lack of coordination among BDG agencies.  The 
Narcotics Control Board, formed in 1989 to design a national drug-
control strategy, was deactivated following the fall of the Ershad 
regime in 1990.

The year's most significant heroin seizure occurred in February at 
Dhaka's Zia International Airport when an American citizen was 
arrested for possession of 3.7 kg of heroin No. 4.  A Nigerian and 
a South African were also arrested.  All three are currently under 
trial in Dhaka, and if convicted, face the possibility of the 
death penalty.  Other seizures in 1992 were of low-quality "brown 
sugar" heroin, locally cultivated cannabis, and small amounts of 
imported opium.

The BDG has no evidence of money laundering.  Possible official 
corruption appears to be limited to border areas and related to 
the smuggling of "brown sugar" heroin.  

The BDG has taken some steps to promote drug awareness.  These 
include antidrug campaigns including public meetings, television 
and radio advertisements, and books and pamphlets on the dangers 
of drug abuse.

The UNDCP plan for Bangladesh, still to be approved by the 
government, focuses on demand reduction, treatment, and the 
development of a long-term narcotics control strategy.  The DNC 
has expressed confidence that the UNDCP project, along with 
increased bilateral assistance, will enhance its narcotics control 
capabilities.

IV.  U.S. Policy Initiatives and Programs

The primary USG interest in Bangladesh is to help the BDG prevent 
the country from becoming a transshipment point for Burmese 
heroin.  The USG seeks to strengthen BDG agencies responsible for 
narcotics detection and interdiction by providing some basic 
training and equipment.  In 1992, the USG sent five BDG officials 
to Nepal for a two-week DEA training course.  The USG also signed 
a letter of agreement (LOA) with the BDG to provide $20,000 for 
narcotics control equipment for the DNC.
(###)

INDIA

I.  Summary

India's importance to the international drug trade is as a transit 
route for heroin and other illegal opium derivatives from 
neighboring producing countries.  Other important drug control 
problems are diversion from its licit opium industry to illicit 
channels, illegal cultivation, and illicit export of essential and 
precursor chemicals.  Despite good cooperation with the U.S. on 
individual cases of trafficking and greater efforts to curtail 
diversion from licit cultivation, the Government of India (GOI) 
needs to raise the priority of antidrug programs and take stronger 
measures to control the transit of drugs and to prevent licit 
opium diversion.  India is a party to the 1988 UN Convention and 
is making progress in meeting its goals and objectives.

II.  Status of Country

Situated between the world's two largest opium-producing regions, 
India traditionally has been a transit country for illicit 
narcotics from Afghanistan, Pakistan, and Burma.  Destined 
primarily for Europe, and also for the U.S., this traffic grew 
when the Gulf War disrupted the traditional land routes to Turkey.  
India is the world's largest producer of licit opium for 
pharmaceutical purposes, but also produces heroin from diverted 
licit opium and illegally grown opium.  Most diverted narcotics 
probably are consumed domestically, but there have been reports of 
processing for export of some of the diverted production.

Diversion occurs in Madhya Pradesh (M.P.), Rajasthan, and Uttar 
Pradesh (U.P.), the three states in which the GOI licenses poppy 
cultivation.  Poppies are grown illicitly in the Himalayan 
foothills of U.P. and in northeast India near the Bangladeshi and 
Burmese borders.  India produces acetic anhydride (AA), the 
essential chemical used by illicit labs throughout South Asia to 
convert opium into heroin.  "Heroin base" remains the drug of 
choice, except in the northeast state of Manipur, where increased 
intravenous use of Burmese No. 4 heroin has spread the AIDS virus.  
Indian "heroin base" is readily available in Nepal, Bangladesh, 
Sri Lanka, and Maldives.

III.  Country Actions Against Drugs in 1992

Policy Initiatives.  The Central Bureau of Narcotics (CBN) and the 
Narcotics Control Bureau (NCB), responsible respectively for 
coordinating licit and illicit drug control, have not been 
provided the political support or funds to carry out their tasks 
effectively.  Nevertheless, in its poppy-cultivation guidelines 
for the 1992-93 crop year, the GOI made more stringent the 
provisions on licit opium production to reduce diversion.  New 
measures included: (1) raising by about 12 percent the minimum 
amount of opium which growers must sell to the GOI in order to 
obtain a license for the next crop year; (2) tightening terms of 
the crop-damage clause; (3) reducing the amount of allowable 
excess cultivation; (4) raising the GOI purchase price for licit 
opium, and (5) paying incentives to growers who sell to the GOI  
more opium than the 1991-92 average yield of almost 4.5 kg per 
plot (the highest average yield on record).  In addition, at the 
turn of the year, the GOI announced creation of a new senior-level 
position of Special Secretary for Narcotics, who will supervise 
both the CBN and the NCB.

Accomplishments.  The GOI says it uproots illicit opium poppy 
whenever it is discovered, although the amount of opium poppy 
eradicated in 1992 declined by more than 80 percent from the 
previous year.  The press has reported on government uprooting of 
illicit poppy plants (allegedly grown for its seed, not opium 
content) in the Himalayan foothills.  Continued reports of 
diversion and illicit production, however, suggest that the GOI 
needs to improve controls.  Although the GOI has become more 
concerned with illicit opium production, GOI seizures fell to 
1,813 kg in 1992 from 2,145 kg in 1991.  Heroin seizures, however, 
rose to 1,034 kg in 1992 from 622 kg in 1991.  Indian law 
enforcement agencies (the NCB, CBN, Central Board of Excise and 
Customs, Directorate of Revenue Intelligence, the Border Security 
Force, and various state-level agencies) made 11,540 arrests under 
the Narcotic and Psychotropic Substances Act during the year, more 
than double the 5,300 arrests made in 1991.

Law Enforcement Efforts.  The CBN's staff of about 1,400 has 
remained static, even though the number of licit growers continues 
to decline, from over 250,000 a decade ago to about 137,000 today; 
thus, the ratio of enforcement officers to growers actually has 
increased.  The Special State Narcotics Courts mandated by the 
1988 drug law to expedite the trials of traffickers have been 
established only in Maharashtra and West Bengal.  Lack of funds 
prevents their full operation in these two states as well as the 
establishment of additional courts in other states.  The GOI has 
regulations controlling sale and possession of AA within 50 km of 
the Indo-Pakistani border and 100 km of the Indo-Burmese border.  
However, smuggling of AA into Pakistan and Burma continues.  The 
GOI announced in early 1993 that initial steps towards national AA 
control have been instituted to identify manufacturers and 
distributors.  

No new law enforcement measures were enacted during 1992.  
Competing and occasionally overlapping jurisdictions of law 
enforcement and other governmental agencies continue to hinder 
effective action against traffickers, illicit cultivators, heroin 
labs, and licensed licit cultivators who divert part of their 
crop.  Although existing laws are adequate to conduct effective 
counternarcotics operations, stronger rules on asset seizure, 
conspiracy, and money laundering would aid in fighting 
international trafficking.  Increased efforts are needed to 
address official corruption which facilitates diversion of licit 
opium.

Given Indian efforts to control illegal cultivation, production 
and trafficking as well as other activities covered by the 1988 UN 
Convention, the USG believes that the GOI is making some progress 
in meeting the goals and objectives of the Convention.

Corruption.  Corruption among police, government officials, and 
local politicians is widely alleged but seldom prosecuted.  The 
USG has seen reports of corruption within the various GOI agencies 
responsible for drug enforcement, but the USG cannot verify the 
extent of corruption in the Indian government fully or 
independently.  CBN field officers are now shifted among the licit 
growing areas to break ties among CBN officers, traffickers,  and 
farmers who divert.  For the first time, CBN staff have been 
dismissed or suspended because of corruption.  Such actions were 
taken against five percent of the CBN staff in 1992.  India does 
not encourage corruption as a matter of government policy.  The 
USG is not aware that any senior official encourages or 
facilitates trafficking or money laundering.

Agreements and Treaties.  Extradition of fugitives between the 
U.S. and India is covered by the U.S.-UK Extradition Treaty of 
1931.  India and the UK signed a new extradition treaty in 1992.  
Neither the GOI nor the USG made any drug-related extradition 
requests during 1992.

Cultivation and Production.  India is the world's largest producer 
of licit opium for pharmaceutical use.  Unlike other narcotic raw 
material suppliers, India produces only opium gum.  In 1992, the 
GOI set up a committee to study the feasibility of partial 
conversion to concentrated poppy straw (CPS).  Lack of alternative 
employment to poppy cultivation and poor infrastructure in the 
growing areas appear to be major constraints to any change in 
production methods, but the GOI is considering construction of a 
pilot CPS plant.  

The GOI also continues to withdraw licenses from farmers who do 
not sell the GOI the required minimum yield.  About 5,500 farmers 
permanently lost licenses in 1992, bringing the number of licit 
growers down to about 137,000.  Each licensed farmer is limited to 
poppy cultivation on 1/10 of a hectare and must sell the GOI at 
least 3.8 kg of opium at 70-degree consistency (30-percent 
moisture) in M.P. and Rajastan and 3.6 kg in U.P.  These minimum 
yield levels were set in 1992 and represent an increase of more 
than ten percent from previous minimum yields.  The GOI is 
considering continued raising of the minimum yields for the next 
few years.

The Department of Revenue in the Ministry of Finance has 
responsibility for licit opium cultivation, operation of opium 
factories in Neemuch and Ghazipur, prevention of diversion into 
illicit channels, and counternarcotics police work on the national 
level.  The creation in early 1993 of a Special Secretary for 
Narcotics should focus more attention on the issue. 

Security at both opium-processing factories, which also stockpile 
opium prior to sale, is generally good.  The stockpile had been 
reduced from 2,057 mt in 1990, to 1,541 mt in 1991 and 1,185 mt in 
early 1992; it is expected to fall below 1,000 mt (the approximate 
level of world opium demand for one year) for the first time since 
1979.  The 1991-92 licit opium crop harvested in the spring of 
1992 was 495 mt at 90-degree consistency (10-percent moisture).  
Average yield (i.e., opium sold to the GOI) was the highest on 
record, about 4.5 kg per licit plot.  It is known that some 
farmers do not sell their entire crop to the GOI, as provided by 
law, and illegally sell amounts of opium varying in weight from a 
few grams to several kg to traffickers for as much as several 
hundred times the GOI purchase price.  Unsubstantiated estimates 
of the amount diverted are from 10 to 30 percent of the total 
crop.  The area under licit poppy cultivation has been reduced by 
about 80 percent, from 66,000 ha in 1978 to just under 14,000 ha 
in 1992.

Drug Flow/Transit.  India has long been a major transshipment 
point for heroin from Afghanistan and Pakistan, and from the 
Burma/Laos/Thailand region.  NCB statistics on heroin seizures 
made between January and October show that possibly as much as 80 
percent of the 1,034 kg of the heroin was identified as being of 
Southwest Asian origin.  The figure for all of 1991 was 77 
percent.  Although intelligence gathered in 1992 indicates a rise 
in transshipment through and use of Southeast Asian heroin, NCB 
seizures show a drop in the percentage of heroin originating in 
Southeast Asia from just under 2 percent in 1991 to about 0.6 
percent during the first 10 months of 1992.  The rise in recent 
years in HIV cases in the northeast, which are directly linked to 
greater use of injectable heroin, raises doubts that enforcement 
measures in the region accurately reflect the transit of Southeast 
Asian heroin through India and Bangladesh.

Demand Reduction Programs.  There are no GOI data on the magnitude 
of opium and heroin addiction, but estimates of the number of 
addicts range from one to five million for opium and about one 
million for heroin.  The GOI is concerned about growing heroin 
addiction by the middle class and among urban workers.  The Health 
and Welfare Ministries, the UNDCP, and police groups support 
treatment and rehabilitation centers.  NGOs conduct demand 
reduction and public awareness programs, but lack adequate funding 
and staff.

IV.  U.S. Policy Initiatives and Programs

 Policy Initiatives.  The USG works with the GOI to focus more 
political attention and financial resources for counternarcotics 
programs to reduce the flow of heroin transiting India and to stop 
diversion from the licit opium industry.  We have urged the GOI to 
focus on major trafficking organizations, to improve cooperation 
with Pakistan and Burma, to increase minimum yields and incentives 
to sell opium to the government, and to strengthen controls on AA.  
The USG has urged the GOI to update its domestic antidrug laws to 
comply with the obligations of the 1988 UN Convention particularly 
those related to forfeiture.  

Bilateral Cooperation.  The USG continues to fund training 
programs for enforcement personnel and the Indian Coast Guard.  
Relations between the DEA and NCB continue to be good, with 
emphasis on exchanges of narcotics information and cooperation on 
controlled deliveries from India to other countries.  Pursuant to 
the U.S.-India Narcotics Agreement of 1990, India and the U.S. 
signed a letter of agreement September 25, 1992, to establish a 
trafficker profile system at Bombay Airport.  This is the first 
time the GOI has accepted bilateral U.S. counternarcotics funding, 
although it has accepted UNDCP assistance in interdiction and 
demand reduction.  India is a party to the 1961 UN Single 
Convention on Narcotic Drugs, its 1972 Protocol, the 1971 UN 
Convention on Psychotropic Substances, and the 1988 UN Convention. 

The Road Ahead.  Effective drug control will require the GOI to 
strengthen political support for counternarcotics efforts and 
devote greater resources to the drug problem.  Such reforms appear 
even more difficult in the wake of nationwide civil unrest caused 
by the destruction of the Mosque in  Ayodhya, which is near licit 
opium growing areas in U.P. and the Ghazipur Opium Factory.  
Nonetheless, the GOI appears to be gradually changing its view of 
narcotics control, especially with regard to the importance of 
controlling diversion of licit opium.  The USG will urge the GOI 
to continue the policies enunciated for the 1992-93 opium poppy 
crop year.


[Chart - India Statistical Tables]
(###)

IRAN 

I. Summary

Iran is a major transshipment point for illegal opiates from 
Pakistan and Afghanistan destined principally for Europe but also 
the U.S.  The USG estimates that approximately 3,500 ha of opium 
poppy were under cultivation in Iran in 1992.  The Government of 
Iran (GOI) claims success in combatting the illegal drug trade.  
However, since the break in U.S.-Iranian diplomatic relations in 
1979, the USG cannot verify these assertions.  Iran ratified the 
1988 UN Convention in 1992, but the USG does not have sufficient 
information to indicate whether Iran is meeting the Convention's 
goals and objectives.

II.  Status of Country

Iran is a traditional opium-producing and consuming country, and a 
major conduit for large quantities of illicit opiates produced in 
Afghanistan and Pakistan.  These are sent for processing into 
heroin in Turkey and onward shipment to Europe and the U.S.  
Finished heroin is also moved through Iran.  Although the GOI 
maintains that opium poppy has been eliminated after cultivation 
was banned in 1980, the USG 1992 survey shows that it continues.  
Morphine base and heroin reportedly also are processed in 
northwestern and southwestern Iran.  The GOI, however, denies that 
there is any drug processing in Iran.

III.  Country Action Against Drugs in 1992

Policy Initiatives.  The GOI adopted tough antidrug laws in 1989.  
The Anti-Narcotics Headquarters, established in 1989, is 
supervised by the President and includes participation of several 
ministries and the General Prosecutor.  The Islamic Revolutionary 
Corps, under the Ministry of Interior, is responsible for law 
enforcement in all drug-related crimes and the protection of 
Iran's borders from drug smuggling.  In October, Iran hosted the 
UN Ministerial Conference on Illicit Drug Traffic and Related 
Matters in the Middle and Near East.

Law Enforcement Efforts.  According to the Iranian press, drug 
addicts and traffickers receive swift sentences from revolutionary 
courts.  Traffickers face the death penalty and confiscation of 
all their property if caught in possession of more than 5 kg of 
opium or 30 grams of heroin.  According to a Tehran radio report, 
which cannot be independently verified, Iranian police arrested 
17,000 drug traffickers and 35,600 addicts in 1992.  However, the 
USG believes that some of those arrested on drug offenses may also 
be political prisoners who oppose the government.  Figures 
published in a 1992 UN human rights report state that of 884 
executions reported in the local press, 670 were for narcotics 
trafficking.  According to the Iranian press, morphine base 
seizures in Iran were as high as 10 mt between April 1992 and 
February 1993, roughly parallel to confirmed interdictions in 
Turkey; however, the USG cannot verify these reports.  Other 
reported GOI narcotics control measures which have not been 
verified were detailed in a report presented to the 1992 UN 
Technical Consultation on Drug Issues in Southwest Asia held in 
Islamabad to which the GOI sent representatives.   The report 
described efforts to reinforce the Iranian-Pakistani border 
against drug smuggling, including an extensive road project.  A UN 
team which visited the new highway in 1991 told U.S. officials 
they were  "impressed" with the effort.

Corruption.  A number of reports received by the USG indicate that 
official corruption adversely affects GOI efforts to combat 
narcotics.  There are, for example, allegations that border guards 
accept bribes from traffickers moving drugs from Afghanistan to 
Iran, and that arrested traffickers have paid officials to gain 
release.  However, detailed information on official corruption 
involving illegal drug activity in Iran is not available to the 
USG.

Agreements and Treaties.  Iran is a party to the 1961 UN Single 
Convention on Narcotic Drugs, but not to its 1972 Protocol.  It 
signed the 1988 UN Convention and ratified it on December 7, 1992.  
The U.S. has no bilateral narcotics agreement with Iran.  After 
the October UN conference in Iran, the Iranian government signed a 
memorandum of understanding (MOU) with the Government of 
Afghanistan.  As part of this agreement, drug liaison officers 
will reportedly be stationed in Kabul and Tehran.  Iran also has 
concluded drug cooperation agreements with Azerbaijan and several 
other Central Asian States, Persian Gulf countries, Germany, 
Italy, Turkey, Nigeria, and Thailand.

Cultivation and Production.  According to a recent USG survey, 
Iranian opium poppy cultivation in 1992 was approximately 3,500 ha 
in traditional growing areas, with an estimated potential opium 
yield of between 35 mt and 70 mt.  The DEA reports that opiates 
are stored and some are processed into morphine base or heroin by 
Baluchi tribesmen in the southeast and by Kurds and Azerbaijanis 
in the northwest.  

Drug Flow/Transit.  Opiate seizures in Pakistan's Baluchistan 
province suggest that the drugs may have been intended for Iran.  
A significant amount of opiate seizures in Turkey and Europe have 
transited Iran.  One technique used by traffickers is to move 
drugs by truck caravan, loaded at Mirjaveh, near the Pakistani 
border, to the Turkish border and onward shipment.  According to 
Pakistani and Iranian press reports during the past two years, 
well-armed trafficker trucks are able to get through Iranian guard 
stations in the southeastern part of the country.  The USG also 
believes that Iranians based in Istanbul have become important 
international heroin brokers.  According to the DEA, they use 
their links to Iran to acquire opiates and refined heroin and work 
closely with their Turkish counterparts to supply distributors in 
European and U.S. cities.

Demand Reduction Programs.  The USG estimates there may be 2-3 
million drug abusers in Iran.  The GOI in 1991 told visiting UN 
officials that the country had some 200,000 heroin and 400,000 
opium addicts.  However, the USG believes that, in light of harsh 
penalties, addicts are reluctant to declare themselves and that 
the official figures represent only "registered" addicts.  While 
first-time offenders are assigned to one of 17 rehabilitation 
centers, those arrested more than once face harsh penalties, 
including imprisonment or execution.

IV.  U.S. Policy Initiatives and Programs

The USG has no diplomatic relations with Iran and has taken no 
narcotics control initiatives.  However, the USG encourages 
counternarcotics cooperation among countries in the region, as 
well as antidrug programs in the Middle East and Southwest Asia 
under UN auspices.
(###)

NEPAL

I. Summary 

Nepal's open border with India and its proximity to Pakistan and 
Burma make it an alternate transit route for heroin from the 
Golden Crescent and Golden Triangle to Europe, other points in 
Asia, and the U.S.  Although Nepal produces marijuana for the 
domestic market, there is no evidence of any significant Nepalese 
production of illicit drugs entering international markets.  The 
democratic Government of Nepal (GON) has continued its 18-month-
old commitment to narcotics control by forming a dedicated 
Narcotics Law Enforcement Unit, and signing a Narcotics Master 
Plan agreement with the UNDCP.  Cooperation with the U.S. and 
other countries on enforcement, training, and legal assistance 
also increased.  Nepal is a party to the 1988 UN Convention.

II. Status of Country

The increase in counternarcotics operations resulting from the 
recent formation of the Narcotics Law Enforcement Unit has 
provided initial indications that South, Southwest, and Southeast 
Asian heroin is smuggled into Nepal in larger quantities than was 
originally suspected across the porous Indian border and through 
the Kathmandu International Airport.  The major domestic narcotics 
problem in Nepal is the abuse of heroin, primarily "brown sugar", 
by urban youth.  During the past year, the USG assisted two 
Nepalese nongovernmental organizations, DAPAN and Youth Vision, to 
conduct the first detailed studies of domestic drug abuse.  
According to these assessments, Nepal is estimated to have 25,000 
heroin addicts and casual users.  GON crop eradication, which also 
included the first detection of a small amount of opium poppy 
cultivation, reached its highest level in 1992.

Policy Initiatives.  Nepal is not a significant producer of 
narcotic drugs or psychotropic substances, although cannabis is 
cultivated for local consumption and some of it reaches 
international markets in the form of hashish.  The GON has 
increased cannabis eradication as part of its narcotics control 
initiative.  There has been some ad hoc cooperation with India in 
these efforts.  The Narcotics Master Plan Agreement signed with 
the UNDCP includes a demand reduction component; initial 
implementation is anticipated in 1993.

Accomplishments.  The Narcotics Master Plan and establishment of 
the Narcotics Law Enforcement Unit mark fundamental advances in 
fulfilling the objectives of the 1988 UN Convention.  
International law enforcement cooperation has also been enhanced, 
including with the U.S.  Increased Nepalese participation in the 
South Asian Association for Regional Cooperation and other Asia 
regional drug control activities offers further opportunities for 
international cooperation.

Drafting of an amendment to Nepal's narcotic drug control act to 
bring it into conformity with the 1988 UN Convention is currently 
underway.  The law, which  already includes an asset seizure 
section, will also facilitate implementation of mutual legal 
assistance agreements.

Law Enforcement Efforts.  The formation of the Narcotics Law 
Enforcement Unit in March 1992 has increased the capability of the 
GON to counter drug trafficking.  Although resources committed 
under the Master Plan have been slow in coming from UNDCP, the USG 
and Germany have provided assistance, and the new unit has begun 
to pursue its mandate aggressively.  The judiciary as well as the 
executive have taken a heightened interest in narcotics 
prosecutions, and the assignment of a lawyer from the Attorney 
General's office to the unit has facilitated presentation of 
narcotics cases in court.

Corruption.  The GON does not encourage or facilitate the 
production or distribution of illicit narcotics as a matter of 
policy.  No senior official was indicted for narcotics-related 
corruption in 1992, and the USG is unaware of instances of senior 
officials facilitating narcotics trafficking.

Agreements and Treaties.  Discussion between the USG and GON on a 
cooperation agreement on narcotics to facilitate judicial 
exchanges began in 1992.  Topics for inclusion include mutual 
legal assistance based on Article 7 of the UN Convention.

Drug Flow/Transit.  Information regarding heroin transit through 
Nepal will remain largely anecdotal, pending organization of the 
intelligence wing of the police Narcotics Law Enforcement Unit.  
There are substantial indications that quantities of Southwest and 
Southeast Asian heroin transit Nepal en route to Europe and the 
U.S., overland across the Indian border and through the Kathmandu 
International Airport.  Evidence includes the arrest of two Thai 
citizens in possession of nearly 10 kg of heroin on a flight from 
Bangkok, the presence of a large number of West Africans suspected 
of drug trafficking in Kathmandu, and the travel of known Indian 
and Pakistani drug traffickers to Nepal.

Nepalese and international drug enforcement officials conclude 
that the previous lax enforcement environment and good air links 
within and outside the region make Nepal an ideal alternate to the 
more heavily used international heroin trafficking routes.

Demand Reduction Programs.  The GON and NGOs continued to make 
significant strides in heightening public awareness to the dangers 
of narcotics abuse.  GON anti-narcotics strategy led by the 
Ministry of Health focused on expanding GON support to NGO-
sponsored drug abuse prevention activities.  The Drug Abuse 
Prevention Association of Nepal's survey of secondary and 
university student drug abuse was published in 1992.  This USG-
funded study has been distributed in the Kathmandu valley and 
other cities in the country in an effort to bring further public 
awareness to the dangers of drug abuse.  A second contributor to 
the survey report, Youth Vision, has begun a five-city school-
based drug awareness campaign covering three of the five regions 
of Nepal.

IV. U.S. Policy Initiatives and Programs

U.S. Policy Initiatives.  The U.S. works with members of the 
cabinet, Parliament, and police in support of the UNDCP Narcotics 
Master Plan, amendments to the Narcotics Control Act, coordination 
with other donor nations on effective assistance, anti-narcotics 
training, and USIS and other media programs.

Bilateral Cooperation.  The 1992 bilateral narcotics control 
program with Nepal included start-up training for the narcotics 
unit, hosting the regional advanced narcotics seminar in Nepal, 
funding of two drug abuse studies and a drug awareness program, 
and provision of mobile communications equipment to the Narcotics 
Unit.

The Road Ahead.  The USG will continue to support the GON's strong 
commitment to drug control.  This will include additional DEA 
collaboration with the Narcotics Law Enforcement Unit, regular 
consultations with the GON on revision of the Narcotics Control 
Act, negotiation of a cooperation agreement, and further provision 
of training and equipment.

[Chart - Nepal 1993 Statistical Tables]
(###)

PAKISTAN

I. Summary

The Government of Pakistan (GOP) had mixed results in its 
narcotics control efforts during 1992.  Cooperation with USG 
agencies in investigations and enforcement operations remained 
good and resulted in the arrests of several persons in Pakistan 
charged with violating U.S. drug laws.  Since 1991, two fugitives 
have been found extraditable by the courts in Pakistan and one 
case has been appealed to the Supreme Court.  In all, six persons 
were arrested at U.S. request and their extradition proceedings 
are underway in Pakistan.  Imports of heroin into the U.S. on 
Pakistan's international airlines continue to be a problem.  From 
1987 to mid-1992, more than 165 kg of heroin was seized on 
incoming flights.

The GOP's record of local prosecutions against major traffickers 
was minimal, and its commitment to expand and enforce the opium 
poppy ban had limited impact.  The hectarage devoted to the 
cultivation of opium decreased by .4 percent from 1991 to 1992 and 
potential opium production fell by 2.8 percent.  Comprehensive 
legislation to bring Pakistani law into conformity with the 1988 
UN Convention, which it ratified in 1991, still awaits passage by 
the Parliament.  Action is also pending on strengthening existing 
asset-forfeiture laws.  The GOP reported it closed 12 heroin labs 
in the Northwest Frontier Province (NWFP) during 1992.  However, 
no prosecutions resulted from their closure.

II. Status of Country

Pakistan remains both a producer and an important transit country 
for opiates and hashish destined for international drug markets.  
Pakistan's remote Northwest Frontier area processed much of the 
opium grown across the border in Afghanistan.  The USG estimates 
that 20 percent of the heroin consumed in the U.S. comes from 
Southwest Asia, a large amount of which is processed in illegal 
labs in Pakistan.  USG agencies estimate that during 1992 
Pakistani growers devoted 8,170 ha to the illegal cultivation of 
opium poppy, which could potentially produce 175 mt of opium, down 
only slightly from the 1991 potential yield of 180 mt.  Abundant 
rainfall during the fall of 1992 may result in higher opium yields 
for the 1993 harvest. Heroin and hashish processing continues 
virtually unhampered in the politically autonomous tribal areas of 
Pakistan's NWFP, where the government has little control and has 
not applied its antidrug laws.  As a result, the tribal areas long 
have been sanctuaries for heroin and hashish manufacturers.  The 
government has reaffirmed its commitment to attack and destroy 
heroin labs, and reports the destruction of 12 such facilities 
during 1992.  This effort does not appear to have achieved any 
perceptible disruption in heroin processing or trafficking.  The 
government has yet to prosecute any heroin lab operator.

According to DEA, Pakistan has not traditionally been a major 
center for international money laundering, but 1991 changes in the 
GOP's foreign exchange regime may alter this assessment.  These 
changes, an element of Pakistan's economic reform program, were 
designed to draw foreign exchange into the banking system and 
encourage the repatriation of  foreign exchange held abroad.  They 
have produced a substantial increase in the foreign exchange 
assets of Pakistani banks.  The anonymity which the regulations 
confer on banking clients makes it impossible to determine how 
much of this new money may be drug related.  GOP officials have 
recognized the money laundering potential of the new regulations 
and have begun to consider ways to combat such activities, but 
planning remains at the early stages.  In any case, the vigorous 
informal financial sector continues to provide a ready alternative 
should strong financial disclosure and enforcement measures be 
implemented.

Pakistani addicts consume about two-thirds of the heroin produced 
in the tribal areas, and the growth of the addict population 
mirrors the explosive growth of the local heroin manufacturing 
industry.  There were virtually no heroin manufacturers or heroin 
addicts in Pakistan in 1979, but GOP and international experts 
estimated in 1988 that Pakistan had a heroin addict population of 
1.2 to 1.7 million, an estimate that has not been updated.  The 
government's demand reduction efforts continue to suffer from 
inadequate funding.

III.  Country Actions Against Drugs in 1992

Policy Initiatives.  The committee formed in 1991 to draft a 
chapter on drug abuse control for Pakistan's Five-Year Plan (July 
1993-June 1998) completed its work.  It recommended extensive 
reforms in policy, administration and legislation, as well as the 
allocation of significant budgetary resources to narcotics control 
efforts.  It also recommended the establishment of a policy review 
board to oversee country-wide policy implementation, and a 
narcotics interdiction review board to coordinate the actions of 
law enforcement agencies, an especially urgent need.  The plan as 
a whole has yet to be formally submitted to the National Assembly 
for approval.  Comprehensive legislation that would bring 
Pakistani law into conformity with the 1988 UN Convention has been 
drafted and submitted to the UNDCP for comments.  The Assembly has 
yet to act on legislation that would strengthen the drug-asset 
forfeiture provisions of existing law by lowering the minimum 
sentence triggering such forfeiture from life to two years, and by 
making the violation of any antidrug law--Pakistani or foreign--
the basis for forfeiture.  Action is also pending on legislation 
to give permanent status and authority to the Narcotics Ministry's 
Anti-Narcotics Task Force (ANTF).  The ANTF has had to depend on 
temporary presidential ordinances, renewed every four months, to 
continue operating.

Accomplishments.  The GOP's narcotics control effort competes with 
other pressing demands on resources and has not consistently 
received the highest priority.  Even though the GOP's narcotics 
budget for 1991-92 was increased by 26 percent (from the 
equivalent of $1.4 million to $1.8 million), narcotics control 
spending still represents less than one percent of overall GOP 
expenditures.  Large military expenditures and budget deficits, 
coupled with the need to meet stringent fiscal targets, have 
severely limited the allocation of the material, personnel and 
financial resources to implement an effective program.  Programs 
to recover from widespread destruction resulting from severe 
flooding in much of the country in September are likely to tax 
government resources further during the coming year.

Pakistan increasingly cooperates with U.S. and other foreign law 
enforcement agencies, especially on cases involving the 
international movement of narcotics.  Since the last INCSR, six 
fugitives have been arrested for extradition to the U.S. and 
another who has been in custody since 1991 is fighting the 
extradition order in the Supreme Court.  The GOP is presently 
considering six extradition requests from the USG, two of which 
have been found to be extraditable.  The GOP continues to support 
DEA investigations which have resulted in the arrest of several 
Pakistani traffickers in the U.S.  Three drug fugitives for whom 
requests have been made remain at large.  The GOP brought four 
prosecutions, started against major traffickers in 1991, to 
successful conclusions in 1992.  In September, the Karachi Speedy 
Trial Court sentenced drug kingpin and former provincial minister 
Amanullah Kundi, arrested in 1991, to life imprisonment for heroin 
trafficking.  In December, the appeals court upheld the 1991 
conviction of Iqbal Baig and Anwar Khattak, leading traffickers 
who were initially convicted with strong U.S. backing.  Earlier in 
the year, Haji Abdullah, an associate of reputed Baluchistan drug 
trafficker Sakhi Dost Jan Notezai, was also sentenced to life 
imprisonment, although in December the appeals court reduced the 
sentence to two years.

The GOP initiated two prosecutions of major traffickers in 1992, 
both through the PNCB.  The first, of reputed trafficker Waris 
Khan, initially brought a conviction, but was reversed on appeal.  
The second, of accused trafficker Bakht Munir, began in August as 
a result of an investigation launched in May 1991.  There has been 
no verdict yet in this case.

In a widely publicized ceremony in March, the GOP inaugurated its 
1991 pretrial destruction law by burning 3,230 kg of heroin and 
39,021 kg of hashish seized in 1991.

Law Enforcement Efforts.  Despite successful prosecutions of some 
traffickers, the performance of GOP narcotics law enforcement 
agencies during 1992 was not consistently strong.  As in the past, 
these agencies continued to focus on drug seizures, rather than on 
the investigation and prosecution of major drug traffickers, but 
their performance declined significantly compared with previous 
years.  The USG estimates that 1992 seizures of heroin and opium 
will be only about 46 percent and 65 percent of 1991 levels.  
These agencies lack institutional initiative and resources to 
follow-up on seizures with case preparation.  Political 
interference in the administration of justice frequently stalls 
prosecutions and undermines the commitment of investigators.  Also 
important is continuing bureaucratic rivalry and ineffective 
coordination among the more than ten GOP agencies which share 
responsibility for narcotics law enforcement.

Corruption.  Illicit drug money has affected Pakistan's economy 
and continues to generate reports of drug-related corruption at 
various levels of the government and the judiciary.  Existing 
anti-corruption legislation is not vigorously enforced.  No senior 
GOP official has ever been indicted for narcotics-related 
corruption.  All but the most senior law enforcement personnel are 
poorly paid, undereducated, and susceptible to bribes from drug 
traffickers and others.  At least three national parliamentarians 
are reportedly involved in drug trafficking.

Agreements and Treaties.  Pakistan is a party to the 1961 UN 
Single Convention on Narcotic Drugs, which it ratified in 1965.  
It is also a party to the UN 1971 Convention on Psychotropic 
Substances and the 1988 UN Convention, which it ratified in 
October 1991.  Legislation to bring Pakistani law into conformity 
with the 1988 UN Convention is pending.  The U.S. provides anti-
narcotics assistance to Pakistan under the terms of bilateral 
letters of agreement which are subject to annual renewal.  
Extradition between the U.S. and Pakistan takes place under a 
treaty signed between the U.S. and the UK in 1931, made applicable 
to India in 1942, and whose terms Pakistan accepted at 
independence.  U.S. Customs and Pakistan International Airlines 
(PIA) are negotiating a carrier agreement to provide better 
measures to deter smuggling on PIA aircraft.  There are no pending 
negotiations on any other narcotics-related agreements.

Cultivation and Production.  Nearly all opium poppy cultivation is 
found in the tribal areas of the NWFP (bordering Afghanistan), on 
both irrigated and non-irrigated land.  Cannabis grows wild 
throughout Pakistan and is cultivated in Chitral and perhaps other 
areas. The GOP states it has expanded the area affected by the ban 
on the cultivation of opium poppy by some 140,000 ha, and that it 
eradicated 977 ha of opium poppy during 1992.  Expansion of the 
ban, however, has had little significant effect on poppy 
cultivation or opium production, in part because cultivation has 
moved into new, politically and physically inaccessible areas.  
Persistent cultivation in areas where the ban has been in effect 
for some years also remains a problem.  USG agencies estimate that 
during 1992 Pakistani growers devoted 8,170 ha to the cultivation 
of opium poppy and could have produced 175 mt of opium.  Acreage 
estimates for 1992 represent a 0.4 percent decrease compared with 
1991, and a 0.6 percent decrease compared with 1990.  Estimated 
potential opium production during 1992 fell by 2.8 percent 
compared with 1991, but increased by 6.1 percent compared with 
1990.  Given the size of the crop, however, and the margin of 
error in the estimation process, these variations are negligible.

The remote tribal areas of the NFWP also contain an estimated 100 
labs producing heroin from both Pakistani and Afghan opium.  DEA 
estimates that production of equivalent pure heroin is 
approximately 70 mt per year, two-thirds of it destined for 
consumption in Pakistan.  Heroin producers have not been visibly 
affected by the GOP's limited efforts to halt their activities.  
These efforts, in any case, are  severely constrained by the GOP's 
inability to apply its laws to the tribal areas.

Drug Flow/Transit.  Heroin, opium and hashish move from growing 
and processing areas of the NFWP to markets in all parts of 
Pakistan and in foreign countries.  Most raw opium is converted to 
heroin for consumption in Pakistan and abroad.  From laboratories 
in the NFWP, heroin moves by road through Balochistan to Iran and 
Europe, as well as through Afghanistan.  In addition, heroin is 
transported by road, rail and air to Karachi, Islamabad and 
Lahore, where it is routed by air and sea, sometimes via India, 
Africa or Turkey to the U.S. and Europe.  A recently discovered 
transshipment route involved the smuggling of heroin produced in 
Pakistan through Afghanistan into the newly independent Central 
Asian Republics of the former Soviet Union and eventually to 
markets there and in Europe.

Demand Reduction Programs.  Pakistani and international experts 
estimated in 1988 that there were 1.2 to 1.7 million heroin 
addicts in Pakistan, consuming a possible 50 mt of heroin each 
year.  There has been no update of the 1988 survey.  There are 30 
drug treatment centers in Pakistan, with both inpatient and 
outpatient facilities.  These centers focus on detoxification and 
management of withdrawal symptoms, but reportedly have a relapse 
rate of over 90 percent.

The GOP channels its demand reduction efforts through the USG-
funded Drug Abuse Prevention Resource Center (DAPRC) and the 
USG/UNDCP-funded Integrated Drug Demand Reduction Project (IDDRP).  
These two projects coordinate their initiatives with, 
respectively, the Narcotics Control Ministry and the PNCB and 
receive the cooperation of other GOP ministries, such as Health 
and Education, as appropriate.  DAPRC works with the Home 
Department of the NWFP Provincial Government in organizing annual 
pre-planting campaigns to persuade farmers not to grow opium 
poppy, as well as more broadly targeted anti-narcotic media 
campaigns.  During 1992, according to USAID, DAPRC organized a 
campaign to discourage farmers throughout the NWFP from growing 
opium poppy.  DAPRC-organized public awareness campaigns through 
electronic and print media, as well as anti-drug workshops, 
continued during the year. IDDRP produced and tested teacher 
training materials, ran a series of treatment workshops, and 
organized a network of local NGOs.  IDDRP is also working on a 
mobile media campaign to bring the counternarcotics message to 
isolated areas, and is negotiating with Pakistan radio to 
broadcast a series of programs dramatizing the narcotics issue.

IV. U.S. Policy Initiatives and Programs   

U.S. Goals and Objectives.  Through diplomatic initiatives, anti-
narcotics assistance programs, and law enforcement activities, the 
USG seeks to achieve the following objectives:

-- Increased willingness of the GOP to devote energy and resources 
to combatting the illicit narcotics trade in all its aspects and 
the development of a coordinated, comprehensive long-term GOP 
national counternarcotics strategy.

-- Arrest and prosecution of heroin manufacturers, destruction of 
their facilities and confiscation of their property;

-- Interdiction of heroin and opium traffic, the arrest and 
prosecution of major traffickers in GOP courts, and seizure of 
drug-related assets.

-- Passage of comprehensive legislation bringing Pakistani law 
into conformity with the 1988 UN Convention and of strengthened 
asset-forfeiture laws.

-- The provisional arrest and extradition of major traffickers 
sought to stand trial in the U.S.

--  Improvement of controls to deter heroin smuggling at airports 
in Pakistan and on PIA flights .

-- The elimination of the smuggling of essential and precursor 
chemicals, and enforcement of controls on their domestic 
production, import, transport and use to prevent diversion.

-- Expansion of the area of enforcement of the opium cultivation 
ban in the NFWP.

-- The development and implementation of bank regulations to 
prevent the laundering of drug money.

-- Elimination of corruption in GOP law enforcement agencies and 
of the influence of drug traffickers on policy and judicial 
process.

-- Broadened and intensified public support in Pakistan for 
narcotics control initiatives.

Bilateral Cooperation.  Additional anti-narcotics development 
assistance through USAID is now prohibited by the Pressler 
Amendment, and pre-existing assistance will end in 1993.  However, 
under letters of agreement, which are renewed annually, the USG 
provides other narcotics control  assistance to the GOP under 
three broad categories: law enforcement, opium poppy ban 
expansion, and demand reduction.  Given the institutional 
weaknesses in GOP law enforcement agencies, the USG has continued 
to channel its assistance to law enforcement agencies or their 
components that demonstrate the ability and willingness to 
undertake effective anti-narcotics operations.  This approach has 
resulted in agreements with sub-units of the PNCB, Customs, and 
the Frontier Corps.  The USG supplies commodities (vehicles, 
communications, investigative and office equipment), provides 
training, and funds certain operational costs for these agencies.

USG-supported projects in the opium poppy growing areas of the 
NWFP, focusing on roads and other infrastructure, are designed 
specifically to open up politically inaccessible areas to the 
authorities.  The object of these projects is the gradual 
expansion of the opium poppy ban and the elimination of heroin 
labs, greater access to GOP political authorities and law 
enforcement agencies, increased economic viability of substitute 
crops, and more comprehensive development activities by the GOP 
and others.

The demand reduction element of USG programs seeks to increase 
awareness within Pakistan of its domestic heroin addiction problem 
and encourage the growth of an antidrug constituency.  This 
element of the program is mainly implemented through financing 50 
percent of the UNDCP's Integrated Drug Demand Reduction Program.

The Road Ahead.  The USG will continue to press the GOP to raise 
the priority of its narcotics control activities.  With respect to 
law enforcement, recognizing that the unit-by-unit approach to 
support for GOP law enforcement agencies cannot address the 
systemic problem of inadequate law enforcement institutions, the 
USG will continue to seek opportunities to support GOP efforts to 
strengthen and coordinate drug law enforcement.  The reforms 
recommended in the draft chapter on drug abuse control in the 
Fifth Development Plan may present such opportunities.  In the 
meantime, however, the long-awaited establishment of the USG-
funded Anti-Narcotics  Task Forces may also provide an 
institutional focus for continued assistance.  The USG also will 
maintain its long-term commitment to helping open up inaccessible 
areas of the NWFP to GOP law enforcement agencies in order to 
continue expansion of the opium poppy ban, and to provide leverage 
to persuade the GOP to move against  heroin lab operators.  The 
USG will continue efforts to strengthen GOP demand reduction 
initiatives, mainly through proven organizations such as DAPRC and 
IDDRP.  An additional initiative may be partial funding to update 
the 1988 Survey of Drug Abuse in Pakistan, both to provide policy 
makers with the most recent information, and to create a catalyst 
around which to invigorate public support for narcotics control 
efforts.

[Chart - Pakistan 1993 Statistical Tables]
(###)

SRI LANKA

I.  Summary

Sri Lanka has a growing narcotics problem resulting from the flow 
of Southwest Asian heroin to meet local demand and for 
transshipment to other countries.  Illicit cannabis continues to 
be grown as well. Money laundering could become a serious problem; 
a 1989 law permitting numbered currency accounts increased the 
local banking system's vulnerability, but there is little 
awareness of the issue outside law enforcement circles.  Law 
enforcement agencies combatting the illegal drug trade are 
hindered by a shortage of trained manpower, a serious backlog at 
the main drug analysis laboratory, and antiquated legislation.  
Nonetheless, the number of arrests for narcotics-related offenses 
increased during the year with USG-trained personnel playing a 
major role.  Sri Lanka is a party to the 1988 UN Convention.

II.  Status of Country  

Several factors account for Sri Lanka's continuing role as a 
transshipment center for Southwest Asian heroin.  Sri Lankan 
Muslims with ties to Pakistan or India apparently are involved in 
transporting heroin to Sri Lanka along traditional smuggling 
routes.  In addition, the war against Tamil separatist guerrillas 
has forced the concentration of  Sri Lanka's limited naval and air 
force assets on the northern part of the island, leaving the 
remainder of the country open to smuggling by sea.  Similarly, the 
war has prompted the security forces to focus their activities at 
the airport and harbor on interdicting terrorists and weapons.  
The relatively uncomplicated procedures which help make the 
Colombo harbor a center for container traffic also contribute to 
the island's vulnerability to narcotics transshipment.  Numbered 
foreign currency accounts have increased Sri Lanka's attraction 
for money laundering.

III.  Country Action Against Drugs in 1992 

Policy Initiatives.  The National Dangerous Drugs Control Board 
(NDDCB) was authorized in 1992 to establish a drug control plan to 
allocate counternarcotics resources over the next 5-10 years.  
NDDCB officials established task forces to deal with several 
issues, including the amendment of local laws concerning evidence, 
the registration of precursor chemicals, and the expansion of 
demand reduction activities.

Accomplishments.  Despite the absence of a comprehensive legal 
framework, the Government of Sri Lanka (GSL) has made strides 
toward the implementation of the 1988 UN Convention.  The GSL has 
continued to cooperate with regional and other law enforcement 
agencies, including those of the U.S., the UK, Australia, 
Singapore, the Maldives, Japan, Germany, and the Netherlands.

The 1991 bilateral narcotics control agreement with the Police 
Narcotics Bureau (PNB) was implemented with the arrival in 
December of USG-supplied computer equipment.  The PNB will use the 
equipment to establish an anti-narcotics monitoring network with 
other   South Asian states.  Further narcotic control equipment 
purchases will be made for the NDDCB under the terms of the 1992 
bilateral accord.

Law Enforcement Efforts.  Sri Lanka's law enforcement agencies are 
making use of their limited resources, particularly in combatting 
drug trafficking through the international airport.  Law 
enforcement agencies are only beginning to focus on problem areas 
such as money laundering and drug transshipments through the 
harbors.  The NDDCB's anti-narcotics action plan will address 
issues such as jurisdictional problems and the "revenue 
collection" focus of the various enforcement institutions.  The 
Sri Lanka Anti-Narcotics Association estimates that over 50 
percent of the country's school age population is exposed to its 
drug awareness publicity during an average year.

IV. U.S. Policy Initiatives and Programs

The USG seeks to maintain and expand cooperative relations with 
local law enforcement agencies press for needed changes in 
narcotics control legislation encourage greater awareness of the 
threat posed by money laundering and secure increased involvement 
of the Customs Service in anti-narcotics work.  Toward meeting 
this goal, U.S. Customs will conduct an INM-funded Overseas 
Enforcement Training Course in Sri Lanka in 1993.  The program 
will be tailored to the highest threat areas and will seek to 
involve Sri Lankan Customs more actively in drug interdiction 
activities.

In March, five Sri Lankan Police officials received training under 
a USG-sponsored program in Nepal.

The Road Ahead.  Implementation of the two bilateral agreements 
will enable the USG to press for changes in local narcotics laws 
and to raise GSL awareness of the dangers posed by money 
laundering.  The USG encourage increased attention by the Customs 
Service to anti-narcotics efforts with a view toward heightening 
controls at the container harbor.
(###)

SOUTHEAST ASIA AND THE PACIFIC


AUSTRALIA

I. Summary

Australia is primarily a narcotics-consumer country, although 
there are indications that traffickers are beginning to use it for 
transshipment as well.  Some heroin may transit Australia to the 
U.S., while cocaine is being shipped from the U.S. and South 
America possibly destined for Southeast Asia:  Australian 
authorities made two recent record seizures which confirm the 
South American link.  Australian enforcement authorities do 
recognize the seriousness of the narcotics threat.  Reliable 
statistics on domestic use are not available.  Australia plays a 
leading role in the Financial Action Task Force (FATF).  

II.  Status of Country

Illicit drug use is a growing problem in Australia, and is treated 
as such by the Government of Australia (GOA).  Domestic production 
of illicit drugs consists of locally grown cannabis and 
clandestinely manufactured methamphetamine and amphetamine.  These 
drugs appear intended for the domestic market, but some also are 
smuggled into New Zealand.  Marijuana is the predominant illicit 
drug with domestic production supplying much of the market.  
Southeast Asian marijuana from Thailand and Papua-New Guinea is 
also in demand.  Heroin remains a serious problem, while cocaine, 
smuggled in from both the U.S. and South America, is a growing 
concern.  South American traffickers are attempting to use 
Australia as a transshipment point for cocaine bound for the Asian 
market.  Hashish from Lebanon and Southwest Asia is an occasional 
problem.  Tasmania's licit opium poppy industry has effective 
controls against diversion and poses no threat.

III.  Country Actions Against Drugs in 1992

Policy Initiatives.  The GOA pursues a vigorous international 
antidrug policy, and strongly supports international action 
against drug trafficking.  In April, it announced a national drug 
strategy based on a demand reduction approach.  It focuses on 
alcohol and tobacco abuse, with illicit drug use of secondary 
importance.  However, law enforcement authorities strongly pursue 
antidrug efforts, and recognize the seriousness of the threat to 
Australia from international narcotics traffickers.  On November 
20, the GOA ratified the 1988 UN Convention.  Discussions with the 
USG on a mutual legal assistance treaty continue. 

Accomplishments.  The GOA is conducting a strong anti-drug 
campaign, endorses UN counternarcotics goals, and ratified the UN 
Convention after bringing its domestic legislation into line with 
Convention goals.  The Australian Federal Police (AFP) and DEA 
maintain representatives in each other's country to coordinate 
efforts against drug trafficking.

Law Enforcement Efforts.  Six state and three federal agencies 
devote considerable resources toward combatting the drug problem, 
but criminal penalties for trafficking in illicit drugs are weak 
and asset forfeiture efforts are still developing.

Corruption.  Political and police corruption is routinely reported 
in the press.  There was a significant increase in reports of 
drug-related corruption by police in 1992.  Strong actions are 
taken to prosecute the accused, but it remains a serious issue in 
controlling organized trafficking. 

Agreements and Treaties.  Australia has signed and ratified the 
1988 UN Convention, signifying that its legal system meets the 
goals and objectives of the Convention.  A protocol amending the 
U.S.-Australia Extradition Treaty recently entered into force.  
Australia cooperates with the U.S. and other countries to counter 
money laundering, and is taking a leading role in the FATF. 

Cultivation/Production.  Cannabis is the only known cultivated 
illicit drug in Australia.  It is grown primarily in New South 
Wales and Queensland.  The GOA continues its active eradication 
efforts.

Drug Flow/Transit.  DEA reporting indicates that Australia is 
being targeted by South American cocaine trafficking organizations 
as a transit point for narcotics destined for the Asian market, as 
well as a new market for cocaine in itself. 

Demand Reduction Programs.  The April national drug strategy 
spells out an aggressive substance abuse program.  The GOA is also 
taking action to counter international drug traffickers attempting 
to use Australia as a transit point. 

IV. U.S. Policy Initiatives and Programs 

Policy Initiatives.  The primary USG goals are improvements in 
assessments of trafficking trends between Australia and the U.S., 
through assistance to the GOA in intelligence gathering on drug 
trafficking groups.

Bilateral Cooperation.  The GOA and USG exchange narcotics-related 
intelligence information and continue to extradite narcotics 
criminals between the two countries.  The FBI and the Australian 
Federal Police are forming a joint working group on organized 
crime and illicit drugs.  The FBI and the DEA make USG 
counternarcotics training available to GOA law enforcement 
authorities.

Road Ahead.  The U.S. will continue to discuss the exchange of 
drug trafficking information with the GOA to further bilateral 
cooperation.
(###)

BRUNEI

I. Summary

Brunei has few drug abuse or other drug-related problems.  Of the 
258 drug-related arrests in 1992, the vast majority were for the 
possession of excessive quantities of cough medicine containing 
codeine, which is the drug abused most.  Small amounts of 
marijuana, cocaine and heroin have been intercepted in Brunei, but 
in all cases to date, the quantities involved have been below the 
legally established thresholds distinguishing personal consumption 
from drug trafficking, the penalty for which is death.  Two of the 
258 drug-related arrests involved third-country laborers, who were 
allegedly growing marijuana for their personal consumption.  To 
date, no one has been put to death in Brunei for drug trafficking.

II. Status of Country  

The incidence of drug abuse and other drug-related offenses was 
relatively minor in 1992, and is not expected to increase 
significantly in the future.  The very limited drug offenses are 
the result of a combination of many factors, including strict law 
enforcement, a high level of community cooperation with law 
enforcement officials, tight immigration and customs controls, a 
small market (only 270,000 total population), a ban on firearms 
(violation of which carries the death penalty), a ban on the 
public sale and consumption of alcohol, and the application of the 
death penalty for drug trafficking.

III. Country Actions Against Drugs

Policy Initiatives.  The Brunei Government has signed, but not yet 
ratified, the 1988 UN Convention.  The government has concentrated 
its antidrug efforts in the areas of law enforcement, drug abuse 
awareness, prevention, education, and therapy.

Accomplishments.  Based on the low incidence of drug problems, the 
USG believes that Brunei is meeting the goals and objectives of 
the 1988 UN Convention, which the Bruneian Government has signed, 
but not yet ratified.

Law Enforcement Efforts.  Judging by the relatively low incidence 
of drug abuse and drug-related offenses, enforcement efforts 
appear to have been equal to the task.

Corruption.  The Brunei Government is adamantly against illicit 
drugs in all its forms.  The USG has no evidence of any drug-
related corruption within the ranks of government employees.

Agreements and Treaties.  There are no drug-related treaties with 
the U.S. and none are currently anticipated.

Cultivation and Production.  Apart from a few patches of marijuana 
surreptitiously sown by third country laborers for their alleged 
personal consumption, there is no cultivation or production of 
illicit drugs in Brunei, nor is there evidence that Brunei is a 
transit point for the trafficking of illicit drugs.

Demand Reduction Programs.  These are carried out primarily 
through TV and radio ads, and antidrug awareness campaigns in 
public and private schools. 

IV. U.S. Policy Initiatives and Programs  

Given the limited nature of drug-related problems in Brunei, and 
with little prospect for significant change, the USG simply 
monitors the situation by maintaining contact with the Narcotics 
Control Board and local police officials.
(###)

BURMA

I. Summary

Burma accounts for over 50 percent of worldwide illicit opium 
production.  Following the 1988 coup and the suspension of most 
foreign narcotics control aid, the Government of Burma (GOB) 
focused on domestic political problems and sharply reduced its 
already limited counternarcotics program.  Potential opium 
production nearly doubled within one year, and has remained near 
that level since them.  In 1989, the GOB arranged cease fires with 
major insurgent/trafficking groups.  Although it claims that these 
accords include long-term opium poppy crop substitution goals, 
there has been no decline in opium poppy cultivation in areas 
controlled by these groups.

The GOB acceded to the 1988 UN Convention in 1991 and continues to 
claim it is committed to eliminating narcotics production.  Recent 
indications of official attention to the problem include 
destruction of a few surrendered heroin refineries, action against 
some corrupt officials, greater narcotics enforcement in Rangoon 
and select provincial towns, limited cooperation with the DEA, 
participation in a USG-funded opium yield study, and permission 
for increased multilateral involvement in the GOB's border 
development program.  However, these efforts have not reduced 
Burma's vast narcotics production.  Seizures remain insignificant, 
given the size of the crop;  major traffickers, to date, have been 
exempt from exempt from arrest and in some cases openly associate 
with senior military officials.  Due to accommodations reached 
with the GOB, former insurgent groups exercise security and 
militia functions and engage in the narcotics business in areas 
they control.

The USG currently provides no direct assistance to the GOB; 
bilateral counternarcotics cooperation is limited to working-level 
DEA/GOB liaison.  An effective counternarcotics strategy in Burma 
would meld long-term development and crop substitution with law 
enforcement efforts, including opium poppy eradication, 
interdiction, and prosecution of major traffickers.  There are few 
signs that the GOB will seriously adopt and implement such a 
strategy in the near future.  Should it do so, international 
support might be forthcoming.

II. Status of Country

Burma's opium poppy crop is cultivated mostly in the rugged 
mountainous areas of the Shan State.  For decades, much of this 
remote area has been outside central government control and under 
the sway of insurgents or private armies that support themselves 
partly through the sale of narcotics.

Since 1989, the GOB has reached accommodations with Wa and Kokang 
trafficking groups, offering them limited political autonomy and 
development assistance in exchange for ending their insurgencies.  
The GOB claims these accords permit border development programs 
designed eventually to end these groups' reliance on opium for 
their livelihoods.  They have not reduced overall cultivation, 
however; only areas controlled by the Kachin  Independence 
Organization, which has not reached an accord with the government, 
show a decline.  Credible reports also suggest that these 
arrangements effectively permit extensive Kokang and Wa business 
activities, at least partially capitalized by drug sales.  Burma's 
military rulers continue  to ascribe a higher priority to 
political accommodation with these former insurgents than to 
combatting narcotics.

While Thailand remains Burma's largest narcotics conduit to the 
world market, heroin also exits via southern China to Hong Kong 
and through southern Burma to Malaysia and Singapore.  Some drugs 
also flow to India and Bangladesh.

III. Country Actions Against Drugs

Until 1988, combatting illicit narcotics was a GOB objective 
because narcotics revenue supported many insurgents, particularly 
the Burmese Communist Party (BCP).  In 1988, the military 
government sharply repressed political opponents and concentrated 
its police and army resources on internal control.  It all but 
abandoned eradication and maintained only minimal narcotics law 
enforcement efforts.  Opium poppy cultivation rose sharply in 
areas west of the Salween River, including areas where GOB access 
is greatest, and which had been subject to USG-funded aerial 
eradication programs in the 1980s.  The greatest increases in 
opium poppy cultivation, however, have come in the Wa area, which 
was never targeted for aerial eradication because it was under 
firm BCP control until 1989.  As a result of its cease-fire with 
the GOB, the Wa now operate large narcotics refineries along the 
Chinese border.  The Kokang Chinese, despite participation in GOB-
sponsored development efforts, continue as major traffickers.

The Shan United Army (SUA) also remains a powerful drug 
trafficking and heroin refining organization.  As part of its deal 
with the Wa, the GOB since early 1990 has provided direct military 
support for the Wa's ongoing war with drug trafficker Khun Sa's 
SUA.  With Rangoon's support, the Wa have enlarged their sphere of 
control to include significant drug turf along the Thai border.  
The GOB has also conducted episodic military operations against 
the SUA, leading to heavy casualties but few drug seizures.  The 
SUA, however, remains well-entrenched in its enclaves along the 
Thai/Burma border.

Policy Initiatives.  In May 1991, the GOB officially legitimized 
several drug-trafficking insurgent groups.  Burmese officials say 
that peasant farmers under control of these groups lack economic 
alternatives to opium, which border development programs are 
designed to provide.  The GOB says its anti-narcotics focus will 
be on long-term rural pacification and development to create 
alternative incomes for opium poppy growers.  To this end, the GOB 
has sought assistance from the UN in cooperation with Thailand and 
China.  While such development is necessary, it must be coupled 
with strong law enforcement to reduce opium poppy output.  
However, expansion of the GOB's writ into the opium poppy 
cultivation belt, an unstated goal of the program, will be slow 
and may ultimately fail precisely because of the arrangements 
Rangoon has struck with ethnic groups. Permitting several ethnic 
insurgent groups to transform their armed forces into local 
militias all but precludes effective GOB law enforcement.

Accomplishments.  Burmese efforts to combat narcotics production 
and trafficking remained minimal.  The GOB continued to take small 
counternarcotics steps on its own and to view claimed narcotics 
control activity as a means to improve its international image.  
It is clear that the fight against illicit drugs is not the GOB's 
highest priority.

The GOB claims to have eradicated about 1,215 ha of opium poppy in 
1992 (less than one percent of the estimated cultivation);  
publicly destroyed 225 kg of heroin and over five mt of opium, 
plus other drugs and precursor chemicals;  and destroyed a heroin 
refinery surrendered by Wa leaders.  These largely cosmetic 
efforts had scant impact on overall narcotics production.  Foreign 
participants in GOB-arranged trips to the border region continued 
to observe that Burma has only minimal control over the heavily 
armed Wa and Kokang militias.  They also saw some evidence of the 
nascent development efforts designed to effect a phase-out of 
opium poppy cultivation.

Since 1990, there has been an increase in enforcement activity by 
police narcotics task forces and army personnel in Rangoon and 
some northern provincial towns, and additional police narcotics 
task forces have been established.  According to GOB 1992 
statistics, seizures of opium increased by 25 percent and of 
heroin by 50 percent over 1991.

During 1992, Burma signed separate trilateral agreements with the 
UNDCP and China, Laos, and Thailand for counternarcotics 
cooperation and subregional border development, which included 
crop substitution, law enforcement and health, drug treatment, and 
AIDS prevention components.  Foreign Minister U Ohn Gyaw and Home 
Minister Lieutenant General Phone Myint participated in an 
unprecedented trilateral meeting in Bangkok to discuss narcotics 
control with ranking Thai and Lao officials.  In April, the UNDCP 
established small offices in the northern towns of Kengtung and 
Tachilek.  Implementation of the Burma/Thai and Burma/China border 
programs, with UNDCP contributions estimated at $4.5 million and 
$7.7 million over the next three years, began in late 1992.

The GOB and UNDCP agreed on the need for an aerial opium survey of 
project areas, to be conducted during the 1992-93 crop season.  
The GOB has since delayed this survey for another year, however.

Law Enforcement Efforts.  Burmese antidrug legislation is broad 
but inadequately enforced.  The 1974 Narcotics and Dangerous Drug 
Act was replaced by a new law promulgated on January 27, 1993, 
which closed several gaps in the previous legislation, such as 
criminalizing money laundering.  The law is clearly intended to 
move Burma toward compliance with the 1988 UN Convention.  Many 
details remain unclear, however, and the interpretation and 
enforcement of the law will be more important than its text.

Burmese anti-narcotics policies and activities are coordinated by 
the Central Committee for Drug Abuse Control, chaired by the Home 
Affairs Minister.  Key enforcement agencies are the People's 
Police Force, the Burmese Army and the Burmese Air Force.  Others 
involved in narcotics control are the National Intelligence 
Bureau, the Directorate of Defense Services  Intelligence, and the 
Bureau of Special Investigation.  Since 1988, the Burmese military 
has assumed direction over narcotics control, though operational 
responsibility remains with the police.

The GOB has noted the USG's indictment of SUA leader Khun Sa, but 
it refuses to extradite him to the U.S. because it denies that a 
valid U.S.-Burmese extradition treaty exists.  The GOB has 
declared Khun Sa a criminal under Burmese law, and professes a 
willingness to prosecute him in Burma if caught.

Corruption.  Narcotics-related corruption is a serious problem in 
Burma.  Multiple, reliable reports confirm that lower-level 
civilian, Police, Customs and Army personnel frequently acquiesce 
or participate in drug trafficking in exchange for payoffs; 
corruption among ranking officials also has been alleged by 
plausible but unsubstantiated reports.  The GOB carried out 
several crackdowns on anti-narcotics police forces in 1992 which 
led to forced resignations or transfers.  However, no senior Army 
personnel were arrested for narcotics-related corruption, although 
credible reports indicate that some army units actively assist in 
Wa and Kokang drug trafficking activities.

Agreements and Treaties.  The GOB is a party to the 1988 UN 
Convention, but made reservations on extradition and the 
submission of disputes to the World Court.  Burma has also acceded 
to the 1961 Single Convention on Narcotic Drugs but not the 1972 
Protocol to the Convention or the 1971 Convention on Psychotropic 
Substances.  It has no bilateral narcotics agreement with the U.S.

The GOB's January narcotics law addresses important areas with 
regard to financial investigations, corruption, conspiracy, money 
laundering and international cooperation.  Depending on its actual 
implementation, the law represents an important step toward 
bringing the GOB into compliance with the objectives of the UN 
Convention.

Cultivation/Production.  Far and away the world's leading opium 
poppy cultivator, Burma produced an estimated potential of 2,280 
mt of opium on 153,710 ha in the 1991/92 crop season -- over 50 
percent of the world's potential illicit output.  Although opium 
poppy is grown in Kachin, Chin, and Kayah states, the chief 
growing area is the Shan Plateau -- extending almost the full 
length of the mountainous Shan State, with an average elevation of 
1,000 meters.  Fields range from 0.1 to 4.0 ha, averaging 0.5 ha.

Residents in the growing areas are largely dependent on income 
from opium poppy for survival, although local chiefs also are 
believed to coerce them to cultivate as much poppy as the labor 
supply allows.  No longer concentrated along the Thai/Burma 
border, heroin refineries now also range along the PRC frontier in 
areas controlled by the Wa and the Kokang Chinese.

While the GOB's nascent rural development program may ultimately 
provide the infrastructure and other facilities necessary to 
enable poppy growers to find other sources of income, the 
obstacles -- including lack of resources and difficulty of access 
-- are considerable.  In the meantime, as Rangoon remains 
preoccupied with political/security concerns, high production and 
trafficking levels will certainly continue.

Demand Reduction Programs.  Preventive education is carried out by 
the Ministries of Education and Information.  The Ministry of 
Health manages drug treatment and detoxification, supervising 28 
centers with an estimated annual capacity of 3,500-4,000 addicts.  
The Ministry of Social Welfare oversees drug rehabilitation 
efforts.

Domestic addiction remains a serious problem.  Addicts must 
register and undergo compulsory treatment/rehabilitation, 
including six weeks of detoxification treatment for heroin 
addicts, but relapse rates are high.  According to Health Ministry 
figures, there are approximately 13,000 registered addicts to 
heroin, 34,000 to opium, and 5,000 to other substances.  Some 
Burmese and UN observers put the total addict population at 
150,000 or more, out of a population of 42 million.  While opium 
and heroin are frequently smoked, widespread heroin injection has 
resulted in many drug-related AIDS cases and positive HIV tests.  
There are no reliable figures for overdose deaths, nor is it 
possible to estimate accurately illicit narcotics consumption.  
The USG has repeatedly drawn official attention to the rise in 
local consumption.

Some knowledgeable observers believe that the GOB's increasing 
concern about AIDS, especially among military personnel, has been 
a factor in the modest increase of counternarcotics activity over 
the past two years.  Official statistics indicate that, of recent 
heroin addicts tested for HIV, up to 82 percent were positive.

IV.  USG Policy Initiatives and Programs

U.S. Policy Initiatives.  From 1990 to 1992, the USG did not 
certify Burma as cooperating fully or taking steps on its own to 
control narcotics under the Foreign Assistance Act of 1961, as 
amended.  The USG has strongly encouraged the GOB to play a 
responsible role in curbing the production, processing and 
trafficking in opium and heroin on its territory.  To this end, 
the USG is prepared to support appropriate multilateral efforts 
through the UNDCP and other UN agencies, provided Burma 
demonstrates its serious commitment and allows adequate access to 
project areas and requisite monitoring of progress by UN 
officials.  The USG maintains close contact with UNDCP, which has 
a local representative and two field workers in Burma. 

Bilateral Cooperation.  Bilateral counternarcotics cooperation is 
principally limited to activities of the DEA, which maintains 
contact and exchanges information with enforcement officials.  In 
1992, the Burmese military used DEA-supplied intelligence in a 
corruption investigation, and worked with the DEA on a joint 
undercover operation targeting major traffickers.  This case 
culminated in early 1993 with the arrest of several persons on 
narcotics charges and the seizure of several properties believed 
acquired with narcotics earnings, although no heroin was seized or 
major trafficker arrested.  In February 1993, the USG carried out 
a scientific collection of opium poppy samples to improve 
assessment of Burmese opium production.  Since 1988, the USG has 
provided no direct counternarcotics assistance to the GOB.

The Road Ahead.  The future of USG counternarcotics activities 
rests upon Burma's readiness to engage in serious law enforcement 
and to fulfill its international commitments under the 1988 UN 
Convention.  Any USG support would be predicated on serious 
Burmese steps toward meeting the Convention's objectives, 
including unrestricted access to the areas for aid workers, far 
more opium poppy eradication and opium interdiction, destruction 
of many more refineries, and arrests of major traffickers.  An 
effective assistance program could then mesh rural development and 
crop substitution with training and equipment to allow GOB 
agencies to carry out their law enforcement responsibilities. 

[Chart - Burma 1993 Statistical Tables]
(###)

CHINA 

I.  Summary

The People's Republic of China (PRC) has become a major narcotics 
transit route for heroin and other opiates from neighboring Burma, 
Laos and Vietnam.  Increasingly, it is also an opium producer 
itself.  Although much of the heroin which transits China is 
destined for the U.S. and other overseas markets, a growing amount 
is consumed in China, where drug abuse has spread from border 
provinces to the interior.  In 1992, the PRC mounted a nationwide 
crackdown against crime, including narcotics trafficking.  China 
has made efforts to enhance law enforcement measures, public 
education, and international cooperation.  

The PRC is a party to the 1988 UN Convention, as well as the 1961 
Single Convention, its 1972 Protocol, and the 1971 Convention on 
Psychotropic Substances.  U.S.-China bilateral counternarcotics 
cooperation still remains restricted by Chinese views on the 
situation of Wang Zongxiao, a Chinese drug trafficker who sought 
political asylum in the U.S. after Chinese authorities, in 
accordance with a USG request, had sent him to testify in the 
"Goldfish" trial.  USG officials stress that this still-unresolved 
case should not block improved bilateral cooperation.  PRC 
officials insist that Wang be returned to China.

II.  Status of Country

China has become a major narcotics transit route because of its 
location adjacent to the Golden Triangle, its extensive borders 
with Burma and Vietnam, and its transport and communication links 
with drug transit areas such as Hong Kong and Macao.  Burma is the 
source of most heroin transiting China.  Although a large 
proportion of it is shipped by road from Burma via Yunnan, Guangxi 
and Guangdong provinces to Hong Kong for overseas distribution, 
air and rail routes are increasingly used and trafficking networks 
are spreading into interior provinces, such as Sichuan.  The 
quantity of narcotics per seizure has been increasing and 
traffickers are turning to firearms to resist inspection and 
seizure.  Ethnic Chinese trafficking networks operating in Asia 
and the U.S. are using China as a base of operation.

PRC officials have raised their estimate on the number of 
registered addicts to 250,000, but the number of unregistered and 
untreated addicts is certainly much higher.  Most of China's 
provinces and autonomous regions now have voluntary treatment 
programs.  PRC officials claim that addicts who have committed 
crimes receive treatment while in reeducation camps.  PRC 
officials have also raised the number of HIV-positive cases to 
969, the majority located in Yunnan province where the rise in the 
number of addicts injecting heroin has contributed to the spread 
of AIDS.

III.  Country Actions Against Drugs in 1992 

Policy Initiatives.  In view of the worldwide increase in 
narcotics production and demand, PRC officials no longer refer to 
the target set in 1991 of eliminating drugs in China within three 
years.  Making a long-term commitment to fight narcotics 
trafficking, in 1992 the PRC stepped up promotion of 
counternarcotics activities throughout the country.  The National 
Narcotics Control Commission (NNCC), composed of representatives 
from 16 government ministries and agencies, including Public 
Security, Customs and Health, leads the fight against drugs and 
directs policy, enforcement, research and international 
cooperation.  To improve law enforcement, China's police and 
customs agencies have implemented plans to expand antidrug units, 
provide training for counternarcotics staff and improve seizure 
techniques.

In the first half of 1992, government officials publicly committed 
themselves to protect China's progress in economic reform from the 
social ills of crime, including narcotics trafficking.  In June, 
Guangzhou and Shanghai, major Chinese economic centers, cracked 
down on prostitution, gambling, narcotics trafficking, and other 
crimes.  Although the campaigns resulted in arrests and received 
nationwide publicity, the PRC will need to sustain its vigilance 
beyond periods of intense anti-crime activity to disrupt drug 
trafficking rings.  The President of China's Supreme People's 
Court said in March his court had empowered the provincial Higher 
People's Court in Yunnan to levy the death sentence on serious 
drug traffickers.  In November, the Kunming (Yunnan) intermediate 
court sentenced to death 10 drug traffickers, caught with amounts 
of heroin ranging from 261 grams to 13.2 kg; the sentences were 
carried out immediately.

China's narcotics control program, while not in all respects 
sophisticated by world standards, indicates that the PRC has met 
or is actively seeking to meet the goals and objectives of the 
1988 UN  Convention.

Accomplishments.  During the first nine months of 1992, 4,696 drug 
traffickers were convicted, of which 885 were given the death 
sentence or suspended death sentences and life imprisonment.  In 
comparison, 5,285 drug traffickers arrested in 1991 were 
convicted, of whom 866 received the death sentence or life 
imprisonment.  Many drug cases have been adjudicated expeditiously 
and with maximum publicity, including public trials. Traffickers 
from Thailand, Vietnam, Taiwan, Burma and other countries in the 
region were given stiff sentences under China's 1990 drug law.  
Suggesting a toughening in Chinese policy toward Western drug 
offenders, five were found guilty on narcotics charges by Shanghai 
courts in 1992;  a Briton and an American were each sentenced to 
15 years imprisonment and a fine for transporting hashish.

The PRC continues limited international cooperation with Interpol 
to track organized crime syndicates involved in narcotics 
trafficking.  The PRC held discussions on counternarcotics 
cooperation in June with Burma under the auspices of the UNDCP, 
and in July with Thailand.  China and Burma have signed an 
agreement with UNDCP for a subregional project aimed at reducing 
the production, consumption and trafficking of narcotics in the  
China-Burma border area.   The UN INCB and the PRC Ministry of 
Public Health cosponsored a seminar in Beijing for drug control 
administrators in Asia in June.

Law Enforcement Efforts.  China dealt successfully with an 
enormous drug abuse problem in the early 1950s, virtually 
eliminating the sale and use of illicit drugs.  Therefore, it did 
not have a significant counternarcotics structure when narcotics 
trafficking surged with the opening of the country and the growth 
of foreign trade in the early 1980s.  However, in the last few 
years, the Chinese Government has put into place the basic 
administrative, legal and public health structures necessary to 
implement a successful drug enforcement program.

In 1990, the Standing Committee of the Peoples Congress passed an 
anti-narcotics resolution which combined laws previously enacted 
into one narcotics control edict.  The comprehensive law covers 
possession, trafficking, transporting and manufacturing of drugs, 
and includes asset forfeiture and conspiracy sections, although 
enabling legislation is not in place in all areas. 

At the request of the Hong Kong Police Commissioner, the PRC 
Ministry of Public Security in June set up a liaison unit in Hong 
Kong to deal with growing cross border crime.  The unit, while 
exercising no jurisdiction in Hong Kong, will function as a 
channel for exchange of information between the Hong Kong Police 
and PRC Public Security officials.  Some of the information 
exchanged may involve the trafficking of narcotics between the PRC 
and Hong Kong.  Hong Kong customs officials maintain frequent 
contacts with their Chinese counterparts in Guangdong on 
counternarcotics activities.

Corruption.  The PRC has taken a strong stand against official 
corruption, and has laws dealing specifically with government 
officials who are found guilty of the use, manufacture or delivery 
of narcotics.  Those convicted receive sentences on the same basis 
as nongovernment offenders.  In addition, in any government 
department where such offenses occur, the head of the department 
and the immediate officer in charge will be held responsible and 
punished accordingly.

There is no reliable evidence of high-level official corruption or 
involvement in narcotics trafficking, but there are numerous 
reports of narcotics corruption among lower-level Chinese 
officials.  In September and October, a major drug and arms 
smuggling network centered in Pingyuan, Yunnan, was disrupted in 
an operation that involved 2,000 militia, public security and 
police officers.  The leader, a Vice Mayor of Pingyuan, and 854 
others were arrested on drug charges.  Illicit drugs totaling 981 
kg and 353 illegal weapons were seized.  As a result, central and 
provincial government and Communist Party officials ordered a 
reshuffle of local government and party leaders in the area.

Drug Flow/Transit.  While the Burma-Yunnan-Hong Kong connection 
remains the primary route for trafficking Southeast Asian heroin 
through China, alternate routes have developed from Yunnan through 
Sichuan and through Vietnam and Guangxi.  In April, police 
arrested five traffickers, including two Vietnamese.  A Vietnamese 
truck driver was detained after police discovered 3,000 kg of 
dried opium poppy in his truck.  According to NNCC statistics, 
during the first six months of 1992, 10,138 drug trafficking cases 
were uncovered, compared to 10,946 cases in all of 1991.  During 
the same period, 44,952 kg of precursor and essential chemicals 
were seized.  In 1991, China made its first seizures of 
methamphetamines;  Chinese officials reported the dismantling of 
several clandestine methamphetamine laboratories in 1992.

Most domestic opium, produced in many Chinese provinces, is 
consumed locally.  In February, Harbin Radio reported a seizure of 
8,100 grams of opium jelly, largely made from opium poppies 
planted in Heilongjiang's mountain valleys.  In June, Shanghai 
police were reported to have destroyed 4,000 plants at 25 sites.

Demand Reduction Programs.  The PRC encourages citizens to report 
on possible cases of drug smuggling and use.  In Yunnan, where 
local efforts are most organized, antidrug organizations are 
involved in identifying drug users, providing treatment, and 
helping former addicts avoid returning to illicit drugs;  however, 
relapse rates are believed to be high.

The number of registered drug abusers has increased from 70,000 in 
1990 to an estimated 250,000 in late 1992.  According to an 
epidemiological survey in Xian, 90 percent of the addicts are 
males under 25.  Drug addiction is spreading from the rural and 
border areas to China's interior provinces and its cities.  About 
46,000 drug abusers received compulsory drug rehabilitation in 
1992.  Of the 969 cases of HIV infection in China, over 70 percent 
are drug abusers.  Although concentrated in Yunnan, HIV infection 
is spreading to other areas.

Drug addicts in China are encouraged to register and receive 
treatment at government treatment centers.  Officials claim 
addicts who have been seized for criminal acts can receive 
treatment in reeducation facilities.  The Ministry of Health 
continues to pursue the integration of customary detoxification 
methods with traditional medicine, acupuncture and other Chinese-
developed treatments, and also has sought assistance from 
rehabilitation organizations such as Daytop Village.  Public 
Health is working to install a drug treatment center in Kunming, 
using Daytop's therapeutic community approach to rehabilitation.

To improve dissemination of narcotics information, the National 
Committee on Drug Prohibition has written material for students 
about drugs, and the Ministry of Public Health plans to publish 
pamphlets for health professionals.  Public Health runs training 
and public awareness seminars on drug abuse.

IV.  U.S. Policy Initiatives and Programs 

Policy Initiatives.  The USG has sought to: (a) continue a 
dialogue with PRC officials on the global and regional narcotics 
situation; (b) encourage an exchange of information on trafficking 
networks and narcotics-related cases; (c) encourage regional 
cooperation and joint counternarcotics projects; and (d) continue 
cooperation on demand reduction initiatives in China.

Bilateral Cooperation.  Pursuant to the 1987 memorandum of 
understanding, the PRC cooperates with the USG on a limited scale 
in law enforcement activities.  While recognizing the need for 
further cooperation with the U.S., the PRC continues to cite the 
Wang Zongxiao case as an obstacle to improved bilateral 
cooperation.  The Chinese insist that Mr. Wang be returned to 
China to stand trial.  Mr. Wang's asylum request is unresolved.  
He has initiated his own action against the USG which has further 
delayed the resolution of this matter.  The USG has emphasized 
with the PRC that, while Wang's case remains in the U.S. legal 
system, it should not stand in the way of any efforts aimed at 
attacking the worsening problem of international narcotics 
trafficking in China.

In October, a DEA training team funded by INM conducted a law 
enforcement training program in Nanning, Guangxi autonomous region 
for 70 public security officers from throughout China.  In 
September, INM funded attendance of a forensic chemist at a DEA 
seminar in the U.S.  In June, a DEA special agent participated in 
the enterprise crime conference in Shanghai.  INM also funded a 
demand reduction training program administered by Daytop Village 
in Kunming.

DEA and PRC public security officials are working on ways to 
expedite information exchange, with DEA emphasizing the need for 
timely and useful feedback from the PRC.  Cooperation with DEA 
continues to be inadequate.  Many DEA requests for or provision of 
information to Chinese authorities go unanswered, or are not 
passed to operating levels on a timely basis.  Progress has been 
made in expanding cooperation on health-related and law 
enforcement training.

The Road Ahead.  The PRC is increasingly concerned about drug 
trafficking and abuse in China.  The PRC's official commitment to 
fight narcotics domestically and through international cooperation 
has provided a strong framework for USG-PRC cooperation.  But the 
pace of expanded counternarcotics cooperation, on information 
exchange in particular, has continued to fall well short of the 
growing threat.  The USG will seek to engage the Chinese in more 
regional, as well as bilateral, counternarcotics efforts to stem 
the flow of drugs at their source and in transit.  In mid-1993, 
U.S. Customs will conduct an INM-funded Overseas Enforcement 
Training program in Qingdao for Chinese Customs officers.  
[Chart - China 1993 Statistical Tables
(###)

HONG KONG

I.  Summary

Hong Kong is an important center for brokering and transshipping 
heroin from the Golden Triangle to the U.S. and elsewhere.  Drug 
traffickers also use it to launder narcotics earnings.  Hong 
Kong's counternarcotics effort represents substantial compliance 
with the goals and objectives of the 1988 UN Convention, although 
it is not party to the convention in view of its special legal 
status.

Bilateral cooperation between USG agencies and their HKG 
counterparts is exemplary.  About $25 million in drug-related 
assets has been confiscated both in Hong Kong and in the U.S. 
under the U.S.-Hong Kong designation agreement since it came into 
force in 1991.  The Hong Kong courts ruled in January 1992 that 
U.S. civil court forfeitures will be accepted by local courts 
under the terms of the bilateral agreement, giving the U.S. the 
ability to request the freezing of drug assets in Hong Kong by 
either a civil or criminal forfeiture request.  The Hong Kong 
Government (HKG) is considering sympathetically a USG request for 
the sharing of seized assets.  In one setback, a Hong Kong court 
ruling voided key sections of the financial disclosure laws;  the 
Hong Kong Government is appealing to the Privy Council.

As of early December 1992, 41 fugitives were extradited from Hong 
Kong to the U.S. on drug charges.  Cooperation between the DEA and 
U.S. Customs and their HKG counterparts continues to be fruitful.  
Hong Kong is an active participant in the Financial Action Task 
Force (FATF).

II. Status of Country 

Hong Kong remains an important transit point for drug trafficking 
and for money laundering of drug proceeds.  Most trafficking 
involves heroin No. 4 brought from the Golden Triangle region by 
trawlers from Thailand or overland through southern China and 
other traditional smuggling means. 

A key element of the HKG's fight against drugs is the 1989 Drug 
Trafficking (Recovery of Proceeds) Ordinance, but  a court 
decision in August struck down elements of its money laundering 
provisions as being in violation of the Bill of Rights.  The 
government has appealed to the UK Privy Council.  In the interim, 
reporting of large financial transactions has dropped greatly, 
hampering financial investigations.  

III. Country Action Against Drugs in 1992 

The Narcotics Police and Customs are professional, active 
enforcement organizations.  The authorities reported 6,645 drug-
related arrests in the first nine months of 1992. Seizures 
included 550 kg of heroin and over 2,950 kg of marijuana in the 
first ten months.  The USG is not aware of narcotics-related 
corruption among senior government or law enforcement officials in 
1992; the HKG does not protect or give haven to known traffickers 
nor, as a matter of policy, does it permit corruption, money 
laundering or trafficking.

The 1989 Drug Trafficking Ordinance empowered the government to 
trace, freeze and confiscate proceeds of persons convicted of drug 
trafficking.  About $43 million in drug-related assets have been 
frozen or confiscated in Hong Kong since its enactment.  As noted, 
bank reports of suspicious transactions dropped sharply since the 
court ruling on the constitutionality of the law. 

The HKG is beginning to set up law enforcement structures to be in 
place post-1997, including negotiations with the U.S. and several 
other countries on extradition and mutual legal assistance in 
criminal matters.  There is no evidence that the basic legal 
system of Hong Kong will not remain in place, according to the 
terms of Sino-British negotiations on the reversion of Hong Kong.

While Hong Kong is not covered by the legal regime established by 
the 1988 UN Convention, Hong Kong's active counternarcotics effort 
represents substantial compliance with its goals and objectives.

Hong Kong is an active participant in the FATF.  The HKG has taken 
a broad range of positive actions on prosecution of traffickers 
and implementation of financial controls, and has cooperated 
extensively with the USG.  

The number of assumed active drug abusers in Hong Kong was about 
35,700 in 1992.  Heroin No. 4 remains readily available and is the 
major drug of abuse.  Cough medicine has replaced marijuana as the 
second most widely-used drug by Hong Kong teenagers, and the 
government has introduced legislation to place tighter controls on 
its sale.  There is some abuse of cocaine in the entertainment 
industry and among the younger, affluent population.  The HKG 
maintains three major treatment and rehabilitation programs:  
mandatory treatment carried out by the Correctional Services 
Department, outpatient methadone maintenance under the Department 
of Health, and a voluntary inpatient program conducted by the 
Society for the Aid and Rehabilitation of Drug Abusers.  Other 
treatment, counselling and public education programs operated by 
various volunteer agencies complement these major programs. In the 
first half of 1992, about 6,300 individuals were admitted to 
various treatment institutions. 

IV.  U.S. Policy Initiatives and Programs

Cooperation between USG and HKG enforcement agencies is excellent.  
Asset seizures have risen sharply since 1991. The Hong Kong court 
ruling accepting U.S. court forfeitures will permit the freezing 
of drug assets in Hong Kong under U.S. civil or criminal 
forfeiture requests.  The HKG appears sympathetic to a pending USG 
request for the sharing of seized assets in a particular case.

From January 1 through early December 1992, 41 fugitives were 
extradited from Hong Kong to the U.S. on drug charges.  
Cooperation between the DEA and U.S. Customs and the HKG continues 
to be fruitful.  USG counternarcotics goals remain focused on 
increasing cooperation in drug interdiction, joint prosecution 
efforts and combatting drug-related money laundering. 

[Chart - Hong Kong 1993 Statistical Tables]
(###)

INDONESIA

I.  Summary

Indonesia is not a major narcotics processing country or money 
laundering center.  Although marijuana is produced in large 
quantities, little enters the U.S. market.  Domestic drug abuse is 
a small but growing problem, and the Government of Indonesia (GOI) 
views drug abuse and trafficking as a major long-term threat to 
social stability.  U.S.-Indonesian cooperation is good, with the 
USG providing funding for training and equipment procurement, and 
the GOI cooperating with DEA in a number of areas.  Indonesia has 
signed, but is not yet a party to, the 1988 UN Convention.

II.  Status of Country 

The only illicit drug produced in significant quantities in 
Indonesia is marijuana.  While no accurate production estimates 
exist, Indonesian authorities believe there has been no 
significant change in marijuana production or use over the past 
year; little, if any, enters the U.S. market.  Indonesia's over 
one million square miles of territorial sea and archipelagic 
waters, however, include some of the world's busiest international 
straits and provide countless opportunities for smuggling 
narcotics and other goods.  

There are some signs that, as other Southeast Asian countries 
increase enforcement on heroin trafficking, Indonesia may be used 
more by trafficking organizations.  In 1992, heroin that transited 
Indonesia was seized from two drug couriers at Boston's Logan 
Airport.  Drug abuse and trafficking in Bali continue to be of 
concern as the government promotes tourism through easier 
immigration and customs procedures, and the number of 
international flights increases.  The Indonesian National Police 
(INP), in two separate incidents in Bali, apprehended West African 
traffickers of sizeable quantities of heroin.  Although Indonesian 
law enforcement officials believe that foreigners are involved in 
moving most narcotics out of Bali, tourists report being 
approached openly by local vendors.  

III.  Country Actions Against Drugs in 1992 

Policy Initiatives.  The INP continued its efforts to combat 
narcotics in Indonesia.  We expect that this will continue as the 
GOI seeks to increase tourism.  In Bali, the INP has taken the 
initiative against West African traffickers of heroin seeking to 
develop a local market among the Balinese.  The GOI also continues 
to expel suspected American drug traffickers. 

Law Enforcement Efforts.  Indonesia's legislation and legal 
structure are technically adequate to prosecute those involved in 
the abuse, production, and trafficking of illicit drugs.  The GOI 
is examining possible additional legislation on money laundering, 
conspiracy and asset forfeiture.  Indonesia is not a signatory of 
the 1971 UN Convention on Psychotropic Substances nor does 
Indonesia's 1976 narcotics law cover psychotropic drugs.  While  
these drugs are regulated and trafficking in them is illegal, this 
omission complicates police efforts to curb growing psychotropic 
drug use.  The GOI is working on legislation to bring Indonesia 
into conformity with the 1961 Convention.  The GOI is a signatory 
to the 1988 UN Convention but has not yet deposited its instrument 
of ratification.  GOI committees continue to discuss options to 
implement the Convention.  While substantial work remains to be 
done, Indonesia is moving toward fulfilling the goals and 
objectives of the 1988 Convention.

Corruption.  Although the Indonesian press has publicized 
incidents of corruption, they have not included senior government 
officials.  Government policy does not encourage or facilitate 
illicit drug production, distribution, or money laundering.  The 
USG has no evidence of senior government official involvement in 
the production or distribution of drugs or in money laundering. 

Agreements and Treaties.  Indonesia has bilateral extradition 
agreements with Malaysia, the Philippines and Thailand, but not 
with the U.S.  Drug offenders may also be extradited to other 
countries under existing law.  Indonesia participates in 
international narcotics control efforts and is a member of the UN 
Commission on Narcotic Drugs.  In September, Indonesia joined in a 
call for common anti-narcotics legislation in resolutions adopted 
at the 13th General Assembly of the ASEAN Inter-parliamentary 
Organization. 

Cultivation and Production.  Cannabis is cultivated in Sumatra, 
Java, Bali, Nusa Tenggara, and Sulawesi.  Most marijuana comes 
from Aceh province in northern Sumatra, where it grows both wild 
and under cultivation.  The highest estimate ever cited for annual 
marijuana production was 200 mt.  An illicitly cultivated mushroom 
of the psilocybin type has a small market among foreign tourists 
in Yogyakarta (Java) and in Bali.  There is no evidence that opium 
poppies are cultivated. Indonesia is not a major processing 
country for illicit narcotics, and police have not found heroin or 
cocaine laboratories in the country.  According to one report, 
illegal heroin labs may be operating aboard fishing vessels in the 
Straits of Malacca.  Officials believe the heroin, opium, 
morphine, and cocaine available locally comes from abroad.  

Domestic Programs.  Domestic drug abuse is a small but growing 
problem among the young.  According to police reports, 
approximately 95 percent of drug abusers in Jakarta are between 15 
and 26.  Drug abuse is reportedly spreading from the affluent to 
middle-and-lower class youth.  Combinations of alcohol, sedatives 
and marijuana are increasingly popular.  Some adolescents have 
turned to solvent abuse (paint thinner, gasoline, glue).  There is 
no registry of drug abusers nor are reliable indirect indicators 
of abuse monitored.  According to the INP, Indonesia now has 
approximately 100,000 drug abusers.  This estimate is based on 
police statistics of persons detained for any period of narcotics 
abuse multiplied by 10 on the presumption that police identify 
only 10 percent of abusers.  Various officials estimate that .05 
to .06 percent of the population are drug abusers, a figure that 
has remained stable over the past several years.  The INP includes 
alcohol abusers in its statistics. 

The GOI views drug abuse and narcotics trafficking as major long-
term threats to social stability, and it coordinates efforts to 
increase public awareness about the dangers of drug abuse through 
the departments of Health, Education and Culture, Religion, and 
Information.  Youth and women's organizations are also active in 
public awareness campaigns, and religious organizations are 
involved in prevention, treatment and rehabilitation.  It is 
difficult to evaluate success of demand reduction activities 
because of poor statistical data. 

IV.  U.S. Policy Initiatives and Programs 

Policy Initiatives.  The USG encourages the GOI to ratify the 
applicable UN conventions and advocates increased cooperation 
among ASEAN nations to control production and trafficking.  The 
U.S. Embassy in Jakarta and the DEA office in Singapore serve as 
the points of cooperation with the GOI. 

Bilateral Cooperation.  DEA closed its country office in Jakarta 
in 1987, in part because of lowered expectations that Indonesia 
was becoming a transit country for traffickers.  In 1992, INM made 
a $40,000 grant for communications and transportation equipment 
for the INP.  An Indonesian official was sent for DEA training in 
the U.S., and Indonesians participated in other counternarcotics 
programs in the region.  The INP also deported a suspected 
American drug trafficker at USG request.

The Road Ahead.  Indonesia will participate in several USG-
sponsored training activities. In February 1993, U.S. Coast Guard 
maritime law enforcement training was given in Indonesian waters.  
In April, the INP will take part in INM-sponsored DEA training at 
three separate locations in Indonesia.   

[Chart - Indonesia 1993 Statistical Chart]
(###)

JAPAN 

I. Summary

Southeast Asian heroin transits Japan, but not on a large scale by 
world standards.  Methamphetamine is the drug of choice:  some 
estimate its methamphetamine addict population as about 400,000, 
supplied by several Yakuza (organized crime) groups which earn 
substantial profits from trafficking.  There are signs that a 
market for cocaine may be developing.  Japan is a party to the 
1988 UN Convention and has enacted several laws to conform with 
the convention.  As a result of limited currency control laws, one 
of the country's most potentially significant narcotics-related 
problems is money laundering. 

II. Status of Country

Japan's demand problem is modest by international standards.  
While a history of methamphetamine abuse predates World War II, 
heroin and marijuana are not widely used.  However, an increase in 
recent years of travel by South American nationals, including 
known members of Colombian cartels without clearly legitimate 
business or tourism purposes, suggests an increase in cocaine 
trafficking.  There are also indications that heroin traffickers 
are trying to exploit the situation:  over the past five years, 
Nigerian heroin rings have begun to use Tokyo as a transit point 
for heroin originating in Southeast Asia.  However, we have no 
basis to estimate the volume of this traffic. 

III. Country Actions Against Drugs in 1992

Policy Initiatives.  The Japanese Diet ratified the 1988 UN 
Convention on June 12, and the Government of Japan (GOJ) has 
enacted several pieces of legislation to bring its legal system in 
line with the Convention.  The laws are intended to tighten 
controls on organized crime, money laundering, and essential 
precursor chemicals.  The new laws also authorize, for the first 
time, use of controlled deliveries in enforcing narcotics 
legislation.

Accomplishments.  Although it is too early to know what effect, if 
any, the new anti-organized crime and money laundering laws will 
have, DEA Tokyo reports that progress has already been made in the 
control of precursor chemicals, and authorities are now authorized 
to engage in controlled deliveries.  The USG and GOJ have no 
narcotics-specific bilateral agreements, but the bilateral 
extradition treaty works smoothly.

Because of Japan's limited drug problem, legislation granting 
national law enforcement authorities powers comparable to those 
enjoyed by counterparts in the U.S. is relatively new.  They are 
significant steps, but more could be done.  Asset seizure and 
forfeiture is not used and only rarely do police conduct 
undercover operations, since prosecutors will not bring cases to 
trial based on covert evidence.  Japanese reluctance to provide 
law enforcement authorities with increased investigative powers is 
cultural and historical, based on concern the police may become 
too powerful.  There are no indications of senior official 
toleration of or involvement in narcotics trafficking or 
corruption.

Legislation and Enforcement.  Japan is a signatory of the 1988 UN 
Convention and in October 1991 passed conforming legislation.  The 
new laws require banks to submit currency transaction reports for 
single, domestic transactions of more than approximately $240,000, 
and for overseas remittances of approximately $34,300 or more.  So 
far, there have been no arrests made under the new laws, and DEA 
Tokyo does not believe the situation is likely to change greatly, 
since traffickers can simply divide their transactions into 
smaller amounts.  Drug abuse prevention programs are not highly 
developed.

IV.  U.S. Policy Initiatives and Programs 

U.S. agencies work with their Japanese counterparts to assist 
Japanese police efforts (e.g., through criminal record checks and 
training assistance), and to encourage further tightening of 
currency transaction regulations to discourage money laundering.  
The USG will continue to urge Japan to develop domestic drug use 
surveys, as well as to undertake narcotics control initiatives 
with the countries of Southeast Asia and the Pacific Rim.  DEA 
engages in controlled deliveries of drugs with its counterparts, 
exchanges narcotics intelligence, and provides investigative 
support and training.  DEA is also providing background 
information for Japan's development of a law to authorize wiretap 
activity in Japan for drug investigations.
(###)

KOREA

I. Summary

While still modest by international standards, drug abuse in Korea 
is increasing; methamphetamine is the most commonly abused drug.  
There is little heroin or cocaine addiction.  The Korean 
Government (ROKG) actively discourages illicit drug production and 
use.  Korea has begun to implement the UN's drug abuse control 
plan.  The primary USG concern is Korea's role as a transshipment 
point for Asian heroin destined for the U.S. and elsewhere. Korea 
is not a party to the 1988 UN Convention.

II. Status of Country:

During the past year, Korea made its first arrests for cocaine and 
LSD abuse, and there are some signs that Korea will face an 
increase in illicit drug use in the 1990s.  Drug abuse among U.S. 
military personnel in Korea is dominated by marijuana and licit 
drugs.  The ROKG is building its first drug rehabilitation center, 
to be completed by the end of 1993, and has designated 22 mental 
hospitals as drug treatment and rehabilitation centers.  While not 
a party to the 1988 UN Convention, the government is preparing 
legislation to meet its goals; the government intends to ratify 
the Convention in 1993.

III. Country Actions Against Drugs

Illicit drug use is prohibited, and drug arrests are prominently 
reported by the local media to educate the population on the 
dangers of illicit drug use.  The USG has no information 
suggesting high-level narcotics-related corruption, or the 
toleration or abetting of drug trafficking by senior government 
officials.

IV. U.S. Policy Initiatives and Programs

The primary USG concern is Korea's role as a transit route for 
Asian heroin.  The Seoul airport and Pusan seaport are documented 
transshipment points for international drug smugglers.  The DEA 
office in Seoul keeps abreast of drug trafficking trends and 
supports the Korean Government and U.S. military authorities in 
developing their capabilities and resources.  USG goals include 
increased cooperation among ROKG agencies and upgrading Korean 
professional skills. The USG and the ROKG initialed a mutual legal 
assistance treaty in September.  The ROKG has expressed a strong 
interest in negotiating an extradition treaty with the U.S. 
(###)

LAOS

I. Summary

Laotian counternarcotics efforts expanded in 1992.  Laos is the 
world's third-largest opium producing country, but the only one of 
the top three to reduce its potential opium production in each of 
the past three years.  Estimated opium production declined 13 
percent in 1992 from 1991, bringing the total crop reduction since 
initiation of USG and UNDCP-funded rural development and opium 
poppy replacement programs in 1989 to 39 percent.

There were several significant law enforcement developments.  The 
Government of Laos (GOL) actively publicized narcotics-related 
arrests and seizures during the past year, in contrast to past 
practice.  An increased number of both highland and lowland Lao 
have been arrested on charges involving opium, heroin and 
marijuana.  In December, Laos arrested its first foreign heroin 
trafficker.  The Lao Customs Department established a separate 
anti-smuggling unit in Vientiane with counternarcotics 
responsibilities.  

In August, the GOL Council of Ministers approved the establishment 
of a counternarcotics police unit.  In September, Laos and the USG 
signed a letter of agreement (LOA) to provide support and training 
for this unit.  Progress in actual formation of that unit has been 
minimal, but previously established counternarcotics efforts have 
continued.

Laos' counternarcotics efforts remain modest, and its slowness to 
establish the new police unit and accept USG assistance are 
disappointing; but these aspects must be seen in the context of a 
very poor country with a poorly developed administrative system.  
Laos is not a party to the 1988 UN Convention.  It has made only 
limited formal progress toward meeting its goals and objectives.  
It is translating materials on the legal requirements of the 
Convention into Lao for legislative attention, and officials have 
stated their intention to meet the Convention's standards.

Narcotics corruption among civilian and military personnel 
continues to be a major problem, but there is no evidence that the 
Lao government itself encourages or facilitates narcotics 
activity.  Senior Lao officials have repeatedly insisted that 
anyone involved in the narcotics trade will be arrested and 
prosecuted, but there is little evidence of aggressive action in 
this regard.

II. Status of Country

The GOL has made progress on narcotics control.   USG estimates 
indicate that there has been a 14 percent decline in opium poppy 
cultivation in 1992 alone, and a 39 percent decline since 1989.  
Poppy cultivation in the USG-funded Houaphan project area has 
dropped 50 percent since 1989.  The GOL repeatedly has stated that 
it is committed to decrease opium poppy production, but that this 
must compete with other GOL priorities for funds and, perhaps more 
importantly, limited management and administrative skills. 

We attribute the reduction in opium poppy cultivation and 
production to several factors:  (1) in the target areas of the USG 
and the UNDCP projects, pressure from district officials combined 
with crop reduction by villagers in expectation of project 
benefits; (2) increased arrests and seizures which deter buyers 
and ultimately growers as well, and  (3) a concerted public 
information program by the GOL stressing the negative consequences 
of illicit trafficking.

III. Country Action Against Drugs in 1992

Policy Initiatives.  The GOL drew public attention to drug 
trafficking by stepping up its public reporting of narcotics-
related arrests, seizures, and penalties, and by making 
counternarcotics statistics publicly available.  The GOL increased 
somewhat the access it affords to the DEA, issuing longer, 
multiple-entry visas to DEA officers stationed in Thailand.  In 
November, the GOL for the first time allowed DEA officers to visit 
the districts targeted in the USG-funded Houaphan crop 
substitution project, and in January, DEA officers travelled to 
the opium-producing areas of Bokeo and Louang Namtha provinces. 

The Lao Government also facilitated UNDCP crop substitution 
projects in Vientiane and Xiang Khouang provinces.  In February, 
the GOL and the UNDCP agreed to an assessment of the drug problem 
in Laos, including recommendations for a comprehensive drug 
control program.  A summary of the assessment's initial findings 
has been submitted to the Lao Government. In March, delegations 
from the GOL, Burma, and UNDCP agreed to develop a project 
proposal for economic and social development in the provinces of 
Bokeo and Louang Namtha to curb trafficking, eliminate opium poppy 
cultivation, and reduce demand.  The GOL also agreed in principle 
to trilateral cooperation with Thailand and Burma, and the GOL 
participated as an observer at the signing ceremonies in June of 
Thai-Burma-UNDCP and China-Burma- UNDCP project documents in 
Rangoon. 

Accomplishments. In August, the GOL approved the establishment of 
a police special counternarcotics unit, under the operational 
control of the Ministry of Interior (MOI), but the policy control 
of the Lao National Committee on Drug Control and Supervision.  In 
September, the USG and GOL signed the LOA for a law enforcement 
project which will include training and resources for the unit and 
activities to accelerate its operational readiness. 

Law Enforcement Efforts.  GOL narcotics-related arrests and 
seizures increased during the past year and were highly publicized 
by Lao authorities.  The GOL has arrested both highland and 
lowland Lao for possession of opium, heroin, and marijuana.  The 
GOL publicly burned seized opium in November as part of its 
counternarcotics public awareness program.  In December, Laos 
arrested its first foreign heroin trafficker, a Singaporean with 
over five kg in his possession.  The Lao acted on information 
provided by Thai officials who had arrested an associate 
trafficker in Thailand.

Corruption. The USG continued to receive reports of military and 
official corruption and collusion in narcotics production and 
trafficking.  There is no evidence, however, that the Lao 
Government as a matter of policy encourages or facilitates the 
illicit production or distribution of drugs or the laundering of 
drug money, although some senior government officials are 
certainly aware of these narcotics-related activities.  The USG 
does not have any solid evidence that senior officials directly 
engage in, encourage, or facilitate the production or distribution 
of illegal drugs.  Senior Lao officials have repeatedly insisted 
that no one in Laos is above the law, and that anyone involved in 
the narcotics trade will be arrested and prosecuted.  

Agreements and Treaties.  The U.S. and Lao governments signed a 
memorandum of understanding on counternarcotics cooperation in 
1990.  The GOL also signed the LOA with the USG in September to 
support the Lao Police special counternarcotics unit.  The USG 
will provide up to $300,000 in training and equipment.  The law 
enforcement project will also assist the Lao Customs Department in 
equipping regional anti-smuggling centers and the provision of 
customs training.

Although the GOL does not have an extradition or mutual legal 
assistance treaty with the USG, it has agreed informally to 
cooperate in deporting drug traffickers.  In May, the GOL deported 
a U.S. narcotics fugitive into USG custody for return to criminal 
proceedings.   Laos has been a party to the 1961 Single Convention 
since 1973.  Although the Lao Government has not yet become a 
party to the 1971 and the 1988 UN conventions, it is actively 
cooperating with the UNDCP and with bilateral donors.  Senior GOL 
officials have stated to USG officials that they accept the 1988 
Convention in principle, but the process of drafting and 
implementing the legal structures to meet the goals and objectives 
of the Convention is still at a relatively early stage.  

Cultivation/Production.  Opium production is spread throughout the 
10 northern Lao provinces where opium is used as a medicine, and 
as a cash or barter crop.  The USG estimates that Laos 
theoretically could have produced 230 mt of opium from 25,610 ha 
in 1992, down from an estimated 265 mt potentially available from 
29,625 ha in 1991.   While the UNDCP estimates domestic 
consumption at about 50 mt, a U.S. Embassy source believes it may 
be as high as 100 mt.

Much of the opium poppy is grown by hilltribes over which the 
central government has little control.  The rural areas are 
isolated and often inaccessible during the rainy season.  Poverty 
is severe, with child mortality rates of up to 40 percent.  The 
Lao Government has called for bilateral and multilateral 
development assistance for crop substitution projects.  It has 
noted repeatedly that village-level opium cultivation cannot be 
eliminated until the farmers have alternative incomes.  

Drug Flow/Transit.  According to the Lao Government, it has 
limited ability to control the flow of illicit narcotics either 
within or across its borders since it is severely constrained by a 
lack of personnel, resources, and expertise.  Laos manages 
effective control over its lengthy borders with Thailand, Burma, 
China, Vietnam, and Cambodia only at major population centers and 
river crossings.

We are unable to establish the extent of domestic Lao trafficking 
in narcotics nor the degree to which Laos is used for 
transshipment of narcotics from neighboring countries.  However, 
Louang Namtha Province has been identified as a route for opium 
and heroin from or through Laos to China, while Bokeo and Oudomsay 
provinces on the Thai border serve as exit and transit areas in 
northwest Laos.  Opium from northeast Laos is reportedly shipped 
through Vientiane and Bolikhamsay provinces to Thailand.  The 
extent of trafficking to or through Vietnam has not been 
established. 

Demand Reduction Programs.  The Lao Government has undertaken a 
public awareness program to emphasize the dangers of narcotics 
usage and trafficking.  With help from the USG and UNDCP, it also 
has established integrated rural development projects to address 
opium poppy cultivation and opium use through the development of 
local agriculture, health, education, and other government 
services.  These projects, as well as the GOL'S public awareness 
program, have reduced demand, although the extent has not been 
quantified.

IV. U.S. Policy Initiatives and Programs 

Policy Initiatives.  The USG has two primary objectives in Laos: 
to help the GOL eliminate opium poppy cultivation, and to suppress 
illicit trafficking in narcotics.  The Houaphan crop substitution 
project has been the primary vehicle for the first objective.  
Poppy cultivation has declined by half in the project area.  
Senior Lao officials have called it the most successful project of 
its kind in the country.  It is now complemented by the new USG 
program in support of counternarcotics law enforcement.  We will 
support the new police counternarcotics unit, along with Lao 
Customs counternarcotics efforts, with the goal of assisting the 
GOL to curb illicit narcotics trafficking. 

Bilateral Cooperation.  The Houaphan project has made substantial 
progress toward its goals, and is on or ahead of schedule in all 
areas.  In addition to the creation of the police special 
counternarcotics unit and the signing of the LOA on law 
enforcement cooperation, there was progress in other areas of Lao-
U.S. narcotics control cooperation.  In June, U.S. Customs 
conducted a two-week training course in Vientiane for Lao Customs 
officers and other officials.  Senior GOL officials have urged the 
USG to conduct further training.  In November, the USG sponsored 
six Lao police officers, including the chief-designate of the new 
counternarcotics unit, at a two-week DEA training seminar in 
Bangkok.  

The Road Ahead.  USG policy is to persuade the Lao Government to 
act more aggressively on counternarcotics matters, including law 
enforcement.  The USG will continue to stress the importance of 
Laos becoming a party to the 1988 UN Convention, as well as 
meeting its goals and objectives.  The USG also will continue to 
press the Lao Government to take stronger measures against 
narcotics-related corruption and collusion, with public punishment 
for those involved. 

[Chart - Laos 1993 Statistical Tables]
(###)

MALAYSIA

I.  Summary

Malaysia is an important transit point for Golden Triangle heroin, 
some of which is also processed in the country from imported opium 
or derivatives.  There is no known cultivation of opium poppy in 
Malaysia.  Heroin No. 3 and marijuana are the primary drugs of 
domestic abuse.  Marijuana is considered to be a significant 
problem, but there are seldom significant arrests or seizures.  
The Malaysian Government (GOM) recognizes the seriousness of the 
narcotics threat both domestically and internationally, and has 
active law enforcement, public education, and treatment programs.  
During 1992, Malaysia arrested at USG request a major Southeast 
Asian heroin trafficker and pursued extradition proceedings 
against him.  Although the extradition request was denied, the 
trafficker was expelled from Malaysia and is now under arrest in 
the U.S.

While low-level corruption facilitates persistent drug trafficking 
and abuse, Malaysia pursues law enforcement efforts under one of 
the most severe drug laws in the world.  Malaysian narcotics 
policy is generally serious, and relatively well-funded and well-
organized.  Malaysia is actively moving to meet the goals and 
objectives of the 1988 UN Convention, which it has signed but not 
yet ratified.

II.  Status of Country

No opium poppy is cultivated in Malaysia, but illicit heroin 
processing and heroin trafficking continue to be serious problems.  
Traffickers smuggle heroin base into Malaysia from Thailand and 
Burma to produce heroin No. 3 for local consumption.  Quantities 
of heroin No. 4 pass through Malaysia en route to the U.S. and 
other Western markets.  Although Malaysian enforcement officials 
seized heroin base and heroin No. 3 in 1991 and 1992, they have 
made only one seizure of heroin No. 4 since 1990, from a mail 
parcel returned from the U.S. as undeliverable.  Seizures of raw 
opium in 1992 increased from the amounts seized in 1990 and 1991.  

Despite severe legal penalties for both drug use and trafficking, 
Malaysian authorities have not significantly reduced drug 
trafficking or laboratory operations.  The immensity of the Golden 
Triangle opium poppy crop and the effectiveness of local 
enforcement determine the flow of opiates into Malaysia.  The 
combination of good harvests in the Triangle and enforcement 
shortfalls in Burma, Thailand and Malaysia have allowed a steady 
increase in the regional supply of opiates.  Opiates remain 
available at stable prices for the local addict population. 

III.  Country Actions Against Drugs in 1992 

Policy Initiatives.  The fight against drug abuse and trafficking 
has been a GOM national security priority since 1983.  An Anti-
Narcotics Committee reports directly to the Prime Minister, while 
its executive arm, the Anti-Narcotics Task Force (ANTF), is the 
key GOM coordinating body.   Similar bodies operate at the state 
and local level;  their activities are closely coordinated by the 
ANTF.  The GOM's second five-year plan retains current priorities; 
prevention and enforcement, rehabilitation, manpower development, 
international cooperation, and coordination.  

Accomplishments.  The GOM's efforts to implement its narcotics 
control plan fully continued, thus moving Malaysia towards 
compliance with the goals and objectives of the 1988 UN 
Convention, which it has signed but not yet ratified.

Law Enforcement Efforts.  Malaysia's drug laws rank among the 
world's most severe.  The 1985 Dangerous Drugs Act mandates the 
death sentence for narcotics trafficking.  Possession of small 
quantities of proscribed drugs (15 g of heroin or morphine, 200 g 
of cannabis, one kg of opium) creates a legal presumption of 
intent to traffic.  From 1975 through 1992, Malaysia hanged 159 
drug offenders, including 41 non-Malaysians.  An additional 286 
convicted traffickers, including 24 non-Malaysians, currently 
await execution.  The Dangerous Drugs Act empowers the government 
to detain suspected drug traffickers without trial.  Royal 
Malaysian Police arrested 744 suspects for offenses under this act 
during 1991;  466 of these were ordered detained under its 
preventive detention provision.  In 1990, Parliament extended this 
provision of the act for five years.  

The police have established a specifically designated antidrug 
unit with 1,775 personnel.  Nearly 1,400 Customs officers conduct 
anti-smuggling operations, including narcotics control, but only 
48 Customs officers in the Preventive Division formally specialize 
in counternarcotics. 

Malaysia has yet to enact adequate criminal conspiracy laws.  Law 
enforcement officials prefer to use preventive detention laws that 
are easier to enforce.  Asset-seizure legislation enacted in 1988 
has proven to be ineffective, and legal procedures under this law 
need to be clarified.  During 1992, the GOM focused more intently 
on asset seizure and efforts to counter money laundering, in part 
as a result of domestic financial scandals and, in part, resulting 
from USG-funded training in money laundering control.

Corruption.  Corruption affects some of Malaysia's law enforcement 
agencies, particularly in Penang where ethnic Chinese gangs 
control most narcotics trafficking.  In addition, official sources 
report that some law enforcement officials have been intimidated 
by death threats from Chinese gangs.  Police agencies have 
difficulty recruiting ethnic Chinese officers for narcotics work, 
while ethnic Malay officers have been ineffective in penetrating 
Chinese-controlled trafficking rings.  Although no senior 
government officials are known to engage in narcotics production, 
distribution or money laundering, some police and prison officials 
have been charged with corruption and involvement in narcotics 
trafficking.  Malaysian government policy does not encourage or 
facilitate trafficking.

Agreements and Treaties.  An original signatory of the 1988 UN 
Convention, Malaysia has not yet ratified it.  Efforts to 
harmonize domestic  legislation with the Convention are 
continuing, and Malaysian officials have expressed the intention 
to ratify soon.  Malaysia is a party to the 1961 Single Convention 
on Narcotic Drugs, the 1972 Protocol to the Convention, and the 
1971 Convention on Psychotropic Substances.  Malaysian and U.S. 
officials have met periodically since 1988 to re-negotiate an 
extradition treaty, but no agreement has yet been concluded.  The 
U.S. and Malaysia signed a memorandum of understanding in 1989 on 
bilateral narcotics cooperation. 

Cultivation/Production.  Small quantities of marijuana are 
cultivated in Malaysia, chiefly in the east Malaysian states of 
Sabah and Sarawak.  Information on total yields is not available, 
but government officials and private experts believe yields to be 
small. 

Drug Flow/Transit.  Narcotics smuggling in Malaysia is centered in 
northwest Malaysia, chiefly on the islands of Penang and Langkawi, 
and along the land border with Thailand.  Increased controls on 
this border have resulted in more smuggling by fishing and barter 
boats between Thailand, Burma and northern Malaysia.  In 1992, 
reports continued that narcotics are being shipped directly to 
Malaysia from Burma.  Nigerian traffickers reportedly began to 
smuggle heroin No. 4 from Thailand via Malaysia in 1990.  However, 
no known Nigerian traffickers or Nigerian-controlled couriers were 
arrested in Malaysia during 1992. 

Demand Reduction Programs.  The GOM points to a decrease in the 
growth rate of the new addict population as evidence of the 
effectiveness of its active demand reduction policies:  14,624 new 
addicts were registered in 1983, but only 7,825 in 1991, a 
decrease of about 50 percent.  About 59 percent of registered 
addicts in 1991 were relapsed former addicts.  At the end of 1992, 
there were approximately 162,000 registered addicts in Malaysia. 

The GOM has sought increased private sector participation in 
primary prevention and treatment; business firms have funded 
education and information programs, and have donated funds to the 
GOM's anti-narcotics trust account.  In addition, leaders of 
Malaysia's major religious faiths also have become involved in 
prevention activities.  The GOM hosted the 15th meeting of senior 
antidrug officials from the Association of Southeast Asian Nations 
in July.  The officials resolved to conduct dialogues with 
authorities in Burma and Laos in an effort to stem illicit opium 
and heroin production.  The GOM also hosted the 14th annual 
meeting of the International Federation of Non-governmental 
Organizations in November which focused on action plans for 
prevention, treatment, and rehabilitation in member countries. 

About 40 percent of Malaysia's $20 million narcotics budget is 
used for rehabilitation.  Malaysia has 23 rehabilitation centers 
with a total capacity of 9,080.  Work is underway on four 
additional centers with total capacity of about 2,600.  
Rehabilitation services are also provided in small voluntary and 
private centers.  Approximately 60 percent of the annual budget is 
allocated to enforcement, education, and prevention programs.  

IV.  U.S. Policy Initiatives and Programs 

Policy Initiatives.  U.S. narcotics control cooperation with the 
GOM seeks to:  (a) increase Malaysian narcotics law enforcement 
effectiveness through appropriate grants for law enforcement 
training and equipment;  (b) provide pertinent drug law 
enforcement intelligence; (c) assist the GOM to identify and 
eliminate narcotics money laundering operations in Malaysia; and 
(d) enhance cooperation in domestic drug prevention and 
rehabilitation efforts. 

Bilateral Cooperation.  Cooperation between Malaysia and the U.S. 
in 1992 included several demand reduction and law enforcement 
programs financed by grants from INM.  U.S. trainers in the 
therapeutic-community concept conducted demand reduction courses 
in May and November.  In August, U.S. Customs provided the 
instructors for a Department of Justice-led team that conducted 
two highly successful seminars on money laundering control and 
asset seizure and forfeiture.  U.S. and Malaysian officials signed 
a letter of agreement in September enabling the USG to provide 
equipment to support drug enforcement efforts by the Royal 
Malaysian Police and Royal Malaysian Customs and Excise 
Department.  It also provided equipment to the ANTF and the 
Pharmacy Division of the Health Ministry.  

The USG and GOM have made arrangements for U.S. Coast Guard 
trainers to conduct maritime law enforcement courses and "train 
the trainer" seminars in early 1993.  In addition, the U.S. 
Customs Service expects to conduct an overseas enforcement 
training program in May.  Malaysian drug law enforcement officials 
are also expected to participate in a regional narcotics 
investigation course and a regional asset forfeiture seminar to be 
held in Kuala Lumpur during April.  

The U.S. requested extradition of a major Burmese drug trafficker 
in March.  The trafficker was arrested by Malaysian authorities, 
and the extradition case submitted to Malaysian courts.  While the 
extradition request was denied by a Malaysian court, the 
authorities immediately expelled the individual from Malaysia, and 
he was subsequently transferred to U.S. custody.

The Road Ahead.  The U.S. intends to continue its program of 
bilateral cooperation with the Government of Malaysia to:  (a) 
assist the GOM in arresting major drug traffickers and disrupting 
their organizations operating in Malaysia; (b) seek GOM 
ratification of the 1988 UN Convention and passage of appropriate 
implementing legislation; (c) renew negotiations on a new 
extradition treaty; (d) encourage GOM legislation to give 
extraterritorial application to the Dangerous Drugs Act; (e) 
explore negotiating a mutual legal assistance treaty; (f) conduct 
drug enforcement and interdiction training for Malaysian law 
enforcement agencies; (g) conduct demand reduction training for 
GOM agencies; and (h) encourage further GOM participation in 
regional and international drug control initiatives. 

[Chart - Malaysia 1993 Statistical Tables]
(###)

NEW ZEALAND

I. Summary

New Zealand is not a major narcotics producing or trafficking 
country;  marijuana remains the dominant illicit drug.  It has 
received increasing attention by the New Zealand Government (GNZ). 
The National Drug Intelligence Bureau (NDIB) is the lead agency in 
these efforts.  Resources remain limited for narcotics control, 
but laws on asset seizure and legislation under consideration in 
the area of money laundering are moving the GNZ toward full 
compliance with the 1988 UN Convention.

II. Status of Country

Illicit drug production and trafficking are on the increase.  The 
NDIB, with the support of police, immigration and health 
authorities, is pressed to cope with the problem.

III. Country Actions Against Drugs in 1992

Accomplishments.  The NDIB has been in the process of developing a 
system to increase involvement of local officials in the 
eradication of narcotics production, public education and 
rehabilitation. Legislation, which has yet to be tested in court, 
went into effect mandating asset seizure in certain narcotics 
cases.  Legislation regarding money laundering is in the 
preliminary drafting stages. The lack of money laundering 
legislation, which is expected to receive resistance in enactment, 
hampers GNZ efforts.

Corruption.  The USG is unaware of instances of official 
corruption involving illicit drugs.  NDIB personnel are rotated 
every three years, and the actions of GNZ officials are subject to 
intense scrutiny.

Agreements and Treaties.  The GNZ has no formal bilateral 
narcotics agreements with other countries.  It uses existing 
customs, police and Interpol arrangements and informal 
relationships.  New Zealand and the U.S. are parties to an 
extradition treaty that covers narcotics offenses, however, 
efforts to extradite fugitives from New Zealand in recent years 
have met with little success.  New Zealand has signed the 1988 UN 
Convention, but has not yet ratified it.

Cultivation and Production.  Cannabis is cultivated in 
comparatively large amounts for the internal market;  GNZ 
eradication in 1992 will likely exceed previous record totals, but 
domestic supplies remain ample.  Local production of other illicit 
drugs largely meets local demand, with the exception of 
amphetamines which are imported from Australia.

Demand Reduction Programs.  Great emphasis is placed upon demand 
reduction and rehabilitation programs.  However, the NDIB has 
become more effective in coordinating suppression activities with 
some notable successes in 1992.

IV.  U.S. Policy Initiatives and Programs

The USG seeks to encourage GNZ enforcement authorities to 
eliminate drug production and control drug transit; assists by 
providing training;  and cooperates with the GNZ to monitor and 
reduce the flow of drugs destined for the U.S.  Even without a 
formal narcotics agreement, the GNZ cooperates with the USG in 
countering the production and trafficking of illicit drugs.  The 
USG encouraged the GNZ to enact asset forfeiture as well as money-
laundering legislation.

The Road Ahead.  To encourage GNZ anti-narcotics efforts, the USG 
will provide training, will share USG legislation for the 
consideration of GNZ legislators, and will provide information on 
narcotics trafficking through appropriate channels.
(###)

PHILIPPINES

I. Summary

Marijuana and, increasingly, hashish dominate illicit drug 
production and export in the Philippines, but methamphetamine is 
the most commonly abused drug.  The country is a transit point for 
heroin and methamphetamines destined for East Asia, the Pacific 
and the U.S.  The Philippines Government (GOP) cooperated with the 
USG in demand reduction operations and law enforcement efforts 
aimed at interrupting the flow of heroin and cocaine through the 
Philippines.  The Philippines signed the 1988 UN Convention, but 
has not yet ratified it. 

II. Status of Country

Ideal growing conditions, limited law enforcement resources, and 
corruption permit a flourishing marijuana trade.  In some areas, 
Muslim and communist guerrillas may be involved in cultivating or 
taxing cannabis to help finance their operations.  Methamphetamine 
is the most commonly abused drug among urban drug users, followed 
by marijuana and cough syrup.  Narcotics law enforcement personnel 
intercepted shipments of methamphetamine originating from China, 
arriving via Hong Kong and Taiwan, but there were no major heroin 
seizures.

III. Country Action Against Drugs in 1992

Policy Initiatives.  The government is committed to narcotics crop 
eradication and to curbing drug abuse, but severe budgetary 
constraints, inadequate training of personnel, and corruption 
hamper its efforts.  GOP law enforcement resources focused on 
peacekeeping during the national elections campaign in 1992.  
Nonetheless, the Dangerous Drugs Board (DDB) participated in 
regional and international fora aimed at coordinating 
counternarcotics and rehabilitation efforts.  The Police Narcotics 
Command (NARCOM), the law enforcement arm of the DDB, works 
closely with the USG and other governments in interdiction and 
other operations.

Accomplishments.  Authorities reported they had identified and 
targeted for eradication 28 cannabis cultivation sites containing 
more than 357,000 cannabis plants and seedlings in the first five 
months of 1992.  In addition, more than 600 kg of marijuana was 
seized and destroyed.  In July, law enforcement officers 
intercepted a 400-kg shipment of marijuana concealed in a 
container of furniture destined for the U.S.  

Corruption.  A major issue in the May elections was graft and 
corruption of government officials, including law enforcement 
authorities.  Efforts by the incoming Ramos administration to curb 
corruption have concentrated on allegations of police involvement 
in protection rackets, including gambling and drug trafficking, 
and in kidnapping for ransom.

International and Bilateral Agreements.  The GOP is a party to the 
1961 Single Convention and its 1972 Protocol, and has signed the 
1988 UN Convention but has not yet ratified it.  It participates 
in meetings of the  Association of Southeast Asian Nations (ASEAN) 
to discuss drug issues and regional efforts in interdiction and 
rehabilitation of drug abusers.  The Philippines has signed 
extradition treaties with Indonesia, Thailand, Canada and 
Australia, but does not have one with the U.S.  The GOP has 
cooperative bilateral narcotics relationships with the U.S., 
Canada, the U.K., Germany, the Netherlands, France, Japan, 
Australia New Zealand, as well as with the ASEAN governments.

Cultivation and Production.  The tropical climate of the 
Philippines is conducive to the cultivation of high-grade 
cannabis.  Principal areas of cultivation include northern Luzon, 
the Visayas, and Mindanao.

Domestic Programs.  GOP agencies operate 44 residential and 
outpatient rehabilitation centers which treat an average of 1,000 
new patients a year.  The NARCOM operates one of the largest such 
programs (780 resident patients) and claims an 80-percent success 
rate.

IV. U.S. Policy Initiatives and Programs.

Policy Initiatives.  The USG's principal objective is to stem the 
movement of drugs to the U.S. from and through the Philippines.  
DEA works to improve the effectiveness of Philippines narcotics 
interdiction efforts.  The GOP is aware that the legislature must 
move to bring the country's laws in line with the 1988 UN 
Convention to be more effective in narcotics control, but progress 
is extremely slow.

Bilateral Cooperation.  DEA continues to try to improve GOP 
narcotics investigative capability.

The Road Ahead.  USG antidrug programs will seek to enhance drug 
law enforcement performance.  Extradition and mutual legal 
assistance issues will continue to be addressed.  

[Chart - Philippines 1993 Statistical Tables]
(###)

SINGAPORE

I. Summary 

Singapore has some of the most stringent anti-drug laws in the 
world.  It is a significant transit country for narcotics 
shipments, and an attractive financial center for money 
laundering.  Since becoming a party to the Financial Action Task 
Force (FATF) in 1991, Singapore has participated in FATF meetings 
and will host the next session in April 1993.  The government has 
passed legislation on asset forfeiture with a provision for money 
laundering targeted against drug traffickers.  Singapore's 
domestic drug abuse problem is small.  Singapore is not a party to 
the 1988 UN Convention.

II. Status of Country 

International traffickers use Singapore's major air and seaports 
to transit of narcotics.  Government of Singapore (GOS) 
authorities have seized cannabis products and heroin from 
oceangoing vessels in Singapore's harbor and from couriers 
transiting Changi airport.  In the last year, Singapore Central 
Narcotics Bureau (CNB) officers arrested a number of Nigerian and 
other third-country citizens carrying significant quantities of 
narcotics from Thailand and Malaysia for distribution to couriers 
en route the United States, Europe, and Nigeria.  There have also 
been several major heroin seizures involving couriers transiting 
Changi airport en route to Europe and the U.S. 

Domestic drug consumption of remains low, partly because of a 
strictly enforced death penalty against dealers.  The government 
also has a rehabilitation program for addicts that discourages 
recidivism. 

III. Country Actions Against Drugs in 1992

Policy Initiatives.  With encouragement from the USG, the GOS 
passed legislation in 1992 against money laundering and permitting  
asset forfeiture.  The legislation received final approval in 
October.

Law Enforcement Efforts.  The CNB is effective in addressing 
domestic drug use,  but it has not addressed Singapore's transit 
and money laundering role as effectively.  Corruption is not 
thought to be a major concern. 

Agreements and Treaties.  Singapore is now a member of the FATF.  
The GOS has criminalized money laundering and passed asset seizure 
legislation, meeting some of the goals and objectives of the 1988 
UN Convention.  It has not yet become a party,  however, which 
would require additional steps to meet fully the convention's 
goals. 

Demand Reduction Programs.  Drug consumption (mostly heroin and 
cannabis products) and the number of addicts appear stable.  Three 
factors are primarily responsible for Singapore's relative 
success:  harsh penalties; the island state's small size and 
geographical isolation;  and rigorous rehabilitation programs for 
addicts.

IV. U.S. Policy Initiatives and Programs.

Policy Initiatives.  The USG encouraged Singapore to pass asset 
seizure and money laundering legislation in 1992.  In August, DEA 
sponsored a seminar on international forfeiture and assets 
investigation for Singaporean officials. 

Bilateral Cooperation. In 1992, Singapore authorities cooperated 
in the extradition of one drug trafficker wanted for offenses in 
the U.S.  

The Road Ahead.  With the passage of drug asset seizure 
legislation, the USG will seek to persuade Singapore to become 
party to the 1988 UN Convention; improve cooperation in 
controlling precursor chemicals; monitor implementation of the new 
drug asset seizure law; and negotiate a bilateral agreement 
required under Singapore's legislation to permit exchange of 
information. 

[Chart - Singapore 1993 Statistical Tables]
(###)

TAIWAN

I.  Summary

Taiwan is not a major heroin producer, but is used increasingly by 
traffickers as a transshipment point, a safe haven, and a 
production center for amphetamines.  It also plays a role in money 
laundering.  Taiwan authorities are becoming more involved in 
combatting narcotics abuse in Taiwan.  Its enforcement system also 
has begun to organize itself to enforce Taiwan drug laws, and to 
work more closely with the international community to investigate 
and prosecute narcotics traffickers. 

II.  Status of Territory 

Heroin transits Taiwan's air and sea ports.  In May 1991, U.S. 
Customs seized in California 486 kg of Southeast Asian heroin 
transshipped through Taiwan, the largest such seizure ever made in 
the U.S.  Since that time, Taiwan authorities have made 
increasingly frequent seizures of heroin, suggesting an emerging 
domestic heroin abuse problem as well.

Amphetamine consumption is a major problem.  Press reports 
indicate that in addition to the illegal amphetamine producing 
labs in Taiwan, there are also several labs in mainland China 
financed by traffickers from Taiwan.

III.  Action Against Drugs in 1992 

Policy Initiatives. Despite the absence of formal bilateral 
counternarcotics agreements or inclusion in any UN-related 
counternarcotics efforts, in October Taiwan signed a memorandum of 
understanding (MOU) with the U.S. that will permit cooperation in 
criminal investigations and prosecutions.  The MOU was a major 
step in permitting the U.S. and Taiwan to work together in 
prosecuting criminals who commit crimes in either the U.S. or 
Taiwan. 

Accomplishments.  Although Taiwan is pursuing greater 
international cooperation in dealing with drug issues, it has made 
no attempt to observe the letter or spirit of key provisions of 
the 1988 UN Convention, such as control of essential and precursor 
chemicals or increased investigation of money laundering.  While 
banks are required to keep records of large transactions, they are 
not required to report them, and there is no monitoring system.  
Also, the large informal banking sector operating through gold 
shops is extremely difficult to control and offers great potential 
for money laundering abuse.  While Taiwan produces large 
quantities of amphetamines for an emerging domestic market and for 
export, principally to Japan, the Philippines and Hawaii, 
penalties for methamphetamines trafficking recently were 
increased.

Law Enforcement Efforts.  Taiwan's Ministry of Justice 
Investigation Bureau (MJIB) is the major law enforcement 
organization that investigates illegal drug matters in Taiwan.  In 
1991, the MJIB organized itself to enforce  Taiwan laws on 
narcotics crime.  In 1992, the organizational changes appear to be 
taking effect, with the amount of heroin seized up 400 percent 
over 1991.  The MJIB has placed counternarcotics under its 
economic crime unit with a ten-person task force responsible for 
directing the bureau-wide enforcement of Taiwan drug laws.  

Corruption.  While corruption doubtless exists, it does not appear 
to be a major factor in counternarcotics law enforcement in 
Taiwan.  The USG, however, continues to receive reliable 
information that some Taiwan authorities maintain formal 
relationships with drug trafficking groups along the Thai-Burma 
border, including Khun Sa's Shan United Army and remnants of the 
Chinese Nationalist forces involved in narcotics.  Taiwan 
authorities state that these links were severed many years ago.

Cultivation/Production.  There is no significant cultivation of 
poppy or cannabis in Taiwan.  Six amphetamine and methamphetamine 
drug labs were raided by Taiwan law enforcement authorities in 
1992, resulting in the seizure of approximately 1,600 kg of 
amphetamines and 310 kg of its raw materials.

Drug Flow/Transit.  Heroin traffic into Taiwan appears to be 
principally by ship, and is difficult to detect due to the large 
number of commercial shipments; the MJIB estimates that Taiwan 
Customs can only inspect about 13 percent of the containers in 
transit.  There have been some heroin seizures from passengers and 
cargo on commercial airline flights as well, and couriers from 
Thailand are increasingly using Taiwan as a transit point.  The 
heroin, usually No. 4, concealed in canned goods, machinery or 
lumber, is largely reexported, although there is some domestic 
consumption.  Amphetamines seized in Taiwan are domestically 
produced or smuggled from mainland China on fishing boats, both 
for domestic consumption and reexport. 

Demand Reduction Programs.  Taiwan authorities estimate there are 
20-30,000 heroin addicts, but the number is very uncertain.  
Amphetamine usage is a growing problem among students, farmers and 
laborers in Taiwan's fast-paced society.  Based on press 
reporting, 0.3 percent of female and 2.1 percent of male high 
school students use amphetamines.  Taiwan does carry out a media 
program to discourage drug abuse. 

IV.  U.S. Policy Initiatives and Programs 

The USG has discussed with Taiwan the need to enact laws to deter 
narcotics traffickers from seeking safe havens in Taiwan.  Since 
the U.S. and Taiwan do not have an extradition agreement, the USG 
is only able to gain custody of a fugitive in Taiwan when 
authorities determine that the fugitive has broken Taiwan's 
immigration laws.

Bilateral Cooperation.  In 1992, the Taiwan authorities cooperated 
with U.S. law enforcement authorities in the exchange of 
intelligence and time-sensitive leads that resulted in the arrests 
of six drug traffickers in Taiwan, eight in Hong Kong and four in 
the U.S.  

The Road Ahead.  With the signing of an MOU on cooperation in 
criminal investigations and continued exchange of drug leads, 
future efforts must concentrate on bringing Taiwan into the 
international community of counternarcotics enforcement.  This can 
best be accomplished by: a) encouraging Taiwan to develop 
information exchanges with concerned countries; b) encouraging 
legislation that would require the investigation of questionable 
financial practices that disguise money laundering; c) persuading 
Taiwan to review its passport laws in order to avoid becoming a 
safe haven for international fugitives; and d) encouraging Taiwan 
to expel drug fugitives to prosecuting countries.
(###)

THAILAND

I. Summary 

While no longer a major source country for opiates (its production 
potential was estimated as 24 mt of opium in 1992), Thailand 
remains the primary conduit for heroin from the Golden Triangle 
sold in the U.S.  Thailand began to address some of its problems 
with the August 1991 passage of narcotics conspiracy and 
forfeiture laws; in 1992, the first arrests were made under these 
statutes.  In 1992, the Police Narcotics Suppression Bureau was 
made a separate organization within the National Police and grew 
to over 500 officers.  Thai authorities arrested 52 major 
traffickers, compared to 32 in 1991.  A new extradition treaty 
with the U.S. came into effect in 1991, and the exchange of 
instruments of ratification of a mutual legal assistance treaty is 
expected early in 1993.  Widespread police corruption, expanding 
cross-border trade with Burma, and the involvement of influential 
Thai and Sino-Thai in the narcotics trade with the complicity of 
some Thai officials are serious impediments to more effective 
counternarcotics action.

While there are serious flaws in Thailand's counternarcotics 
effort, Thailand is devoting increased resources to narcotics 
interdiction, public education, and drug treatment.  It has sought 
to encourage regional cooperation with Laos and Burma, works well 
with Malaysia, and continues to cooperate actively with U.S. law 
enforcement agencies.

Thailand has in place nearly all the laws and regulations needed 
for it to accede to the 1988 UN Convention.  Royal Thai Government 
(RTG) policy initiatives plus accession to the Convention will 
mean that Thailand has moved significantly toward meeting its 
goals and objectives.

II. Status of Country  

Opium has long been cultivated by hilltribes in northern Thailand 
for medicinal use; it became important also for  cash income as 
the heroin market grew.  Development efforts over the past few 
decades have integrated many of the hilltribes into the Thai 
economy and provided economic alternatives to opium poppy growing.  
There is still a ready internal market for Thai opium, however, as 
well as for heroin production, principally in Burma.

Thailand also produces marijuana for the international market.  
Cannabis is now cultivated increasingly in southern and northern 
Thailand.

Thailand is an important drug trafficking center.  Its superior 
transportation and communications infrastructure, the rapid growth 
in Thai international trade, particularly of sealed containers, 
and widespread corruption facilitate  drug smuggling, both through 
Thailand's major ports and by land and sea to Malaysia and 
Singapore.  DEA and other law enforcement observers believe that 
most Golden Triangle heroin destined for the U.S. and other 
Western nations passes through Thailand.

Thailand was not believed to be a significant money laundering 
center, but since enactment of the asset forfeiture legislation, 
Thai enforcement authorities have become concerned that narcotics-
related financial transactions may be a much larger problem than 
originally thought.  This realization and the absence of Thai 
money laundering laws have raised Thai awareness to the need to 
take action.  U.S. Treasury officials discussed money laundering 
with Thai enforcement, Ministry of Finance, and Central Bank 
officials during the year.  The Thai indicated that they were 
ready to address money laundering and seek enactment of needed 
legislation.

Just as Thailand is the preferred route for heroin leaving the 
Golden Triangle, Thai highways are the preferred route for 
essential and precursor chemicals coming in.  While a few 
significant seizures were made in 1992, it has been difficult for 
Thai officials to identify which legitimate industrial chemicals 
are intended for narcotics production.  The task of interdicting 
chemicals headed for heroin labs is further complicated by 
refiners' efforts to produce their own "final use" chemicals, such 
as acetic anhydride, and import only basic chemicals even more 
difficult to tie to narcotics production. 

III. Country Actions Against Drugs in 1992

Policy Initiatives.  The Thai are now entering the second year of 
a five-year  narcotics control plan.  The comprehensive plan 
includes crop reduction, interdiction and demand reduction goals.  
The Thai spent an estimated $51 million on counternarcotics 
programs in FY 1992 and are expected to spend at least that much 
in FY 1993.  Thai Government expenditures on narcotics control 
have tripled in the past decade. 

Law Enforcement Efforts.  Statistics of the Office of Narcotics 
Control Board (ONCB) as of September 1992 project heroin seizures 
in Thailand for the year at approximately 600 kg, a drop from the 
1,500 kg seized in 1991, when several large seizures were made.  
Law enforcement activity remains high with over 72,500 arrests for 
narcotics offenses expected in 1992.  Marijuana seizures in 1992 
rose to an estimated 87 mt, up more than 60 percent from 1991.  In 
1992, there were no confirmed reports of heroin refineries 
operating in Thailand. 

The U.S. law enforcement assistance program focuses on assisting 
the RTG to dismantle drug trafficking organizations and arrest 
high-level traffickers.  In cooperation with DEA, Thai law 
enforcement authorities pursued several major case investigations.  
In the year ending September 30, cases had been initiated against 
52 DEA-defined "major traffickers", an increase of about 20 over 
the previous year.  The new narcotics conspiracy and asset 
forfeiture law came into force in 1991; one of the first two 
arrests involved a corrupt employee of the ONCB.

In 1992, the new Police Narcotics Suppression Bureau (PNSB) grew 
to a strength of over 500 of its authorized 621 personnel.  More 
than 200 officers who entered the unit without previous narcotics 
experience are receiving training.  Two new divisions are now 
operational, one in the ONCB and the other in the PNSB, to focus 
specifically on cases to be prosecuted under the new narcotics 
conspiracy and asset forfeiture laws. 

Corruption.  The Thai Government as a matter of policy does not 
encourage or facilitate the production or transit of illegal drugs 
or the laundering of drug money.  However, the widespread 
perception that illegal drugs are a foreign rather than a Thai 
problem and a social and legal system susceptible to pressure from 
influential persons contribute to extensive narcotics corruption.  
A candidate for Prime Minister, who had briefly been Deputy Prime 
Minister, was forced to withdraw due to allegations of involvement 
in narcotics trafficking;  press and other reports suggest that 
other influential politicians are also involved in narcotics 
trafficking.

There is also a network of relationships among Thai military and 
government officials and the ethnic/insurgent groups in Burma 
which traffic in narcotics.  Some Thai police, army and civilian 
officials facilitate and profit from drug trafficking, and in 
1992, DEA was forced to terminate one previously effective program 
because of a corrupt commander.  The Thai Government has said it 
will take legal action when it has evidence it can use in court.  
While one of the first cases to be filed under the new conspiracy 
legislation was filed against an ONCB employee as a result of an 
ONCB investigation, in general there has been little evidence of 
active pursuit of allegations of official corruption.  The current 
Thai Government, however, has indicated that corruption will 
receive more serious attention. 

Cultivation and Production.  Opium poppy has been grown in 
northern Thai highlands for decades, principally by ethnic 
minorities not part of mainstream Thailand.  Opium is used by 
these hilltribes medicinally, and also is a valuable cash crop in 
remote areas.  In recent years, opium poppy cultivation by 
traditional growers has been supplemented to some degree by 
commercial enterprises financed and managed by heroin traffickers. 

Opium poppy cultivation in Thailand has been illegal since 1958.  
The Thai Government seeks to reduce production by deploying army 
patrols prior to the growing season and by manual eradication when 
cultivation is found.  The army's commitment to eradication is 
limited by a desire not to alienate hilltribes:  as a rule, 
hilltribe opium poppy farmers are not arrested, though on occasion 
police have taken action against commercial opium growers.  
Eradication in 1992 removed more potential opium and heroin from 
the market than was seized as heroin in law enforcement actions.

Some opium poppy cultivation does continue due to the ready market 
inside Thailand and for heroin refineries in Burma.  Cultivation 
for the 1991/92 growing season was estimated at 3,630 ha, a 14-
percent reduction from the previous year.  Opium production was 
further reduced by the most successful eradication campaign to 
date in which the USG estimates that 1,580 ha were destroyed, or 
44 percent of the total hectarage.   Based on an estimated 
production of 11.5 kg per hectare of opium poppy, total net Thai 
opium production for the 1991/92 season was approximately 24 mt, 
the lowest since accurate records have been available. 

Total hectarage of opium poppy cultivation in Thailand is 
calculated by systematic aerial surveillance and technical 
analysis by Thai and USG analysts.  The yield estimate is based on 
a comprehensive USG/Thai field study.

Treaties and Agreements.  Thailand is a party to the 1961 Single 
Convention on Narcotic Drugs, the 1972 Protocol to the Single 
Convention and the 1961 Convention on Psychotropic Substances.  A 
new extradition treaty with the U.S. came into force in 1991.  
Mutual legal assistance legislation was passed in 1992, which will 
permit the Thai to implement a new mutual legal assistance treaty 
with the U.S.  Thailand was an active observer in meetings of the 
Chemical Action Task Force in 1991; Thai officials are working to 
conform their regulations to those recommended by the Task Force 
and are planning to establish a multi-agency Thai/DEA task force 
in 1993 to target essential and precursor chemicals.  Thailand has 
in place nearly all laws and regulations needed for it to accede 
to the 1988 UN Convention.  RTG policy initiatives and accession 
to the Convention will mean that Thailand has moved significantly 
towards meeting the goals and objectives of the Convention.  
Thailand is meeting the goals established in bilateral agreements 
with the USG.

 Demand Reduction Programs.  Drug prevention education is 
integrated into the Thai curriculum in primary and secondary 
schools and broadcast throughout the country in television spots 
and on radio programs.  Teachers in training must take at least 
one course in drug prevention education and the schools operate 
drug prevention outreach centers.  Systematic surveys of target 
groups are still in the early stages; it is difficult to gauge how 
effective current prevention efforts are. 

Thai drug treatment efforts include inpatient and outpatient 
detoxification, therapeutic communities, religiously oriented 
rehabilitation institutions, and self-help efforts.  Thai health 
authorities believe amphetamine and inhalant abuse are the most 
widespread drug abuse problems, though particular attention is 
also being given to the high incidence of HIV infection among IV 
drug users.  There is an awareness of the rapid increase of heroin 
addiction among hilltribe youth in the north and among Muslim 
youth and fishermen in the south, but many Thai continue to 
believe heroin abuse is principally a Western problem.  

IV: U.S. Policy Initiatives and Programs 

Policy Objectives.  The disruption of heroin trafficking remains 
the foremost goal of USG narcotics policy in Thailand.  The USG 
also seeks to help the RTG eliminate opium poppy cultivation 
through crop control and development of viable economic 
alternatives for indigenous poppy farmers, and is involved in Thai 
efforts to measure and curtail domestic drug abuse. 

Bilateral Cooperative.  Official Thai-American narcotics 
cooperation is close and longstanding and includes USG-funded 
projects in law enforcement, crop  control and demand reduction.  
The Thai generally allow greater DEA involvement in narcotics 
control operations than the agency enjoys anywhere outside the 
U.S.  The Thai continue to cooperate with the USG on extradition 
requests, but not for Thai nationals, limiting the usefulness of 
this procedure.  The USG also has experienced some difficulty in 
persuading the RTG to act quickly to arrest traffickers as 
required by the Treaty.  

The USG makes a significant financial contribution to the Thai 
anti-narcotics effort, providing enforcement equipment and almost 
totally supporting the crop eradication effort.  The Thai have 
increased their own spending on many aspects of narcotics control 
in recent years, and in 1993 are initiating a four-year, $8.4 
million antidrug program in the Ministry of Interior.

The bilateral narcotics law enforcement effort involves a number 
of USG enforcement elements.  DEA has a major presence in Thailand 
and works closely with the Narcotics Suppression Bureau, the 
Provincial Police, and the law enforcement division of the ONCB.  
It provides intelligence and operational support in most major 
Thai narcotics cases.  INM, through the U.S. Embassy's Narcotics 
Affairs Section, provides substantial nonlethal commodity support 
and training for law enforcement units.  U.S. Customs provides 
training for Royal Thai customs units.  The U.S. Department of 
Defense, through U.S. Customs, funded a regional center in Phuket, 
Thailand, to monitor the movements of small vessels suspected of 
running drugs.  In addition, DOD provides services for narcotics 
monitoring, surveillance and interdiction support. 

Economic development of northern highland areas has long been a 
cooperative effort between Thailand and foreign governments.  The 
USG urges other international donors to tie development assistance 
to cessation of opium poppy  cultivation.  While most development 
programs do not contain specific cultivation provisos, one of 
their primary objectives is to replace opium poppy cultivation.  
With the addition of the USG-funded crop control campaign, there 
has been considerable success in the reduction of opium poppy 
cultivation in northern Thailand. 

INM and USIS work with the RTG, the media and private voluntary 
organizations to raise public awareness of the dangers of 
narcotics and build public support for more effective policies and 
enforcement. USIS keeps the U.S. narcotics policies and programs 
accurately on the public record.  USIS also conducts seminars and 
speaker programs, provides a narcotics data base for academics and 
journalists, and conducts public opinion research on Thai 
attitudes toward narcotics use, policy, and the U.S. cooperative 
role.

The Road Ahead.  Implementation of new conspiracy and asset 
forfeiture laws holds the greatest promise to improve RTG 
capability to reduce trafficking of heroin from Thailand by 
bringing to justice the organizers and financiers of the heroin 
trade.  In 1993, the provision of conspiracy and financial 
investigations training will continue to be a high USG priority. 

After Thailand fully accedes to the 1988 UN Convention, as 
expected in 1993, it will be in general conformity with 
international legal standards and expectations for narcotics 
control.  Thailand plays a leading role in regional drug control 
efforts, although the challenges posed by widespread drug-
producing and trafficking areas of the Golden Triangle limit the 
potential of such efforts.

As the Thai appreciate more fully the dangers of drug abuse and 
devote more of their own resources and energies to narcotics 
control, Thailand can become more effective in curbing the flow of 
heroin from the Golden Triangle. 

[Chart - Thailand 1993 Statistical Tables]
(###)

VIETNAM

Vietnamese officials have publicly stated that their country faces 
a drug addiction problem and that opium production and use are 
growing.  While most opium seems to be consumed domestically, 
there is growing evidence that Vietnam is being used as a transit 
country for Golden Triangle opiates destined for Western markets.  
Increasing international travel and trade to and with Vietnam will 
increase the potential for narcotics trafficking.

The Government of Vietnam (SRV) has become increasingly concerned 
with domestic narcotics production, trafficking and consumption in 
recent years.  Opium poppy, grown primarily by ethnic minority 
groups in the northern highlands, is the principal concern;  
cannabis is cultivated in southern provinces, where its abuse is 
concentrated.  There are no reliable estimates for opium poppy 
production or use, but SRV officials publicly acknowledge that at 
least 2,000 ha are cultivated with a potential yield of 15-20 mt 
of opium annually.  Given the uncertainty of these figures, the 
USG plans to undertake its own estimate of Vietnamese cultivation. 

To deal with its drug problem, the SRV sought assistance from the 
UNDCP in 1991, and received a UNDCP fact-finding team in November 
of that year.  Further visits took place in 1992, and the UNDCP 
has provided funds for the preparation of a comprehensive drug 
control plan.

Vietnam has publicized incidents of low-level official involvement 
in narcotics trafficking and corruption.  The USG does not have 
information suggesting that the SRV, as a government, permits or 
engages in narcotics trafficking as a matter of policy, nor that 
senior officials are engaged in or tolerate trafficking.  Vietnam 
is not a party to the UN drug conventions of 1961, 1971 or 1988, 
but existing legislation covers some aspects of each of the 
conventions, according to a UNDCP review of Vietnamese legal 
codes.  Vietnam has indicated a desire to strengthen its 
counternarcotics legal structures.

During 1992, the SRV arrested a trafficker indicted in the U.S., 
and expelled him to Thailand for transfer to U.S. custody.  Police 
personnel with counternarcotics responsibility have established  
relationships with Western counternarcotics personnel based in 
Bangkok, and have indicated an interest in cooperation with and 
training and assistance from Western narcotics law enforcement 
agencies, including the DEA.
(###)

OTHER ASIA AND PACIFIC

FIJI AND TONGA 

Fiji, a popular tourist destination, has a large foreign community 
and a major regional port.  The country does not have a tradition 
of drug use other than the drinking of yaqona a mild stimulant not 
officially classified as a narcotic or psychotropic substance.  
Alcohol abuse is also common in both Fiji and Tonga.

Both Fiji and Tonga face an incipient marijuana problem among 
local youth stemming from contact with foreign travellers and the 
many emigrant Tongans who return to visit home.  Marijuana 
cultivation occurs on some of the remote islands of both 
countries.  To date, however, there is no evidence of large-scale 
local marijuana use nor of use of hard drugs by local citizens.

In both Fiji and Tonga, police/military surveillance and law 
enforcement capabilities are extremely limited.  Each country made 
a major, chance seizure of marijuana in 1992, and there were also 
initial indications that Fiji may be used as a center for money 
laundering connected with the narcotics trade.  Both the 
governments of Fiji and Tonga impose relatively strict penalties 
for drug use or trafficking and prosecute both local and foreign 
offenders.  Recently the government of Tonga provided excellent 
assistance with the extradition of a New Zealand citizen wanted on 
federal drug charges in the District of Rhode Island.  We believe 
this was the first extradition from Tonga, which acceded in 1966 
to the U.S.-UK extradition Treaty (1931), although the fugitive 
ultimately waived the formal process.   The Tongan Government 
received proceeds from the sale of a seized yacht at public 
auction, a step that may prove an incentive to greater law 
enforcement in this region.  In 1992, the South Pacific Forum 
sponsored a seminar on money laundering in Fiji which was well 
attended.  In 1992, both Fiji and Tonga became participants in the 
U.S. Customs-sponsored "Project Cook".

No drug statistics are available for Tonga.  For Fiji, police 
statistics covering 1983 to 1991 show seizures of 32.1 kg of dry 
cannabis, 16 g of hashish and 5,867 cannabis plants.  During that 
period 833 individuals were arrested for use, importation or 
trafficking of marijuana.  Police estimate the drug user community 
in Fiji to number around 1,000 individuals, mostly 15-25 years 
old, in a population of about 760,000.  Hard drug seizures have 
been rare.

Treaties Agreements.  In early 1992, Fiji was ready to sign both 
the 1961 and the 1988 UN Conventions.  However, the new government 
elected in May, the first general election since the 1987 coups, 
relegated these conventions to a lower priority. The Government of 
the Republic of Fiji maintains that it still plans to sign these 
conventions.  The Kingdom of Tonga, however, is not a member of 
the UN.   Neither country has made sufficient progress in 
counternarcotics matters to meet the objectives of the UN 
Convention.
(###)

PAPUA NEW GUINEA 

Papua-New Guinea (PNG) is not a significant drug producing, 
trafficking, or money-laundering country.  Like many other 
countries in the region, however, Papua New Guinea has a small but 
increasing problem of production and trafficking of high-potency 
cannabis grown by farmers who find it more profitable than licit 
crops.  While this cannabis is primarily consumed domestically, 
the Governments of both PNG and Australia are concerned by reports 
of cannabis shipments to Australia in exchange for weapons 
imported into PNG.  A number of Australians have been arrested in 
Australia in connection with such smuggling, including a senior 
Australian police official in early 1992.  The two governments are 
taking steps to encourage bilateral police cooperation to stop 
this traffic.

The National Parliament passed an act establishing a National 
Narcotics Control Board in early 1992 to oversee the anti-drug 
effort.  As part of this effort, the PNG Government opened the 
National Maritime Surveillance Center in Port Moresby in December  
and has established a National Surveillance Monitoring Committee 
to coordinate inter-agency efforts.  The Royal PNG Constabulary 
has established a criminal intelligence unit that will focus, 
among other subjects, on drug trafficking.  At the same time, 
counternarcotics law enforcement programs do not currently appear 
to receive high priority in government budgets,  while demand 
reduction programs are in their infancy. The National Narcotics 
Bureau has drawn up a variety of proposed educational programs, 
but lacks the funds to implement them. 

There are no narcotics-related agreements or treaties under 
negotiation with the U.S.  PNG and Australia signed a Joint 
Declaration of Principles (JDP) in 1987, which includes provisions 
for mutual legal assistance in criminal cases.  PNG has not yet 
ratified the 1988 UN Convention, and has made little progress in 
meeting its goals and objectives.  The USG will encourage PNG to 
update its counter-narcotics legislation so it can become a party 
to the Convention.  

The USG seeks to help PNG discourage the establishment of 
widespread production and trafficking networks within PNG, given 
the potential for production to shift from cannabis to higher-
value illicit drugs.  In this regard, the USG has agreed to donate 
portable radio equipment valued at $20,000 for PNG police to use 
for counter-narcotics purposes.
(###)

WESTERN SAMOA

Western Samoa is an independent, democratic island-state in the 
south Pacific with a population of 160,000.  The standard of 
living and relatively high level of literacy belie the country's 
annual per capita income of about $650, which makes it one of the 
poorest countries in the world.

Western Samoa is not a significant producer, user or trafficker in 
narcotics.  An April 1992 U.S. Army aerial survey of the entire 
country identified only a few small plots of cannabis which is 
consumed by local youth.  The Army study concluded that there was 
no current need for USG work in this field in Western Samoa.  The 
Ministry of Health and the police authorities of Western Samoa are 
alert to the possible expansion of narcotics use in the country 
and the potential for transshipment;  to date, however, there is 
no evidence of the latter.

Western Samoa is not yet a signatory to either the 1961 UN Single 
Convention or the or 1988 UN Convention.  


[Chart - Other East Asia and Pacific 1993 Statistical Tables]

[EDITOR'S NOTE:  Charts referenced to in brackets [ ] are 
available only in hard copy of report.]

Contents of this publication are not copyrighted unless indicated.  
If not copyrighted, the material may be reproduced without 
consent; citation of the publication as the source is appreciated.  
Permission to reproduce any copyrighted material (including 
graphics) must be obtained from the original source.
(###)
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