China and the Warring States of Northern Myanmar
Beijing seeks to end cross-border telecom crime in a neighbor mired in civil war
On Dec. 10, Chinese police issued warrants for 10 ringleaders of telecom fraud based in northern Myanmar’s Kokang Self-Administered Zone, a 2,000-square km strip of land bordering China. This was an unusual move in terms of China’s non-interventionist foreign policy doctrine, as most of those on the wanted list, infamously known as the members of Kokang’s “four big families,” are local officials appointed or endorsed by the Myanmar military junta regime.
Top on the list was Bai Suocheng白所成, who became the first head of Kokang local authorities since the military wrestled control of the region from rebel forces in 2009. The others are also robber barons in Kokang fashioned with government titles and under the military’s protection, exerting extensive control over local military organs and business branches. Four days before China put prices on their heads, Myanmar’s Deputy Prime Minister U Than Swe met with Chinese Foreign Minister Wang Yi in Beijing. While there was no explicit agreement on their arrest according to the official readout, the two sides did reach a consensus on the “crackdown on cross-border illegal and criminal activities.”
Last month, Chinese police began its punitive actions against the “four big families” and went on to detain three of their members lingering in China, and the so-called “fifth family,” a less time-established but equally powerful house in Kokang headed by Ming Xuechang明学昌, was also obliterated by the Myanmar police at Beijing’s behest. In December, China went all in by including all prominent members of the “four big families” onto the wanted list.
The telecom criminal activities directed at the Chinese mainland have been running amok overseas in recent years, taking a huge toll on the gullible and those who were scared out of their wits. In 2022 alone, China’s public security organ intercepted a total sum of over US$44 billion that was otherwise transferred to the scammers, most of whom could be traced to northern Myanmar. These fraud cases led to the bankruptcy of tens of thousands of Chinese families. The warlords in northern Myanmar harbored or organized telecom scams in their “science and technology parks,” where many Chinese nationals were lured and forced to take part. They capitalize on the fact that Kokangnese are largely Chinese-speaking and use Chinese currency and China’s telecom system. Other than the government-backed mafia in Kokang, ethnic armed organizations (EAOs) in Wa佤邦 and Mong La勐拉 in northeast Myanmar’s Shan State, taking advantage of the power vacuum and their cultural and geographical proximity to China, also tapped into this lucrative business to enrich their war chest in their struggle against the junta and each other.
As Beijing ramped up its pressure this year, an estimated 30,000 rank-and-file telecom fraudsters were repatriated to China, even though that only amounts to less than 1/3 of the total number. To further put themselves in the clear, the chieftains of “four big families” assembled open meetings several times in the name of “tackling telecom frauds.” They certainly underestimated China’s resolve to uproot the entire business and bring the culprits to justice.
The wanted list also came at a critical time when a militant group called the Myanmar National Democratic Alliance Army (MNDAA) began to lay siege to Kokang’s capital Laukkaing, the power base of the “four big families.” Bai Suocheng, Ming Xuechang and many others of the “four big families” were once members of this insurgent EAO based in Kokang, until they collaborated with the junta and expelled their leader Peng Jiasheng彭家声 from his two-decade rule in Laukkaing in 2009. Peng ran into mountains and carried out guerrilla warfare until he died in 2022. His son Peng Deren彭德仁, who succeeded him as the head of MNDAA, is now leading a rampageous Hamlet-esque comeback. The MNDAA’s military campaign known as “Operation 1027,” as it started on Oct. 27, was justified by their slogan of “battling telecom fraud, saving stranded compatriots.”打击电信诈骗，拯救被困同胞
As a matter of fact, the Pengs have made several unsuccessful attempts at retaking the entire Kokang from the junta-backed gangs beforehand, and such assaults usually happened around the Chinese Lunar New Year. MNDAA moved their military operation ahead of the schedule this year because it jumped on the occasion of the alleged “1020 incident,” a bloodbath committed by Ming Xuechang and his thugs which reportedly left four undercover Chinese police and dozens of imprisoned Chinese nationals killed in his scam center. This atrocity precipitated the increase of Beijing’s pressure on Naypyidaw to cut its ties to the mafia families in Kokang. MNDAA took advantage of the situation. As it turned out, those who were added to the wanted list in December included heads of local militia and police force, and their demise would certainly weaken the defense of Laukkaing.
However, there is no evidence to date for any direct link between China and MNDAA, even though there have been mounting voices of support for the latter from Chinese netizens. Also, it is not the first time that MNDAA tried to profit from Kokang’s cultural affinity with China. Immediately before MNDAA’s military offense in 2015, Peng Jiasheng published a letter to “all the Chinese compatriots around the world,”告全体世界华人同胞书 trying to spin his power struggle into a racial strife between ethnic Chinese and Myanmese. It failed to prompt any response from the Chinese government whatsoever. China has been cautious not to ignite any nationalist sentiment on irredentist claims. Concerning MNDAA’s advance this year, a Chinese foreign ministry spokesperson on Nov. 29 reaffirmed China’s respect for “Myanmar’s sovereignty and territorial integrity.” Chinese mainstream media has also mainly focused on the progress of rounding up telecom fraudsters, covering little about the insurgent groups’ advances.
Up to now, Beijing still mainly channels its pressure through Naypyidaw. With the newest wanted list coming up, the junta is likely to have openly jettisoned the mafia groups that had helped Naypyidaw regain control of Laukkaing. Noticeably, China hasn’t just targeted the ringleaders that are within the junta’s reach. On Oct. 12, Chinese police issued warrants on two high-ranking officials of Wa, a self-governing polity founded by Myanmar’s strongest EAO — the United Wa State Army. Four days later, these two figures charged with telecom fraud were sacked in a public announcement by the Wa authorities. Sensing Beijing’s deep misgiving, The EAO in Mong La also decided to cooperate fully on repatriating the fraudsters back to China.
China has long faced a dilemma when it comes to the volatile situation in northern Myanmar. While China’s non-interventionist policy has its hands tied even when direct engagement is needed, the lawlessness and militarization in the region continue to cause security hazards to spill over across the border. Ever since Myanmar’s (or Burma’s) independence from British colonial rule in 1948, the central government has never established full control of its northern region. Rebel forces across the political spectrum partook in the opium planting in this region later notoriously known as the Golden Triangle, largely thanks to the surging demand from American soldiers during the Vietnam War. Peng Jiasheng, then a military commander under the Burmese Communist Party’s guerrilla force, was one of the first to openly engage in drug trafficking. As the Americans pulled out of Indochina in the 1970s, a big share of the drug was smuggled across the Chinese border, giving rise to organized violence and social instability. In the early 1980s, China had to establish its very first anti-narcotic force of 1,000 men in Yunnan, a province that borders Myanmar.
China shares a borderline of 2,185 km with Myanmar, but 80% is now under the de facto control of insurgent groups on Myanmar’s side. That means even if the drug plantation and telecom business in northern Myanmar had subsided under China’s pressure, local warlords would still look for other illegal profiteering industries that might destabilize the Chinese border.
Therefore, it is in China’s interest that Myanmar’s central government should put an end to the political fragmentation in the region, one way or another. Not only will it be easier for China to maintain peace at the border, but it will also prevent China’s Belt and Road investment in Myanmar from going down the drain. There was actually some hope in this regard when Aung San Suu Kyi’s National League of Democracy (NLD) was still in power from 2016 to 2021. NLD took a radically different approach from the junta by enhancing political inclusion of ethnic minorities and establishing a permanent federal system. The four sessions of the 21st Century Panglong peace conference were then steering the country in that direction. But the 2021 coup d’etat drove this process into an early grave. As another round of civil war broke out, there is no sign that the junta has the caliber to restore peace and order in the region.
In the foreseeable future, China is apt to maintain equally cautious pragmatism towards all sides in northern Myanmar. It is unlikely for Beijing to help the junta fuel its war with militant groups, nor is it possible that China should midwife an opposition alliance among EAOs against Naypyidaw as some watchers argue. Both options add to the possibility of disastrous scenarios that China is unwilling to endure. In the short term, Beijing has calibrated to pursue one specific goal and one goal only - ending the unscrupulous cross-border telecom frauds at all costs.
Subscribe to Sinical China for more original pieces to help you read Chinese news between the lines. Xu Zeyu, founder of Sinical China, is a senior correspondent with Xinhua News Agency, China’s official newswire. Follow him on Twitter @XuZeyu_Philip
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