Pubdate: Wed, 30 Jan 2002 Source: Wall Street Journal (US) Copyright: 2002 Dow Jones & Company, Inc. Contact: http://www.wsj.com/ Details: http://www.mapinc.org/media/487 Authors: James Hookway, Peter Wonacott Bookmark: http://www.mapinc.org/meth.htm (Methamphetamine) ECONOMIC EMERGENCE POWERS CHINA'S RISE AS DRUG EXPORTER MANILA, Philippines -- Zeng Jiaxuan sold fish balls in the shadow of Spanish mission churches when he first arrived here from his native China. Yet within a year he was hawking something far more lucrative - -- methamphetamines -- and was on his way to becoming one of the biggest drug barons in his adoptive country. His rise, and eventual disappearance, provides a window onto what is being described as the Opium Wars in reverse. Instead of 19th-century British trading houses pushing opium on the Chinese, China's massive production might is shoveling an addictive stimulant known as "ice" into markets from Seoul to Sydney, throwing police forces and governments off balance. China was first exposed to the trade only a decade ago when synthetic concoctions such as ecstasy and methamphetamines -- renowned for their fast-paced, euphoric high -- began seeping in from Southeast Asia. Today, Chinese criminal syndicates control a sprawling web of laboratories, trained scientists and offshore bases that pump out vast amounts of high-quality methamphetamines, or "meth," according to Western and Asian antinarcotics officials. Just as China's economic emergence is turning it into a major competitor in sectors such as toys, televisions and memory chips, the country's rise in the synthetic-drugs business is powered by a ready supply of capital and low-cost manufacturing muscle, according to drug-enforcement officials. China, says one antinarcotics agent in Beijing, "is a formidable producer." The change marks a pronounced power shift in the world's narcotics industry, disrupting the once-predictable patterns of Asia's drug trade. Since the early 1980s, when truck drivers and factory workers in Southeast Asia began popping pills to stay awake, Myanmar has had a stranglehold on meth production in Asia. Drug lords hiding out in hills around the Golden Triangle have created millions of Asian addicts. But, according to intelligence officials, China is fast catching up with Myanmar. China, for example, now accounts for 95% of all methamphetamines in the Philippines, according to Philippine National Security Adviser Roilo Golez. China still consumes much of the meth it makes domestically. Yet the sheer scale of production and smuggling networks through offshore hubs such as the Philippines give it brute strength overseas. That has allowed Chinese traffickers to begin squeezing out their rivals in foreign markets, these intelligence officials say. China's police forces are scrambling to get a handle on the problem. Officials check mail for drug ingredients such as ephedrine and look for telltale signs of clandestine laboratories, such as efforts to bury or conceal chemical waste nearby. They are also sharing intelligence with China-based foreign authorities to disrupt the supply from the labs to the streets. "Most are getting busted in the production stages," says Chen Cunyi, deputy head of China's Narcotics Control Commission. Authorities seized about 20 metric tons of methamphetamine in 2000, up from just 1.6 tons two years before. But the amounts of meth seized, as well as the chronicle of arrests, highlight how some parts of the country's industrial infrastructure have mobilized in pursuit of drug profits. Some companies licensed to trade chemicals are illegally selling them to meth labs. Even without that conduit, though, chemicals are widely available. Unlike in some countries, ephedrine, a cold-medicine ingredient, is legal in China. What's more, the root plant ephedra grows wild in southwestern China, within arm's reach of aspiring chemists. "You can go to these areas, pick it up and do it yourself," says the drug agent based in Beijing. At the same time, meth labs have become increasingly sophisticated. In October 2000, Chinese authorities arrested two government-award-winning scientists, former employees of a pharmaceutical factory, for acting as "technology advisers' to ice production in three different provinces. "Unfortunately, lured by money, the scientists and technicians, with glorious pasts and otherwise brilliant futures, have fallen into an abyss of crime," the government's 2000 annual report Drug Control in China said. The Chinese triads have made the most of this fertile environment, both at home and overseas. Nowhere is this more evident than in the Philippines, where weak law enforcement, immigration loopholes and a porous coastline have eased the way. Indeed, triad organizations such as the 14K Gang have been among the most successful foreign investors in the Philippines in recent years. Chinese nationals control every stage of the drug trade here, from smuggling to distribution to sales on Manila's crowded streets, where meth is known as shabu or "poor man's cocaine." Hulking gray freighters and fishing boats set out from China's Fujian coastline for remote corners of the Philippines, where they drop off plastic-wrapped bundles of the drugs to outrigger canoes waiting in the darkness below. Police say that every year at least $6 billion of methamphetamines is consumed in the Philippines or passes through the country; some five million Filipinos -- 6.5% of the population -- are habitual users of the drug, according to the Philippine government. Military intelligence chief Col. Victor Corpus worries that the money from the trade is corrupting the Philippines's police and judiciary. "Narcotics are now the biggest threat to our national security," he says. The story of Zeng Jiaxuan shows why. In 1998, at the age of 26, Mr. Zeng left his hometown of Zhang Guo in Fujian province for Ongpin Street, the winding, bustling road at the heart of Manila's Chinatown. It is often the first stop for new arrivals from China. The Fujian dialect is more readily spoken here than the local Tagalog language; noodle shops and dim-sum vendors jostle for space with old men selling the fertilized duck embryos prized by Philippine men for their supposed aphrodisiac powers. Here, Mr. Zeng sold fish balls. But the way he entered the country suggests that Mr. Zeng, who was a television repairman in Fujian, didn't come to Manila to be a street hawker. Mr. Zeng was granted a special visa for people who invest at least $80,000. The Special Investors Residency Visa program was introduced in 1996 to stimulate foreign investment. However, Philippine police officials say it is often used by Chinese criminal syndicates to spirit in foot soldiers. - --- MAP posted-by: Josh