WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A009600050001-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 38
• Document Creation Date: December 20, 2016
• Sequence Number: 1
• Content Type: SUMMARY

Approved For Release 2007/10/23: CIA-RDP79-00927A009600050001-2
Secret
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
State Department review completed
Secret
23 June 1972
No. 0375/72
Copy Ng 47
Approved For Release 2007/10/23: CIA-RDP79-00927A009600050001-2
 Approved For Release 2007/10/23: CIA-RDP79-00927AO09600050001-2
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The caption of this 19th century woodcut ex-
plains that in 1839, Imperial Commissioner Lin
Tse-hsu burned 20,283 chests of opium belonging to
foreign firms in the Canton area and later captured 23
boats used by foreigners to smuggle opium into
China. His actions precipitated foreign intervention
and war. The caption also exhorts the Chinese to
think back upon these events and to eliminate the
evils of opium.
SECRET
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 Approved For Release 2007/10/23: CIA-RDP79-00927AO09600050001-2
SECHE I
China An International Trafficker?
In the past few years, China has been ac-
cused, largely by the Chinese Nationalists and the
Soviets, of supplying the world illicit market with
huge quantities of raw opium and its derivatives.
Over the past three years, Nationalist China has
inspired a number of articles throughout Asia
purportedly documenting Peking's involvement in
the illicit narcotics trade. In 1971 an exhibition
was held in Taipei of narcotics said to be of
mainland origin. These materials have often
served as the basis for charges carried in the US
press. The USSR, for its part, seems to have been
responsible for the planting last year of a story
quoting Chou En-lai to the effect that China was
engaged in poisoning the free world in general,
and US troops irr Vietnam in particular, with
opium. Soviet broadcasts to Africa in March and
to Southeast Asia in May have portrayed China as
an active participant in the illicit narcotics traffic.
Most of the charges focus on the historical record
of opium production in China and the foreign
exchange earnings that Peking supposedly garners
from the illicit export of opium.
Opium-Growing Capabilities
China has the capability to grow very large
quantities of opium, and the suppression of do-
mestic addiction was not designed to eliminate
opium cultivation. Like other countries, China
requires some opium for the production of phar-
maceutical drugs. Peking may also have a main-
tenance program for long-term addicts who could
not be cured of their habits.
Peking does not release data on the
country's opium or pharmaceutical production,
and a firm estimate is not possible. However, a
minimum pharmaceutical requirement for opium
in China can be inferred from data provided by
other countries. Countries that subscribe to the
1961 UN Single Convention on narcotic drugs
report data on licit opium production, con-
sumption, and inventories to the International
Narcotics Control Board. The board's figures
yield the opium use findings listed in the chart
below:
Country
Total Opium Consumption
Approximate Consumption
(tons of raw opium equivalent)
per million population
(kg)
India
Japan
60.9
USA
188.8
USSR
425.0
1,770
Special Report
SECRET
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 Approved For Release 2007/10/23: CIA-RDP79-00927AO09600050001-2
SEUKE I
CHINA: Former Opium Growing Areas
Ch'eng-1u?
6
Special Report
Percent of crop area in opium
0-9 40-79
10-39 M 80-100
SECRET
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titUHE I
Of the four countries, India is probably the
closest to China in the availability of modern
public health and medical services. If Chinese
pharmaceutical requirements for opium are com-
parable to Indian requirements, China's annual
opium need would be only about 100 metric
irons. At the other extreme, if China consumes as
rnuch medicinal opium on a per capita basis as the
USSR, China's opium requirement each year
Would be about 1,500 tons. The acreage required
-`o grow either amount would be only a fraction
of a percent of the roughly 150 million hectares
sown to all crops each year in China.
Communist troops occupied China's primary
opium growing region in Yunnan Province in Jan-
uary 1950, but, since a special dispensation was
Special Report
made for the ethnic tribesmen to give them time
to adjust, a harvest was gathered in May-June
1951. This harvest may have amounted to some
2,500 metric tons--roughly equivalent to the total
estimated amount of opium being produced in
the world today for licit and illicit markets com-
bined.
Private cultivation arid consumption inYun-
nan continued until 1956, when it was banned.
Opium produced there had been consumed lo-
cally or sold through Burmese traders to buyers in
Thailand. The quantities that found their way out
of China, however, had apparently been small,
and, because the sales were illicit, the government
presumably had received no tax or other revenue.
-6- 2IJune 1972
SECRET
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 Approved For Release 2007/10/23: CIA-RDP79-00927A009600050001-2
S L F{ b I
Heroin seized in New York in November 1970
bearing the World Twin Lions trademark. This mark-
ing is known to date back to 1937, when it appeared
in the Customs Agency Service Narcotics Manual and
on bags of smoking opium originating from Macao,
but now apparently is used by traffickers outside of
Communist China. Narcotics bearing this trademark
were seized on several occasions during 1971.
Opium as an Export Commodity
Although China retains a capability to pro-
duce large quantities of opium, China is not
known to have sold opium on the licit market and
probably has sold very little, if any. Furthermore,
there is no evidence of sales to Japan which is
urgently seeking additional sources of licit opium
for its own pharmaceutical industry.
The particular Chinese aversion to opium
may in itself be enough to bar opium sales
abroad. Additionally, Chinese earnings from
either licit or illicit sales of opium would not
likely be large. In the licit market, the Chinese
would have to compete with established suppliers
such as India-which in 1970 provided 90 percent
of total licit exports of 885 tons. Chinese sales
would therefore be unlikely to exceed a few hun-
dred tons. In the illicit market the earnings from
10,000 tons-China was once accused of peddling
that amount-would be perhaps only a mere $25
million. This is about equal to one percent of
Peking's current export earnings. Furthermore,
nothing like 10,000 tons of Chinese (or any
other) opium could be absorbed by the world
illicit market. Current estimates suggest that the
world illicit market is using about 1,200 metric
Special Report
tons of raw opium a year. This comes chiefly
from Southeast Asian producing areas, where
there appears just now to be a sizable surplus
available, and secondarily from Pakistan, Afghan-
istan, and Turkey.
The draconian suppression of opium use in
China, the small financial stakes in licit or illicit
opium dealings, and the recent move towards
cooperation in international narcotics control
work all suggest that the Chinese regime is not
now and is not likely to become a factor in the
illicit narcotics traffic. Positive proof of this nega-
tive proposition is, not surprisingly, lacking. For
example, narcotics have been seized bearing main-
land brand markings with histories dating back to
at least the 1930s, but there is evidence that
traffickers in Southeast Asia have appropriated
the brand names for their own locally produced
products. Narcotics traced back to Hong Kong,
whose proximity to the mainland led some ob-
servers to suspect that China was implicated,
turned out to have originated in Southeast Asia.
The many sources that provide information on 25X1
world illicit narcotics developments have so far
failed to unearth good evidence of official Chi-
nese involvement in thr? drug traffic.
SECRET
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Secret
Secret
Approved For Release 2007/10/23: CIA-RDP79-00927AO09600050001-2