AN EXAMINATION OF THE CHARGES OF CHINESE COMMUNIST INVOLVEMENT IN THE ILLICIT OPIUM TRADE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00935A000400150001-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 36
• Document Creation Date: December 9, 2016
• Document Release Date: September 28, 1998
• Sequence Number: 1
• Publication Date: November 9, 1956
• Content Type: IM

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INTELLIGENCE MEMORANDUM
AN EXAMINATION
OF THE CHARGES OF CHINESE COMMUNIST INVOLVEMENT
IN . THE ILLICIT OPIUM TRADE
CIA/RR IM-438
9 November 1956
WARNING
THIS DOCUMENT CONTAINS INFORMATION AFFECTING THE NATIONAL
DEFENSE OF THE UNITED STATES WITHIN THE MEANING OF THE
ESPIONAGE LAWS, TITLE 18, USCG SECS. 793 AND 79)+, TEE
TRANSMISSION OR REVELATION OF WHICH IN ANY MANNER TO AN
UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
CENTRAL INTELLIGENCE AGENCY
Office of Research and Reports
REIN To RECOELDS CENTFk:
SE
LY AFTER U
IMMEDIATE
OB /I' i ~ s 4.
J
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CONTENTS
Page
Sunnnary . . . . . . . . . . . . . . . . . .
.
1
I. Introduction . . . . . . . . . . . . . . . . . . . .
.
3
II. Involvement in the Illicit Opium Trade
of the Free World . . . . . . . . . . . . . . . .
5
III. Opium-Producing Areas and Opium Markets
in the Far East . . . . . . . . . . . . . . . . .
8
1. Burma . . . . . . . . . . . . . . . . . . . . . .
.
8
2. Thailand . . . . . . . . . . . . . . . . . . .
.
10
3. Indochina . . . . . . . . . . . . . .
12
4. Singapore and Malaya . . . . . . . . . . . . . .
.
15
5. Hong Kong and Macao ... . . . . . . . . . . . . .
.
20
IV. Production of Illicit Opium and Principal Markets
in the Near East and South Asia . . . . . . . . . .
..
21
1. Iran . . . . . . . . . . . . . . . . . . . .
.
22
2. India . . . . . . . . . . . . . . . . . . . .
22
3. Turkey . . . . . . . . . . . . . . . . . . . .
.
23
4. Pakistan . . . . . . . . . . . . . . . . . . . .
.
23
5- Afghanistan . . . . . . . . . . . . . . . . . . .
.
23
V. Markets for Illicit Opium in Other Areas of the World .
24
VI. Conclusions . . . . . . . . . . . . . . . . . . . . .
.
24
Appendixes
Appendix A. Methodology . . . . . . . . . . . . . . . .
.
27
Appendix B. Gaps in intelligence . . . . . . . . . . . .
.
29
Appendix C. Source References . . . . . . . . . . . . .
.
31
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Tables
Page
1. Value of Estimated Exports of Opium from Burma
to Thailand at Various Stages of Transport, 1955
2. Estimated Number of Opium Addicts and Consumption
of Illicit Raw Opium in Indochina, 1955 ? . . . . .
13
3. Sources of Supply of Raw Opium Seized in Singapore,
by Country of Origin, 195+-55 ? . . . . . . . . . .
16
4+. Sources of Supply of Raw Opium for Singapore
and Malaya, by Country of Origin, 195+-55 ? ? ? . .
5. Estimated Value of Imports of Opium into Singapore
and Malaya, by Country of Origin or by Source,
1955......
19
6. Estimated Wholesale F.O.B. Value of Exports of Opium
to Singapore and Malaya, by Country of Origin,
1955........... ...........
20
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CIA/RR IM-438 S-E-C-R-E-T
(ORR Project 1+2.972)
AN EXAMINATION
OF THE CHARGES OF CHINESE COMMUNIST INVOLVEMENT
IN THE ILLICIT OPIUM TRADE*
Summary
There is no reliable evidence to indicate that the government of
Communist China either officially permits or actively engages in the
illicit export of opium or its derivatives to the Free World. There
is also no reliable evidence of Chinese Communist control over the
lucrative opium trade of Southeast Asia and adjacent markets. There
is evidence, however, that small quantities of raw opium produced by
minority tribes in Yunnan Province, Communist China, move over the
Burmese border. The annual earnings of the Chinese Communist tribes
from such sales probably would not exceed US $500,000 per year.
Currently, Communist China is attempting to win the favor of the
Yunnan border tribes, and it may be that, because of political ex-
pediency, Communist China permits small-scale violation of its strict
antiopium program.
The principal opium-producing areas in the Far East are in Burma
and Laos. The production of opium in these countries, in addition
to production in Thailand, is sufficient to supply the great mass
markets of Burma, Thailand, and Indochina and to provide a further
export potential of the equivalent of 150 metric tonsXXX of raw
opium a year.**** This export moves principally through Thailand
and to a lesser extent through Burma to markets in Malaya, Hong Kong,
and Macao. Estimates of consumption and reports of seizures indicate
that exports to these markets for domestic consumption probably do
not exceed the equivalent of 50 tons of raw opium a year. Of the
remainder (approximately 100 tons), part is probably hoarded;
The estimates and conclusions contained in this memorandum
represent the best judgment of ORR as of 10 October 1956.
** Dollar values throughout this memorandum are given in terms
of US dollars.
KKR Tonnages throughout this memorandum are given in metric tons.
xx-xx Estimates of consumption and export figures from reports of
seizures are given in terms of raw opium equivalents throughout this
memorandum.
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part moves to other markets, principally through such transit ports
as Hong Kong and Singapore; and approximately 40 tons are seized.
The governments of Burma, Thailand, and Laos either explicitly or
tacitly permit the production of opium by the minority tribes. These
governments have only nominal control over the majority of these
tribes, and attempts to suppress opium production very likely would
result in strenuous resistance. Furthermore, these tribes trad:L-
tionally have relied on the sale of their opium crop as a source of
cash income, and a ban on its production would work an economic hard-
ship on these people.
The principal profits from opium, however, are not earned by the
producers but by the opium traders, middlemen, and government officials.
For example, reliable price data indicate that the Burmese,-producers
realize less than $1.5 million for the 90 tons of Burmese opium which
transits Thailand annually. This same quantity of opium in Bangkok
is worth approximately $9.5 million, and, when delivered in foreign
markets like Singapore, its wholesale value is increased to almost
$25 million. This large increase in value illustrates the lucrative
profits earned by the traders, the middlemen, and the opium runners,
as well as the bribed government officials involved in the opium
trade. This trade is substantially in the hands of private traders
motivated by considerations of profit and not by ideological factors.
Southeast Asian opium is exported either in raw, crudely processed
form or in a relatively highly refined form. In the estimates men-
tioned above, morphine, heroin, and other derivatives have been con-
verted to raw-opium equivalents. There are several refineries located
in Thailand near the Thai-Burmese border, and it is believed that the
majority of the morphine and other refined forms of narcotics which
move through Thailand are processed in this area. Other refineries
are located in the major market and transit areas. For example, in
1955 there were four known refineries operating in Macao, and ex-
tensive clandestine facilities for refining morphine and heroin are
known to have existed in Hong Kong.
Countries of the Near East and South Asia also supplied signifi-
cant quantities of opium to the world's illicit markets, including
even those in Southeast Asia. For example, it is estimated that in
1955 Malaya received 50 tons of opium from Iran and 12 tons from
India. The Near East and South Asia, however, also constitute a
major consuming area and consume far more than they export.
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Minor markets exist in other areas of the world. These markets
are supplied with opium produced in Southeast Asia and in the coun-
tries of the Near East and South Asia. The European and African
opium traffic has been characterized by the UN Commission on Narcotic
Drugs as not important." The North American market appears to be
supplied principally with opium from Lebanon and Mexico.
There appears, therefore, to be production in the Free World of
opium which is more than adequate to meet the demands of the two
great opium-,consuming areas the Near East and Southeast Asia --
and in view of the extremely limited foreign exchange which Communist
China might earn from the production of opium, appreciable official
Chinese Communist participation in such production is unlikely. Trade
and refinery processing appear to be in the hands of non-Communists,
and Communist China does not appear to have any effective control
over individuals engaged in these activities.
1. Introduction.
Smuggling of goods in the Near East and the Far East is a com-
monly accepted trade channel. Border areas are in some cases poorly
defined, and in extreme cases exist only as a line on a map. Even
well-defined borders are often poorly guarded. Customs officials,
military authorities5 and police enforcement officers customarily
supplement their low salaries by accepting bribes from smugglers or
by actually engaging in smuggling themselves. Central governments
hestiate to enforce laws which would change traditional trading cus-
toms and provoke the hostility and resentment of semiautonomous minor-
ity ethnic groups. Under these conditions, smuggling flourishes.
One of the commodities most frequently smuggled is opium. Opium
in these regions is more than a narcotic: it is a medium of exchange
and a store of value. The governments of Asia in general do not re-
gard the use of opium with the same abhorrence that Western govern-
ments do. One official Southeast Asian view of production and traffic
in narcotics was voiced by the Burmese government to the UN Opium
Conference in 1953 when it commented as follows on a proposed protocol
to limit and regulate the cultivation of the poppy plant: "In the
Shan State and the Kachin State ... the hill tribes find it an
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economic necessity to cultivate poppy for their own consumption, be-
sides striking a favorable balance in their barter trade in which
they have been traditionally engaged from time immemorial. The
prohibition of poppy cultivation in these areas has all along been
a difficult problem, as poppy is a cash crop in these areas." J
Recently the Chief Minister of Malaya, Tengku Abdul Rahman, called
for a return to the prewar system of registering known addicts and
permitting them certain prescribed amounts of opium. One of the
reasons advanced by the Chief Minister for the legalization of
opium smoking was that revenues of approximately $165,000 yearly
would accrue to the government. It should be noted, however, that
the proposal of the Chief Minister was greeted by a storm of
criticism.
Addiction to narcotics in the Near East and in parts of the
Far East is extensive, and, because trade in narcotics generally
is officially prohibited, there is a large and lucrative illicit
trade. As an illustration of the profits involved. in this trade,
it is estimated that, in the Malayan area, with a population of
less than 6 million, there are 115,000 opium smokers and an esti-
mated yearly consumption of illicit opium of approximately 100
tons. The wholesale price for this quantity of raw opium amounts
to approximately $37 million. J The price paid to the producers,
however, amounted to only about $2 million. (See Table l-* for
prices paid to opium producers.) The rest accrued to the opium
"syndicates" and "runners" and to government officials.
Many complex motivations, therefore, encourage, condone, and
sustain the production and trade of narcotics in the Near East and
in the Far East. In order to appraise the probable involvement
of Communist China in this trade, it is necessary to determine as
carefully as data permit the amount of illicit narcotics furnished
the principal markets by the several suppliers. This approach
serves to place in perspective the extent of the probable involve-
ment of Communist China through 1955 with that of the other major
suppliers. Accordingly, this memorandum presents available data
on production and illicit traffic for each of the major markets.
For serially numbered source references, see Appendix C.
P. 9, below.
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II. Involvement in the Illicit Opium Trade of the Free World.
There are numerous reports both from intelligence sources and
from the popular press stating that Communist China is officially
and substantially involved in the international illicit opium
trade. 1 From an examination and evaluation of these reports and
from a survey of the Southeast Asian and other world opium markets
it would appear that the majority of these reports have little
factual basis.
There are, indeed, indications that opium is not being produced
on an extensive scale in Communist China. These indications are
as follows:
1. Communist China has apparently waged an intensive
campaign against opium production, trade, and addiction.
A series of articles appearing in Chinese Communist news-
papers and magazines (including those in opium-growing
areas) has detailed the progress of this campaign. J
2. A complete lack of reliable reports on extensive
production of opium in Communist China.
3. Reports that other Bloc countries of the Soviet
Bloc have been buying opium from the Free World, pos-
sibly indicating that Communist China has inadequate
production to supply such markets. 6
Although Communist China has apparently been successful in cur-
tailing opium production and trade, it is reported that small amounts
of opium poppies are still being grown in Yunnan along the Burmese
border. In these areas the Kachen, Wa, and Lisu ethnic groups live
on both sides of the rather poorly defined border. 7/ Among these
groups several tribes engage in the growing of opium poppies as a
major occupation. In such settlements, therefore, opium poppies are
grown on the Chinese Communist as well as on the Burmese side of the
border. In Burma the authorities have either explicitly or tacitly
permitted the growing of opium poppies by these groups on the grounds
that it would work undue hardships to ban this major cash crop unless
the tribes could be persuaded to grow other cash crops. J Moreover,
control over these tribes on the Burmese side, and perhaps on the
Chinese Communist side as well, is nominal. It is reported that when
the Communists attempted to ban opium production, they met with such
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resistance from Chinese Kachen tribes that they permitted this ac-
tivity to continue. 9
There appears to be no precise way to measure the quantities
of opium which move from Yunnan to Burma. There are, however,
several indications that such amounts are small. From a, 1950 ethnic
study of the area it is known that the majority of the opium-pro-
ducing tribal groups mentioned above are physically located in
Burma rather than in Communist China. 10/ Furthermore, it is
reliably reported that the bulk of opium exported from Burma is
actually of Burmese origin. 11
The identity of the Yunnan opium so reported becomes lost be-
cause it is intermingled with Burmese opium. The Singapore Central
Narcotics Intelligence Bureau, however, reports whenever possible
the suspected origin or source of supply of seized narcotics, and
in 1955 about 20 percent of its total seizures of raw opium were
classified as "Yunnan" opium. 12 The Singapore authorities state
that the classification "Yunnan opium is used to designate opium
'received through Thailand and probably consists of opium produced
in Burma, Yunnan, Thailand, and Laos.* 13/ They state, however,
that they have no evidence that this opium is produced in Com-
munist countries. l4/
If, however, the opium termed "Yunnan" opium by the Singapore
authorities and imported at an estimated annual rate of 20 tons
was in fact produced totally in Yunnan, the Chinese tribes would
receive only $300,000 for the entire export -- the price of Burmese
and Yunnan opium is reported to be $15,000 a ton at the producer
level. (See Table 1.**) In fact, the total amount received by the
producers of the Burmese export crop would not exceed $2 million.
If the extreme assumption is made that 25 percent of Burmese ex-
port was of Yunnan origin, possible foreign exchange earnings by
the Chinese tribes from such sales of opium in 1955 would not exceed
$500,000.
The lucrative profits in the illicit traffic of opium and its
derivatives are earned not by the opium producers but by the various
processers and middlemen.*** Especially profitable is the marketing
In earlier years this opium was classified as "Thailand" opium.
This classification is, of course, as misleading as the classification
"Yunnan" opium.
** P. 9, below.
XXX The relative earnings of producers and middlemen are given in
III, below.
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of morphine and heroin. An examination of narcotics markets in
Southeast Asia, Malaya, Macao, and Hong Kong failed to identify
any official Chinese Communist involvement. On the contrary, sub-
stantial evidence exists that this market is dominated by non-
Communist groups.
Some idea of the possible involvement of Communist China both
in the adjacent Southeast Asian and in other world markets can be
obtained from the Annual 1955 Report of the UN Commission on
Narcotics. 15/ A total of 211 opium seizures is listed by suspected
country of origin in this report, and in only one case was Communist
China reported as the country of origin of the drug. The reporting
country was the US. ThQ seized drug, heroin, was less than 3 per-
cent of total US opium seizures reported, and the case involved a
shipment from Hong Kong. Hong Kong authorities, however, as recently
as the spring of 1956, stated that they have no evidence that opium
or opium derivatives of Chinese Communist origin enter Hong Kong. L6/
The Chinese are the racial group in Southeast Asia most addicted
to the use of opium and most heavily involved in the distribution of
opium. It is reasonable to assume that among the Chinese involved in
the trade a number are Communists or Communist sympathizers. Chinese
Communist intelligence and political agents may also engage in individ-
ual and perhaps even in group -- efforts in the lucrative opium
trade in order to obtain funds to finance Communist activities. It is
reported that Communist groups peripheral to Communist China engage in
the trade; and their activity may furnish indications of the possible
ways. in which the Chinese Communists may be involved. For example,
one of the reasons given for the recent raids by the South Vietnamese
government on opium dens was that they were a source of funds for
agents from North Vietnam. / 17/ It is also reported that a local
Japanese Communist Party group sold opium derivatives in the early
1950's to finance Party activities. 18 However, Communist China's
official participation in a systematic way in such activities as these,
although probable, does not appear to be appreciable.
It is thus concluded that Communist China is not involved in an
extensive export of opium or opium derivatives to the countries of
the Free World. Communist China, furthermore, does not engage to a
significant extent in the lucrative opium trade in the Free World.
The principal sources of opium and derivatives for illicit Free World
markets are described. in the following sections.
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III. Opium-Producing Areas and Opium Markets in the Far East.
It is believed that Communist China probably is involved only
to a very minor extent in the illicit opium traffic in the Far
East (see II, above). There are, on the other hand, many indica-
tions that non-Communists are substantially involved in this trade.
Some of the major aspects of this involvement are discussed below.
There are no official estimates of the annual production of
opium in Burma. Although tribes of the Akha, Kachen, Lahu, Lisu,
Shan, and Wa groups traditionally produce opium, the number of people
involved in the production of opium and the acreage planted to
opium poppies is not known. The government of Burma freely admits
that substantial quantities of opium are produced in. the areas where 25X1X4
these groups live but has never released an estimate of annual pro-
duction. 19 the
majority of opium exported from Burma originates in the ian State. 20/
From available information on domestic consumption and ex-
ports it is possible to estimate tentatively that the annual pro-
duction of opium in Burma is at least 150 tons.
It is estimated that 60,000 opium addicts, concentrated
principally in the producing areas and in the Bhamo and Nritkyina
districts, consume 30 tons of opium a year.* 21
Opium is exported from Burma to overseas markets by sea'from
Rangoon and, after traveling through Thailand, from Bangkok. It is
estimated that 30 tons were exported from Rangoon in 1955. This
estimate is based on the following considerations: (a) it is esti-
mated that 12 tons were exported to Singapore and Malaya in 1955
from Burma (see Table 1+**), and (b) Rangoon is 1 of the 2 principal
supply ports for the Hong Kong and Macao maxkets.xXx The opium
traffic.from Burma to Thailand is much larger than the shipments
from Rangoon and is estimated to amount to approximately 90 tons.XXX
* This estimate is derived by assuming that the annual consump-
tion of a Burmese addict is similar to that of a Thai addict --
500 grams a year.
.** P. 17, below.
XXX See 5, p. 20, below.
xxxx For the derivation of this estimate, see Appendix A.
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25X6A
The collection of opium from the producers is in the hands
of officials and the ruling class of the Shan State, and the officials
of the Wa and Kengtung States particularly are reportedly very
heavily involved. L2/ Opium is then carried by caravans of Yunnanese
traders who are called "Haws." The Haws are refugees from Yunnan.
It was estimated in mid-1954 that approximately 1,500 of these
people were scattered in small groups in-tribal villages in Amphur
Fang, Thailand. L3/ Burmese army officials reportedly are involved
in this trade both as armed escorts for the protection of the opium 25X6A
It is probable that large stocks of opium are hoarded by
the producers. One possible indication of such stocks is furnished
by the offer of a Thai firm to sell 200 tons of opium. 26 The
source of this quantity of opium has.never been satisfactorily.ex-
plained by the firm. The most logical assumption, however, is that
large quantities have been hoarded in the Burmese producing areas.
The value of the exports of opium from Burma to Thailand
is given in Table 1.
a. Estimated to be 90 metric tons.
b. 27
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Value of Estimated Exports of Opium from Burma to Thailand
at Various Stages of Transport a
1955
Stage of Transport
Value in Wholesale Prices b
(Thousand US $)
Producers
1,350
Kengtung, Burma
3,970
Thai-Burmese border
5,310
Chieng Mai, Thailand
6,840
Bangkok, Thailand
9,540
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In addition to the $1,350,000 received by the producers for
the opium moving to Thailand, the producers also would receive
$450,000 for the 30 tons exported from Rangoon. Assuming that a
total of $200,000 more is earned by supplying opium to consumers
in the domestic markets (part of the domestic supply is consumed
by the producers), the Burmese tribal groups probably would not
earn more than $2 million annually from the sale of opium.
The profits to the Burmese groups involved in the. clandes-
tine trade would be considerably more than the amounts realized by
the producers. From Table 1 it appears that 90 tons of opium at
the Thai-Burmese border is valued at $5,310,000. If it is assumed
that opium at Rangoon is valued at the same price as at Bangkok,
the 30 tons reported by this route would have a value of $3,180,000.
The middlemen, bribed government officials, and runners thus would
earn approximately $6.7 million for their services (this sum is
the difference between the $1.8 million paid the producers and the
$8,490,000 received by the Burmese middlemen).
2. Thailand.
Opium is smuggled from Burma to the following places in
Thailand: Ban Chieng Dao, Chieng Rai, Chieng Mai, Muang Fang, Ban
Mae Suai, and Muang Lampang. The main collection points are Chieng
Rai, Chieng Mai, and Muang Lampang, from which points it, moves by
rail or by road to Bangkok. Opium from Laos in Indochina moves
from Luang Prabang to Nan and Uttaradit. 28 There is also a small
export from other towns in the producing areas of Laos to Thai towns
across the border. 29
Small quantities of opium are also produced in Thailand. The
main regions of opium cultivation are along the side of the Tenasserim
in the
st
th
,
we
Mountain Range on the Thai-Burmese border in the nor
area west of Tak, in Mae Hong Son, and north of Chieng fromople
Chieng Rai to Nan. There are approximately 15,000 20,000
of the Meo, Musso (Lahu), Lisu, and Yao tribes who are the principal
cultivators of opium poppies. 30 It is believed that production
of raw opium may amount to approximately 25 tons a year. 31
The annual consumption of opium in Thailand is estimated at
30 tons, of which 17 tons are supplied by-legal channels and the re-
25X6A
ng 13 tons by illicit channels. 32
25X6A
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25X6A
There are approximately 30 Chinese "Opium kings" in Thailand. 38
These dealers finance a considerable part of the trade. Some of these
dealers had previously operated opium syndicates in Malaya. In 195+
they were banished and went to Thailand where they resumed their for-
mer occupation.
From Table 1* and with an addition for the transit Laotian and
Thai opium, it can be estimated that the profits to the Thais in-
volved in the wholesale opium trade would be about $6 million annually.
Profits are also made; from morphine and heroin, which are produced in
Thailand. It is believed that there are two refineries in Thailand
near the Thai-Burmese; border, one at Chieng Saen 39 and one probably
in Tachilek. !Lo/ Another refinery was reported under construction in
early 1956 at Chieng Dao. 1I.1 The value and volume of the trade in
morphine and its derivatives, however, cannot be estimated without
further information. The price of a pound of morphine at the re-
finery is approximately equal to the price of the raw opium used to
manufacture it plus a, small processing fee. Raw opium at the refine
points is therefore worth $35 a pound, and morphine $212 a pound. L2
This is a ratio of a little more than 6 to 1 and reflects, the re-
lationship between the input of raw opium and the output of morphine.
As with raw opium, the profits in the morphine trade go to the middle-
men rather than to the producers.
* P.-9-,- -above.
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There are a few reports indicating that Communists or Com-
munist sympathizers are involved in the illicit opium trade of
Thailand. 43- It is apparent, however, that they do not dominate
the trade. Available information indicates that Communist partici-
pation is relatively minor.
The Thais purchase opium at. the border areas for gold. The
value of such purchases is about $7 million annually.* Of the esti-
mated 1955 Thai imports of gold of $22 million, it is estimated that
50 to 75 percent ($11 million to $16.5 million) was illegally re-
exported. 44 It is reported that a considerable part of the il-
legally reexported gold was used to pay for the import of opium.
Assuming that 50 percent of the gold illegally reexported from
Thailand was expended for this purpose, Thai gold expenditures for
imported opium in 1955 could have amounted to between. $5.5 million
.and $8.25 million. Thus the estimate of $7 million as the value
of Thai purchases of Burmese, Thai, and Laotian opium is reasonably
consistent with the possible level of payments.
3. Indochina.
Laos is the producing area for opium in Indochina. ?5j The
main producers are the Meo, principally in the provinces of Xieng
Khouang, Houa Phan (Sam Neua), and Luang Prabang. The Yao in Nam
Tha Province and the Kha of northwest Laos also produce a small part
of the total output. Production varies greatly with the weather.
A severe rainy season will cut down the output as much as 60 percent.
Production in an average year is probably about 125 tons of raw
opium.
The average rate of production in Laos apparently has been
little affected by the occupation of part of the important producing
area of Houa Phan by the Communist Pathet Lao. L6/ The Pathet Lao
and their Viet Minh overlords do not attempt to control opium pro=
duction in areas of Laos occupied by them but instead purchase opium
from the tribes with silver at more favorable prices than the latter
can obtain elsewhere. The Pathet Lao and the Viet Minh have been
very careful in dealing with the Meo tribes, whose fighting qualities
This estimate is composed of the following elements: approximately
$5.3 million for the purchase of 90 tons .of opium from Burma (Thai-
Burmese border price) $590,000 for the purchase of 10 tons of opium from
Thai producers (paid in gold), and $1,180,000 for the purchase of 20
tons of Laotian opium.
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they respect. It is noteworthy that the Pathet Lao authorities
share with the Thais and Burmese a reluctance to interfere with
the traditional opium production and traffic engaged in by these
mountain tribes.
Estimates of the number of opium addicts and of the con-
sumption of illicit raw opium in Indochina in 1955 are given in
Table 2.
25X1X6
Estimated Number of Opium Addicts and Consumption of Illicit Raw Opium
in Indochina
1955
Province
Number of Addicts
Illicit Consumption
(Metric Tons)
South Vietnam
55,000 a/
30
North Vietnam
60,000
45
Laos
10,000
8
Cambodia
20,000
15
Total
145,000
98
a. Approximately 15,000 of these addicts receive legal opium dis-
intoxication" doses from government stocks rather than illicit opium.
Annual consumption of opium in South Vietnam is estimated by
Mr. Tran Van, a Deputy Director of the South Vietnamese Police and
Surete, at about 36 to 48 tons a year. L7/ Total number of addicts
is estimated at 55,000, of whom about 40,000 are supplied by illicit
opium. The remaining 15,000 are registered addicts, who receive
legal "disintoxication" doses. From these figures it is estimated
that illicit consumption of opium may amount to about 30 tons a year.
No statistics are available of annual consumption of opium
in North Vietnam, Cambodia, and Laos. 25X1X6
about half the opium pro uce is consume
locally. 48 This estimate of consumption is probably not an estimate
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of personal consumption by the Lao (as they number only 1.3 million)
but an estimate of the amount retained by the Lao after the official
collection. The larger part of the opium retained after the official
collection was purchased by private opium dealers and resold in Indo-
china, Thailand, Burma, and Communist China. A smaller part of re-
tained opium was actually consumed in Laos. Assuming that North
Vietnam, Laos, and Cambodia have a pattern of addiction. and consump-
tion similar to South Vietnam, annual consumption could. amount to
about .68 tons.
Thus total consumption in Indochina could amount to approxi-
mately 100 tons a year. As approximately 125 tons of opium are
produced annually in Laos, approximately 25 tons of Laotian opium are
available for hoarding and for export to other countries.
25X1 X6 Opium is sold quite openly in Laos. 25X1 X6
recently reported: "Opium can be purchased in
village markets in Sam Neua ~H_oua Phan
, Luang Prabang, and Xieng
Khouang provinces, as well as in the northwest. It can be bought
right in the town of Xieng Khouang." 49 With a readily available
source of supply at competitive prices, opium smuggling from Laos is
a relatively large-scale operation. Airplanes and trucks, both
civilian and military, are used extensively for the clandestine move-
ment of opium from the Laos collection centers to the markets.
South Vietnam is currently supplied principally from
Vientiane, Laos, by plane and truck. The center for import is the
Cha Lon district of Saigon. 50
25X6A
* Above thenth parallel the only customs offices are along the
Mekong River -- at Ban Houoi Sai, Pak Lay, Sanakham, Vientiane,
and Pak Sane.
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25X1X6
According to the South Vietnam police, opium constitutes an
important source of revenue for Communist agents in South Vietnam.
It is believed that a part of the illicit supply of opium may be
smuggled from Haiphong and other ports in North Vietnam. The re-
tail end of the opium trade in South Vietnam is reportedly in the
hands of Chinese who since the recent introduction of stricter
measures against illicit opium traffic probably are susceptible to
blackmail by Communist agents. Although there is no evidence at
hand that this is taking place, a development of this type is not
impossible. The determination of whether the Communist North Viet-
namese are involved in the South Vietnamese opium traffic is not
within the scope of this memorandum,
25X1X6
Commenting on the in-
creased activity in late 1955 of the law enforcement authorities
in raiding and closing clandestine opium dens in the Cha Lon area
of Saigon, he said: "It is believed probable that two factors
contribute to this increase in anti-narcotics activity, first the
strong reformist views of Prime Minister Ngo Dinh Diem and secondly
a desire to eliminate sources of revenue for the Binh Xuyen rebels.,-,
clandestine Vietminh agents, and other anti-government elements." 55
On the other hand, quantities of opium move from Laos across the
Tonkin frontier into North Vietnam. 56 This traffic is not covert-,
smuggling, since the Viet Minh control the border and do not inter-
fere with the 'traffic. The.quantities involved, however, are believed
to be small.
4. Singapore and Malaya.
Two of the principal markets for Southeast Asian opium ex-
ports are Singapore and Malaya. The sources of supply of raw opium
seized in Singapore by country of origin, in 1954 and 1955 are given
in Table 3.* In 1955, 50 percent of the seizures of opium in Singa-
pore by weight were :produced in Iran and 32 percent in Southeast
Asia.
The market in Singapore and Malaya is estimated by the Singa-
pore Central Narcotics Intelligence Bureau to consume about 100 tons
of illicit opium annually. 57 The total number of opium addicts in
Singapore and Malaya is estimated to be 115,000. There is no domestic
production of raw opium in either Singapore or Malaya. Assuming that
the data on seizures of opium of Singapore origin are closely
* Table 3 follows on p. 16.
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correlated with estimates of total illicit consumption and that the
data concerning Singapore may be applied as well to Malaya, the
sources of supply and origin of raw opium for Singapore and Malaya
are estimated to be as given in Table 4.* The estimates indicated
Table 3
Sources of Supply of Raw Opium Seized in Singapore a
by Country of Origin
1954-55
Quantity Seized
(Pounds)
Percent of Total Seizures
Country of Origin
1954
1955
1954
1955
Iran
1,834
2,333
46.5
50
Yunnan
914
965
23
20
India
5546
552
14
12
Burma
656
547
16.5
12
Unknown
9
498
6
Total 3,959 4,695 100
a.
b. This term is used by local traffickers to indicate opium
received through Thailand and probably consists of illicit
supplies originating in the adjoining areas of the Wa States
and Kantung State in Burma, Laos, and North Thailand as well
as in Yunnan.
in Tables 3 and 4 are consistent with the known export potential of
the above countries. These tables indicate that, despite the
proximity of sources of supply of raw opium in the Burma-Thailand-
Yunnan-Laos region, the major part of the illicit supply of opium
in 1955 came from Iran. Singapore officials believe that the pref-
erence for Iranian opium rather than for other types is the result
of the following two factors: (a) Iranian opium is easily imported
Table follows on p. 17.
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and available in good. supply, and (b) Iranian opium has a very high
morphine content (9 to 11 percent, compared with 6 to 9 percent for
the Yunnan type).
Table 4
Sources of Supply of Raw Opium for Singapore and Malaya
by Country of Origin
1954-55
Amount
(Metric Tons)
Country of Origin 195+ 1955
Iran x+6.5 50
Yunnan a/ 23 20
India 14+ 12
Burma 16.5 12
Unknown 6
a. This term is used by local traffickers to indicate
opium received through Thailand and probably consists
of illicit supplies originating in the adjoining areas
of the Wa States and Kantung State in Burma, Laos, and
North Thailand as well as in Yunnan.
Iranian opium moves into the Malayan market principally by
sea. The following ports on the Persian Gulf are active. outlet
centers for Iranian opium: Bahrein, Dibai, and Aden. Additional
Persian Gulf ports which are outlets for illicit opium are Mena-
Al-Ahmadi (near Kuwait), Fao (at the mouth of the Euphrates), Ras
Tanurah (near Bahrein), Abadan, Kuwait, Basra, Khorramshahr, and
Dammam (near Bahrein). 59
There are several reports which furnish details of the move-
ment of illicit opium from Iran to the outlet ports on the Persian
Gulf. One report states that a small syndicate of Bahreini Arabs
trades in opium on a very large scale from Dibai to Aden, East Africa,
and Singapore. 60 The opium is procured from Iran and shipped to
Aden concealed in cargo where it is transferred to oceangoing vessels.
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25X1X7
Another report states that fairly large quantities of opium are being
smuggled into Basra, Iraq, from Iran via Muzaira and Shuwayyib. 61
The source of this report states that Iraqi police share in the
profits. It is also reported that the town of Qasbat, Iran, is the
center for smuggling opium into Kuwait. Small ships of Iranian or
Kuwaiti ownership are used to carry the opium from Qasbat to Kuwait.
Opium smugglers have also used commercial aircraft to move
opium from Iran to the Malayan area.
Tables 3 and 4 show that, next to Iranian opium, the most
common type imported into the Malayan area is "Yunnan" opium.*
Considerable information exists concerning the routes used to move
this type of opium from Thailand to the Malayan area. The principal
route is by sea from Bangkok. Singapore Narcotics Bulletin No. 2 for
the second quarter of 1955 reports that nearly every ship arriving
from Bangkok carries illicit narcotics drugs, usually opium.
It is probable that considerable quantities of opium move
across the Thai-Malayan border. 62 Opium is shipped by rail from
Northern Thailand to Haadyai, which apparently is the smuggling
center of South Thailand. From Haadyai it moves out to the ports
of Songkhla, Pattani, and Norathiwat and across the border to Malaya.
The facilities of commercial-airlines have also been used to smuggle
opium from Bangkok to Singapore. The transport of opium by airplane,
however, appears to b.e a small-scale and intermittently used means
of smuggling. Opium from Burma is transported to Malaya, principally
from the port of Rangoon.
The estimated value of imports of opium into Malaya and
Singapore, by country of origin or by source, is given in Table 5.**
The importance to the Malayan economy of such imports can easily be
seen by an examination of Table 5 and trade returns. In 1955, opium
was the sixth largest import into Singapore and Malaya. 63/
* For definition of "Yunnan" opium, see p.. 6, above.
Table 5 follows on p. 19.
25X1X7
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Table 5
Estimated Value of Imports of Opium into Singapore and Malaya
by Country of Origin or by Source a/
1955
Value per
Country of
Estimated Imports
Metric Ton
Total C.I.F. b Value
Origin or Source
(Metric Tons)
(US
(us $)
Iran
50
396,995
19,849,750
Yunnan /
20
272,003
5,440,060
India
12
459,491
5,513,892
Burma
12
308,761
3,705,132
Unknown
6
356,800
2,140,800
36,649,634
a. 6L4
b. Cost, insurance, and freight.
c. For the discussion of "Yunnan" opium, see p. 6, above.
The values in Table 5 have been expressed on a c.i.f. basis;
however, the cost of importing opium into Malaya is very high. Bribes
alone are reported to account for almost half of the delivered costs.
In 1955, opium could be purchased in Bangkok'at $105,831 a ton, or
approximately 39 percent of the price in Malaya. Assuming that this
percentage is representative, the wholesale f.o.b.* value of exports
of opium to Singapore and Malaya, by country of origin, can be esti-
mated as given in Table 6.**
Opium also moves to Singapore for transshipment to other
world markets. Seizure reports indicate that opium from Singapore
Free on board.
Table 6 follows on p. 20.
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Table 6
Estimated Wholesale F.O.B. of Value of Exports of Opium
to Singapore and Malaya, by Country of Origin W
1955
US
Country of
Approximate F.O.B. Value
Origin or Source
of Opium
Iran
7,741,4o.2
Yunnan J
2,121,62;3
India
2,150, 41f8
Burma
1,445,001
Unknown
8311, 912
Total 111-, 293, 35F6
a. Free on board.
b. 65
c. For discussion of "Yunnan" opium, see p. 6, above.
25X1 X7
moved to Indonesia, to the UK, and to Mauritius. !L6/ The amount
of opium transshipped annually from Singapore and Malaya is not
known but is probably small in comparison with the estimated 100-
ton consumption in the Malayan area.
5. Hong Kong and Macao.
Seizure reports indicate that Thailand is the principal source
of opium and opium derivatives imported into Hong Kong and that Burma
and India are secondary sources. 67 Macao's sources are reported to
be similar to those of Hong Kong. 78/ In both cities there are re-
finery facilities. In 11955, Macao had at least four refineries. 69
in 1955 there existed
in Hong Kong elaborate clandestine manufacturing activities. 70
Unlike the rest of Southeast Asia, the Hong Kong and Macao markets
are not essentially opium-smoking markets. "Smoking" heroin or heroin
"red-ball pills" appear to be preferred by the native addict.
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The annual opium consumption of Macao and Hong Kong, esti-
mated on the basis of 10,000 addicts, apparently would not exceed
the equivalent of 10 tons of raw opium. Probably larger than this
import for domestic consumption is the import for transshipment.
Seizure reports indicate that the US and Japan imported heroin from
Hong Kong. 71 opium from Hong
Kong also reaches other markets.
Seizure reports probably provide a very rough indication
of the amount of opium and opium derivatives imported into Hong
Kong. Hong Kong seizures in 1955 amounted to about 60 percent of
Malayan and Singapore seizures. 72 It would be expected, however,
that Hong Kong authorities would be considerably more effective in
preventing opium smuggling, since they do not have to guard a long,
thinly settled coastline, and domestic conditions are more settled.
Annual Hong Kong imports, accordingly, might be estimated to amount
to the equivalent of from 20 to 30 tons of opium.
Macao is probably a considerably less important market than
Hong Kong, and much of its opium export goes through Hong Kong and
is included in the estimate of Hong Kong imports. Perhaps the
equivalent of from 5 to 10 tons of opium is also imported by Macao
for consumption and export to markets other than Hong Kong.
The great majority of the Hong Kong seizures report that
Thailand is the origin of the opium and opium derivatives. This,
obviously, is not the actual origin of the opium but merely the
outlet country. The Hong Kong imports probably originate mainly
in Burma, with smaller amounts originating in Thailand, Laos, and
Yunnan.
Total imports into Macao and Hong Kong are therefore esti-
mated to be about the equivalent of from 25 to 40 tons of opium and
reexports to be from 15 to 30 tons.
IV. Production of Illicit Opium and Principal Markets in the Near
East and South Asia.
Apart from the Far East there is only one other area where an
extremely large market for opium exists. The problem of opium
addiction is very serious in the Near East and in South Asia. Per-
haps the worst problem exists in Iran, where in 1955, according to
a press statement made by the Minister of Health, there were 1.5
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million opium addicts. 73 He also stated that in the past 10 years
total production of opium had varied between 700 and 1,200 tons
annually, of which an annual average of only 90 tons was legally
exported. Other producing countries in this region from which opium
is exported clandestinely are Turkey, Afghanistan, India, and
Pakistan. 74
Opium from the Far East is clearly not an important factor in
this area. Production facilities for the manufacture of morphine
and heroin in 1955 existed in practically all the countries mentioned
above. In addition, refineries probably were operating in transit
zones. In this connection, the exports from Lebanon to the US are
of some significance. 75
It is estimated that in 1954, production of opium in Iran
was approximately 850 tons. 76 Of the 850 tons, it is estimated
25X t,X 150 tons might have been clandestinely exported from the coun-
try. Seizure reports indicate that Iranian opium
in substantial quantity was exported to Singapore and Malaya. 77
Iranian opium also was clandestinely exported to India, Pakistan,
Aden, the UK, and the Netherlands. Reports indicate that, despite
the complete ban on production of opium in Iran in 1956, some
clandestine production still continues. 78
The Iranian Minister of Public Health has estimated a daily
consumption of opium in Iran of about 1 ton. 79 This estimate
would appear to be extremely low in view of his own estimate of
1.5 million addicts, since it would represent a daily consumption
per addict less than half that of the Southeast Asian addicts. An
annual opium consumption before 1956 of from 500 to 600 tons would
appear likely in view of the number of addicts and in view of what
is known about production and exports.
In 1951-52, production of opium in India was 331+ tons. 80/
This production was under relatively firm control of the Central
Government. It is estimated that, in 1951-52, opium amounting to
approximately 15 tons was smuggled from Madras to Singapore and
Malaya. 81 Seizure data indicate that 1955 exports to Singapore
and Malaya were about 12 tons, or slightly less than the 1951-52
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estimate of Indian illicit exports to this area.* Illicit opium
from India also was exported to Hong Kong, the Netherlands, and
the UK. 82/
3. Turkey.
The Central Statistical Office of Turkey has estimated that
44,000 hectares were planted to opium poppy in 1955. 83 Production
in 1955 is estimated at 300 tons compared with the production in
1954 of 130 tons. It is estimated that from 10 to 15 tons escaped
the governmental official buying program. A substantial portion of
the 10 to 15 tons presumably could be illicitly exported. Seizure
data indicate that Turkish opium was exported to Egypt and the US. 84
~+. Pakistan.
Opium is grown in the Jadun area of the Northwest Frontier
Province of Pakistan under governmental supervision. 85 In 1952
the government collected approximately 15 tons, principally from
this area. Current production and collection probably have increased
since 1952 as the government planned to increase domestic production
to 50 percent of its domestic legal requirements (legal requirements
in 1952 were estimated at 45 tons). There is reported illicit cultiva-
tion of opium and Indian hemp in the Northwest Frontier Province and
tribal areas and in Baluchistan, Chitral, and Swat. Although Pakistan
is believed to be a net importer of illicit opium, there are indica-
tions that some illicit opium is exported from West Pakistan to other
areas.
5. Afghanistan.
Estimates of average annual production of opium in Afghanistan
cannot be made with any great degree of precision. A US botanist
visited the Jurim and Kishim districts of Badakshan Province in late
1954 and estimated total Afghan production at 12 tons. 86 It is
reported that production in 1955 probably exceeded that of 1954-
A report of early 1955 states that the Afghan government had.re-
quested UN permission to sell on the legal world market about 40 tons
annually. 87 This request suggests that production in 1955 probably
was in excess of 12 tons. It is believed, however, that the 40 tons
requested were for purposes of bargaining and probably were for double
the amount of current production. It is also believed that part of
Afghan production is exported clandestinely. 88
* See Table , p. 1.7, above.
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V. Markets for Illicit Opium in Other Areas of the World.
The markets for illicit opium in the other areas of the world
are small compared with the markets of the Far East, the Near
East, and South Asia. The UN Commission on Narcotic Drugs stated
in its annual 1955 report that opium traffic in Europe and Africa
is unimportant. 89 The North American market apparently is sup-
plied principally with opium from Mexico and Lebanon. 90 In
South America, opium traffic is relatively unimportant.
The international illicit opium trade is conducted in an
atmosphere of secrecy and intrigue. This secrecy, as well as the
fact that the trade is carried on by many entrepreneurs, militates
against the making of precise estimates. Despite these disadvan-
tages, it is possible to obtain sufficient reliable information to
characterize the possible involvement of Communist China in the
opium situation in Southeast Asia and in other world markets as
follows:
1. There is a small export of raw opium produced by
minority tribes in Yunnan Province, Communist China, to
Burma. The earnings to the producers from this export
would not exceed $500,000 annually.
2. Communist China probably permits this export for
political purposes -- that is, it does not want to precipi-
tate an open break with the unruly tribal producers by
interfering with an important traditional economic and
social pursuit.
3. The major opium producers in Southeast Asia are
Burma and Laos. The production of these two countries
coupled with Thai production supplies the large domestic
markets and provides a sizable export potential. The
Burmese, Thai, and Laotian governments permit this produc-
tion for political and economic considerations similar to
those attributed to Communist China.
4. Opium exported from Southeast Asia moves principally
through Bangkok, Thailand, and, to a lesser extent, through
Rangoon and Burma, supplying significant quantities of opium
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to Malaya, Hong Kong, Macao, and Indonesia. Singapore,
Hong Kong, and Macao are important intermediate transit
points for the supply of opium to other world markets.
Refinery facilities to service the markets for opium
derivatives exist in Thailand, Macao, Hong Kong, and
in the major consuming areas. There is no evidence
indicating that Communist China exports opium deriva-
tives. Spasmodic: efforts of the affected governments
to suppress this trade are nullified by the tolerant
attitude of the Southeast Asian people toward opium
addiction; by the venality of poorly paid government
officials; and by the realization that, if opium does
not move through their country, it will move through
an adjoining country.
5. The Southeast Asian producers receive a very small
return for their opium crop. Opium produced for the il-
licit trade is apparently in surplus supply. This surplus
may be the result of the virtual disappearance of the
former large Chinese market since the generally success-
ful opium-addiction-suppression campaign of the Chinese
government on the China mainland.
6. The lucrative profits in the opium traffic are
earned by many middlemen and by government officials.
Available evidence suggests that these dealers and govern-
ment officials are engaged in this trade for personal gain.
Members of local Communist parties in the Far East and in
Southeast Asia may be involved in the trade in order to
finance Communist activities, but there is no available
evidence indicating that such involvement is substantial
or that it is systematically directed by the Chinese Com-
munists. The trade appears to be dominated by non-Com-
munis is .
7. North Vietnamese and North Korean agents may be
involved in the opium traffic in South Vietnam and South
Korea. Because Communist China is not patently and direct-
ly involved in this trade, however, this aspect has not been
developed in this memorandum.
8. In the Near East and in South Asian countries, the
production and illicit consumption of opium and opium
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derivatives probably are even greater than in Southeast
Asia. The countries in these regions are also important
suppliers to the world illicit markets. It is estimated
that Iran, alone, supplied 150 tons to international.
markets in 1955. Seizure reports indicate that Turkish
opium is an important factor in the supply of Middle
East countries. Morphine- and heroin-processing facili-
ties and trade are under the control of non-Communists
in this general region. There does not appear to be any
evidence of Chinese Communist influence in this trade.
9. Compared with the Near East and Southeast Asia,
the remaining illicit markets are relatively unimportant.
Opium traffic in Europe and Africa is not important.
Seizure reports indicate that the North American market
is principally supplied with opium which either originated
in Mexico or Lebanon or was transshipped from these coun-
tries. One US seizure report indicates that Communist
China was the suspected origin of a shipment of contra-
band heroin which was transshipped from Hong Kong. Hong
Kong authorities and US Treasury representatives in Hong
Kong state, however, that they have no evidence that
opium or derivatives from Communist China enter Hone; Kong.
With this possible exception, seizure reports indicate
that the world illicit markets are supplied with contraband
opium and derivatives produced in Free World countries,
and intelligence reports indicate that the world opium
trade is in the hands of non-Communists.
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APPENDIX A
METHODOLOGY
The general methodology used in this memorandum is as follows:
(1) a survey, based on intelligence and seizure reports, was made
of the origin of opium which moves to the principal markets; (2) a
rough calculation was made of the amounts of opium required by the
illicit markets; and (3) a similar survey was made of the groups
involved in the marketing of opium. As a result of these three
steps, it was determined that adequate supplies of illicit opium
produced in the Free World moved to the illicit markets under the
direction of Free World contraband traders. Substantial partici-
pation by Communist China in this trade was therefore ruled out.
The secrecy of the international illicit opium trade made it
impossible to reconcile all the elements of the various estimates.
For example, one of the key estimates indicates that, on the
average, approximately 150 tons of opium are exported every year
from Laos, Thailand, and Burma. A tabjulation of imports by
various markets with an addition for total seizures leaves approxi-
mately 35 tons of this opium unaccounted for. This discrepancy,
however, is not serious since it does not affect the main con-
clusions of the memorandum. Errors could have resulted from one
or more of the following factors:
1. The estimated.150 tons of opium exports (opium and
derivatives -- derivatives were converted to their raw
opium equivalent) were broken down to a 120-ton transit
movement through Thailand and a 30-ton export through
Rangoon. The former estimate, based on an estimate that
seizures probably represent 25 percent of total transit
movement, could be in error. The latter estimate appears
to be relatively firm.
2. The assumption was made that the origin of opium
imported into Malaya is identical with the origin of opium
imported into Singapore. This assumption may be in error,
however, because opium from Thailand could move more
easily into the Malayan Federation than could opium from
Iran, which is the principal supplier for Singapore.
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The opium traffic from Burma to Thailand is estimated to amount
to approximately 90 tons. This estimate is based on the following
considerations:
(a) Total transit traffic through Thailand is estimated
to be 120 tons.
(b) Approximately 10 tons were available for export from
Thai production.
(c) Approximately 20 to 25 tons were available for export
through Thailand from Laotian production.
(d) The remainder of the transit opium, approximately 90
tons, entered Thailand through Burma and was pro-
duced principally in Burma. Opium from Yunnan sup-
plemented the Burmese production.
There are a considerable number of unreliable reports alleging
that Communist China is substantially involved in the illicit ex-
port of opium and derivatives to the Free World. Each of these re-
ports had to be evaluated. This evaluation required extensive
research into the opium situation of the entire world in order to
determine the actual: sources of illicit narcotics.
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APPENDIX B
GAPS IN INTELLIGENCE
The most serious gap in intelligence on the illicit opium trade
is the lack of an independent estimate for the production of opium
in Burma. It is possible that data could be obtained from local
Burmese officials which would allow an estimate to be made based on
acreage under cultivation or number of people growing opium poppies
rather than by the method used in this memorandum.
There is also a deficiency of reliable information from Com-
munist China on the production of opium. It has been assumed that
this deficiency indicates that production of opium in Communist
China is extremely limited, but information obtained from systematic
interrogation of refugees and repatriates on this subject might fur-
nish a more accurate appraisal. More reports on the extent of the
production of opium by the Chinese minority ethnic groups probably
could be obtained from Chinese who have fled from Yunnan into Burma
and Thailand.
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APPENDIX C
SOURCE REFERENCES
Evaluations, following the classification entry and designated
"Eval.," have the following significance:
Source of Information
Doc. - Documentary
A - Completely reliable
B - Usually reliable
C - Fairly reliable
D - Not usually reliable
E - Not reliable
F - Cannot be judged
1 - Confirmed by other sources
2 - Probably true
3 - Possibly true
4 - Doubtful
5 - Probably false
6 - Cannot be judged
"Documentary" refers to original documents of foreign governments
and organizations; copies or translations of such documents by a staff
officer; or information extracted from such documents by a staff
officer, all of which may carry the field evaluation "Documentary."
Evaluations not otherwise designated are those appearing on the
cited document; those designated "RR" are by the author of this
memorandum. No "RR" evaluation is given when the author agrees with
the evaluation on the cited document.
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