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CHINA MOVES ON
MYANMAR
Part
2: Casino town loses
out
By Xia Hailong
Part 1: PLA masses on the
border
MONG LA, Myanmar
- On September 9, a large number of Chinese People's
Liberation Army (PLA) soldiers marched to the Myanmar
border. On the Chinese side, life remained normal, with
business and livelihoods largely unchanged. But the
opposite side experienced a big chill.
With the
help of local authorities, China cracked down on
Chinese-invested casinos in Myanmar's Mong La, a tiny
town bordering Xishuangbanna autonomous prefecture of
Yunnan province. China urged all Chinese citizens
working in the casinos to return to the motherland as
soon as possible. The move dealt a big blow to the
economy of Mong La.
But why? Why is China
bothering to bully casinos in its neighbor country?
The reason can be traced back to this summer,
when the daughter of a high-ranking cadre in the Chinese
central government lost millions of yuan in Mong La's
casinos. She was lured by one of her good friends. Yet
this "good friend" also made good money from her,
pocketing 15 percent of what she lost. Later, the
woman's family complained to top authorities in Beijing,
who dispatched investigators to Yunnan to look at the
issue. The findings were stunning.
Tens of
billions of yuan slip into Mong La every year through
one single bank on the Chinese border town of Daluo in
Xishuangbanna; a Chinese official lost several million
yuan of public money in Mong La; and dozens of Chinese
gamblers have lost their entire fortune in these
casinos.
Soon, a special task force was
established to carry out full-scale investigations and
prepare for prompt action.
With the help of
Chinese troops and the Mong La government, Chinese
Operation Blue Arrow sealed off five large casinos
operated by mainland, Hong Kong or Macau people. The 1.4
million yuan (US$168,674) lost by the cadre's daughter
was refunded. The Chinese government in addition
requested that all Chinese working in the casinos return
to China before August 31. Mong La, known for its
gambling business, seemed to lose all its vitality
overnight.
Worse still, Chinese troops have
massed along the border, meaning that gamblers can no
longer move freely in and out. Mong La's economic
outlook thus is facing great challenges. Will it resort
to its previous and once booming business - opium
farming and trafficking? In early October, Asia Times
Online dispatched its correspondents to Mong La to dig
out the truth.
History and glory of Mong
La
Mong La is in the fourth special region (SR)
of the Eastern Shan state of Myanmar. Covering an area
of 4,952 square kilometers, the SR has a population of
74,000. A decade ago, it was a hub for farming,
processing and selling opium and also an important
channel of transporting narcotics from northern Myanmar
to the rest of the world.
On March 21, 1989,
warlord Peng Chia-sheng, based in Ko Kang, announced his
separation from the Communist Party of Myanmar. Roughly
one month later, Peng's son-in-law Lin Ming-shing
surrendered to the Myanmar government and set up the
Eastern Shan State Army. On June 30 that year, the
Myanmar government approved the founding of Special
Region 4 of Eastern Shan state and Lin took up the
position of chairman of the Military and Political
Committee of the region. At that time, the zone still
had more than 1,300 hectares of opium fields, three
heroin-processing factories and one
rough-morphine-processing factory.
Because of
international pressure, the SR initiated a
drug-elimination project in 1991. At the time, Mong La
was still a primitive village without access to
electricity.
With the support of the governments
of Myanmar and the neighboring Chinese province of
Yunnan, the SR government began to educate local farmers
to plant alternative crops other than opium to earn
their bread and butter.
But Mong La, capital of
the SR, found a faster way to riches: gambling tourism.
Benefiting from the genuine tourism in neighboring
Xishuangbanna and acquiescence or support from
governments in Yunnan, a gambling business soon
blossomed in the town.
On August 26, 1998, the
SR legislative authority promulgated a new regulation
that officially legalized up to 10 gambling items such
as Mah-jong, dominoes, blackjack, etc. In Mong La, the
actual annual profits of the gambling industry and its
contribution to local finances remain secret. But one
thing is for sure: it had become an indispensable
mainstay industry by the time of the September
crackdown.
In a short 10 years' time, the former
tiny mountain village turned into a fantastic
"international" city symbolized by the gambling
industry. Gold-seekers and investors flooded in, easily
outnumbering the locals.
Southern Weekend, a
renowned newspaper based in Guangzhou, filed an in-depth
report on Mong La in 2002. It read in part: "On April
17, 2001, a Xishuangbanna friendship delegation visited
Mong La. The importance of the gambling sector to Mong
La is best told by the figures disclosed by a deputy
chairman of the SR military government council. The
deputy chairman said that in 2001 the SR government
waived all taxes and compulsory grain tributes of local
peasants. In addition, it introduced hybrid rice from
Lancang county of Yunnan to peasants for planting. The
government also allocated nearly 10 million yuan from
gambling contributions to build roads and bridges and
buy agricultural chemicals and fertilizer for farmers.
In 2002 and 2003, the government allocated another 20
million for public welfare."
Yet that counts as
only a drop of the ocean when you look at the city's
total income and the investment from China. According to
authorities and other sources, Chinese investments
(including those from the mainland, Hong Kong and Macau)
in Mong La's gambling and hotel businesses had mounted
to 5 billion yuan as of July 11; Chinese gamblers have
altogether dumped more than 40 billion yuan ($4.8
billion) into Mong La.
Money talks in getting
a visa
In early October, ATol's correspondents
arrived in Xishuangbanna on their way to Mong La. In
Jinghong, the capital city of Xishuangbanna, it was
decided to check whether an ordinary Chinese citizen
could find his way to Mong La. The correspondents had
already gotten a visa in Yunnan's provincial capital,
Kunming.
Staff in the hostel told ATol that
before Operation Blue Arrow, the casinos had set up in
Jinghong's high-end hotels four "customer reception
offices" providing a one-stop service to arriving
gamblers. Chinese arrivals, upon alighting from their
aircraft or bus, would get all meal and accommodation
expenses covered by the gambling houses. The casinos
would also take care of the red tape for getting a visa
to Mong La for first-time customers and even pay for
two-way air tickets for "members".
These offices
have now retreated to Mong La or gone underground
because of the operation. When the ATol crew expressed
their eagerness to gamble and have some fun in Mong La,
the attendant suggested that the crew try their luck in
the Office of Entry and Exit in the Public Securities
Bureau of Xishuangbanna prefecture.
Officers of
the Entry and Exit Office were very impatient with
ATol's inquiry. They went on high alert when informed
that Mong La was the reporters' destination. After being
told that the reporters were merely going there for
business, they disclosed what documents were required:
first, an invitation letter from a business partner in
Myanmar; second, the visa applicant's business license
in Xishuangbanna. If the visitor were a
non-Xishuangbanna resident, he had to get a temporary
resident permit for the prefecture.
With
complete documents, one only need pay 40 yuan for a
visa, 30 of which is charged by the security bureau and
10 by border checkpoint.
Sources revealed that
before Beijing's crackdown, people from all over the
country could easily get a visa by paying some money.
The visa charge for Xishuangbanna residents was as low
as 10 yuan.
When the attendant learned of the
correspondents' failure to get a visa, he gave the crew
a mobile-phone number, promising that the man at that
number could get everything done with six photos of the
applicant(s) and several hundred yuan. The
correspondents reached the man over the phone, who
guaranteed to hand the ATol crew a visa within one hour,
without requiring any of the documents demanded by the
security bureau.
In the border town of Daluo,
the crew was told by a hostel receptionist that it was
now difficult to get a Myanmar visa in Daluo. But she
knew someone who could get it done for the price of 450
yuan.
Into Myanmar
At the Daluo
checkpoint, travelers to Mong La are still quite large
in number. Yet it was learned that tourists are only
allowed to visit designated places and visits to casinos
and red-light districts were strictly forbidden. On the
Chinese side of the checkpoint, there was a bulletin
board stating "no gambling", warning that violators
would get fined or even detained.
After
undergoing strict checks, the crew finally stepped on to
the other side of the border, the fantastic Mong La. A
cab driver surnamed Zhang, from southwestern China's
Sichuan province, said the only destination for gambling
now was the New East Hotel. Such big names in the local
gambling industry as The Golden Triangle, Lan Dun,
Xinbao and Ming Sheng Tang had been closed as a result
of the Chinese government's ban of Chinese funding for
casino operations.
Zhang lamented that local cab
drivers' incomes had suffered a drastic fall since
August 31, the last day for Chinese casino workers to
return to China. To top it off, the prostitution, hotel,
cyber-cafe, restaurant and retail businesses had also
slumped considerably. For example, the price of a
prostitute had dropped to 150 yuan from the previous
500.
Zhang gave the correspondents a business
card: on the front were instructions for contacting a
male prostitute, and the address on the back was that of
a massage center offering girls. "Call me if you need a
girl and I will send her directly to your room," the
card said. It was obvious that local people were finding
new ways to boost their income: cab drivers had formed
an alliance with sex workers. They all use the same
business card carrying the contact instructions for all
three parties.
In later conversations, Zhang's
missing of the good old days became more than obvious.
Indeed, 2002 was really a golden year for him. After
deducting 30,000 yuan for his Toyota cab, Zhang still
made a profit of more than 100,000 yuan.
The
streets in Mong La were packed with Toyota Crowns,
General Motors cars and Mercedes-Benz. Zhang explained
that they were all smuggled cars costing only
30,000-50,000 yuan.
A promotion notice at the
correspondent's hotel entrance read "60 percent off": a
standard room originally quoted at 380 yuan was now
priced at only 100 yuan for one night's accommodation.
On the gate of another hotel was a banner saying 60 yuan
for one night. As the cab driver Zhang said, local
business had been hit hard by the crackdown.
That night when the ATol crew returned to their
room, there were six prostitute business cards behind
the door. They called one of the numbers. The woman
speaking on the phone quoted the prices: 200 yuan for a
young lady, 300 for a Russian girl, 400 for a twin, 400
for a male prostitute and 4,000 for a virgin. The woman
said the price for a virgin had been as high as 10,000
yuan in the boom times because gamblers often make a
fetish of virgins. They believe they will make big
fortunes after sleeping with virgins.
In the
local agricultural market, two streets are specially
designated as red-light districts, with 99 percent of
the pimps and prostitutes being mainland Chinese. In
Mong La, prostitutes are all registered with authorities
because the public health department demands a physical
checkup every month. By contrast, prostitutes in China
enjoy much more freedom, as the authorities do not
exercise control on them, which partly contributes to
the ever-increasing spread of AIDS.
On the
streets, there were many garment shops carrying
international name brands, though some of them the shops
had "for sale" signs. In addition, fortune-telling
booths were found on the streets. Obviously, their good
days are gone, at least now.
Guided by a person
in the know, the correspondents went to the sites of
such old casinos as Golden Triangle, Landun and Xinbao,
etc. They were all closed, but still guarded by security
guards. One guard, from Hunan, said the former Chinese
boss of that casino had returned to China and the new
boss was a Myanmar national. But an insider said the
Myanmar national was only a temporary proxy for the real
boss, that the Chinese bosses were still controlling the
business in the background. As veteran players, they
will not sell their business now on the cheap but are
waiting for the good times to come back.
Nonetheless, as a precaution, the Chinese bosses
have quietly changed the names of their hotels: Landun
Hotel is now the Grand London Hotel, while Xinbao Hotel
has turned into the Xinxin Hotel.
Filthy
lucre
Every casino in Mong La was an absolutely
lucrative joint-stock business shared by government
officials and foreign investors. Proprietors would
usually contract the gambling hall out to individuals,
mostly from China's Guangdong, Fujian, Sichuan, Hubei
and Yunnan provinces. A well-decorated VIP hall, for
instance, cost at least 20 million yuan ($2.4 million)
per year.
The New East Entertainment City or the
New East Hotel, the sole casino operating there at the
moment, has more than 100 tables in 11 VIP halls. A
table capped with a maximum bet of 50,000 yuan rents at
6,000 yuan a day, while one topped with 10,000 yuan
rents at 4,000 yuan. A rough calculation shows that the
annual rental aggregate alone totals 180 million yuan.
But nowadays only two-thirds of the tables are open.
By convention, players have to pay the casino
owners 5 percent commission on their winnings. Although
the percentage itself seems a trifle, it actually adds
up to an astronomical sum.
There should have
been 11 gambling halls on the ground floor, but the
Chinese police raid shriveled that number to five only,
which were also renamed in panic. Signs reading "no
photo" could be seen in each doorway. Every table was
monitored by four ceiling cameras and everything in the
casino was under close watch by several hundred cameras,
as well as guards either in striking uniforms or
indistinct plain clothes.
The bell rung by the
dealer seemed to have an irresistible charisma, fixing
all eyes on the hand that was about to deal the cards.
Seconds later, the crowd surrounding the table ran into
a jumbled commotion of winners and losers, cheers and
sighs, prayers and curses. These generous gamblers
blended with many daintily dressed youthful ladies,
whose skill in card reading and calmness in stakes
placing told of their abundant experience. Within only
two days, correspondents witnessed a man in his 30s,
with a bodyguard-looking person standing behind him,
gamble away more than 200,000 yuan, but he appeared not
at all dispirited.
On the first floor, all halls
were closed except for a high-class VIP hall, the
restricted admission to which was strictly enforced by
four guards. According to an insider, only plutocrats
and senior officials from mainland China were welcome; a
bet inside had a ceiling of 300,000 yuan, while
downstairs the ceilings ranged from 100 to 100,000 yuan.
Apart from the East Hotel, a smaller casino
hides itself in the local farm-produce market. Running
around the clock, Huangxin Entertainment City is rather
popular, where a single bet ranges from 1 to 100 yuan
only.
In a neighboring pub, a correspondent got
to know Mr Xiang from Beijing, who came to this barren
land to try his luck at the casinos. Xiang ran a
construction business in Beijing, where he was once
taken into custody for gambling and then put to flight
here together with the gambler clique. Xiang was shown
into the casino by a friend who had lost more than 1
million yuan in the previous few months, and he himself
dumped 450,000 yuan. Confirming the saying that one
could have a 15 percent payoff on the loss of whomever
he had introduced to the casino, he also revealed that
loans were available at each hall and that the interest
stood at 10 percent of the loan due for repayment in one
week. The indebted gambler became a virtual hostage in
the city until he or she was bailed out by family or
friends.
It has been more than eight years since
the first casino caught on in Mong La, which has become
the scene of tragic suicides by losers from China. Mr
Wang, a grocer here, found a gambler dead with his guts
exposed outside in the street early this spring. The man
was rumored to have taken his own life.
Rumor
also had it that one could be buried alive for failing
to pay a casino loan. Though confirmation of this is
unavailable, reported disappearances are logged at above
10 annually, which may also include people sneaking into
Thailand or Laos, as well as those hiding in Myanmar
mountain villages away from mainland China. Upon
inquiry, a local policeman said emotionally that these
were rumors only, since security in Mong La is much
better than in China, with thefts or robbery rare and no
record of rape.
Legends, dreams and
nightmares
According to a report in Southern
Weekend, the legend of King Liao prevails among the Mong
La casinos. King Liao or Brother Liao seems common
knowledge of gamblers who have stayed in the Golden
Triangle. Some say the hero has lost about 400 million
yuan on gambling over the years, while a Sichuanese who
claimed intimacy to King Liao said, "not that much, he's
only lost 200 million". In another story, King Liao came
from China's Sichuan province, where he owned a grand
real-estate business. Also he was one of the pioneer
contractors, but at the time it was the bosses from
Fujian and Guangdong province that dominated the
contracting business. Then, in a scuffle against his
rivals in those provinces, King Liao demoralized them
and "earned face for the Sichuanese".
King Liao
is known for his generosity. Each time he wins a bet, he
tips the dealer thousands. "In Mong La, King Liao is the
God of Fortune revered by all of us," said a habitual
gambler at a VIP club of the New East Entertainment
City.
Another popular legend has it that once
there was a lad from Yunnan province who was too poor to
bet at the very beginning. But he loved watching others
gambling. Having accumulated experience through
observing, he later worked as a stand-in for gamblers.
Once he won 100,000 yuan on a bet and was rewarded
20,000 yuan, which he bet again, making 4 million out of
it. After that, he washed his hands of gambling. But
some believe this pauper-becomes-millionaire story was
fabricated by casinos hoping to hook more gamblers.
The casinos have tempted the lust for fortune
among those residing across the border in Yunnan. Some
of them set up their own casinos, while others embezzled
government corporate funds to feed their gambling habit.
On the first day of the 2002 Spring Festival,
Fang Jiangang, a chief at the Menglian Town Office of
Menglian County Branch Agricultural Bank of China,
misappropriated 2.4 million yuan from the deposits but
lost everything at a casino in Myanmar in just two days.
Having nothing left, he absconded from Menglian but was
brought to justice the same month.
Almost a year
earlier, Hu Honghui, vice chief of the Prices
Administration in Simao city, was sentenced to 11 years'
imprisonment. At about 1am on October 28, 2000, he stole
a Volkswagen Santana parked by the Simao Civic Labor
Union in the governmental housing complex and drove it
to Mong La, where he gambled at the Golden Triangle.
Having lost all 2,100 yuan he had with him, he turned to
Mr Cai, the casino manager, and asked for a mortgage on
the Santana. As soon as he left the casino after being
rejected, he was arrested on the spot.
That same
year, several hotels in Daluo city, on the Yunnan side
of the border, opened casinos underground. Intercepting
part of the upstream gambler tide toward Mong La, those
hotels found their heyday. But it did not last long, for
the underground casinos were banned soon by local
authorities. Sources said that informants were all from
Mong La, because casinos in Daluo were a threat to those
in Mong La. In other words, Mong La was the most active
supporter of China's enforced ban on gambling and the
most active watchdog of the Daluo government.
This year, another official from mainland China
dumped 1.4 million yuan in Mong La's casinos. The
culprit has now been caught and all the money has been
reclaimed.
That the money lost in casinos can be
reclaimed sounds incredible but is actually
understandable. For one thing, China years ago granted
its consent to the Mong La government to open the
casinos for fear that the local people would relapse
into drug trafficking. But Beijing failed to anticipate
the outcome: gambling fever swept the whole country,
with billions of yuan flowing out to Mong La.
For another, Lin Ming-shing, the supreme leader
of Mong La, was once a Chinese national. As well, Mong
La has to "import" everything from Menghai, including
direct exchange lines and the mobile network - nearly
everything, indeed, except water and rice.
Next: The opium capital of the
world
(Copyright 2003 Asia Times Online Co,
Ltd. All rights reserved. Please contact content@atimes.com for
information on our sales and syndication policies.)
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