The Increasing Impatience of China as Online Scam Warlords Impact Myanmar's Junta
China's tolerance for Myanmar's junta wavers due to the rise of online scam centers The thriving scam industry becomes the breaking point, leading to China's loss of patience with the brutal military rulers
China's patience with Myanmar's military rulers finally ran out due to the flourishing online scam centers. The impoverished Southeast Asian nation has been a longstanding concern on China's southwestern border. For years, Beijing has strategically supported Myanmar's military regimes by providing essential economic, military, and diplomatic aid, including support at the United Nations, while also maintaining strong relationships with influential rebel militias along the borders.
Beijing's dissatisfaction has been growing due to the actions of Naypyidaw's generals, who took control in 2021 by overthrowing a democratically elected government that Beijing had strong ties with. This led to the revival of the isolated junta rule that Myanmar's people had endured for decades. The unpopular regime has been preoccupied with fighting a brutal civil war, facing difficulties in governing larger areas of its territory and fulfilling Beijing's economic and strategic goals, which include an ambitious infrastructure project to link China's inland southwest with the Indian Ocean.
In recent months, the displeasure has escalated as the military regime delayed addressing a major security concern for Beijing: the closure of the notorious online scam hubs that have spread along the border with Myanmar. The country's mountainous border areas have for years been a hub for gambling, drugs, and the trafficking of humans and wildlife. However, since the outbreak of Covid-19, online scam operations, often led by Chinese criminal syndicates, have thrived.
Thousands of individuals, predominantly Chinese, have been ensnared and coerced by criminal organizations to engage in complex internet scams within heavily fortified compounds overseen by local warlords.
Despite Beijing's efforts, the military government of Myanmar has been unsuccessful in curbing these fraudulent operations.
In late October, a coalition of ethnic rebel groups initiated a significant offensive, known as Operation 1027, against the ruling junta. This resulted in the capture of towns and military posts in the northern Shan state by the ethnic militias, leading to the liberation of several illegal compounds near the Chinese border. Chinese authorities, along with the victorious militias, repatriated thousands of trafficked victims and apprehended suspected ringleaders.
The Chinese police have taken custody of powerful warlord families that were previously considered untouchable by the law and supported by the junta. Jason Tower, Myanmar country director of the United States Institute of Peace (USIP), stated that China is using Operation 1027 to pressure the military regime to crack down on cross-border crime targeting Chinese nationals.
Beijing announced last week that it had facilitated a temporary ceasefire between the junta and the rebels, bringing them together in China for peace negotiations. However, Beijing's support came at a significant cost - the elimination of the crime families that the junta had depended on to govern the border region.
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Tacit support
Chinas growing frustration with the junta over its failure to tackle the scam industry was not lost on the ethnic rebels as they planned their attack for October 27.
The Three Brotherhood Alliance, consisting of armed ethnic groups, has declared an offensive with the aim of dismantling large-scale scam operations. They have expressed their determination to not only overthrow the military dictatorship but also to eliminate telecommunications fraud and scam networks across the country, including those along the China-Myanmar border, which experts believe is a direct message to Beijing.
In May, Chinese officials publicly urged the junta to take action against cross-border crime that was targeting Chinese citizens. This call for action was made during a visit to Myanmar's capital Naypyidaw by then Foreign Minister Qin Gang, who raised the issue with army chief Gen. Min Aung Hlaing. "The prolonged lack of response and ongoing criminal activity may have led to China providing covert support for Operation 1027," suggested Tower, a USIP expert.
Throughout this year, Chinese authorities have been encouraging ethnic armed groups to avoid escalating conflicts and to engage in negotiations with the military. This has resulted in a small number of meetings between the two sides, as reported by Tower.
However, there has been a significant shift in this approach since October. According to Tower, "China's frustration with the junta ultimately led to the lifting of this pressure. Once the pressure was lifted, an operation like Operation 1027 became possible."
Kokang, an area with a large population of ethnic Han Chinese and under the control of the Myanmar military through the Kokang Border Guard Force, was a central hub for scam syndicates. The militia, established by junta chief Min Aung Hlaing after a military operation in 2009 to remove the Myanmar National Democratic Alliance Army (MNDAA), is now a key player in the Three Brotherhood Alliance, working to reclaim territory in the region.
Alleged cyber scam suspects are handed over to Chinese police by Myanmar authorities on November 18, 2023.
Chinese Ministry of Public Security/Weibo
Last straw
The recent violent incident in Laukkaing, the capital of Kokang, has been described as a major challenge to Beijing's patience. The city, which borders China's Yunnan province, has become a haven for internet fraud and is infamous for its lawless environment. Reports from local media in Myanmar and Thailand revealed that in the early hours of October 20, several Chinese citizens were fatally shot by guards while trying to escape from a scam center in Laukkaing.
The reports quickly spread on Chinese social media, with rumors that four undercover Chinese police officers were among the victims. Hu Xijin, former editor-in-chief of the state-run tabloid Global Times, shared this claim online.
Chinese state media reported that the compound, Crouching Tiger Villa, was managed by Ming Xuechang, a former Kokang official and leader of a influential family with ties to the local government and junta militia. "I think that was the final event that prompted China to essentially approve this operation," Tower said.
Four days after Operation 1027 was launched, China's Minister of Public Security, Wang Xiaohong, made a visit to Naypyidaw. In a meeting with Min Aung Hlaing, the Chinese police chief expressed the intention to enhance cooperation between law enforcement agencies in both countries to combat cyber scams and online gambling.
In mid-November, Chinese police issued arrest warrants for Min and three of his relatives, including his son who holds a leadership position in the Kokang Border Guard Force. They were charged with running scam operations that specifically targeted Chinese citizens and openly using armed forces to protect their illegal activities.
Several days later, the three relatives were transferred across the border and detained by Chinese authorities, while Ming allegedly took his own life before he could be apprehended, as reported by China's state broadcaster CCTV.
By late November, Myanmar authorities had extradited 31,000 suspects to China since both countries initiated a campaign against online scams in September, as stated by China's Ministry of Public Security. The majority of these suspects were repatriated following Operation 1027.
Richard Horsey, a senior adviser for the International Crisis Group on Myanmar, stated that China had prioritized cracking down on scam centers over peace on the border in the short term. He also added that China seems to be willing to endure a temporary period of instability and conflict on the border in order to shut down the scam centers, although it is unlikely that China wants the conflict to continue any longer than absolutely necessary or to spread further than necessary.
On December 13, 2023, in Namhsan Township, northern Shan State, members of the Ta'ang National Liberation Army (TNLA) -- one of the members of the Three Brotherhood Alliance -- are seen preparing their weapons amidst clashes with the military.
Stringer/AFP/Getty Images
Peace talks
China has consistently urged for the de-escalation of the conflict in Myanmar in public. A spokesperson for China's Foreign Ministry announced a temporary ceasefire on Thursday, stating that Beijing has been working tirelessly to facilitate negotiations and bring an end to the fighting since it began in October. However, experts argue that in reality, China had mostly stayed out of the situation until earlier this month.
China's unexpected participation in peace negotiations may indicate a change in Beijing's strategy, according to experts. The rebel offensive in Shan was highly effective, with other insurgent groups also launching their own attacks in different parts of Myanmar. This has further strained the military forces of the ruling junta. "The Chinese government probably did not anticipate that the offensive would completely disrupt the profitable border trade between China and Myanmar, nor did they expect it to have a ripple effect throughout the entire country, resulting in the Myanmar military losing hundreds of posts and experiencing unprecedented losses in battle," Tower remarked.
Concern is growing in Beijing over the extended disruption to border trade, which could severely impact the already struggling economy in southwest China, particularly in the border province of Yunnan. The ongoing conflict also has the potential to jeopardize China's energy security, as many of its southwestern provinces depend on the China-Myanmar pipeline for oil and gas access, Tower reported.
A photo taken on March 9, 2023 shows members of the ethnic rebel group Ta'ang National Liberation Army (TNLA) patrolling near Namhsan Township in Myanmar's northern Shan State. The image is credited to AFP via Getty Images.
Opponents pledge the start of the downfall for Myanmars junta as resistance mounts nationwide offensive. These concerns may have influenced Chinas choice to assist the junta in facilitating peace talks with the Three Brotherhood Alliance. However, Beijing's assistance came with a steep cost.
The day before the military government disclosed its negotiations with the rebels, with assistance from China, the Chinese police issued new arrest warrants for 10 alleged "ringleaders" of Kokang's online scams syndicates. The accusations include fraud, murder, and trafficking. These individuals are from influential families in Kokang, some of whom are leaders in the Border Guard Force, which controls one of the junta's vital border zones with China.
Bai Suocheng, the most notable figure among them, betrayed the MNDAA and joined forces with Min Aung Hlaing to secure Myanmar army control over the region in 2009. Experts believe that China is strategically utilizing the warrants to pressure the junta into peacefully withdrawing from Kokang and returning the territory to the MNDAA.
The warrants have placed the Myanmar army in a precarious situation, as they are unable to maintain control over Kokang without the Border Guard Force leaders. Surrendering them to the Chinese side would essentially mean handing over Kokang to the MNDAA and its allies," Tower explained. Horsey from the International Crisis Group suggested that the ceasefire could mark the end of MNDAAs dramatic takeover of Kokang.
"The Myanmar military is currently unable to retaliate, but can retreat its forces safely," he stated. "However, the situation is complex and it is uncertain if the MNDAA will be able to take control of Laukkaing without bloodshed."
At the same time, the ceasefire appears to be unstable.
The Three Brotherhood Alliance restated its dedication to defeating the military dictatorship on Wednesday, without addressing peace talks or a ceasefire. Meanwhile, conflict persisted in Shan state, with the Taang National Liberation Army (TNLA), a member of the Three Brotherhood Alliance, claiming to have seized the trading hub of Namhsan on Friday, a day after China's announcement of a temporary ceasefire.atitude.
