A New Business Sense Helps Bind the Ties Among Northern Alliance Members

By Lawi Weng 18 May 2018

Some ethnic Shan have wondered publicly whether the Kachin Independence Army (KIA) is providing material support to the Ta’ang National Liberation Army (TNLA) in its fight against the Restoration Council of Shan State (RCSS) after grenades carrying KIA markings were found following a clash between the RCSS and TNLA in Kyaukme Township early this month.

The KIA has produced a range of weapons including sniper rifles, grenades and ammunition for a long time. But some ethnic Shan may not understand this, and have accused the KIA of supporting the TNLA. While it is likely the KIA has been willing to sell the TNLA guns, grenades and ammunition, the deals are more commercial than political. They are also not unique. The TNLA also purchases arms from the United Wa State Army — indeed, almost all the AK-47 guns used by the TNLA come from the UWSA – and have bought weapons from Chinese arms dealers as well. Illegal weapons markets can be found at a number of different spots along the Chinese border, and according to TNLA sources, for the right amount of money, it’s possible to buy any type of gun.

The ethnic armed forces based near the Chinese border know how to generate cash, which they then look to invest in a variety of ways to generate returns to finance their revolutions. In March 2017, the Myanmar National Democratic Alliance Army (MNDAA), attacked several casinos in Laukkai in Kokang, and made off with US$73 million, according to a report in the South China Morning Post. This set an example for other ethnic rebels groups not just to attack your enemy, but to think about how to use their armed forces to raise money too. The MNDAA justified the attacks by claiming that the casinos belonged to Myanmar Army generals and local Kokang authorities who were former members of the MNDAA.

Following the casino raids, different rumors circulated around the border that the MNDAA would use the cash to set up an arms factory to produce guns. But, other sources in the area said the MNDAA invested the money in businesses in areas controlled by the UWSA and the National Democratic Alliance Army (NDAA).

The UWSA controls Special Region 2, while the NDAA controls Special Region 4 (Mongla) in the eastern and northern parts of Shan. These two armed groups signed a ceasefire agreement in 1989, and their territories have since seen a range of commercial activity develop. The central government does not have any influence over or enough power to control this region. The UWSA has 30,000 troops, according to the National Reconciliation and Peace Center, while the NDAA has 3,000 men under arms.

Chinese authorities occasionally crack down on illegal money laundering through banks, so the rebel groups do not view it as prudent to keep their money there. They do view it as safe, however, to invest money in the Wa and Mongla regions and even further afield; some say that the MNDAA has invested its casino horde in different enterprises in China.

Members of the Northern Alliance – the KIA, Arakan Army, TNLA and MNDAA — have no shortage of ideas about how to make money, and they understand that is better not to spend it all waging war. They have tried to think ahead about how to make money, grow interest and ensure the have the funds to finance their revolutions in the future.

In their attack on Muse on May 11, the TNLA targeted a casino belong to the Pansay militia, which historically had been involved in the illegal drug business. The TNLA claimed that the casino even belonged to some Burmese officials cooperating with the Pansay militia.

However, the TNLA could not get inside the casino.

The TNLA may have intended to seize laundered money when attacking the casino but motivated by good reasons. Gambling has ruined the lives of many poor people in the region, while the casino also plays a part in the illegal drug trade in the area, they say.

The leaders of the TNLA, AA, and MNDAA want to build their own capitals similar to those established by the KIA, UWSA, and NDAA (Mongla). There are several reasons why. The groups have concluded that if they want to have peace they need their own separate areas. As long as they live among the Burmese, there will be no peace. They point out that the KIA has Laiza, and Mai Ja Yang towns and KIA soldiers have shown they are willing to sacrifice their lives to protect these places.

The TNLA, AA and MNDAA want to set up arms factories similar to those operated by the KIA. The KIA arms factory were initially run by Chinese engineers but in 2015, according to border sources from China, the KIA was able to replace them with their own engineers, who had been trained by the UWSA. Today, the KIA operates the factories on its own.

The Myanmar Army has repeatedly threatened to eliminate the KIA and other armed groups. But, the ethnic armed groups including the UWSA, which is based near the Chinese border, have shown a united front, one built as much on commercial motivations as communal interests.