Myanmar is a country that is rich in natural resources but remains extremely poor in terms of economic development. Institutionalized corruption and the concentration of wealth amongst the elite has left the majority of Burmese people in a state of poverty. The mining sector in Myanmar, and more specifically the jade industry, reflect this inequitable state of affairs. Myanmar is home to some of the most sought-after green gems in the world. Sadly, for decades this stone has been the cause of social unrest and armed rebellion.
AN OPAQUE SECTOR
Most of the country’s jade lies under the soil of the unstable Kachin state, a region inhabited predominantly by people of Kachin ethnicity. The precious stones are extracted by companies controlled by Burma’s military elite, crony businessmen and drug lords, or by the KIO (Kachin Independence Organization) through its military wing the KIA. There is very little information on who actually holds mining licenses, who owns the companies, or even on how the licenses are allocated and what taxes are paid. Regardless of the owners, we know the profits from the jade trade hardly ever reach local populations or the government’s treasury in Naypyidaw, the capital of Myanmar.
At the 2014 Shanghai World Jewellery Expo, Jade was up to four times more valuable than gold. Most of the jade mined in Kachin finds its way, usually illegally, into China where it is a highly prized good. The profits end up in the pockets of a few well-connected Burmese individuals. China is by far the largest buyer of jade. Most other countries in the international community had for a long time cut all ties with Myanmar’s jade sector due to sanctions imposed by the UN, limiting trade in response to state enforced human rights abuses.
THE REAL PRICE OF JADE MINING
A recent report from Global Witness estimated the total revenue from the jade trade to be around $31 billion in 2014. That equals 48% of Myanmar’s GDP. It’s also 46 times what the government spends on health every year. Hardly any of this money ever reaches local populations or state treasury but goes to companies who manage and own jade mines, or those who run its trade with Chinese buyers. Not only does this illicit trade bypass ordinary Burmese people, but the relentless mining for the green stone has a disastrous environmental and social impact. Mountains are reduced to valleys, forests are depleted and rivers are polluted. The Kachin people who should be the first to benefit from this wealth are instead the first to suffer the calamitous consequences. As some Kachin people put it “the tree is in our garden but we are not allowed to eat the fruit”.
The jade industry also has social consequences in Kachin state. The capital of the mining area is the town of Hpakant where around 300,000 people live and most of whom work in the mining sector. The working conditions are so harsh that most miners drug themselves to work better and longer. It is estimated that as a result, almost 90% of the local population is addicted to heroin. Local and even national authorities are not doing much to stop this epidemic and it is widely believed that they are directly involved in the drug trade. After Afghanistan, Myanmar is the biggest producer of poppy seeds in the world.
A FUEL FOR CONFLICT
The unsustainable and unfair process of jade extraction, along with other development projects in the region such as the Chinese sponsored dam on the Irrawaddy river, have sparked and fuelled armed rebellion and population discontent for decades. The Kachin Independence Army has been fighting the Burmese military government to keep this resource in the hands of the local population and uses revenues from the trade to fund its activities. The Burmese army, or Tatmadaw, is also using jade to fund its activity in the region while enriching a few military families who own or manage the mines. The Tatmadaw actually holds stakes in the jade trade via its two major companies: the Myanmar Economic Holding Ltd. and the Myanmar Economic Corporation.
While the conflict also has political causes, such as the representation and autonomy of the Kachin people, both the KIA and the Tatmadaw are fighting for jade money. Control of the trade is symbolic for the KIO and the Kachin people too, who feel left out of the economic development that is benefiting other parts of the country, mainly the ethnic Burman regions. The conflict is further complicated by military personnel whose personal interests drive the war. Many army officials, at all levels, benefit from the jade trade in Kachin and can only continue making this money illegally if the war continues and their presence in the region is justified.
A GREEN PEACE
Jade is at the center of the conflict in Kachin state. A conflict that has displaced more than 100,000 people since it was rekindled in 2011. Many argue that a sustainable, transparent and equitably managed jade trade would be a giant step towards ending the conflict in Kachin.
Written by Francois De Nicolay.