152. Memorandum From the Executive Secretary of the Department of State (Eliot) to the President’s Assistant for National Security Affairs (Kissinger)1

SUBJECT

  • U.S. Assistance to Thai Program for Resettling CIF Opium Traffickers

Summary

We have agreed to give the Royal Thai Government (RTG) $1 million to support Thai efforts to resettle the Chinese Irregular Forces (CIF) of Generals Li and Tuan against the latter’s promise to cease trafficking in opium, and to turn over about 28 tons of opium, now under their control, to the RTG for destruction.2

Background

In 1949–50 KMT (Kuomingtang–Chinese Nationalist) troops under General Li Mi were driven out of Yunnan into Burma, where they settled despite the protests and military efforts of the Burmese to dislodge them. In 1953–54 and again in the early 1960’s many of these KMT’s were evacuated to Taiwan, and the Government of the Republic of China no longer has any control over those who stayed behind. The remaining forces, now mostly in Thailand, have gradually assumed a more local character through recruitment but have remained an effective military force, probably the best in the tri-border area. Now known as the “Chinese Irregular Forces” (CIF’s), they are under the leadership of Generals Li Wen-Huan and Tuan Hsi-Wen.

Over the years the CIF’s have acquired control over most of the illegal opium traffic from eastern Burma and northern Thailand to Bangkok. Operating in terrain they know better than the government forces, profiting heavily from “protection” and trade in opium, and fighting when they have to, the CIF’s became a law unto themselves.

For the past year or two the Thai Government, faced with an increasing Communist insurgency in the north and recognizing the bad effects the opium trade was having on Thailand’s reputation, has sought to settle the CIF’s and make useful residents out of them. To this end the Thai promised that if the CIF’s would turn their forces RTG’s relations with the CIF have been carried out by General Kriangsak, Deputy Chief of Staff of Supreme Command, who has been well and favorably known to us for many years.

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The Opium Trade

Recognizing the increasing problem of the illicit opium trade, the Thai Government sought to get the CIF’s out of the business. Li and Tuan said they were willing to give it up, but they needed 20 million baht (equivalent to $1 million) to dispose of their obligations and opium procurement agreements and to settle their followers. While the RTG was able to put aside some funds for resettlement purposes, they could not allocate this additional amount, so General Kriangsak approached us for assistance. After careful consideration in Bangkok and Washington, agreement was reached on the form and amount of U.S. assistance. An essential consideration from the Thai point of view was that Li and Tuan were not to be aware that the USG was the eventual source of funds. U.S. funds are to be provided from AID Development Loan funds transferred to the BNDD.

The U.S./Thai Agreement

On February 1, General Kriangsak and the U.S. BNDD director in Bangkok signed a letter3 which provided essentially as follows (full text attached):

In the interest of assisting RTG efforts to resettle the CIF’s, the U.S. would contribute 20.8 million baht in two installments on a grant basis against the CIF surrender of 16,000 choi of opium (about 28 tons).

Disposition of the opium is to be by agreement between the RTG and the U.S. (the RTG insists on destruction of the opium).

The U.S. assistance is provided on a one-time basis.

In separate agreements between General Kriangsak and the two CIF leaders, the latter have agreed to turn over their stocks, to get out of the opium trade entirely, and to subject themselves and their forces to Thai law for any future offenses.

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Conclusion

While we recognize that it is unlikely that our support of Thai efforts to resettle the CIF’s will put a complete stop to opium trafficking in northern Thailand, the U.S./RTG agreement will enable us to hold Kriangsak and the RTG responsible for any violations by the CIF’s. The removal of 28 tons of opium from illicit channels and its destruction will have a major impact on the quantity available for consumption outside the indigenous market. The resettlement scheme if successful may make productive citizens out of a group of several thousand freebooters. Finally, the possibility of further use of the CIF’s as a force against the Communist insurgents in northern Thailand will be enhanced.

James Carson 4
  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 564, Country Files, Far East, Thailand, Vol. VIII. Secret; Nodis.
  2. The suggested text of the agreement was transmitted to the Embassy in Bangkok in telegram 231185, December 27, 1971. (Ibid.)
  3. The February 1 letter to Lieutenant General Kriangsak Chomanan was signed by William T. Wanzeck, Narcotics Attaché of the Thai Embassy. In the letter Wanzeck repeats the language of telegram 231185 almost verbatim. He states that the U.S. Government is “particularly pleased with the provisions in this program that would remove these forces permanently from the illicit trade in opium which has international ramifications, and would turn them instead to agricultural pursuits or other legitimate means of earning a livelihood.” Attached but not printed.
  4. Carson signed for Eliot above Eliot’s typed signature.