7. The Golden Triangle: 
Heroin Is Our Most Important Product

"LADIES AND GENTLEMEN," announced the genteel British diplomat, raising his glass to offer a toast, "I give you Prince Sopsaisana, the uplifter of Laotian youth." The toast brought an appreciative smile from the lips of the guest of honor, cheers and applause from the luminaries of Vientiane's diplomatic corps gathered at the send-off banquet for the Laotian ambassador-designate to France, Prince Sopsaisana. His appointment was the crowning achievement in a brilliant career. A member of the royal house of Meng Khouang, the Plain of Jars region, Prince Sopsaisana was vice-president of the National Assembly, chairman of the Lao Bar Association, president of the Lao Press Association, president of the Alliance Francaise, and a member in good standing of the Asian People's Anti-Communist League. After receiving his credentials from the king in a private audience at the Luang Prabang Royal Palace on April 8, 1971, the prince was treated to an unprecedented round of cocktail parties, dinners, and banquets. (1) For Prince Sopsaisana, or Sopsai as his friends call him, was not just any ambassador; the Americans considered him an outstanding example of a new generation of honest, dynamic national leaders, and it was widely rumored in Vientiane that Sopsai was destined for high office some day.

The send-off party at Vientiane's Wattay Airport on April 23 was one of the gayest affairs of the season. Everybody was there: the cream of the diplomatic corps, a bevy of Lao luminaries, and, of course, you-know who from the American Embassy. The champagne bubbled, the canapes were flawlessly French, and Mr. Ivan Bastouil, charge d'affaires at the French Embassy, Lao Presse reported, gave the nicest speech. (2) Only after the plane had soared off into the clouds did anybody notice that Sopsai had forgotten to pay for his share of the reception. When the prince's flight arrived at Paris's Orly Airport on the morning of April 25, there was another reception in the exclusive VIP lounge. The French ambassador to Laos, home for a brief visit, and the entire staff of the Laotian Embassy had turned out. (3) There were warm embraces, kissing on both cheeks, and more effusive speeches. Curiously, Prince Sopsaisana insisted on waiting for his luggage like any ordinary tourist, and when the mountain of suitcases finally appeared after an unexplained delay, he immediately noticed that one was missing. Angrily Sopsai insisted his suitcase be delivered at once, and the French authorities promised, most apologetically, that it would be sent round to the Embassy just as soon as it was found. But the Mercedes was waiting, and with flags fluttering, Sopsai was whisked off to the Embassy for a formal reception.

While the champagne bubbled at the Laotian Embassy, French customs officials were examining one of the biggest heroin seizures in French history: the ambassador's "missing" suitcase contained sixty kilos of high-grade Laotian heroin worth $13.5 million on the streets of New York,(4) its probable destination. Tipped by an unidentified source in Vientiane, French officials had been waiting at the airport. Rather than create a major diplomatic scandal by confronting Sopsai with the heroin in the VIP lounge, French officials quietly impounded the suitcase until the government could decide how to deal with the matter.

Although it was finally decided to hush up the affair, the authorities were determined that Sopsaisana should not go entirely unpunished. A week after the ambassador's arrival, a smiling French official presented himself at the Embassy with the guilty suitcase in hand. Although Sopsaisana had been bombarding the airport with outraged telephone calls for several days, he must have realized that accepting the suitcase was tantamount to an admission of guilt and flatly denied that it was his. Despite his protestations of innocence, the French government refused to accept his diplomatic credentials and Sopsai festered in Paris for almost two months until he was finally recalled to Vientiane late in June.

Back in Vientiane the impact of this affair was considerably less than earthshaking. The all-powerful American Embassy chose not to pursue the matter, and within a few weeks everything was conveniently forgotten (5) According to reports later received by the U.S. Bureau of Narcotics, Sopsai's venture had been financed by Meo Gen. Vang Pao, commander of the CIA's Secret Army, and the heroin itself had been refined in a laboratory at Long Tieng, which happens to be the CIA's headquarters for clandestine operations in northern Laos.(6) Perhaps these embarrassing facts may explain the U.S. Embassy's lack of action.

In spite of its amusing aspects, the Sopsaisana affair provides sobering evidence of Southeast Asia's growing importance in the international heroin trade. In addition to growing over a thousand tons of raw opium annually (about 70 percent of the world's total illicit opium. (7) Southeast Asia's Golden Triangle region has become a mass producer of high-grade no. 4 heroin for the American market. Its mushrooming heroin laboratories now rival Marseille and Hong Kong in the quantity and quality of their heroin production.

As America confronted the heroin epidemic in mid 1971, governme t leaders and massmedia newsmen reduced the frightening complexities of the international drug traffic to a single sentence. Their soothing refrain ran something like this: 80 percent of America's heroin begins as raw opium on the slopes of Turkey's craggy Anatolian plateau, is refined into heroin in the clandestine laboratories of Marseille, and smuggled into the United States by ruthless international syndicates.

If any of the press had bothered to examine this statement they might have learned that it was based largely on a random guess by the French narcotics police, (8) who had eleven officers, three automobiles, and a miserable budget with which to cover all of southern France! (9) If they had probed further they might have discovered this curious anomaly: that although Southeast Asia produced 70 percent of the world's illicit opium, it was credited with being the source of only 5 percent of America's heroin supply, while Turkey, with only 7 percent of the world's illicit opium, was allegedly responsible for 80 percent of our heroin. (10)

The truth, as it often is, was rather embarrassing. To summarize, Turkey's opium production had declined sharply in the late 1960s, and international drug syndicates had turned to Southeast Asia as an alternate source of raw materials. Southeast Asia's Golden Triangle-comprising the rugged Shan hills of northeastern Burma, the mountain ridges of northern Thailand, and the Meo highlands of northern Laos-had become the world's largest source of opium, morphine, and heroin. Its narcotics were flooding into the United States through Hong Kong, Latin America, and Europe. The sudden increase in Southeast Asian heroin exports to the United States was fueling a heroin epidemic among American youth. Since some American allies in Southeast Asia were managing the traffic and U.S. policies had contributed to its growth, the Nixon administration was hardly anxious to spark a heated political controversy by speculating openly on Southeast Asia's growing importance in America's heroin traffic.

In the 1960s a combination of factors-American military intervention, corrupt national governments, and international criminal syndicates -pushed Southeast Asia's opium commerce beyond self-sufficiency to export capability. Production of cheap, low-grade no. 3 heroin (3 to 6 percent pure) had started in the late 1950s when the Thai government launched an intensive opium suppression campaign that forced most of her opium habitues to switch to heroin. By the early 1960s large quantities of cheap no. 3 heroin were being refined in Bangkok and northern Thailand, while substantial amounts of morphine base were being processed in the Golden Triangle region for export to Hong Kong and Europe. However, none of the Golden Triangle's opium refineries had yet mastered the difficult technique required to produce high-grade no. 4 heroin (90 to 99 percent pure).

In late 1969 opium refineries in the Burma-Thailand-Laos tri-border region, newly staffed by skilled master chemists from Hong Kong, began producing limited supplies of high-grade heroin for the tens of thousands of alienated GIs serving in South Vietnam. The U.S. military command in Saigon began getting its first reports of serious heroin addiction among isolated units in early 1970. By September or October the epidemic was fully developed: seemingly unlimited quantities of heroin were available at every U.S. installation from the Mekong Delta in the south to the DMZ in the north.

When rapid U.S. troop withdrawls in 1970-1972 reduced the local market for the Golden Triangle's flourishing heroin laboratories, Chinese, Corsican, and American syndicates began sending bulk shipments of no. 4 heroin directly to the United States. As a result of these growing exports, the wholesale price for a kilo of pure no. 4 heroin at Golden Triangle laboratories actually increased by 44 percent-from $1,240 in September 1970 to $1,780 in April 1971-despite a 30 percent decline in the number of GIs serving in Vietnam during the same period. (11) Moreover, the rapid growth of exports to the United States has spurred adramatic leap in the price of raw opium in the Golden Triangle. One American trained anthropologist who spent several years studying hill tribes in northern Thailand reports that "between 1968 and early 1970 . . . the price of raw opium at the producing village almost doubled from $24 to $45 a kilogram. (12) While the growing rate of addiction among remaining U.S. troops in Vietnam probably accounted for some increased demand, increased exports to the American domestic market provided the major impetus behind the price rise. Significantly, it was in April 1971 that the first bulk shipments of Laotian heroin were intercepted in Europe and the United States. On April 5 U.S. customs officials seized 7.7 kilos of Double U-0 Globe brand heroin at Fort Monmouth, New Jersey, (13) and on April 25 French authorities seized Prince Sopsaisana's 60 kilos at Orly Airport.

In 1970-1971 U.S. law enforcement officials became alarmed over the greatly increased heroin supplies available to America's addict population. Massive drug seizures of unprecedented size and value did not even make the "slightest ripple" in the availability or price of heroin .(14) Knowing that Turkey's opium production was declining, U.S. narcotics experts were mystified and began asking themselves where all this heroin was coming from. (15) The answer, of course, is the Golden Triangle.

The CIA, in its 1971 analysis of narcotics traffic in the Golden Triangle reported that the largest of the region's seven heroin factories, located just north of Ban Houei Sai, Laos, "is believed capable of processing some 100 kilos of raw opium per day."(16) In other words, the factory is capable of producing 3.6 tons of heroin a year-an enormous output, considering that American addicts only consume about 10.0 tons of heroin annually. Moreover, none of this production is intended for Asian addicts: as we have already mentioned, high-grade no. 4 heroin is too expensive for them; and they either smoke opium or use the inexpensive low-grade no. 3 heroin. In Bangkok, for example, one gram of no. 4 heroin costs sixteen times more than one gram of no. 3. (17) The only market outlets for these heroin laboratories are in the well-heeled West: Europe, with a relatively small addict population, and the United States, which has a large and rapidly increasing addict population.

U.S. military and political activities had played a significant role in shaping these developments. Although opium production continued to increase in Burma and Thailand, there were no major changes in the structure of the traffic during the 1960s. Still enjoying tacit CIA support for their counterinsurgency work, Nationalist Chinese (KMT) military caravans continued to move almost all of Burma's opium exports into northern Thailand, where they were purchased by a Chinese syndicate for domestic distribution and export to Hong Kong or Malaysia. The Shan national revolutionary movement offered a brief challenge to KMT hegemony over the opium trade, but after their most powerful leader was defeated in the 1967 Opium War, the Shan threat evaporated.

After the 1967 Opium War, the KMT solidified its control over the BurmaThailand opium trade. Almost none of the seven hundred tons of raw opium harvested annually in Burma's Shan and Kachin states reaches world markets through any of Burma's ports: instead, it is packed across the rugged Shan hills by mule caravan to the tri-border junction of Burma, Thailand, and Laos. This area is the beginning of two pipelines into the illicit international markets: one shoots across Laos to Saigon, the other heads due south through central Thailand to Bangkok." (18)(For smuggling routes, see Map)

Although Shan rebel bands and Burmese self-defense forces collect a heavy tax from tribal opium farmers and itinerant small merchants who transport raw opium to major Shan States market towns, they control very few of the caravans carrying raw opium south to refineries in the tri-border area, In 1967 one CIA operatiye reported that 90 percent of Burma's opium harvest was carried by Nationalist Chinese army mule caravans based in northern Thailand, 7 percent by Shan armed bands, and about 3 percent by Kachin rebels.(19)

Thailand's northern hill tribes harvest approximately two hundred tons of opium annually, according to a 1968 U.S. Bureau of Narcotics estimate. (20) The Thai government reports that KMT military units and an allied group of Chinese hill traders control almost all of the opium commerce in northern Thailand.

In Laos, CIA clandestine intervention produced changes and upheavals in the narcotics traffic. When political infighting among the Lao elite and the escalating war forced the small Corsican charter airlines out of the opium business in 1965, the CIA's airline, Air America, began flying Meo opium out of the hills to Long Tieng and Vientiane. CIA cross-border intelligence missions into China from Laos reaped an unexpected dividend in 1962 when the Shan rebel leader who organized the forays for the agency began financing the Shan nationalist cause by selling Burmese opium to another CIA protege, Laotian Gen. Phoumi Nosavan. The economic alliance between General Phoumi and the Shans opened up a new trading pattern that diverted increasingly significant quantities of Burmese opium from their normal marketplace in Bangkok. In the late 1960s U.S. air force bombing disrupted Laotian opium production by forcing the majority of the Meo opium farmers to become refugees. However, flourishing Laotian heroin laboratories, which are the major suppliers for the GI market in Vietnam, simply increased their imports of Burmese opium through already established trading relationships.

The importance of these CIA clients in the subsequent growth of the Golden Triangle's heroin trade was revealed, inadvertently, by the agency itself when it leaked a classified report on the Southeast Asian opium traffic to The New York Times. The CIA analysis identified twenty-one opium refineries in the tri-border area where Burma, Thailand, and Laos converge, and reported that seven were capable of producing 90 to 99 percent pure no. 4 heroin. Of these seven heroin refineries, "the most important are located in the areas around Tachilek, Burma; Ban Houei Sai and Nam Keung in Laos; and Mae Salong in Thailand." (21)

Although the CIA did not bother to mention it, many of these refineries are located in areas totally controlled by paramilitary groups closely identified with American military operations in the Golden Triangle area. Mae Salong is headquarters for the Nationalist Chinese Fifth Army, which has been continuously involved in CIA counterinsurgency and intelligence operations since 1950. According to a former CIA operative who worked in the area for a number of years, the heroin laboratory at Nam Keung is protected by Maj. Chao La, commander of Yao mercenary troops for the CIA in northwestern Laos. One of the heroin laboratories near Ban Houei Sai reportedly belongs to Gen. Ouane Rattikone, former commander in chief of the Royal Laotian Army-the only army in the world, except for the U S. army, entirely financed by the U.S. government.(22) The heroin factories near Tachilek are operated by Burmese paramilitary units and Shan rebel armies who control a relatively small percentage of Burma's narcotics traffic. Although few of these Shan groups have any relation to the CIA today, one of the most important chapters in the history of the Shan States' opium trade involves a Shan rebel army closely allied with the CIA. (For location of these laboratories, see Map )

Other sources have revealed the existence of an important heroin laboratory operating in the Vientiane region under the protection of Gen. Ouane Rattikone. Finally, the U.S. Bureau of Narcotics has reports that Gen. Vang Pao, commander of the CIA's Secret Army, has been operating a heroin factory at Long Tieng, headquarters for CIA operations in northern Laos. (23)

Thus, it is with something more than idle curiosity that we turn to an examination of CIA clandestine operations and the concurrent growth of the narcotics traffic in the Golden Triangle.