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 Other Presidential Documents agreements to curb narcotics production and trafficking, it has only re- cently begun to take aggressive law enforcement actions to control these ac- tivities. Over the past 6 months, the Burmese Government has cracked down particularly hard on the Kokang region controlled by Peng Jiasheng's Myanmar National Democratic Alliance Army (MNDAA), which had pledged to be opium free by 2000. With the assistance of the People's Re- public of China, the Burmese Government staged a series of arrests of maior traffickers in all areas of the Kokang, including Laukkai, the capital of Kokang State. In other areas, the SPDC has moved more cautiously. In areas controlled by the United Wa State Army (UWSA), the principal drug-producing and drug-trafficking organization in Burma, the government has slowly ex- panded its administrative presence, but has not yet attempted any aggres- sive law enforcement operations comparable to those in the Kokang region. The Wa have pledged to end all opium production in their territories by 2005. The United States has urged the government to take law enforcement action and exact other forms of pressure against the Wa narcotics oper- ations even before that deadline is reached. There have also been significant improvements in Burma's cross-border co- operation with neighboring states. In 200% Burma signed memoranda of understanding on narcotics control with both China and Thailand. The MOU with China established a framework for ioint operations, which in turn led to the series of arrests and renditions of maior traffickers in 2001 and 2002. The MOU with Thailand committed both sides to closer police cooperation on narcotics control and to the establishment of three joint "narcotics suppression coordination stations" at major crossing points on the border. Thailand has also provided a grant for a crop substitution project in the Wa-controlled regions of southern Shan State. In addition, Burma participated actively in a series of quadrilateral meetings (China, Burma, Laos, and Thailand) on narcotics control that were held in Thai- land, Burma, and China in late 2001 and early 2002. Under pressure from the Financial Action Task Force (FATF), which des- ignated Burma as a "non-cooperating" state in June 2001, the Government of Burma has a draft of a new money laundering law, which will reportedly address many of the FATF's concerns. That law, as well as a new Mutual Legal Assistance Law, facilitating Burmese legal and judicial cooperation with other states, should be enacted in 2002. Despite these recent steps, the United States does not believe that Burma's counternarcotics efforts are commensurate with the scale of the narcotics problem in Burma. We work with the GOB on annual opium yield surveys in Burma, and through UNDCP on opium reduction and crop substitution programs. In September 2001, the United States pledged an additional $1,000,000 to support UNDCP's Wa Alternative Development Project, which has helped reduce opium production in the territories of the United Wa State Army, but made utilization of these funds contingent on the mo- bilization of matching funds from other donors. 335

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