China and Thailand target Myanmar’s sin city – junta set to benefit

Myanmar junta chief Min Aung Hlaing has given the green light to Liu Zhongyi, China’s Assistant Minister of Public Security of China, to tackle scam operations in Myawaddy on the border with Thailand. However, beneath the surface, former Thai prime minister Thaksin Shinawatra, known as "STR" – an acronym meaning "Meddling in everything" – has emerged as a hidden player, reportedly collaborating with Myanmar to pressure the Border Guard Force (BGF), the Karen militia that controls Myawaddy.

Liu Zhongyi, Beijing's enforcer, is closely overseeing the crackdown on call-centre fraud gangs in Myawaddy, but his actions risk triggering border tensions.

The "Sin City” cleanup led by Liu Zhongyi has sparked widespread debate. Some question the Thai government's inaction, while others argue that China is encroaching on Thailand's sovereignty. Myawaddy lies on the border, next to Thailand’s Mae Sot in Tak province.

The crackdown on Chinese crime syndicates in Myawaddy is a joint effort by China, Myanmar, and Thailand, shaped by the unique political dynamics within ASEAN, where Beijing wields significant influence.

Liu Zhongyi's success is inseparable from behind-the-scenes diplomacy. Key figures like Thaksin and Min Aung Hlaing have played critical roles in pressuring Major General Saw Chit Thu, the junta-allied BGF warlord, as well as the Democratic Karen Buddhist Army (DKBA), which also protects scam syndicates.

Thailand implemented a "three-cuts" strategy – cutting electricity, fuel, and internet services to the syndicates – while Myanmar added pressure by halting fuel supplies.

Liu Zhongyi

As a result, Saw Chit Thu capitulated and launched the crackdown, while the Chinese-run fraud operations relocated from Myawaddy to Hpa-An, the capital of Kayin (Karen) State.

Last Friday, Liu Zhongyi visited Naypyitaw, Myanmar, where he met with the junta’s Home Affairs Minister Tun Tun Naung and secured approval to enter Myawaddy.

On Sunday, Liu crossed the Thai-Myanmar border to Myawaddy, meeting with Tun Tun Naung and Myanmar’s police chief to discuss the crackdown on call-centre gangs.

On Monday, Liu visited the human trafficking victim screening centre in Myawaddy’s notorious scam hub of Shwe Kokko, where over 1,000 Chinese and other nationals rescued from slavery in scam compounds are housed.

Saw Chit Thu

In Shwe Kokko, Liu met with Lieutenant Colonel Tin Win, deputy commander of the BGF, but did not meet with BGF leader Saw Chit Thu.

On the same day, Saw Chit Thu held a press conference to announce that he had not met or spoken with Chinese representatives, but had sent a letter to the Chinese through Thai representatives.
 

Myanmar's agenda

Since the junta’s 275th Battalion at Phasong was defeated by the Karen National Union (KNU) in April last, Myawaddy has become a "no-man's land" for Naypyitaw, surrounded by enemy forces. While some immigration officers remain, they are largely ineffective.

Min Aung Hlaing seized the opportunity presented by China's push to dismantle call-centre fraud gangs in Karen State, initiating talks to pressure his ally, Saw Chit Thu, who controls Myawaddy and surrounding areas. Eventually, Saw Chit Thu agreed to cooperate.

The presence of the home affairs minister and police chief in Myawaddy signals that the junta is preparing to fully reclaim the city.

The sight of Myanmar security personnel working at full capacity at the human trafficking victim screening centre marks the first step in Min Aung Hlaing’s subtle efforts to regain control of Myawaddy.
 
Thailand's agenda

The government of PM Paetongtarn, Thaksin’s daughter, has expressed a desire to restore normalcy to the Thailand-Myanmar border trade, particularly the Mae Sot-Myawaddy crossing.

The Asian Highway 1 (AH-1), which spans 1,500 kilometres from Myawaddy to Tamu on the Myanmar-India border, has been closed for over a year since KNU/KNLA forces destroyed a bridge and blocked junta troops.
This highway is a vital trade route linking three countries, highlighted by cross-border trade Myawaddy valued at over US$1 billion annually.

At the end of last year, the KNU, BGF, and DKBA discussed reopening the Asian Highway, but the KNU refused, fearing that the Myanmar military would use the route to advance on Myawaddy.

If the call-centre fraud issue in Myawaddy is resolved, analysts warn it could lead to a major conflict between the Myanmar military and the KNU during the ongoing dry season.