MYITKYINA, Burma — The jade tycoon of Burma lives behind stone walls and a sophisticated security system. A visitor must be buzzed through a gate into the garden, pass a hunk of jade as big as a compact refrigerator, enter through a sliding screen and glide by the preserved tusks of the family elephant before sitting down with the man himself.
Yup Zau Hkawng is a well-known figure in Burma’s Kachin state, a broker in the peace process between armed rebels and the military and one of the few ethnic Kachin to own a jade mining business.
Burma’s northernmost state is home to 1.2 million people and some of the country’s most intractable problems — including a rapacious jade mining culture, opium cultivation, environmental devastation, controversial development deals with China, and an armed insurgency. Kachin may pose one of the stiffest challenges to the new democratically elected civilian government, led by Aung San Suu Kyi, that has taken over a country that suffered decades of military rule.
Ask Yup Zau Hkawng what the odds are that Suu Kyi and the new civilian leaders will be able to make any headway here, and he breaks into a slow, conspiratorial smile.
“I’d rather say [I] hope than tell you what I think,” he said.
At the root of much of Kachin’s agony lies the immensely valuable green stone — jade. Activists charge that families and cronies of the country’s all-powerful military are plundering the state’s jade and other natural resources, such as timber and gold. Large companies worked round-the-clock for the past year to extract as much jade as possible before the new government came in, turning mountains into valleys in a matter of weeks.
The trade fuels the traffic in weapons, drugs and gems that flows past verdant poppy fields and over the porous border with China. The insurgent Kachin Independence Army continues to clash with the military over the state’s resources, a conflict that has displaced thousands and dates back decades.
“We are so proud that the opposition won the election. It’s one more step toward democracy,” said Steven Tsa Ji, who runs a network of civil society groups here. “But how can they solve in a five-year period what has happened in 60 years?”
Any trip to Kachin state must start at the meeting place of two small rivers, cool from glacier water coursing from the Himalayas, that join and form the Irrawaddy, the grand river that has almost mystical significance to the Kachin people.
At the confluence, a golden pagoda gleams. Climb into a boat with a puttering engine and, about 30 minutes up a pristine shoreline, seven rusting pylons rise above the water.
This is what exists — for now — of the Myitsone Dam, a massive, 6,000-megawatt hydropower plant that, if built, would be one of the biggest in Asia.
The previous, military-backed government in Burma, also known as Myanmar, suspended the $3.6 billion Chinese project in 2011 after public outcry. Critics said the dam would displace more than 10,000 villagers and cause damage to wildlife and fish populations and, as the river spools south, the rich delta rice paddies.
The hydropower project as originally conceived would have sent most of the electricity generated back to China, even as hundreds of thousands remain off the power grid in Burma.
With the change in government, the Chinese have begun to put pressure on Burma in hopes construction can resume. Speaking to reporters last month, Chinese Vice Foreign Minister Liu Zhenmin said that “how to push this cooperation forward is an important thing for both countries.”
Suu Kyi, who opposed the project in 2011, has given the Kachin little insight into her views on the matter. She said in the fall that the new government would have to review the contract before making a decision.
“There’s no way to continue the project,” said Ja Seng Hkwan, 50, a state legislator. “If you kill the Irrawaddy, you’re killing the whole country.”
Control of the state’s rich natural resources is at the heart of the conflict between the Kachin and the government, a conflict dating back to the country’s independence from Britain in 1948. The Kachin are largely Christian in a majority-Buddhist country.
The Kachin Independence Army and the military renewed fighting near a Chinese-run hydropower plant in 2011, splintering a 17-year truce and displacing an estimated 100,000 people.
Since then, activist groups such as Human Rights Watch have reported that both sides have committed rape, enlisted child soldiers and planted land mines. Because of the fighting, voting was not held in dozens of villages in November’s election, which vaulted Suu Kyi and her National League for Democracy into power.
Suu Kyi has said that national reconciliation and a peace accord with the Kachin and other armed militias is one of her highest priorities. But after years of conflict, distrust lingers. And analysts say that both the military and the rebels benefit from the lucrative jade mining business.
In recent years, heavy mining by companies run by military-
controlled conglomerates, military cronies and families, or illicit Chinese investors have caused rapid deforestation, pollution of rivers and streams, and landslides that have killed hundreds, according to a report by Global Witness. The group estimated that the value of the jade produced in the area in 2014 was $12 billion to $31 billion, and much of it ended up across the border in China. The United States does not allow the importation of jade or rubies from Burma, and several businessmen who run jade mining companies are prohibited from doing business with U.S. companies.
In an open-air tea shop in the center of Myitkyina, buyers and jade-pickers illegally buy and sell polished gems and uncut stone, violating Burma’s tight laws restricting gem sales and possession of all but the lowest-quality jade.
Naw Khan, 44, said he makes up to $2,000 a month picking stones from refuse dirt dumped by the big mining companies. It’s a dangerous business, he said, with malaria rampant and the constant risk of landslides. But jade, he said, “can make you be rich in one day.”
Recently, about 300 civic activists from the area called for a moratorium on mining until new laws and a monitoring system can be set up to prevent the “unlawful and reckless extraction of jade.”
Members of her party say that Suu Kyi’s success depends on her relationship with Burma’s still-powerful military, which controls the security forces and key ministries and industries. So it’s unlikely the party will push the issue of jade anytime soon, they say.
“I don’t think [Suu Kyi] will talk about these things right away. We can’t turn black into white with a silver bullet,” said Thet Thet Khine, a member of parliament from Suu Kyi’s party who herself owns a gold and jewelry business in Rangoon. “She will not destroy these businesses. It’s an ethical dilemma. These businesses practice cronyism but at the same time are employing a lot of people. It’s a very low priority for her.”
The jade business has been good to Yup Zau Hkawng and his Jadeland Myanmar Group. Once, he was a small-time prospector. Now he’s a prosperous businessman who owns a 300-acre ranch and a 12-bedroom family house in Myitkyina where a sign over the entryway reads: “Extra Fortunate Jade Mountain Family.”
He said the riches from the mines should benefit the Kachin people, not cronies and the military elite. Roads, schools and drug treatment centers are needed.
“Our people are sitting on natural resources and should be rich with it,” he said. “But they suffer.”
Eaint Thiri Thu contributed to this report.