LEGAL border trade along Myanmar's frontiers has been largely unaffected by a government crackdown on illegal trade at the Muse and Myawaddy checkpoints, private sector and government sources said last week.

A crackdown on those bypassing official trade channels or providing inaccurate documents began in late March this year at Muse on the border with China and spread to Myawaddy on the Thai border in mid July.

A number of houses and warehouses belonging to traders were raided, resulting in arrests of offending traders and the confiscation of goods that had not been declared to the government, sources said.

U Myo Oo, deputy director general of the Directorate of Trade, told The Myanmar Times that government action at the border trading points was targeted at those who were not following trade procedures properly, not at those trading legally.

He firmly denied a rumour that all transactions and trade at the border points had halted due to the crackdown.

“It is not true and these rumors are groundless,” he said. “Only illegal trade has been placed under (government) control while legal trade is continuing as usual.”

U Myo Oo said border trade at Muse had increased “month after month” despite the government crackdown and stood at US$311 for the first six months of 2006 compared to $257 million for the same period last year.

“Judging by these figures, we can say that Muse border trade is still running normally,” he said.

Trade at Myawaddy for the first six months of this year was $49 million, down $1 million on the first half of 2005.

Most of the illegal trade of the government’s focus were crops grown in Myanmar for which exports were limited to ensure sufficient domestic supplies.
However, a trader at Myawaddy said such produce was still heading to Thailand illegally in large amounts.

“More than 60 percent of exported garlic goes out through illegal channels,” said the trader, who requested anonymity.

In March, shortly before the crackdown on illegal trade, a survey conducted at Muse by the Ministry of Commerce showed that 70 cargo vehicles out of 88, or almost 80 percent, were crossing the Chinese border without government permission.

The move to curb illegal trade was welcomed by many Myanmar traders at the Chinese and Thai borders, who expressed optimism that legitimate Myawaddy-Mae Sot and Muse-Ruili trade would continue to thrive.

U Than Htay Aung, managing director of Hanse International Ltd, said traders on both sides of the border were in a position to complement one another and that each other’s commodities had well-established markets in the other’s country.

He said, however, that trading at Kawthoung, which borders Thailand in Myanmar’s southern Taninthayi Division, had been slow for the past two months.

“That’s because local items, such as onions and garlic, have been strictly controlled in to make sure there’s enough for the local market,” U Than Htay Aung said.

He blamed delays of incoming goods on Myanmar traders failing to accurately declare what they were importing.

According to government figures, Myanmar’s trade in the 2005-06 fiscal year reached $5.5 billion. Twenty percent, or $1.1 billion, of this was from border trade.