Myanmar's thriving black market, then and now

A video of goods being unloaded from a train making an unscheduled stop at night on Yangon’s outskirts has focused renewed attention on Myanmar’s massive black market – a problem the Tatmadaw could help to solve, if it wanted to.


A CURIOUS thing happened on a Myanma Railways train from Mawlamyine to Yangon on November 25. It made an unscheduled stop at Ywathagyi, in Yangon’s eastern outskirts, where workers spent about 30 minutes unloading bales of goods. The unexpected interruption to the train’s journey was filmed by a passenger who posted the footage on social media where it attracted strong interest as a likely example of the black market at work. The incident raises questions about the scale of black market activity in Myanmar and what can be done to stamp it out.

The incident has certainly raised questions at Myanma Railways, which has admitted that the stop was irregular and that the train’s crew was under investigation. But the incident is not that simple.

The video shows bales of goods, big and small, being carried from the train by workers and loaded into two trucks. It is obvious that the train did not stop because of a mechanical failure but for a pre-arranged and probably illegal activity. One possible scenario is that the goods were smuggled across the border with Thailand at Myawady and sent to Mawlamyine for the train journey to Yangon. The detour through the Mon State capital follows a crackdown on the black market that has forced smugglers to avoid the main highway linking Yangon and Myawaddy via Hpa-an.

Black market suppression teams and inspection gates on the highway have made the railway an appealing alternative for smugglers. One reason is that MR goods wagon staff usually do not check if tax has been paid on freight because it is not their responsibility. As long as freight costs are paid, goods wagon staff don’t care if the cargo is legal or illegal.

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Black marketeers try to ensure their shipments are not unloaded at Yangon Central Railway Station, because consignments are inspected there and untaxed goods are seized and the owner arrested.

Black market traders arrange for goods to be unloaded at Toegyaungkalay station, a stop closer to Yangon from Ywathagyi, but to do that they need the cooperation of the train’s driver and crew.

It is hardly new that products smuggled into Myanmar through the black market are unloaded from trains on the outskirts of Yangon. The problem was rife during the socialist era of General Ne Win, whose disastrous policy of economic autarky contributed to a thriving black market. Despite brutal attempts to suppress the trade in contraband, all kinds of goods were shipped to Yangon by train from Mawlamyine. Guards were bribed to look the other way and soon after the train slowly pulled away from the Mon State capital for the overnight trip to Yangon, goods were loaded and hidden in carriages. The trains would reduce speed as they neared Yangon to make it easier to unload the contraband. MR trains have been transporting contraband to Yangon from Mawlamyine for many decades and the video posted on November 25 suggests that black marketeers remain as wily as ever when it comes to avoiding taxes.

Seizures of untaxed goods only hint at huge scale of the black market. Contraband worth a total of K2.8 billion (about US$2.05 million) was seized throughout the country in November alone. It’s clear that the government needs to do more than just control illegal trade at a few notorious crossings, such as Mayangyaung in Mon State, and Yebu near the border town of Muse in Shan State.

Dealing with the black market is one of the many challenges facing the government as it faces criticism over the state of the economy. It is a challenge complicated by the involvement in cross-border smuggling of armed groups, including Border Guard Force units, about which the government and the Customs Department can do very little.

The Tatmadaw can be part of the solution to tackling this problem. If Tatmadaw leaders accept that the black market is having a negative effect on the economy and help the government to deal with the problem, it would be a major step towards a solution.

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