Bureau of International Narcotics and Law Enforcement Affairs

A. Introduction

Due to its enormous economy, large consumer market with growing disposable income, and expanding global commerce, China has become a hub for illicit drug consumption, drug and precursor chemical trafficking, and money laundering activities.

Synthetic drugs such as methamphetamine and other amphetamine-type stimulants (ATS) such as MDMA (ecstasy) have surpassed heroin to become the most abused drugs in China. China is also a major producer, destination, and transit country for ATS, especially methamphetamine. Despite several successful law enforcement operations in 2015, China's production and export of methamphetamine continues to increase, especially to Indonesia, Malaysia, Australia and New Zealand.

Heroin, traditionally the most widely abused drug in China is gradually being replaced by more readily available synthetic drugs. However, China remains a major destination and transit country for heroin produced in Southwest and Southeast Asia.

Abuse of various new psychoactive substances (NPS) is increasingly prevalent in China. Ketamine is the third most widely abused drug and is categorized as an NPS. China is a major producer and exporter of NPS, which are increasingly in demand in illicit international markets. China's vast chemical and pharmaceutical industries and regulatory loopholes associated with NPS provide an ideal environment for the production and export of these drugs. Nearly all of the NPS seized in North America and Europe have originated from chemical and pharmaceutical businesses in China and can be ordered via the Internet and received in the mail. Chemical alterations of NPS drugs designed to circumvent existing anti-drug laws make efforts to stem the flow of these drugs challenging. In October 2015, however, China announced new controls on 116 NPS, and streamlined the process for controlling additional NPS.

China remains the primary source of the precursor chemicals used to manufacture methamphetamine consumed in the United States and is one of the world's top producers and exporters of precursor chemicals. Although the majority of precursor chemical production and export is intended for legitimate use, precursors are being diverted by transnational criminal organizations to produce illicit drugs. China's close proximity to drug production centers in Southwest and Southeast Asia, insufficient regulatory oversight of the chemical industry, corruption among government and business officials, lower production costs, as well as numerous coastal cities with large precursor chemical factories and modern port facilities, make it an ideal source for precursor chemicals intended for illicit drug production. In a promising development, in late 2015 China criminalized additional activities involving transportation and production of chemicals and simplified the procedure for placing controls on additional chemicals as the need arises.

B. Drug Control Accomplishments, Policies, and Trends

1. Institutional Development

China’s drug control strategy focuses on prevention, education, illicit crop eradication, interdiction, rehabilitation, commercial regulation, and law enforcement. The Ministry of Public Security (MPS) Narcotics Control Bureau is the primary national drug enforcement entity and works in conjunction with provincial public security bureau offices. The Anti-Smuggling Bureau (ASB) within the General Administration of Customs is responsible for the enforcement of China’s drug control laws at seaports, airports, and land border check points. China maintains bilateral counternarcotic agreements with various countries and international organizations, including the UN Office on Drugs and Crime (UNODC), and participates in a variety of international drug conferences and bilateral meetings, including the annual International Drug Enforcement Conference hosted by the U.S. Drug Enforcement Administration (DEA).

2. Supply Reduction

Official Chinese drug arrest and seizure data were not available at the time of this report. Two comprehensive national anti-drug campaigns led by MPS were initiated in China during 2014. Operation "Drug-Free Peace" resulted in the seizure of 26.5 metric tons (MT) of illicit drugs during a 10-week period. China’s "Hundred-City Anti-Drug War" resulted in the seizure of 43.3 MT of illicit drugs over a six-month operation spanning 2014 and early 2015.

According to Chinese authorities, law enforcement officials investigated 145,900 drug trafficking cases resulting in 168,900 drug-related arrests and seized 68.95 MT of illicit drugs, including 9.3 MT of heroin, 25.9 MT of methamphetamine, 11.2 MT of ketamine, and four MT of cannabis during 2014.

3. Public Information, Prevention, and Treatment

China’s National Narcotics Control Commission has an outreach program to raise awareness of the negative health effects of drug abuse and to promote drug prevention. By the end of 2014, the number of registered drug users in China reached nearly 2.96 million, including approximately 1.45 million users of opiates, or 49.3 percent of all registered drug users. The number of registered synthetic drug users reached approximately 1.46 million, or 49.4 percent of all registered drug users. Of this number, 463,000 were classified as new drug users. 2014 was the first year that the number of synthetic drug abusers exceeded the number of opiate users in China.

The centers for mandatory detoxification are managed jointly by the Ministry of Public Health and the Ministry of Justice to support HIV-positive patients in an effort to prevent the spread of HIV/AIDS. Community-based drug rehabilitation programs developed in Yunnan Province to treat drug addiction and help former addicts reintegrate into society have been expanded to other parts of the country.

4. Corruption

The Ministry of Public Security takes allegations of drug-related corruption seriously, launching investigations when deemed appropriate. Despite efforts to stem drug-related corruption, financial corruption among provincial, prefectural, county, and district government officials continues to be a concern. To date, no senior Chinese official at the central government level is known to have facilitated the illicit production or distribution of drugs. Similarly, no senior Chinese official from the central government is known to have laundered proceeds from drug-related activities.

China's central government-driven anti-corruption campaign led to the arrests of many lower-level government personnel and some senior-level government officials, most notable Zhou Yongkang, former member of the Political Bureau of the Communist Party of China’s Central Committee and Minister of Public Security. Corruption at the provincial, prefecture, and county level outside of Beijing also continues to pose a problem for the central government.

While drug-related corruption exists in China, it is not reported by the government-controlled press, and there is no indication the problem is widespread. However, irregularities within some of the many state-owned enterprises in the chemical and pharmaceutical industries raise questions regarding the government's knowledge and involvement (intentional or inadvertent) with the diversion of precursor chemicals for illicit drug production and the manufacturing of counterfeit pharmaceutical products.

C. National Goals, Bilateral Cooperation, and U.S. Policy Initiatives

The United States and China are parties to a mutual legal assistance agreement. Under the framework of the U.S.-China Joint Liaison Group on law enforcement cooperation, the Bilateral Drug Intelligence Working Group (BDIWG) and the Counternarcotics Working Group meet to exchange views and information on trends in drug abuse and trafficking; discuss pertinent laws, regulations, policies and procedures in the respective countries; seek progress and address challenges in precursor chemical control; and find mechanisms to cooperate on investigations and cases of mutual interest. DEA and the Narcotics Control Bureau of China are parties to a memorandum of understanding that established the BDIWG, which brings legal and law enforcement experts together to share information and discuss cooperation.

D. Conclusion

Trafficking of illegal narcotics, diversion of drug precursor chemicals, and other drug-related crime remain significant problems in China. The central government continues to take steps to integrate China into regional and global counternarcotic efforts, and some progress is being made in addressing China’s domestic drug consumption problem through enforcement and rehabilitation. China has added 116 chemical compounds to its control list as a measure to reduce NPS drugs for domestic use and international export. Although China’s cumbersome internal approval processes have often limited direct access by U.S. law enforcement officials to local counterparts at provincial Public Security Bureaus, bilateral law enforcement cooperation is showing positive signs of improvement through case consultations and information sharing.