A soldier in the Karen National Liberation Army raises the Karen flag on the outskirts of Myawaddy on April 15, before burning a Myanmar flag that once flew over this trading hub on the Thai border.Athit Perawongmetha/Reuters
Just over a rickety bamboo bridge spanning the Moei River, which serves as the border between Thailand and Myanmar, a flag hangs limply in the stifling, premonsoon humidity.
This isn’t the standard of any country, but rather the red sunburst on blue of the Karen National Union, one of the largest of the ethnic militias that have been battling Myanmar’s military junta since a coup in February, 2021, alongside forces loyal to the parallel National Unity Government (NUG).
In April, the KNU overran a junta base near Myawaddy, a crucial trading hub, and advanced on the town, capturing government troops and sending others fleeing into Thailand. Since then, the militia and its allies have been battling a counteroffensive in the mountains west of the town, as the military raced to retake Myawaddy before the start of the monsoon season.
The Karen National Union flags in Myawaddy serve as a reminder of the struggle for power at this border crossing with Mae Sot, Thailand.James Griffiths/The Globe and Mail
As of early June, with torrential rain now a daily occurrence, hampering the junta’s air force and turning many roads into rivers of mud, that advance appears to have stalled, leaving the KNU in effective control of much of the Thai border region.
“Their ground forces are very demoralized. They depend on air support,” KNU spokesman Saw Taw Nee said of the junta assault. “Because of the rains, they can’t move anywhere and just have to wait for our attacks.”
But while the military has been unable to retake Myawaddy, the KNU is not in charge of the town either, having ceded control to another armed group, one with a long history of shifting loyalties, alleged human-rights abuses and criminality: the Border Guard Force.
The BGF has its roots in a KNU split in the 1990s, during a previous period of military rule in Myanmar. A group of Buddhist officers broke off from the predominantly Christian KNU, signed a ceasefire with the junta and began battling their former allies for territory in the traditional homelands of the Karen people, an ethnic group who live in both Thailand and Myanmar.
In the 2010s, as Myanmar began a transition to partial democracy, the BGF was formed under the leadership of Colonel Chit Thu. It worked with the military to keep the peace and secure trade in and around the Myawaddy region.
After the 2021 coup, the BGF stuck with the new junta, known as the State Administration Council (SAC), doubling down on a partnership that has been hugely lucrative for the group.
Scam call centres and illegal casinos, many with links to Chinese organized crime, have proliferated in areas under BGF control. According to the United Nations Office on Drugs and Crime, such operations have generated billions of dollars, “with profits rivalling the GDP of some countries in the region.”
From the China View café on the Thai side of the river, Shwe Kokko in Myanmar might look prosperous. But the UN says it is a miserable place for the people forced to work in its call centres and illegal casinos.James Griffiths/The Globe and Mail
This money is evident in Shwe Kokko, once a tiny village on the Myanmar-Thai border that is now a sprawl of high-rise buildings, many with Chinese signage. While Myawaddy has faced persistent power blackouts since the start of the coup, this hasn’t been a problem for Shwe Kokko, its skyline even becoming something of a tourist attraction for people in neighbouring Thailand, who pose for photos at the “China View” café across the river.
Behind the glitz, however, Shwe Kokko is a hub of misery, the UN says, harbouring thousands of ”trafficked persons and migrants in vulnerable situations who face a range of human rights risks, violations and abuses.”
These people live in cramped dorms, are forced to work in the call centres during the day and the casinos at night, facing torture and even death if they resist, with little chance of escape.
Call centres have sprung up in other border regions as well, as the conflict has reduced state control over much of Myanmar. But they’ve also played a role in how the fighting has developed: China’s growing fury at the SAC’s inability to shut down the call centres – which have targeted Chinese citizens as victims of both human trafficking and scams – was seen as a pivotal factor in the decision by several ethnic armies with links to Beijing to launch a surprise assault against the junta in October.
In the months since, resistance groups have been on the advance across the country. According to the Special Advisory Council for Myanmar, an independent group of experts led by several former UN special rapporteurs, the Naypyidaw-based SAC now controls less than 15 per cent of Myanmar and should no longer be considered the “de facto government.”
With SAC forces along the Thai border limited to a handful of isolated hill bases, and the counteroffensive to retake Myawaddy having stalled, the junta is almost entirely dependent on the BGF to maintain even nominal control of this key crossing.
KNLA troops inspect the house of a high-ranking Myanmar soldier in April, when the junta base near Myawaddy was first overrun. Since then, the KNLA and allies have been resisting a counteroffensive from the mountains.Athit Perawongmetha/Reuters
This has put the Karen group in an awkward position. Its leadership has vacillated between sticking with the SAC and cultivating stronger ties with resistance forces.
In January, the BGF declared its neutrality in the conflict and said it would no longer accept financial support from the junta. Weeks later, it rebranded as the Karen National Army in an apparent attempt to distance itself from the government.
During the fighting in April, however, the BGF helped evacuate junta soldiers to Shwe Kokko and then seized control of Myawaddy, preventing KNU and allied forces from occupying it.
Reports in Myanmar media, supported by interviews with multiple people familiar with the situation, suggest the junta threatened to conduct air strikes against Shwe Kokko and other BGF strongholds if the group fully broke with the regime.
“The SAC pressured the BGF,” said Mr. Taw Nee, the KNU spokesman. “They said that if they worked with us they would be punished.”
This has created a situation in which “even though we captured Myawaddy, we have not been able to control the town,” he added. “This is a problem.”
Saw Taw Nee is head of foreign affairs for the Karen National Union.James Griffiths/The Globe and Mail
Both the KNU and the BGF have expressed an unwillingness to see “Karen fighting Karen,” as BGF leader Chit Thu told Radio Free Asia in January, despite the long history of violence between the two sides. When The Globe and Mail attempted to ask KNU soldiers near Myawaddy about the BGF, the mood of the conversation shifted notably, and they refused to answer.
In recent weeks, the KNU has been tied up repelling the junta’s counterattack and keeping the remaining government forces in the region holed up, leaving the militia too busy to launch what would inevitably be a bloody assault on Myawaddy. But there is another reason the KNU may hesitate to seize the town – one that speaks to a wider problem for resistance groups as they consolidate control over Myanmar’s borders: trade.
Cross-border trade between Thailand and Myanmar is worth more than $3.7-billion a year, according to the Federation of Thai Industries, with a vast amount of Myanmar’s consumer goods entering the country via Myawaddy. In early June, even with the KNU still fighting junta forces less than 20 kilometres outside the city, The Globe witnessed a steady stream of trucks crossing into Myawaddy over the Thai-Myanmar Friendship Bridge.
A well-connected trader in Myawaddy who crosses the border regularly said the bridge was shut briefly during the worst of the fighting in April but soon reopened as the number of containers built up on the Thai side. This was possible because junta officials are still running key government functions such as customs and immigration, even with the BGF in de facto control of the town.
The Globe is not identifying the trader so they could speak freely without risk of retaliation.
At the main trade crossing between Mae Sot and Myawaddy, questions linger about how a resistance occupation on the Myanmar side would affect imports, exports and official travel documents.James Griffiths/The Globe and Mail
Saw Kapi, a veteran Myanmar political analyst, said there were some “50,000 people who depend on government immigration officers in Myawaddy to maintain their paperwork,” such as passports and import-export documents.
“If the resistance completely occupied the city and could not facilitate trade, they would face a backlash,” he added. “No international country is ready to recognize NUG documents, so you’re going to make all these people illegal by occupying Myawaddy.”
Mr. Taw Nee acknowledged this problem is “very difficult to solve” but was confident that, as it becomes clear resistance groups are in firm control of the border, neighbouring countries will find a way to work with them.
“In the past they may have relied only on government-to-government, but that does not work any more,” he said. “We can solve this issue together. Dealing with immigration, customs, this is new for us, but we can set up structures. It’s not too much of a problem.”
The KNLA and allies around Myawaddy are in a difficult diplomatic spot as resistance groups decide what to do next in this region.Athit Perawongmetha/Reuters
One means by which the KNU and other resistance groups can curry international favour is by shutting down the scam call centres, a priority for both Thailand and China.
“We have a policy that all illicit businesses must stop, and when we crush them, this will include all Karen groups involved as well,” Mr. Taw Nee said, dismissing claims by the BGF that the group had given foreign gangs six months to leave.
“This time frame is unbelievable. They have thousands of troops – if they wanted people to leave, they could make them do so tomorrow.”
The Myawaddy trader, who has supplied generators and other equipment to Shwe Kokko, was equally disparaging of the BGF’s claims, saying the group was too dependent on income from the call centres to give them up. A recent report by Justice For Myanmar, an advocacy group, estimated Chit Thu’s militia could be raking in billions of dollars a year. The report called for other countries to join Britain in sanctioning him for his role in trafficking and human-rights abuses.
If the junta forces cannot break through and the BGF remains cut off, the group may find it hard to maintain its current position of authority in Myawaddy, however lucrative. And the SAC does seem to be making preparations for a future in which it does not control any land crossings: The trader was recently told to start sending goods to one of the few places in the country still securely in SAC control, the port of Yangon.
With reporting by Aung Myo Myat in Mae Sot, Thailand
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