4777

It is expected that the non-producing

374

States will

obtain what they require from the trans-Salwen districts.

It is not intended to apply the regulation to these districte, Kokang and East Monglem, because of the difficulty of enforcing

them.

Apart from what is consumed locally and smuggled into Chine, it is calculated that in ordinary years Kokang can supply 4,000 to 5,000 vise (14,000 - 18,008 lb) annually.

It is apparent that once the regulations are enforced no more frontier cases concerning opium can arise except in Kokang and Monglem, and to this extent that source 010

of embarrassment at the frontier meetings is removed,

My confidential 0890s, however, remain to be settled. opinion about Kokang is that while it is certainly more remote than other parts of Forth Hsenwi there is no other reason why control should be more difficult.

To argue that

the population there, Chinese by race, is more dependent on the opium crop and might create a disturbance if deprived of this source of income would hardly appeal to impartial judges if opium suppression is admitted as right.

No figures are yet available a

production of opium in the Shan States or

amount exported to China.

to the total

the proportions te

(signed) 0.4L COALIS,

Consul.

22

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