Corrupt regime officials and allied armed groups are earning at least 100 million baht per month taxing business in and through Three Pagodas Pass , on the Thai-Burma border, says a new report released by the Human Rights Foundation of Monland.

Much of the trade through Three Pagodas is illegal because the border has been closed since 2005. Hundreds of trucks cross the border every day, however, laden with goods including timber, minerals, agricultural products and goods from Thailand .

According to the report, titled “Protecting their rice pots: an economic profile of trade and corruption in Three Pagodas Pass,” 30 to 40 tons of illegally exported rice crosses the border daily, while over 1,000 tons of illegally logged hardwoods make the trip monthly. The timber trade typically takes the form of raw timber, semi-processed wood products or furniture.

Notably, the report also indicates that Htoo Trading Company recently received permission from the Karen National Union to transport 2,000 tons of teak in the opposite direction, deeper inside Burma . HURFOM was unable to determine the destination of the teak beyond a village along the Moulmein highway in Mon State , but noted that Htoo Trading Company is one of the few businesses in Burma to possess a legal timber export license. The company, whose owner has close connections to Burma ’s top generals, has been repeatedly accused of trading illegally logged timber with China .

The report also provides details on the “taxes” levied by local officials and allied cease-fire groups seeking to profit from the border trade. “Large amounts of money are being made in Three Pagodas Pass every day,” says HURFOM, before concluding that the monthly revenue surpasses 100 million in total.

“On the outside, it looks like there is a very small amount of trade – and money – being made in Three Pagodas because the border is officialy closed,” Nai Aue Mon, HURFOM’s research coordinator, told IMNA on Tuesday. “But when you look inside the area, you will see that large amounts of money are made off of residents and businessmen. But, on the other hand, local people are getting poorer and poorer every day. Only the authorities and cease-fire groups benefit.”

The HURFOM report is also careful to highlight the human rights impacts of the border trade and corruption. In an ironic twist, taxation of the border trade, once a funding boon to insurgent groups, now appears to be helping pay a Burmese army that is instructed to be “self reliant.” “Battalions that rotate through Three Pagodas undoubtedly view it as a lucrative posting,” says HURFOM, “before they return to the violence of the countryside.”

The same is true for the SPDC allied armed groups the Karen Peace Front (KPF) and the Democratic Karen Buddhist Army (DKBA), which HURFOM says undoubtedly rely upon revenue generated by taxing the border trade. “The DKBA in particular has been documented committing human rights atrocities,” says HURFOM, including “summarily executing villagers, burning crops and devastating whole villages.”

The HURFOM report also argues that regime authorities’ political interest in maintaining relations with the DKBA and KPF, plus personal desires for profit, encourages them to turn a blind eye to the destructive business activities of groups like the KPF and DKBA.

According to the report, DKBA members are the primary actors involved in drug trafficking through the pass, which HURFOM estimates to be well over 50,000 amphetamine pills a week. The KPF, in turn, controls gambling in the town, a high-profit position considering that HURFOM estimates 50% of the population to regularly bet on slot machines. KPF members also operate 3 of the town’s 4 largest massage parlors.

“Though activities like gambling and the sex trade will perhaps always exist in frontier border towns, the extent to which they dominate life in Three Pagodas stretches beyond the ordinary,” concludes HURFOM. “Stagnant economic conditions and official permissiveness means that unregulated gambling, rampant drug use and the exploitative sex trade have combined to create conditions that are altering the fabric of the community…details common to daily life in Burma, like hanging washing to dry outside a home, have changed. The clothes are now often stolen.”