China is believed to have given its tacit blessing to an armed resistance movement on its border with Myanmar – potential payback for the ruling junta’s failure to crack down on violent scam gangs targeting Chinese citizens.

Members of the ethnic rebel group Ta'ang National Liberation Army (TNLA) at their base camp in the forest in Myanmar's northern Shan State. 

A surprise offensive that began on October 27 in northern Shan state near China has triggered a wave of rebellion across the Southeast Asian nation, emboldening insurgent groups from the Indian to the Thai borders, and presenting the biggest threat to the military since it seized power in 2021.

Last week, Antonio Guterres, the United Nations Secretary-General, expressed deep concern over the escalating conflict – dubbed “Operation 1027” – which has so far displaced more than 200,000 people. Myanmar’s president has warned the fighting is so fierce it threatens to split the country.

China, which has significant influence in the area where the operation began, has called for a ceasefire.

However, it has long been pressing the junta to tackle crime gangs operating global online scams on Myanmar’s territory that have disproportionately targeted Chinese citizens, as well as trafficking many into slavery.

Some analysts and diplomats say it is unlikely the 1027 offensive could have been carried out without China’s nod.

Box-office hit foreshadowed the crackdown

A Chinese crime thriller that broke summer box office records with its plotline of a computer programmer and a model lured into a violent scammers compound may have been an early sign of what could be payback for the junta’s failure to curb illicit activities that have infuriated Beijing.

‘No More Bets’ depicts the horror of young, tech-savvy professionals trapped in a prison-like fraud factory in Southeast Asia, cruelly tortured and forced to rip off unsuspecting victims around the world in online scams.

The film carried a strong state-sponsored public health warning, grounded in a dark reality that has reported links to Myanmar’s military.

The Telegraph reported earlier this year on a regional “scamdemic” operating out of industrial-sized compounds in Southeast Asia, and increasingly in lawless backwaters and border areas of Myanmar thrown into deep turmoil by the coup.

Thousands of crypto investors across the world, including the UK, have been conned out of billions of dollars by the increasingly elaborate online scammers, many of whom are victims themselves.

In August, a shocking investigation by the UN Human Rights Office revealed that hundreds of thousands of people are being forced into online criminality in south-east Asia by a network of brutal gangs.

The scammers are often young professionals who are lured by the gangs with the promise of fake jobs before being imprisoned in compounds and coerced into cheating people all over the world through romance-investment scams, crypto fraud and illegal gambling.

If they refuse to comply, they face serious threats to their safety, including torture, cruel and degrading treatment, arbitrary detention and sexual violence, said the report.

The rampant criminality has now become entangled with the brutal internal battle for Myanmar’s future.

While the country’s hardcore military has waged battles with insurgent groups for decades, experts believe a group of armed ethnic forces known as the Three Brotherhood Alliance has tapped into Beijing’s anger with the junta, to win unspoken approval for its cause.

Since the launch of Operation 1027, an alliance made up of the Myanmar National Democratic Alliance Army (MNDAA), Arakan Army (AA), Ta’ang National Liberation Army (TNLA) and other resistance groups has overrun more than 100 military outposts.

As a result of the fighting, the junta stands to lose control of key border crossings that account for some 40 per cent of cross-border trade and a vital tax revenue source.

Alongside eradicating oppressive military rule, the alliance’s stated aim to combat the online gambling fraud that has plagued Myanmar has resonated well in Beijing.

“Without the ability to paint Operation 1027 as an effort to serve Chinese interest in curbing the criminal compounds, the anti-junta forces would have risked strong Chinese disapproval and possible prevention of such an attack on its border,” the United States Institute of Peace said in a November report.

“Tacit Chinese support was therefore essential to the operation’s success,” it concluded.

Richard Horsey, senior Myanmar adviser for the Crisis Group, said China’s relations with the Myanmar military had been characterised by decades of “mutual distrust” that had deepened during the coup.

“Beijing was really not happy with the coup. It damaged Chinese interests. It made China’s strategic objectives in Myanmar more difficult to achieve,” he said. The scam centres “added another layer” to frayed relations, he continued.

The Chinese media has suggested that an incident on October 20, when dozens of Chinese nationals, including undercover agents, were killed by armed guards as they tried to flee a scam compound, may have tested Beijing’s patience to the limit.

“China is in no mood right now to throw a lifeline to the Myanmar regime,” said Mr Horsey.

The Chinese police have launched their own crackdown on the fraudsters and this month launched what they said were “swift attacks” on crime gangs in Myanmar.

On Tuesday, the Chinese authorities said Myanmar had handed over 31,000 telecom fraud suspects since September, including 63 “financiers” and ringleaders of crime syndicates that have cheated Chinese citizens of large sums of money.

Myanmar’s overwhelmed and crumbling military

Assistant Foreign Minister Nong Rong also visited Myanmar this month, saying China was ready to work with Myanmar on tackling cross-border crime including online gambling, and offering to support the country in maintaining stability.

But the success of Operation 1027 has already emboldened ethnic armed groups and newly formed “people’s defence forces” [PDFs] across the country to rise up again in what could be a turning point for Myanmar’s national struggle against a brutal junta that has intensified its campaign of terror since 2021.

Myanmar’s cash-strapped, over-stretched and demoralised military has now found itself fighting major battles on multiple fronts.

Junta spokesperson Zaw Min Tun said last week the military was facing “heavy assaults from a significant number of armed rebel soldiers” in Shan State in the northeast, Kayah State in the east and Rakhine State in the west.

He said some military positions had been evacuated and the insurgents had been using drones to drop hundreds of bombs on military posts.

In Kayah State, south of Shan along the border with Thailand, ethnic Karenni insurgents are attacking the main town of Loikaw.

The Karen National Union, another large ethnic force in south-eastern Myanmar, is also stepping up operations against military positions along the vital trade route to the Thai border.

The junta has also lost control of much of the border between Chin State and India, prompting thousands of civilians and dozens of soldiers to attempt to take refuge there after insurgents assaulted their military bases.

Arindam Bagchi, spokesperson for India’s foreign ministry said last Thursday that New Delhi was “deeply concerned.”

PDFs are reportedly very active around Myanmar’s second-largest city of Mandalay, although the metropolis itself is currently peaceful.

Meanwhile, the parallel “national unity government” (NUG), formed by pro-democracy politicians to oppose the military, and allied with some insurgent factions, has launched a “Road to Naypyitaw” campaign which it says is aimed at taking control of the capital.

“It’s a very significant moment historically. We haven’t seen this degree of coordination between the resistance since the birth of Myanmar, or Burma, in 1948,” said Avinash Paliwal, a senior lecturer at the SOAS South Asia Institute.

But while the “pace and scale of the junta’s collapse” had been “astonishing,” he warned that the resistance forces would also find the battle more challenging as they ventured further south and would need a “much stronger political vision” if they wanted to unite to form a federal union.

Mr Horsey also cautioned that it would be a mistake to underestimate the determination of the regime to cling to power.

“The road from the military being overstretched and losing bases to regime collapse and the military being routed – that’s a very long road,” he said.

He predicted the military would more likely double down on indiscriminate attacks from the air, the burning of villages and atrocities, “so a new violent equilibrium is reached rather than collapse.”