Stefan Austermühle, CEO of Gemrock Peru                           Last updated 02/2025

Myanmar, formerly known as Burma, is a famous source of many high-quality gemstones, including jade, ruby, sapphire, spinel, and topaz. Those stones are financing war, genocide, corruption, and drug abuse. Stop buying genocide gemstones.

Connect with the author on LinkedIn:

Gemstone mining in Myanmar (Burma)

Burmese gemstones are known for their unique and distinctive colors, high clarity, and excellent transparency. Burmese rubies, for example, are known for their rich red color and excellent transparency, often referred to as “Pigeon Blood” red. Burmese sapphires are renowned for their deep, velvety blue color, usually called “Burmese Blue”. Burmese spinel is known for its rich red and pink hues and high transparency.

The Mogok region of Upper Myanmar is considered the primary source of many of these precious gemstones. It has been known for centuries as the “Valley of Rubies” due to the high-quality rubies that are mined there. The area is also known for producing other precious gemstones like spinel, sapphire, chrysolite or peridot, tourmaline, and even rare gemstones.

The area around the city Hpakant is the second important mining area in Myanmar, mainly for jade. Hpakant is a town in Hpakant Township, Kachin State in the northernmost part of Myanmar (Burma). It is located on the Uyu River 350 km north of Mandalay.

The short history of an ongoing civil war.

Myanmar’s civil war has been ongoing since 1948 when the country gained independence from the United Kingdom. The conflict is rooted in ethnic diversity and identity struggles.

1948: Myanmar (then Burma) gains independence from the United Kingdom

1962: Generals stage a coup and seize power.

1989: the ruling military junta changed the country’s name to Myanmar, saying “Burma” was a hangover from colonial times that favored the majority Burmar ethnic group.

1994: A peace treaty is signed with the government of Myanmar, but the Kachin Independence Army (KIA) continues to recruit.

2015: the Burmese government invited 15 insurgent groups to negotiate a “Nationwide Ceasefire Agreement”. The draft was agreed upon by a majority of the invited parties on 31 March 2015, and the agreement was signed by Burmese president Thein Sein and the leaders of eight insurgent groups on 15 October 2015.

2021: A military coup overthrows the democratically-elected government

Since seizing power and imprisoning the country’s elected leaders, Myanmar’s military and its police have killed more than 1,200 civilians. They have fired indiscriminately into residential neighbourhoods, arrested thousands of people on spurious charges and systematically tortured prisoners in detention.

How the mining finances an ongoing civil war.

The coup was the latest in a decades-long series of power grabs by the Myanmar military, which has consolidated control over the country’s gemstone mines. It has granted mining rights to its own conglomerates, Myanmar Economic Corporation (MEC) and Myanmar Economic Holdings Limited (MEHL), which used the revenue from mines to fund military units that have committed atrocities.

Meanwhile, military leaders have used the country’s gemstone wealth to buy off armed opposition, granting lucrative licenses to ethnic armed groups. And now, the military’s illegal takeover of state functions has placed regulatory control over the industry back in its own hands.

MEHL and MEC, which have been placed under sanctions by the US, the EU, and the UK, are controlled by Senior General Min Aung Hlaing, the architect of the illegal power grab who faces allegations of crimes against humanity including genocide against the people of Myanmar.

Despite all gemstone mining being officially illegal in Myanmar following the expiration of the last mining license in 2020, gemstone mining has boomed since the February coup.
Tens of thousands of informal miners have filled the void left by the end of official mining, and are being exploited by the military as well as non-state armed groups.

Based on a conservative estimate, Myanmar’s ruby industry at full production before licenses expired was worth an average of $346 million to $415 million a year.

The Kachin Independence Army (KIA), an ethnic armed organization, also controls some of the mine sites in Hpakant. An employee of a jade mining company, speaking on condition of anonymity for security reasons, says companies have to pay the KIA 10% of the total profit of mining sites under its control. As a result of deals like these, resource extraction is also a source of the conflict between the Myanmar army and ethnic armed groups.

In an interview, Dau Hka, a senior official with the political wing of the rebel Kachin Independence Army, described a sophisticated revenue collection system in which mining companies that want to operate in areas under the rebels’ control “donate” money to them, providing half their operating budget.

The K.I.A. also makes money by working with Chinese companies to smuggle jade through the jungle into China, according to activists and a Chinese jade importer. “They’ll call us beforehand, and we’ll come in a convoy to pick up the goods,” said the trader, who would give only his surname, Chun. The rebels, he added, demand cash on delivery.

Chinas role:

China is an ally of, and supplies weapons to, the military but it also has ties with some of the powerful ethnic armed groups located near its shared border.

China’s response to the coup has shifted over time. Its initial response to the coup in 2021 was muted, but Beijing grew increasingly frustrated 

with the military’s inability to control the country, and especially its failure to clamp down on the criminal scam centers that proliferated in border areas and targeted Chinese citizens.

In 2023 it gave implicit approval for the Brotherhood Alliance, formed of armed ethnic organizations in the north, to launch an offensive against the military, in what many analysts believe was an attempt to punish the junta. However, when these groups launched a second offensive in 2024 and succeeded in taking even more territory, China put pressure on them to stop by cutting off border supplies, apparently concerned that the military could lose control of central cities. Since then, it has been more supportive of the military.

Jade has fired the Chinese imagination for thousands of years. According to legend, the birth of Confucius was prophesied by a unicorn who gave his mother a jade tablet heralding his destiny. To this day, many Chinese believe the stone wards off misfortune and heals the body.

Myanmar’s jade industry took off in the 1980s after the introduction of market reforms in China. For the first time since Mao Zedong began banning private enterprise in 1949, entrepreneurs betting that the gemstone would become big business in China started jumping into the trade. Their financing helped build an industry that churns out the Buddha figurines and thick bracelets that have become status symbols for China’s middle class.

Driven by an insatiable demand from the growing Chinese middle class, Myanmar’s jade industry is booming and should be showering the nation, one of the world’s poorest, with unprecedented prosperity. Instead, much of the wealth it generates remains in the control of elite members of the military, the rebel leaders fighting them for greater autonomy, and the Chinese financiers with whom both sides collude to smuggle billions of dollars’ worth of the gem into China.

Myanmar produces about 70% of the world’s jade stone, with Global Witness valuing the market at $31bn a year. But as much as four-fifths of the country’s jade is smuggled abroad, the vast majority to China, meaning hundreds of millions are lost by the country in tax revenue every year.

China imported an estimated $31 billion worth of jade from Myanmar in 2014, according to a report by Global Witness. Myanmar’s gross domestic product in 2014 was US$65.45 billion, according to the World Bank.

Myitkyina city is the closest Westerners can get to the mining area, Hpakant. The government says it keeps the area closed because of sporadic fighting with the Kachin rebel army, but activists see a darker purpose: to hide the illegal jade and drug trades flourishing there. The only foreigners allowed past the military checkpoints, they say, are the Chinese who run the mines or go there to buy gems.

The lack of access adds to the mysteries of the jade industry, whose inner workings are deliberately obscured. Even the simplest information is not publicly available — including which companies operate the mines and how many are Chinese-run or financed despite laws banning foreign ownership. But interviews with jade miners and executives in Myitkyina, and with gem traders, diplomats, and nongovernmental organizations elsewhere, reveal a dizzyingly corrupt and brutal industry funded almost completely by Chinese trade.

“China prioritizes naked greed over any concern for the local population or how the jade is extracted,” said David Mathieson, a senior researcher on Myanmar for Human Rights Watch. Chinese buyers are pushing prices down, taking advantage of the political situation in Myanmar. We don’t have many options, so we have to sell at the prices they offer.”

Indias role:

Traditionally, the gem dealers of India are the most important in the Orient. Perhaps the widespread impression that rubies and sapphires originate in India stems from the fact that the bulk of gemstones found in Ceylon, Siam, and Burma are purchased by Indian dealers who keep in close touch with the gem-producing mines. There they have informants from whom the dealers purchase information about new discoveries of gems. Because so many engage in gem trading, competition is very keen.

Besides the Indian markets, they also supply the Western markets via Paris, where many gem-buying offices are located. Purchasers from all over the world generally find it much more convenient to do their buying in Paris, where the Indian dealers keep their outlets well supplied.

As people across Myanmar risk their lives to oppose the military junta, and as Western countries impose economic sanctions aimed at cutting the regime off from key revenue sources, the country’s natural resource wealth is proving to be an economic lifeline for the generals.

Major US online retailers are continuing to sell jewelry with rubies and jade sourced from Myanmar. The continued trade profits the Myanmar military junta, helping to finance its nationwide terror campaign against the Myanmar people. The US has sanctioned Myanma Gems Enterprise but has not banned the import of gems, allowing the trade to continue.

The organization “Justice For Myanmar” found listings for jewelry with Myanmar gemstones produced by Indian publicly listed company Vaibhav Global Limited and sold through retailers Amazon, Walmart, and Overstock. Vaibhav Global has actively traded in Myanmar gemstones since the coup.

Vaibhav Global is a major seller of discounted jewelry, listed on the National Stock Exchange of India and the BSE. According to filings, institutional shareholders include The Vanguard Group, Dimensional Fund Advisors, State Street Global Advisors,

BlackRock, and the Florida State Board of Administration, all based in the US. The USA is Vaibhav Global’s biggest market, with 2021 financial year revenue at US$234.9 million, according to its latest annual report.

Shipping records since the attempted coup, found in the Panjiva trade database, show imports into India of jade from Vaibhav Global’s Hong Kong subsidiary and rubies from its Thai subsidiary. Some of the shipments originate in Myanmar, while others list precious stones with Myanmar as the country of origin.

Overstock lists jade and ruby jewellery manufactured by Vaibhav Global, including rings and loose rubies. Like Amazon, listings specify India as the country of origin, even when the product description describes the stone as “Burmese jade” or “Burmese ruby”.

Overstock states they “require that our suppliers maintain high moral and ethical standards in producing and transporting products offered for sale on our websites”.

Thailands role:

Most of Myanmar’s Burmese rubies and sapphires are smuggled into Thailand to be cut and sold on the international market.

Thailand was the second-highest exporter of rubies to the U.S. by weight (310 kilograms) in 2014, and the highest exporter by value ($59 million), according to data from the U.S. Geological Service. Thailand did not produce any ruby from its own mines in 2014, according to the USGS annual industry report. USGS data for Myanmar shows it produced 486,945 kilograms of ruby in 2014.

houses Sotheby’s and Christie’s, and mass market retailers Walmart and Intercolor.
They are then bought by customers who have no way of knowing whether they are funding atrocities.

“Professionals in the trade know that nowadays, Thailand doesn’t produce rubies,” said Montreal-based gemologist Odile Civitello.

Companies worldwide are hiding behind the complexity of gemstone supply chains, which obscures the origins of stones sold on the global market. By the time rubies reach Thailand, the global gemstone processing hub, in a murky process that involves payments to armed actors, most dealers have no idea which mine they came from.

Rubies sourced from Myanmar are being sold by multinational jewelry companies Graff, Van Cleef & Arpels and Pragnell, high-end auction houses Sotheby’s and Christie’s, and mass market retailers Walmart and Intercolor.
They are then bought by customers who have no way of knowing whether they are funding atrocities.

Deadly landslides in the mines:

The mines are narrow and deep to maximize space, making them prone to landslides – particularly in the monsoon season, which is said to claim lives every day.

• More than 100 miners were killed after a 60-metre-high mountain of earth and waste collapsed in 2015.
• A 2020 landslide claimed 162 lives.
• At least three people were killed in a December 2021 landslide.

• On February 28, 2022, a landslide from mines in Myanmar’s town of Hpakant buried dozens of scavengers and miners in search of jade stones. Some official media sources confirmed two deaths, while aid workers and residents claimed a minimum of 23 deaths that day and an additional 80 missing individuals.

According to a local charity organization in Hpakant, more than 500 people have been killed in landslides since 2015.

 Heroin’s High Toll:

For decades, heroin was rare in Kachin State. The surge in the jade trade changed all that, creating a market for drugs among the thousands of Kachin laborers who flocked to the mines seeking an escape from poverty.

Heroin is sold in bamboo huts “like vegetables in a market” for between $4 and $8 a hit. Miners squat in the open, next to piles of used needles, with syringes hanging from their arms. If the drug fails to take the workers’ meager earnings, the prostitutes waiting nearby are happy to oblige for $6 per 20-minute session.

When digging all day with an iron rod Heroin, gives enough energy to work 24 hours straight. Miners say at least four out of five workers are habitual drug users. Users who overdose are buried near the mines, amid groves of bamboo.

Over time, heroin abuse spilled into the broader population. Kachin activists estimate that a sizable majority of Kachin youths are addicts; the World Health Organization has said about 30 percent of injecting drug users in Myitkyina have contracted H.I.V.

Large-scale environmental destruction

As a teenager in the late 1990s, Roi Awng remembers seeing tigers and other wild animals on mountains covered by deep green forests around her village in the Hpakant region.

But the tigers and wild animals have fled.

Two decades later, the landscape has undergone a vivid transformation. The forest is now a barren landscape, scarred by deep mining pits. The 32-year-old Kachin woman says many bright yellow trucks traverse the terrain and wheel loaders scoop out earth in a daily search for jade. Mining waste is improperly disposed of or towers in mounds hundreds of feet high.

Sources of water and fisheries in Hpakant, the jade-rich area where her village is located, are polluted. Outside town, mountains are torn apart. Open pits are fenced with galvanized iron sheets.

Stay in touch wherever you want and can!

Just click the icons!

FREE CONTENT RESOURCES

Products for Jewelry Makers – Newsletter

FREE CONTENT RESOURCES & PERSONAL CONNECTION

SOCIAL NETWORKS

Follow us from EX-Twitter to Threads