China Is Finally Starting to Do Something About the U.S. Fentanyl Crisis
Chinese authorities quietly shut down chemical sellers and say they will regulate other opioid precursors
By Brian Spegele July 4, 2024 The Wall Street Journal
BEIJING—China is taking tentative new steps to help disrupt the global supply chain fueling the opioid crisis after intensifying criticism from the U.S. that its chemical factories are partly responsible for the deadly scourge.
After a long freeze in joint counternarcotics work between the countries, President Biden and Chinese leader Xi Jinping pledged to resume cooperation at a summit in California last November. Since then, Chinese authorities have quietly shut down some sellers of precursor chemicals used by Mexican cartels to make fentanyl and say they are close to imposing new regulations sought by the U.S. on three additional chemicals.
Meanwhile, Chinese police, acting on U.S. intelligence, recently arrested a suspect the U.S. says was involved in money laundering for Mexico’s Sinaloa cartel.
“We are seeing some meaningful steps,” a senior Biden administration official said. “There is a lot more to do. But we are encouraged particularly by the actions of the last couple of weeks.”
Those measures alone won’t solve the fentanyl crisis, and U.S. officials are continuing to press China to do much more. But the steps by Beijing, together with a string of high-level meetings, are beginning to show that diplomacy between the rival superpowers can still make an impact, despite strained ties.
The U.S. government estimates more than 107,000 people nationally died of drug overdoses last year, including around 75,000 from synthetic opioids such as fentanyl. While estimated deaths fell slightly in 2023 from the previous year, the total overdose fatality count is still roughly double what the U.S. was experiencing as recently as 2015. The drug crisis remains an election issue, including in Midwestern swing states ravaged by the effects of fentanyl.
U.S.-China cooperation on fentanyl could still fall apart. Relations have grown increasingly strained lately over a number of other thorny issues, including U.S. tariffs and American support for Taiwan. On fentanyl, China at times has viewed Washington as acting in bad faith by portraying Beijing as a cause of the drug crisis.
China is especially upset at the U.S. for placing it on a blacklist of major drug-producing countries for the first time, alongside the likes of Mexico and Colombia. The designation, announced last September, followed a change in how the U.S. defines drug-producing countries to include those manufacturing precursor chemicals used to make illicit drugs.
“We think it’s absurd and ridiculous,” Wei Xiaojun, the head of the Ministry of Public Security’s narcotics-control bureau, said at a press conference in June.
The Biden administration official said Beijing was misinterpreting the U.S.’s action and stressed that China wasn’t included among a smaller subset of the list of the worst-offending countries.
The U.S., meanwhile, says China is the one undermining ties. The U.S. ambassador to China recently criticized Beijing in a Wall Street Journal interview, saying it intimidated ordinary Chinese people who took part in U.S.-organized events in China and stirred up anti-American sentiment.
Despite those tensions, the situation on counternarcotics cooperation has improved significantly since before the Biden-Xi summit, when U.S. officials fighting the opioid crisis struggled to get their Chinese counterparts to take their phone calls.
In recent months, a steady stream of senior U.S. officials have traveled to Beijing. During a June visit by Dr. Rahul Gupta, the White House’s director of National Drug Control Policy, the two sides agreed to establish a direct line of communication on emerging threats from new synthetic substances.
Private companies in China are some of the main producers of the chemical building blocks used to make fentanyl, U.S. officials say. The precursor chemicals are sold openly over the internet, including to the cartels, leading U.S. authorities to complain that Chinese authorities aren’t doing enough to police these marketplaces.
Wei said at the press conference that a recent campaign against producers of fentanyl precursors led to the closure of 14 digital sales platforms and the removal of more than 1,000 online stores. The number of online advertisements for fentanyl precursors has dropped significantly as a result, Wei said. Some U.S. officials have expressed cautious optimism about these efforts by China beginning to disrupt established supply chains between the country and drug rings in North America.
The recent campaign sought to deal with precursor sellers quietly, and largely stopped short of making public arrests that would have sent a stronger signal to China’s chemicals industry. One risk of China’s softer approach is that targeted entities can simply pop up with new names in the future unless the people behind them are put in jail.
Pressed about this possibility by a reporter, Wei denied that large numbers of Chinese precursor producers were selling their products over the internet today.
“If you have specific information about these so-called large numbers of chemical entities or individuals, please let me know,” he said. “I assure you that I will absolutely deploy Chinese law enforcement authorities to carry out appropriate investigations.”
The U.S. has long contended that China has been too slow to regulate precursor chemicals. In March 2022, at the urging of the U.S., the United Nations Commission on Narcotic Drugs voted to more strictly control three precursors known as 4-AP, 1-boc-4-AP and norfentanyl. This required member states including China to implement corresponding national regulations.
For the next two years, as relations between the U.S. and China soured, China didn’t act, even as senior U.S. officials raised the issue in their bilateral meetings. Wei now says that China’s regulatory procedures for controlling the three precursors of concern to the U.S. will be completed within a few months. If China follows through, it would be a breakthrough for the U.S. that would give Chinese police a stronger legal basis to go after companies that produce precursors.
Until now, the lack of regulation has served as a barrier to closer law-enforcement cooperation. In some instances when the U.S. has shared intelligence about suspected precursor producers, Chinese officials have responded that these people couldn’t be arrested since they weren’t breaking Chinese law, said one person familiar with the recent discussions.
At the same time, China’s slow pace of regulating new precursors is likely to remain a point of contention as new chemicals constantly pop up in the market.
Chinese officials, for their part, say that endless regulation isn’t the answer to a problem they see stemming from U.S. failures to prevent and treat drug addiction. Beijing is hesitant to place too many burdensome rules on its vast chemicals industry, especially when its economy is struggling to find its footing.
The U.S. has found some of the most visible recent successes with China in combating money laundering, an issue where the countries’ interests align. China wants to stop wealthy citizens from evading its capital controls to move large sums of money out of the country while the U.S. is seeking to break up the rings that launder drug proceeds on behalf of the cartels.
These two areas intersect in China’s underground banking system, U.S. officials say, with illegal foreign-exchange operations serving both sets of clients.
Acting on intelligence from the U.S., Chinese authorities recently arrested a 27-year-old man named Tong Peiji. The U.S. said Tong was part of a money-laundering ring that was working for the Sinaloa cartel in Southern California. Tong couldn’t be reached for comment.
“Arrests are important,” the Biden administration official said. “They send a chilling effect through the entire country.”
Write to Brian Spegele at Brian.Spegele@wsj.com