Scam centres drive Burma’s soaring inflation

Tachileik

Burma’s economy is buckling under the weight of criminal capital, with scam compounds fuelling inflation and deepening hardship in border towns such as Tachileik, according to Antonio Graceffo.

Since the 2021 coup, the country has lost around 20% of its economic output, annual inflation has surged past 30%, and more than a third of the population now faces food insecurity. Scam centres, often disguised behind casinos, hotels and restaurants, have become a defining feature of this collapse. Inside, trafficked workers are forced to run cyber fraud schemes, from cryptocurrency scams to online romance cons, targeting victims abroad.

The impact on local communities is stark. Prices for food and rent have soared, while wages remain far below those in neighbouring Thailand. A simple bowl of noodles in Tachileik costs 80 baht (£1.70), compared with 50 baht across the border, despite average daily wages being less than half.

Graceffo explains that scam centres distort the economy through three channels: labour markets, commodity manipulation and currency collapse. In Shan State, call centres offered wages high enough to lure young people off farms, driving up consumer prices.

Militias linked to the compounds have cornered fuel supplies, triggering sudden price spikes. Meanwhile, the kyat has lost 75% of its value since the coup, making imports cripplingly expensive.

Residents describe the changes vividly. “Before the call centres arrived, the prices of goods and rent were similar to those in Thailand,” said Nang Oo, a noodle vendor from Tachileik. “But when the scammers set up their base around 2018, prices nearly doubled.”

The scale of the scam economy is immense. A US Institute of Peace report estimates 305,000 scammers across Myanmar, Cambodia and Laos generate $39 billion annually. In Burma, the military itself benefits directly, collecting nearly half of the $192 million earned each year by the Shwe Kokko scam centre.

As pressure mounts, operators are relocating compounds deeper into Shan and Karen states, spreading inflationary effects into previously insulated communities. For Graceffo, the lesson is clear: scam centres are not just a criminal scourge but a central driver of Burma’s economic collapse.