N.Korean shabu flood Philippines

High-grade methamphetamines from North Korea have started to flood the Philippines, reducing street prices of the drug by about 50 percent, the head of the country's drug enforcement agency said on Friday.

Dionisio Santiago, a retired general, told Reuters there was strong suspicion a huge shipment of methamphetamines seized at the former U.S. navy base of Subic north of Manila this week came from clandestine drugs laboratories in North Korea.

"We've been informed by our counterparts abroad that North Korea has become a steady source of methamphetamines in the Asia and Pacific region," Santiago, a former army chief, told Reuters in an interview.

The Philippines has long been a source of methamphetamines, enforcement officials say. Clandestine production centres make the drug for local consumption but it is also smuggled to Australia, Canada, Japan, South Korea and the United States.

The country itself had about 3.4 million regular and occasional drug users in 2007 , down from 6.7 million in 2004, according to government figures.

On Wednesday, more than 700 kg of high-grade crystal white methamphetamine worth nearly $100 million was seized in what is believed to be the country's biggest-ever drugs haul.

"Based on our initial investigation, the Vietnam-registered boat which unloaded the methamphetamines shipment had made port calls in North Korea," Santiago said.

He warned that the Philippines could become a transhipment point for illegal drugs from other countries.

"Our ports are becoming transhipment points for ecstasy, cocaine and shabu and what had happened in Subic this week should be a wake up call for our port authorities to work closely with us," he said.

The quality of narcotics available on the street was also improving and prices were falling, Santiago noted.

"In the last few months, we've noticed methamphetamine prices going down to as much as 3 million pesos ($68,000) per kilo from a high of 6-8 million pesos," he said.

"Those that were manufactured here were of yellowish and brown crystal form, but, lately we've been seeing higher-grade methamphetamines in crystal-clear white form."

TRANSHIPMENT POINT

In its 2007 annual report, the Philippine Drug Enforcement Agency (PDEA) said methamphetamines, locally known as "shabu", were the primary drug of choice in the country.

Drug use in the country cuts across all social and economic classes, enforcement officials said. A small number of wealthy people use ecstasy and cocaine but methamphetamine and marijuana are the most popular drugs, while homeless people use solvents.

Santiago said transnational drug syndicates operating in the Philippines could have resorted to importing high-grade finished products from abroad after the break up of clandestine production bases in the country.

Nine clandestine laboratories and 13 warehouses around the capital Manila last year were dismantled last year.

There were eight known international drug rings with links to criminal gangs in China and Taiwan, Santiago said. (Reporting by Manny Mogato; editing by Raju Gopalakrishnan and Valerie Lee - Reuters)