The U.S. State Department says Burma is the only country in the world that -- quote -- "failed demonstrably" to work with other countries to combat illicit drugs in 2004.
The department said in its annual International Narcotics Control Strategy report that Burma's military government has been unable to curb the production and trafficking of synthetic drugs. Burma is also the world's second largest producer of opium.
The report says China is an important producer and exporter of synthetic drugs and a transit route for drug smugglers. But it says the Chinese government considers drug trafficking a threat to national security.
The report praises Thailand for honoring bilateral treaties, enforcing drug-related laws and cooperating closely with officials from other countries.
For the first time in 2004, Thailand was removed from President Bush's list of major narcotics producing or trafficking countries.
The State Department said Laos continues to make progress in its counter narcotics efforts.