AFP, Yangon :
Chinese banks have frozen the accounts of more than 100 commodities traders in northeast Myanmar in a bid to clamp down on smuggling and illegal gambling, state media reported Tuesday.
Myanmar's government has been negotiating with Chinese officials since the accounts were suspended last week by three banks based in China's Yunnan province, according to the state-run Global New Light of Myanmar.
Many of the accounts belonged to Myanmar merchants who trade foodstuffs, such as rice and pulses, which are often exported to China through the border town of Muse in eastern Shan state.
"These accounts were frozen after their (China's) crackdown on 27 illegal rice trading gangs in recent days," Soe Tun, vice-chairman of the Myanmar Rice Federation, told AFP.
He estimated that up to 1,000 accounts had been frozen-a figure not immediately confirmed by the three Chinese banks affected: the Agricultural Bank of China, China Construction Bank and the Industrial and Commercial Bank of China.
"This freeze is the worst in decades," Soe Tun added. "Although some accounts were frozen in the past, it wasn't that many-about four to five to 10 at the most."
According to Myanmar state media, some of the accounts were also suspended over "possible links to illegal internet gambling."
The Chinese embassy in Yangon said the accounts had been closed to "combat illegal border trading" and it was working with both sides to resolve the issue.
Chinese authorities often confiscate rice and other foodstuffs at the border due to restrictions on imports and because of confusion over tax issues as the levy paid in Myanmar is lower than in China, according to local media.
The bank crackdown comes as Chinese President Xi Jinping drives forward a sweeping anti-graft campaign launched in 2012.
Border trade between the two countries was also disrupted in November when armed groups launched a major attack on Myanmar's military close to Muse, sparking the most intense fighting for decades in the conflict-racked region.

Banks have been asked to keep their branches open in the industrial zones of Dhaka and Chittagong on Jun 23 and 24, the last weekend before Eid holidays, to facilitate salary payment of garment workers.
"Banks in Dhaka and Chittagong will remain open on Jun 23 and 24," said a Bangladesh Bank statement on Tuesday.
The decision has been taken to clear wages, arrears and Eid bonus of garment workers, said the central bank.
According to the BB, AD (Authorised Dealer) branches of banks located in Dhaka metropolitan, Ashulia, Tongi, Gazipur, Savar, Bhaluka, Narayanganj and Chittagong will remain open on the two days.

Standard Chartered Bank arranged BDT 1.60 Billion Non-Convertible Redeemable Cumulative Preference Share For Raj Lanka Power Company Limited, a subsidiary of LTL Holdings Ltd of Sri Lanka.  The company owns and operates a 53 MW Heavy Fuel Oil (HFO) fired IPP power plant in Natore.
This is the first Preference Share transaction arranged by Standard Chartered Bank, Bangladesh. The facility is aimed to re-finance the company's existing Preference Shares to reduce overall cost.
There was a diverse mix of investments in the transaction from Banks, Non Banking Financial Institutions and Corporate, which testifies to Standard Chartered Bank's strong relationship with investors from all segments and Issuer's strong business fundamentals and reputation.
The closing ceremony took place at the Westin Hotel recently, which was attended by U D Jayawardanat, CEO of LTL Holdings Limited,  M J M N Marikkar, Managing Director of Raj Lanka Power Company Ltd, and  Abrar A. Anwar, Chief Executive Officer of Standard Chartered Bank, Bangladesh, Enamul Haque, Head of Commercial Banking, Alamgir Morshed, Head of Financial Markets and Md Maroof ur Rahman Mazumder, Head of Capital Markets, Standard Chartered Bank, Bangladesh. The ceremony also was attended by the Investors, Lawyers, Rating Agency and Senior Officials from Standard Chartered Bank and Raj Lanka Power Company Ltd.