A TRADITIONAL Chinese medicine, which was first recorded in 168 BC, is proving to be the most effective cure for malaria ever, reducing the disease's mortality rate by up to five times in some parts of Southeast Asia. When artemether, a derivative of the herb artemisinin, was used as part of a study on drug-resistant malaria in Thailand, it was shown to reduce the death rate threefold, compared with the traditional treatment, quinine. The two-year trial, covering 97 patients with severe and complicated drug-resistant malaria, showed that only six out of 47 patients with severe malaria died after receiving intramuscular injections of the drug. With quinine treatment, 18 of 50 patients died. In Vietnam, where deaths from malaria have reached record levels, the use of home-grown artemisinin - as part of an aggressive government campaign - reduced deaths by 44 per cent in 1992 and a further 64 per cent last year. ''This is very encouraging news,'' said Dr Hiroshi Nakajima, director-general of the World Health Organisation. ''In many countries malaria is worsening. It kills some 1.5 million to three million people a year. The scientific demonstration of the success of this drug, a derivative of a centuries-old Chinese medicine, in an area where malaria is so resistant to other drugs, is a dramatic step forward.'' Artemisinin was first identified as a potent anti-malarial drug and analysed in China in 1972 during a survey of traditional Chinese medicines. Called qinghaosu in Chinese, it was first recorded in an apothecary's list dated 168 BC, entitled ''Prescriptions for 52 kinds of disease''. ''The texts certainly helped the Chinese with their original isolation of the substance. All credit must go to the Chinese, they did some beautiful work,'' said Dr Richard Haynes, part of a research team from the Hong Kong University of Science and Technology which has been working on ways to synthesise the drug. Synthesis is necessary because the plant extract may not be enough for predicted world demand. ''This is an absolutely sure-fire recipe for curing malaria. I've seen the results and I can tell you they're very, very good,'' he said. ''I know this first hand because I've been out to Vietnam as part of an Australian Government working party.'' The World Health Organisation estimates there are up to 500 million clinical cases of malaria a year. With the possible exception of leprosy, no other major disease is so consistently associated with poverty and underdevelopment. The worst affected areas are Africa, India, Brazil, Sri Lanka and Indochina.