Whole towns and villages in the Kokang region of Shan State have been deserted as residents fear a major army assault after the government declared a 90-day state of emergency and imposed martial law in the area. At least 30,000 people, mainly the ethnic Chinese Kokang, have crossed the border into China's southwestern Yunnan province, according to local Chinese authorities.

The clashes, which have reportedly seen the use of government helicopters and jet fighters to target rebel positions in Laukai Township, have alarmed Beijing. The township is located some 500 miles northeast of Myanmar's biggest city, Yangon. China now fears that the influx of Kokang refugees could swell just as in 2009, the last time large-scale fighting broke out between the Myanmar army and Kokang rebels.

So while Chinese authorities are reportedly providing food, medicine and other supplies to those entering Yunnan, they have also strengthened security along the border to control the influx, and Beijing has called on both sides in the conflict to exercise restraint.

Bernt Berger, Head of the Asia Program at the Stockholm-based Institute for Security and Development Policy (ISDP), says that Beijing's main concern is the potential instability on its borders with Myanmar.

"This is particularly so because many of the ethnic groups involved are living on both sides of the border, and the region is a key problem in terms of human, weapons and drug trafficking, and armed conflict is at times spilling over the border," said Berger.

Civilian exodus

Reliable information on the number of displaced is hard to come by, but experts believe the number of those fleeing the fighting is already in the tens of thousands, with the Myanmar Red Cross Society (MRCS) reporting it assisted over 3,000 displaced over the past seven days alone. Thousands more have reportedly fled to Lashio and Muse, large towns in northern Shan State outside of the Kokang region, and many more are seeking shelter along the border.

According to the UN Office for the Coordination of Humanitarian Affairs (OCHA), reports indicate that most of those displaced are government or migrant workers from other parts of the country, many of whom are likely to continue to travel to their places of origin. "They are receiving assistance from local authorities, MRCS and civil society organizations. International organizations are ready to assist if there are additional needs," Chris Hyslop, OCHA Deputy Head in Myanmar, told DW.

The latest round of fighting erupted on February 9, shattering six years of relative calm in the region. While the immediate trigger for the clashes remains unclear, the proximate cause was a large assault on February 9 by the Myanmar National Democratic Alliance Army (MNDAA), as the Kokang militia is known, on army positions near Laukai, the region's administrative capital.

A symbolic date

The assault, which saw at least 50 soldiers killed and many more wounded, came just before Myanmar's Union Day, which the government had previously set as the target date to sign a nationwide ceasefire with ethnic armed forces. While there are no confirmed reports about civilian fatalities, Haw Shau Chen, a member of parliament from the area, was quoted by Reuters as saying that about 50 civilians have been killed since fighting began.

Moreover, two MCRS volunteers were wounded on February 17 when a convoy transporting displaced families came under fire in an unprecedented attack. The eight vehicle convoy, which was marked with the Red Cross emblem, was evacuating civilians displaced by fighting, according to an MCRS statement.

Autonomy in Kokang?

Ever since independence in 1948, Myanmar has been plagued by a number of insurgencies. This is why over the past few years the government has been trying to install a nationwide ceasefire with numerous ethnic minority rebel groups by drawing up peace agreements which involve the integration of armed groups into the border guard forces.

But the MNDAA, which controlled the self-administered Kokang region between 1989 and 2009, rejected the deal. As a result, the conflict escalated in 2009, with the army ultimately driving the rebels out of the area.

But as Berger explains, the Kokang fighters have now regrouped and returned to Myanmar with modern arms in their arsenal. As for their goals, the analyst says the rebels - most of whom are ethnic Han Chinese - seek first retribution, which means establishing a force against the Myanmar military and taking revenge on those whom they consider traitors. Second, they want to re-establish the status quo by retaking the lost territory and establishing an autonomous Kokang area.

Support for the rebels

But the MNDAA, which reportedly has between 1,000 and 3,000 soldiers, is only one several ethnic armed groups operating in the Shan State.

Ever since the February 9 incident, other groups including the Kachin Independence Army, the Ta'ang National Liberation Army, the Arakan Army and Shan State Army-North have reportedly joined the fight against the government, according to the state-backed Global New Light of Myanmar newspaper.

Analysts argue the army's actions in recent months against these other groups may have led them to join in the fight.

President Thein Sein has reacted by placing the Kokang region under military rule as allowed by the constitution. He has promised not to lose "an inch" of land to the MNDAA and seems intent on sticking to that pledge. The army, for its part, has insisted that its actions have been defensive.

But managing a conflict situation in Myanmar's north will not be easy. As analyst Berger points out, new kinds of weapons are coming into the country that the military cannot match and it is difficult to keep civilians outside the fighting zones, especially given the geography of the conflict and armed groups.

"If one looks at the patchwork on the map where ethnic armed groups are located, it becomes obvious that military action is impossible without leaving other groups unaffected. Any confrontation can create a larger conflict. Therefore, from a strategic standpoint, the military needs to patrol larger zones and attain better means to launch targeted action."

A faltering peace process

So what does this means for the government's efforts to forge a nationwide ceasefire? According to Gregory Poling, a Southeast Asia expert at the Washington-based Center for Strategic and International Studies, the timing of the latest assault along with the fact that the fighting has continued for days suggest that the Kokang militia is uninterested in what seems to be a faltering peace process, and instead hopes to regain the autonomy it lost during the government assault in 2009 by force.

"This is further evidence that, despite continued talks between the government and various ethnic groups, many ethnic armed groups in northern Myanmar have not bought into the peace process. And the blame does not lie entirely with them; the Myanmar military has been a spoiler in the peace process in the Kachin and Shan states," said Poling.

A similar view is shared by analyst Berger who stressed that given that the MNDAA is not part of the ceasefire agreement, their goal is to provoke the military into action and use this for information warfare.

"Much depends on how much other groups such as the Kachin Independence Army or the United Wa State Army are drawn into the conflict. If this is not the case, there is a good chance that existing negotiations can proceed as planned. The basic question is on how far Kokang leaders are able to stir discontent."

Analysts therefore believe that a long-term political solution to this conflict will require a form of federalism in Myanmar that grants them considerable local autonomy.