LAWA YANG, Myanmar (AP) -- Kneeling beside a line of freshly dug trenches carved like one long, open wound into a lush hillside, the rebel sergeant peered through dusty binoculars at all his troops had lost.
Scattered across the sprawling valley below, a dozen thatched-roof homes stood quiet, abandoned by fleeing villagers as government forces drew near. Towering above: four forested mountain ridges seized by Myanmar's army after some of the bloodiest clashes here in decades -- so fierce the ethnic Kachin guerrillas who survived said the artillery fire came down like rain.
If the Kachin Independence Army, the last armed insurgent group still at war in Myanmar, loses just one more mountain ridge, there will be little to stop government forces from taking their stronghold on the Chinese border. They are ill-equipped -- some rebels wear helmets made only of hardened plastic and admit running low on ammunition -- but they remain defiant.
"We're very vulnerable because the army now holds the high ground," rebel Sgt. Brang Shawng said as he scanned the new front line at Lawa Yang, where his unit retreated last month.
But he added: "We will never give up. For us, this is a fight for self-determination, and I'll keep fighting for it until I die."
Government soldiers, bolstered for the first time by screeching fighter jets and helicopter gunships that pounded the hills for weeks, advanced late last month to within just a few kilometers (miles) of the rebel headquarters town of Laiza, the closest they have ever come.
The region has been relatively calm since, but even so, the dramatic upsurge in fighting underscores how far Myanmar is from achieving one of the things it needs most -- a political settlement to end not just the war with the Kachin, but decades-long conflicts with more than a dozen other rebel armies that have plagued the country for decades and still threaten its future.
Much is at stake for this Southeast Asian nation, which has stunned the world by opening politically and economically over the last two years following five decades of military rule. President Thein Sein's government rose to power in 2011 following elections that rights groups said were neither free nor fair, but it has since ushered in reforms, freed political prisoners and allowed opposition leader Aung San Suu Kyi and her supporters to be elected to parliament.
Still, Myanmar has yet to resolve a multitude of conflicts with its ethnic minorities, which make up about 40 percent of the population. Their persistent push for political autonomy has turned vast patchworks of territory along the borders with China and Thailand into rebel fiefdoms rich in jade, timber, gold and opium.
In Kachin state alone, the control of which is split between rebels and the government, resource-hungry China has invested billions of dollars in hydroelectric dams. A Chinese-backed pipeline project is due to begin pumping oil and gas from the Bay of Bengal in May, and more development projects are planned, including highways and railways that would link Indian Ocean seaports with the rest of Southeast Asia. Most of them cross rebel zones.
Thein Sein's administration has signed truce deals with 18 armed groups -- everyone except the Kachin, according to Min Zaw Oo, who heads cease-fire negotiations at the Myanmar Peace Center, a government-appointed body that is coordinating peace talks.
Most of those truces had already been negotiated with the former junta, but the nation's former military rulers "never accepted the need for a political settlement," Min Zaw Oo said.
Thein Sein's administration, by contrast, realizes a cease-fire alone is not sufficient, he said. "This government sees dialogue as key. It is ready to talk. That's a major policy distinction."
Min Zaw Oo said he believes Myanmar has the best chance in 60 years of ending the country's ethnic conflicts. But he acknowledged that "practically, there are a lot of obstacles in the way."
Distrust runs deep, and even the truces remain fragile. The army and rebels in eastern Shan state, for example, have clashed at least 44 times since agreeing a cease-fire last year, Min Zaw Oo said.
In Kachin state, there has been speculation the government was trying to strengthen its hand at negotiations by escalating the war to new heights with airstrikes. But rebel Col. Zaw Taung, director of strategic analysis for the Kachin Independence Army, said the skirmishes only pushed the two sides further apart.
"They say they want peace, but they just threw everything they have against us," he said. "With one hand they're trying to burn us, with the other, they're trying douse us with water. They cannot be trusted."
The army, like the rebels, insists it fought only in self-defense.
On Wednesday, government envoys resumed talks in the Thai city of Chiang Mai with the United Nationalities Federal Council, an alliance of 11 ethnic militias, including the Kachin, that banded together last year. Few expected any breakthroughs, and no cease-fire was reached with the Kachin, which have met the government more than a dozen times since war in the north reignited in 2011.
The talks are "only about the framework of future discussions," said Hkun Okker, a senior alliance member. "We're demanding a political dialogue, and the government agrees, but real dialogue hasn't started."
Last week, Thein Sein acknowledged that his country's history of ethnic conflict has been a major barrier to progress, and that achieving stability is crucial as it pursues a democratic future.
His words, though, were delivered on an occasion infused with bitter irony: Union Day, which commemorates the 1947 deal between Suu Kyi's father, independence hero Gen. Aung San, and ethnic leaders to break away from Britain's colonial arms together.
The so-called Panglong agreement also granted ethnic minorities autonomy, but it fell apart after the assassination of Aung San.
The Kachin, who are predominantly Christian in a majority Buddhist country, first took up arms in 1961. A 1994 truce with the army lasted 17 years, but during that time, rebel demands for rights and a federalist system were never addressed.
Instead, the junta in 2008 forced through a new constitution. The nation's minorities say it places enormous power in the hands of the central government and the military, which rights groups say has orchestrated a campaign of discrimination, forced labor and abuse against the Kachin and other groups for decades. The constitution can be amended only with approval of the armed forces, which even now control 25 percent of parliament.
Tensions rose further in 2009, when the junta tried to persuade ethnic armies to join a new border guard force. Most, including the Kachin, refused.
Two months after Thein Sein took office in 2011, the Kachin truce finally broke down when the army bolstered its presence near a hydropower plant in Dapein that is a joint venture with a Chinese company, and rebels refused to abandon a strategic base nearby.
Since then, more than 100,000 Kachin civilians have been displaced, and the rebels have progressively lost territory, pressed closer and closer against the Chinese border.
Only one major mountain ridge now separates Laiza from Myanmar's army, and a grim mood has settled over the town.
At the main cemetery, workers are erecting concrete tombstones for rebels who died in the latest fighting. At least 23 are buried here under mounds of red dirt, though rebel officials declined to say how many were killed altogether.
Every night, a single-file candlelight peace vigil organized by a Catholic priest snakes through Laiza's darkened and nearly deserted streets. Shops are closed. Displaced people crowd camps perched on a rocky river that marks the border with China.
The rebels, clearly outgunned, say they will not even try to retake lost ground. There is talk of the rebels abandoning Laiza if need be, of shifting their headquarters to a secret location if the army makes a push for the town. Most of their offices on a hillside overlooking town already appear empty, and the rebels' most senior leadership is no longer here.
"For a guerrilla army, what matters most is not holding ground, but maintaining the support of the people," Zaw Taung said, speaking at a Laiza hotel the rebels use as an office that is decorated with wall-to-wall maps.
Judging by comments from many Kachin, across many levels of society, they overwhelmingly support the rebels, whom they see as protectors and their legitimate government, perhaps now more than ever.
Asked why the rebels were the only armed group that has yet to sign a truce with the government, Zaw Taung was dismissive.
"We tried that for 17 years. What did it get us?" he asked. "The only thing that will end the war is a political solution. Without that, a truce means nothing. The fighting will go on."