Government troops in Myanmar battled one of the country's powerful northern militias Tuesday, trying to force rebel fighters from a strategic region where China is building major hydropower plants.

The fighting has killed 20 people and forced 2,000 more to flee _ most of them into China _ since it started Thursday, according to the U.S. Campaign for Burma.

The violence is some of the most serious in Myanmar since its military junta handed power in March to a civilian government critics say is simply a proxy for continued military rule. The new government has said it wants to improve ties with ethnic minorities that have waged rebellions along the border, but the latest fighting underscores the deep tension that remains.

The rebels involved in the most recent clashes belong to the Kachin, one of Myanmar's sizable ethnic minorities. Their decades of struggles for more autonomy have routinely been met by military suppression.

Kachin military commander Gwan Maw told U.S.-funded Radio Free Asia on Monday that the fighting in northern Myanmar's Momauk region, near the Chinese border, could spread and possibly escalate into civil war if the government refused to negotiate an end to it with the Kachin Independence Organization.

Though the fighting could worsen, it is unlikely to engulf the repressive nation.

The 8,000-strong Kachin militia reached a peace deal with the country's former ruling junta in 1994, but the truce broke down last year after the militia rejected a call by the government to become border guards under army leadership. The junta made the appeal ahead of last November's elections, Myanmar's first in 20 years, which introduced the nominally civilian government now in power.

The Campaign for Burma, a Washington-based lobbying group that uses Myanmar's former name in its title, said on Tuesday that hundreds of Myanmar government troops deployed to the northern region and forced Kachin rebels to abandon a strategic outpost. The post is near a major hydropower project that being built by China's state-owned China Datang Corporation, the group said.

On Tuesday, rebels blew up a bridge connecting to power plants to prevent more government troops from entering the area, the lobbying group said.

The fighting has left at least 16 government troops and four rebels dead, including one who was allegedly captured and beaten to death by government troops, the Campaign for Burma said.

Maw said the violence took place about 20 miles (30 kilometers) from the China border, and schools in the region have closed. The Campaign for Burma said at least 2,000 people have fled their homes.

The area is virtually inaccessible to outside observers, and the government has yet to comment on the fighting.

Myanmar's central government has tenuous control of many parts of the country where minority groups _ many of which maintain their own militias _ are strongest. It has reached cease-fire agreements with 17 ethnic minority rebel militias since 1989 and most have been allowed to keep their weapons and maintain some autonomy over their areas.

Despite sanctions against its government, Myanmar received a record $20 billion of foreign investment pledges in the last financial year, an extraordinary amount that tops total foreign direct investment over the past two decades combined.

Neighboring China, with $8.27 billion, accounted for 41 percent of the commitments in the financial year that ended in March, much of it poured into hydropower projects.

The U.S. and European Union have imposed economic sanctions on Myanmar for its poor human rights record and failure to make democratic reforms. Sanctions, including banning U.S. companies from investing in Myanmar and banning Myanmar exports to the United States, started in 1997.

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Associated Press writer Grant Peck contributed to this report.