Manila  - The Philippine government and Muslim separatist rebels should hammer out a new ceasefire to end military offensives that have displaced thousands of civilians in the country's troubled south, the International Crisis Group (ICG) said Tuesday.

The military's operations in the southern region of Mindanao aim to arrest three commanders of the Moro Islamic Liberation Front (MILF) who led a series of attacks in August 2008, killing dozens of civilians and soldiers.

In a report, "Running in Place in Mindanao," the Brussels-based ICG urged the end of military operations that "are producing nothing except more displaced and more Moro resentment of Manila."

"The priority should be a ceasefire that would allow displaced civilians to return home," the report said.

The ICG said a new ceasefire would also help strengthen the structure for future negotiations between the Philippine government and the MILF, the largest Muslim rebel group fighting for an independent Islamic state in Mindanao.

The two sides had forged a ceasefire in 2004, but the renewed hostilities practically ended the truce in a large part of Mindanao as troops hunted down those behind the August 2008 attacks.

The bulk of an international team monitoring the ceasefire also pulled out of Mindanao in November 2008 due to the continued fighting.

The rebels launched the attacks to protest a Supreme Court ruling that blocked a key agreement between the government and the MILF that would have expanded an existing autonomous Muslim region in Mindanao.

The government eventually scrapped the Agreement on Ancestral Domain, which the MILF insists was already a done deal and should be binding.

Amid continuing disagreements over substantive issues such as the memorandum, the ICG said a broader settlement of the conflict was unlikely to be reached during the remaining tenure of President Gloria Macapagal Arroyo, whose term ends in 2010.

"As it stands, the two sides are too far apart, the potential spoilers too numerous, and the political will in Manila too weak to hope for a negotiated peace anytime soon," said Sidney Jones, ICG's Asia Senior Adviser.

"But progress around the edges is possible," she added.

The report said "an important short-term objective is to secure a ceasefire" to end the military operations against the three wanted MILF commanders named Umbra Kato, Abdullah Macapaar and Aleem Sulaiman Pangalian.

It said a truce would allow both sides to discuss steps to make the three commanders accountable for the August 2008 attacks, which triggered fighting between the military and the MILF that killed more than 200 people.

At the height of the fighting, more than 500,000 civilians were also forced to flee their homes. While many have returned, an NGO worker told the ICG, "they keep their bags packed, ready to flee when the next mortar hits." (dpa)