YANGON (AFP) - Myanmar soldiers have seized an important outpost from a powerful rebel faction during a recent bout of intense fighting, state media and insurgents confirmed Sunday (Dec 18) - a fresh blow for the country's struggling peace process.

Fighting has blighted Myanmar's border regions for decades, pitting various ethnic minority groups seeking autonomy or independence against the country's notoriously abusive military.

Since winning landmark elections a year ago, de facto civilian leader Aung San Suu Kyi has made forging a lasting peace deal a cornerstone of her administration.

But her time in office has witnessed some of the fiercest fighting in years break out between some rebel groups and the country's military, a force that under a junta-era constitution she has almost no control over.

The latest fighting erupted between Myanmar's military and the Kachin Independence Army (KIA), one of the country's strongest rebel groups based in northern Kachin state.

Myanmar's military, backed by jets and artillery, captured Gidon Outpost in the early hours of Saturday morning, according to state-run Global New Light of Myanmar newspaper.

The report said both sides suffered losses, but did not disclose figures.

Daung Kha, a spokesman for the KIA, confirmed the outpost's capture but said rebel troops were trying to retake it.

"We are fighting them to get it back, today there is still fighting," he told AFP.

The skirmish is significant because it is taking place close to the KIA's well fortified headquarters in Laiza and delivers a new blow to the peace process.

In Shan, which lies to the south of Kachin, renewed fighting has broken out in recent weeks between an alliance of rebel factions, sending refugees streaming over the Chinese border and causing tensions with Beijing.

The KIA is one of the rebel groups involved in that fighting.

Analysts say the recent bout of unrest in Shan threatens the second round of peace talks Suu Kyi had scheduled for February.

Myanmar's army has also been carrying out a bloody crackdown in the north of Rakhine state that has sent more than 20,000 from the Muslim Rohingya minority fleeing to Bangladesh.

KIA spokesman Daung Kha warned that the fresh fighting would only draw rebel groups closer into alliances.

"If the government cannot control the army not to fight, we will be form an ethnic alliance armed group soon and will forcefully fight back," he said.