Soldiers have clashed with al-Qaeda-linked fighters in the Philippines' volatile south, leaving eight government troops and four rebels dead, military officials say.

Army Major General Ricardo Rainier Cruz said the army struck after pinpointing an encampment of Abu Sayyaf fighters early on Thursday in Basilan Island's Sumisip township. 

Sporadic fighting continued until afternoon, with reinforcement troops deployed.

Officials said the Abu Sayyaf fighters belonged to a group which had attacked rubber plantation workers in Sumisip two weeks ago. Five farm workers and one government militiaman were killed in that attack.

On Wednesday, the same group attacked a military detachment securing the rubber planters' co-operative but no soldier was killed or hurt, army spokesman Major Harold Cabunoc said.

The plantation workers' co-operative operating in the area had previously received extortion letters purportedly from the Abu Sayyaf demanding payment of more than $1,000 a month in exchange for not being harmed.

For decades, Muslim separatist groups have fought for independence or an autonomous substate in the southern regions they say are their ancestral homelands.

Philippine offensives have weakened the fighters but they remain a threat. They are holding several foreign hostages, apparently in an attempt to raise funds for food and weapons in their jungle hideouts.

Abu Sayyaf has been linked to the worst attacks in Philippine history, including a ferry bombing that killed more than 100 people in 2004.

Source: Agencies