Fighting is continuing in the Philippines as government forces clash with Muslim rebels holding more than 100 hostages in the southern port city of Zamboanga.

Residents were sent fleeing on Thursday as government troops attempted to flush out rebel fighters from areas of the city, with the fighting leaving houses on fire.

An unidentified group of gunmen launched a separate attack on a town on the island of Basilan, local media reported.

The Philippine government has warned Muslim rebels, to end peacefully a standoff "at the soonest possible time".

Let it be clear ... that the state will hesitate to use its forces.

Edwin Lacierda, a presidential spokesman,

Edwin Lacierda, a presidential spokesman, said on Thursday that any attempts by other groups to sow trouble would be crushed, citing the army's defeat of an armed group's attempt to set a nearby village and wharf on fire.

"While the government is exhausting all avenues for a peaceful resolution to the situation, let it be clear to those defying us that they should not entertain the illusion that the state will hesitate to use its forces," Lacierda said.

"It is time for you to cooperate to resolve this situation peacefully at the soonest possible time."

The MNLF signed a 1996 peace accord with the government, but many of its fighters held on to their weapons and accused officials of reneging on a promise to develop an autonomous region for minority Muslims in the south of the predominantly Catholic Philippines.

The group has said it was being left out in government's negotiations with another fighter group, the Moro Islamic Liberation Front (MILF), which broke away from the MNLF in the early 1980s.

Source: Al Jazeera and agencies