The United Nations Security Council in recent weeks has placed new focus on Myanmar through discussions about violence in the country's western Rakhine state, allegations of "ethnic cleansing" and the exodus of hundreds of thousands of refugees into neighboring Bangladesh.

Missing though was the bigger picture in Myanmar, beyond Rakhine, which will not only shape future options for refugee return, but also regional stability, and any possibility of a better life for all the country's peoples.

Aside from Rakhine, there are at least another half million internally displaced persons, around 20 ethnic-based armed groups (the largest with more than 20,000 soldiers), hundreds of militias in the rest of the country and no real peace in sight. In addition, the economy is far from healthy, with the stability of the banking sector in question, investor confidence in decline, and prospects for millions of the poorest people in Asia in the balance. Meanwhile, Beijing is offering major infrastructure projects that would tie the country more closely with China's interior provinces and essentially make Myanmar China's bridge to the Indian Ocean.

The current constitution gives the armed forces crucial powers over security while allowing the elected civilian government free reign over economic issues and foreign relations. It has been a tense cohabitation and the success of the next elections in 2020 and further democratic reforms are far from guaranteed.

For Myanmar's people, this is a time of anxiety. Millions are worried that the fast pace of change will leave them and their families destitute and without opportunity. These same millions are now on the internet. Over the past five years the proportion of people with mobile phones has gone from a few percent to more than 70%. A population that still largely lacks access to electricity, clean water or health care is now on Facebook, widely regarded as Myanmar's only social media platform.

New dark currents

In this time of national anxiety, a neo-nationalism is taking shape, enabled by social media and fueled both by the unfolding crisis in Rakhine state and a sense that the outside world, in particular the U.N. and the West, are siding with Myanmar's mortal enemies.

While world opinion is focused on the humanitarian tragedy along the border with Bangladesh and allegations of horrific human rights abuses mainly against the minority Rohingya, the view inside the country is not only different but diametrically opposite.

In Myanmar the overwhelming focus among not only by the government but also the general public has been on the threat from the Arakan Rohingya Salvation Army and fears of Islamic extremism. Since ARSA's attacks on Aug. 25, Myanmar social media has been brimming with reports of alleged ARSA atrocities against Buddhist and Hindu minorities, tens of thousands of whom have fled south away from the country's Muslim majority areas.

Rohingya flee to Teknaf, Bangladesh, on Sept. 8 after violence erupted in Myanmar's Rakhine State.   © Sipa/AP Images

In late September, both al-Qaeda and the Islamic State group called for action in Myanmar, heightening fears of impending terrorist attacks in Yangon or Mandalay. Eyewitness accounts from refugees are often dismissed as fabrications, and what is seen from outside as a Rohingya human rights tragedy is portrayed within Myanmar -- especially by Rakhine Buddhists -- as a foreign invasion by illegal immigrants turned terrorists.

A resurgent nationalism is taking shape but remains inchoate, uncertain of its attitudes toward the country's many and varied minorities, relations with the West and China, as well as the very idea of Myanmar democracy.

Forsaken Rakhine

The northern part of Rakhine is one of the least hospitable places on the planet -- an earthquake zone, prone to devastating cyclones, and with up to nearly a meter of torrential rain a month during the monsoon season. It was here in February 1944 that Indians, Gurkhas, Englishmen and West Africans fought the Japanese in the Battle of the Admin Box. It has also long been a civilizational divide. Burmese chronicles relate ancient encounters in the region between humans and bilus, or ogres. For ancient Indians, the lands beyond the Meghna river in Bangladesh were a Pandava barjita desh, a land of utter barbarism, a place no self-respecting Hindu would go.

It was here too in 1824, after a different insurgency and refugee crisis, that the British East India Company invaded the kingdom of Burma. In Myanmar, the region is still known as the anouk-taga, the "western gate."

The early history of Rakhine, also known as Arakan, is little understood, but by the 1400s it was a spirited little kingdom that stretched from present-day Chittagong to the Andaman Sea. The kings spoke Rakhine, a variant of Burmese, and were Buddhists who built temples of singular beauty. But they were cosmopolitans too, some taking both Bengali-Muslim and Burmese Pali titles, welcoming Dutch traders and integrating Afghan archers and renegade Japanese samurai into their bodyguard. Bengali slaves, captured together with Portuguese pirates, were brought to populate today's borderlands.

The Burmese coming from the Irrawaddy valley destroyed this kingdom in 1785. Then came the British, who in the interests of ever more revenue encouraged the immigration of hundreds of thousands of what one colonial officer termed the "frugal and hard-working Bengali Muslims from Chittagong." Burmese settlers arrived from the other direction and by 1910 the Rakhine were a minority in their own land.

Burmese nationalism was born around the same time as what we might call today an anti-globalization and anti-immigration movement. In the late 19th and early 20th centuries, as Bengali Muslims were migrating overland into Rakhine, millions of others from the Indian subcontinent were arriving by sea. The colonial economy grew by leaps and bounds, but with the Burmese near the bottom of the new social pyramid.

Rakhine nationalism was akin to Burmese nationalism. There were ties to Theravada Buddhism and a dread of being overwhelmed both by modernity and by outsiders. When the Japanese invaded in 1942 and civil administration broke down, thousands were butchered in Buddhist-Muslim ethnic violence, with the Japanese arming the Buddhist Rakhine and the British arming the Muslims (as part of their "V Force" reconnaissance and guerrilla operation).

After the war, leaders of local Muslim communities (who speak a dialect of Bengali) toyed with the idea of northern Rakhine joining Pakistan and demanded their own "homeland" within Burma. The "mujahideen" and other local insurgencies waxed and waned over the following decades. In 1978 and 1990, hundreds of thousands of Muslim refugees fled to Bangladesh in the wake of army crackdowns. By the 1990s Rakhine had become one of the poorest and most isolated parts of a very poor and isolated country.

A question of ethnic identity

Burmese nationalists, like the British ethnographers before them, take an essentialist view of ethnicity (like nearly all foreign commentators today, unfortunately) and divide the country into "indigenous" and "alien" races. A central tenet of Burmese nationalism is that the country belongs to people officially recognized as indigenous (taing-yin-tha), with everyone else a "guest." The Shan and the Kachin, for example, are seen as indigenous. So too are the Kokang, descendants of Chinese freebooters who fled the Manchu invasions of the 17th century; and the Muslim Kamans, whose Afghan ancestors arrived around the same time in the train of the Mughal Prince Shah Shuja, an erstwhile governor of Bengal. They are regarded as indigenous because "their people" came prior to British rule. Those who arrived after -- Tamil Christians, Nepali Hindus, Yunnanese Muslims, and many others -- are welcome to stay, say the nationalists, but their cultures will never be accepted in the same way.

It is not really an issue of citizenship. Under the current 1982 citizenship law, immigrants and their children may only be "naturalized" or recognized as "associate" citizens, with restricted political rights. But by the third generation, people of any ethnic background, for example the grandchildren of early 20th century Bengali Muslim migrants, are allowed the privileges of full citizenship.

It is more an issue of perceived history and discrimination. Today, virtually all Burmese believe that Bangladesh (and East Pakistan before) has been the source of mammoth illegal immigration. They blame the corruption of border officials and the greed of businessmen in search of cheap labor. They say many in northern Rakhine are recent illegal migrants. They accept that many may also be descendants of British-era Bengali immigrants and so qualified for citizenship, but oppose allowing them to identify themselves as "Rohingya."

The very word "Rohingya" is anathema in Myanmar because it is seen as a claim to be officially recognized as an indigenous people, a taing-yin-tha. The presence of distinguished Muslims, like the 17th century poet Shah Aloal or eunuch and war minister Ashraf Khan, at the court of the old Rakhine kingdom of Mrauk U in cannot be disputed. It is also clear that Rakhine had a significant population of Bengali Muslims, captured as slaves, long before the British arrived on the scene. What is not clear is who is actually descended from whom. The British had a mix of terms for varied Muslim peoples in this area: Arakanese Mohamedans, Chittagonians, Zerabadis, Kamans, Bengali Muslims.

In the 1950s, local Muslim politicians crafted the ethnonym "Rohingya" as a new overarching and indigenous identity for all but the Kaman Muslims, and by the end of the last decade, Rohingya had become the preferred way for Muslims in northern Rakhine, at least, to identify themselves. It is this very claim to be taing-yin-tha that is rejected ferociously by Burmese.

Final opportunity

Five years ago, around the time U.S. President Barack Obama spoke at Yangon University about the importance of seeing Myanmar's diversity as a strength, there was a hope that the country's incipient transition would be infused with liberal views and that efforts toward peace, free markets and democracy would all go hand in hand. What was conveniently overlooked was the resurgent strength of ethnic based Burmese nationalism, its century-old suspicions of capitalism and the outside world, the mental scars from decades of war, isolation and Western sanctions, and the very nature of state institutions that had not evolved to serve the people.

There was a vacuum of ideas waiting to be filled. In 2012, communal violence erupted in Rakhine, leaving hundreds of both Buddhists and Muslims dead and over 100,000 displaced. Images of Buddhist-Muslim violence merged online with images of Islamic terrorism around the world. Tens of thousands of Muslims in Rakhine were left in camps or encouraged to flee in boats. Then came ARSA and the present tragedy.

The U.N. Security Council will continue to meet on Myanmar over the coming weeks. The council is right to focus on ending the violence in Rakhine and mobilizing assistance for urgent humanitarian needs. It is also important to recognize that Myanmar is at a tipping point. Myanmar can still be a liberal democracy and a peaceful and prosperous crossroads at the heart of Asia. But there is an alternative scenario too, one where neo-nationalism takes a clear illiberal and xenophobic turn; inter-communal tensions, not only in Rakhine, rise and spill over into violence; the peace process descends into disarray amid an escalation of fighting along the other, Chinese border; the economy fails to offer anything resembling a better life; and the attractions of democratic change are increasingly in doubt.

Now more than ever, the country's friends need to understand local history, engage local sentiment, help the Burmese move away from an essentialist view of ethnicity, and appreciate the complexities of Myanmar's big picture.

Thant Myint-U is a historian and an author, most recently of "Where China Meets India: Burma and the New Crossroads of Asia (2012)."