The persecution of the Rohingyas is taking place within the context of Myanmar’s ongoing neoliberal reforms, and it has to be understood, and addressed, within this context.
Rakhine state, where the violence and repression is centered, is one of Myanmar’s longest coastal region. As such, it is an economically vital territory for the regime. Rakhine is key for trade, tourism, and the oil and gas industries, and has been the focus of Foreign Direct Investment (FDI) ever since the government began liberalizing the economy. There is also a history of unrest in Rakhine, and separatist aspirations, with the local population desiring a greater share from the wealth extracted from the region. Thus, the government has a keen interest to maintain very tight control. The Rohingyas have been a persecuted minority for decades, so they are the ideal instrument for managing and diverting local discontent. It is extremely useful to have an officially loathed segment of the population that you can always use as a decoy.
There has been a systematic program to dehumanize the Rohingyas, but I do not believe the government wants to exterminate them; they are committing psychological and social genocide; exterminating their humanness. They want a population that is eligible for extinction, without ever actually wiping them out. They are too useful as pariahs.
With the recent project of creating an armed civilian police force in Rakhine, officially sanctioned Buddhist paramilitary squads; you can expect the violence to intensify. If and when it does, the government can justify the virtual military occupation of the state on the pretext of preventing ethnic violence, while the intention is merely to protect investment, and secure complete control over all economic activity. This is similar to what happened in the Niger Delta.