* Locals say Islamists extorted money, imposed harsh laws
* Boko Haram biggest threat to stability in oil producer Nigeria
* Vast remote, semi-desert region difficult to defend
By Joe Brock
KIRENOWA, Nigeria, June 7 (Reuters) - All that remains of the Islamist fighters who once bedded down in this sandy enclave are charred clothes, burned out trucks and surgical equipment left beneath a thorny tree.
Hausari Camp - 300 square metres of baking wilderness near Nigeria’s border with Chad - was until last month a base for militants from Boko Haram, whose four-year-old insurgency has left thousands dead and destabilised Africa’s top oil producer.
Fearing its northeast was turning into a de facto Islamist state similar to northern Mali before French military action in January, Nigerian President Goodluck Jonathan declared a state of emergency last month and launched a military offensive to retake villages that had fallen under Boko Haram control.
But as before, the Islamists have packed up and fled across borders with Niger, Chad and Cameroon or melted away into the civilian population, raising doubts about whether military might can really resolve a crisis rooted in economic malaise.
In the nearby village of Kirenowa, residents described how armed Boko Haram fighters overthrew the local government, tore down the Nigerian flag and hoisted their own black colours.
They did the same across nearly a third of northeastern Borno state this year, imposing an austere brand of sharia or Islamic law.
“They took over the whole place and demanded we pay them money, sometimes 100,000 or 200,000 naira ($650-1,300), but we didn’t have it,” said Mohammed Abdullahi, a 25-year-old school teacher, with a crowd of skinny children in torn clothes and sandals gathered nearby.
“They tore the place apart. We pray they will not return.”
Hausari Camp, which the military took journalists to see this week, showed no trace of battle - no bodies, no blood, no discarded bullet cases.
Lieutenant Colonel D.R. Hassan, who led the offensive, said they took their dead away. For all that is left, they could have fled before a shot was fired.
“Their bases were ... not just dislocated but destroyed completely,” Brigadier General Chris Olukolade told reporters outside a state TV compound in the city of Maiduguri, the birthplace of the insurgency and, in centuries past, part of a medieval Islamic empire that thrived on cross-Saharan trade.
Nigeria’s military says it has arrested or killed scores in its most determined offensive yet against the militants fighting for an Islamic state in religiously-mixed Nigeria.
“Boko Haram closed the schools and many of our people fled. They treated us so badly,” said Abubakar Jarma, an elderly village chief, draped in traditional long white robes, near the camp.
Nearby, the charred remains of a church and a police station recalled an attack by Boko Haram’s masked fighters.
Yet in past crackdowns, Boko Haram has retreated, only to come back stronger. Many thought the shadowy sect was finished after the military suppressed an uprising in mid-2009, leaving some 800 people dead, including its founder, Mohammed Yusuf.
The military says most territory has been wrested back. Yet these makeshift camps can easily be set up elsewhere in the vast northeastern semi-desert region - or in neighbouring areas.
As a string of attacks in Niger by al-Qaeda linked militants whom French forces chased out of Mali proves, Islamists can easily flee one battle scene and launch another elsewhere.
“Gains are unlikely to be sustained. The militants are likely to regroup and resume attacks in the north to reassert their capability,” said Control Risks analyst Roddy Barclay.
Jonathan says he is open to seeking an alternative, political solution, but Boko Haram leader Abubakar Shekau’s latest video showed him in no mood to talk peace.
And no one has yet started work on trying to revive the north’s economy, seen as the only long term solution to the insecurity.
After decrying Boko Haram’s severity, village chief Jarma swiftly raised another complaint: why had the government not fixed the roads or helped his mostly farming community with tools? ($1 = 159.7000 naira) (Additional reporting by Tim Cocks in Lagos; Editing by Tim Cocks and Mike Collett-White)