Jake Lloyd-Smith, Batam/Vaudine England, Jakarta – Shirley Lau says she fled her home in fear of her life, clutching just a handful of possessions.

Her family joined hundreds of other ethnic Chinese aboard a flotilla of boats to escape the near total destruction of Selatpanjang, an island town southwest of Singapore. The two-day riot, which broke out early in the week, reduced most the settlement to a mass of smoking ruins.

"When we left there weren't any soldiers. We heard afterwards that they had come. We packed just enough for the kids," she said yesterday, sitting in Maha Vihara Duta Maitreya, a Buddhist monastery on Batam island. "I am scared," said Ms Lau. "But where else can we go? It was our village."

Amid the bloodbath on Borneo, the fate of the Riau province town went almost unnoticed. But the episode, which may have spawned a 5,000-strong wave of refugees, underlines the fear and vulnerability of Indonesia's minority Chinese population.

Resented by jealous locals for their industriousness and relative wealth, Chinese are often targeted as scapegoats by politicians or the military.

A trigger for the carnage is hard to pin down and accounts of the violence differ widely. Refugee and local reports say the spark may have been a dispute between gambling syndicates.

Representatives of the Batam branch of the Indonesian Chinese Social Association offer a darker theory, saying the violence was a co-ordinated bid to terrorise ethnic Chinese. The say agents provocateurs may have been acting for players on the national political stage, with Selatpanjang simply a sideshow in the drama swirling around President Abdurrahman Wahid.

Whatever the truth, it is clear that security forces could have moved to restore order more promptly, although police themselves were the target of much of the mob's fury.

Yohannes, head of the Batam chapter of Chinese association, said: "The mob burnt down the police station and a police dormitory, hundreds of shop-houses, and at least four schools."

Reports said that on Sunday a group of locals confronted Johan, an alleged ethnic Chinese gambling lord who was said to enjoy police protection. In the stand-off that followed, police panicked and shot and injured at least three people, which set off the rampage. Observers add that systematic looting occurred before much of the town was torched.

As the violence intensified, the mainly Chinese refugees took to boats and headed for the Sumatran mainland, or Batam and other islands in the Straits.

Most of those fleeing were women, children and the elderly, with one group of 84 crammed into a cargo vessel, a local press report said. Up to 2,000 people had arrived in Batam by midweek. Those who had nowhere to go – like Ms Lau and her family – were installed in the monastery, with food and provisions arranged by local volunteers.

Is the problem as simple as gambling, then? "No, it's more complex," Mr Johannes said. "Gambling is just the scapegoat."