By Hnin Yadana Zaw and Timothy Mclaughlin
(Reuters) - Hundreds of demonstrators, including Buddhist monks, denounced the United States for its use of the term Rohingya to describe Myanmar's stateless Muslim community during a protest outside of the U.S. embassy in Yangon on Thursday.
The Rohingya, most of whom live in apartheid-like conditions, are seen by many Myanmar Buddhists as illegal immigrants from Bangladesh and the term is a divisive topic.
The demonstration was sparked by a statement from the embassy last week expressing condolences for an estimated 21 people, who media said were Rohingya, who drowned off the coast of Rakhine State and came just a day after President Htin Kyaw accepted the credentials of the new U.S. Ambassador, Scot Marciel.
"Today, we, from here, want to declare to the U.S. embassy and the ambassador to Myanmar, to all the other countries, that there is no Rohingya in our country," Parmaukkha, a monk and member of the hardline Buddhist group Ma Ba Tha, told about 300 people who gathered on a busy road across from the embassy compound.
"If the U.S. accepts the term 'Rohingya,' you (U.S.) should take them back to your country."
The previous government referred to the group as Bengalis, implying they were illegal immigrants from Bangladesh, despite many having lived in Myanmar for generations.
Aung San Suu Kyi, the leader of the ruling National League for Democracy party and state counsellor, has drawn criticism from rights groups for avoiding using the term Rohingya and not doing enough to address their plight.
Thousands have fled persecution and poverty in the country.
Some 125,000 Rohingya remain displaced and face severe travel restrictions in squalid camps since fighting erupted in Rakhine between Buddhists and Muslims in 2012.
Zaw Htay, spokesman at the state counsellor's office, said on Thursday that the name issue was being handled by the Ministry of Foreign Affairs and would be addressed in a "diplomatic way" but did not provide further details.
A spokesman for the U.S. Embassy said the United States supports the right to demonstrate and added that "around the world, people have the ability to self-identifty".
Lt. Col. Kyaw Htut, head of the western Yangon region police, said the protest organisers would face charges for holding the demonstration in an unapproved location.
(Additional reporting by Aung Hla Tun; Editing by Nick Macfie)