Rebel forces in Sri Lanka were dealt a devastating blow Friday as government forces managed to capture the city of Kilinochchi in the country’s northern region. The city has served as the de facto capital for the Tamil Tigers, a militant group designated as a “Foreign Terrorist Organization” by the United States and Europe.

Kilinochchi held great symbolic value as the center of the Tamil Tigers’ de facto state and its capture by government forces for the first time in a decade was sure to badly damage the rebels’ morale. The rebels used the town as their headquarters and created structures for an independent state, such as police, courts and tax offices.

Rebels claim that they moved their operations further north before the capture, but they would just to try to deny the government forces any victory.

The army first captured Kilinochchi from the rebels in 1996, but lost it in a rebel counterattack in 1998.

The government has predicted repeatedly over the last two months that the town was about to fall. But the rebels built a massive, 10.5 mile (17 kilometer) -long earth and moat fortification, and fierce resistance from the guerrillas and pounding monsoon rains made it difficult for government forces to advance. The battles reportedly killed hundreds of fighters.

Army troops cleared the way into the town Thursday when they captured a key crossroad north of Kilinochchi that allowed them to close in from three directions, the military said.

Troops entered Kilinochchi Friday morning, said Lakshman Hulugalle, a military spokesman. Senior military officials said their forces met only minimal resistance once in the town, an apparent sign that the rebels had withdrawn and retreated to their jungle bases, analysts said.

Army commander Lt. Gen. Saratha Fonseka said Friday that troops had taken control of most of the north’s largest highway, which runs through the spine of the country. Troops were “attacking the fleeing terrorists,” he said.

Foneska also says that there are only about 1,700 rebel forces left and that they’ll be defeated within a year. Of course, as the Associated Press notes, the same was promised by the end of 2008.

Still, it’s good news whenever a U.S.-designated terror group is dealt a stinging blow. Hopefully we’ll see much more of this in the coming year.