MYANMAR'S army chief, Senior General Min Aung Hlaing will step down within the next two months and enter the country's political scene, according to informed sources. The current second in charge, Vice General Soe Win will replace him within weeks, according to sources close to the general. The official order was signed earlier this month.

The move will come just as the country prepares for multi-party elections later this year. "Clearly Min Aung Hlaing has political ambitions, and is retiring to enter politics," said Win Htein – a National League for Democracy (NLD) MP and a member of the party's central executive.

The expectation is that the out-going army chief will join the ruling Union Solidarity and Development Party (USDP), formed by his mentor, Senior General Than Shwe. But this is far from certain, the retiring general can still enter politics without being a member of a political party, as nominations for the actual presidential race do not need to be elected MPs.

There has been speculation about the army commander's future plans for some time now, with many believing he was due to retire this year. The compulsory retirement age in the military is 60, but earlier this year he insisted he only reached the retiring age next year. However some sources suggest that Min Aung Hlaing may also be retiring because of health reasons.

Some analysts have suggested that the current top two generals would retire together as their predecessors - Senior General Than Shwe and Vice Senior General Maung Aye - did in March 2011. Reported tension between the two top military commanders fuelled this speculation. Soon after Min Aung Hlaing became commander in chief, he removed three senior army officers -- Major General Tun Khan, Divisional Commander of Yangon, Major General Tin Ngwe of Mandalay Region, and Major General Kyaw Phyo, who was in charge of the Triangular Division – who were known to be close to General Soe Win.

However, any rift between the two top generals will not have been allowed to disturb cohesion, unity and morale within the army. "The interests of the military as a whole always supersedes personal rivalries and divisions," said Sean Turnell, a Myanmar expert at Macquarie University in Australia. "As the institution that sees itself as protecting the interests and security of the whole country, and with considerable collective economic interests, they will always maintain a united front."

Many analysts have been tipping Lieutenant General Myat Htun Oo, who has been rapidly promoted up the ranks in the last couple of years, to succeed Min Aung Hlaing when he retired. He also became head of military intelligence, a crucial position, last year. More recently he has been prominent during the current military campaign against the Kokang, who are ethnically Chinese, in Northern Shan State.

Myat Htun Oo was originally in charge of the military operation in August 2009, which forced the Myanmar National Democratic Alliance Army (MNDAA) to flee, with many believing its leader Pheung Kya-shi, also known as Peng Jiasheng, took refuge across the border in China, after first escaping with the help of the Wa rebel army, and split the Kokang rebel group.

During this current offensive though there are reports that 
hundreds of Myanmar troops have been wounded or killed. Nevertheless this campaign has raised the profile of the army, and fostered a surge of nationalist pride in the Tatmadaw – with thousands of Myanmar people expressing their admiration for the soldiers in the front line on the country's social media. This has also increased Min Aung Hlaing's political power in Naypyidaw. Since the fighting erupted in early February, Min Aung Hlaing dominates the weekly National Defence and Security Council meetings, according to informed sources, with Thein Sein completely sidelined.

Whatever the debate and divisions within the army, the question of succession has been resolved amicably, and Soe Win will take over as Commander-in- Chief of the military in July. The army's hierarchical nature and the need for institutional stability have prevailed. Myat Htun Oo will have to wait his turn, but as the comedian and former political prisoner, Zaganar put it, "he's still the one to watch."

While it is as yet unclear who will become the deputy army chief, sources close to the military believe it will be Lieutenant General Kyaw Swe, who until he was replaced last year, also ran military intelligence, with Myat Htun Oo likely to become the third highest ranking office in the army. Kyaw Swe is also reportedly close to Soe Win – both are regarded as former General Maung Aye's protégés.

One of Soe Win's key priorities will be to make sure the army maintains its prominent role in the country's politics, including protecting the 25 percent quota of seats the army automatically has in the parliament, under the 2008 constitution. It will be the new commander-in-chief who will appoint these 166 MPs. Under the constitution the military commander also appoints three ministers – Defence, Home Affairs and Border Affairs – these then will also be selected by Soe Win.

As part of the plan for the future, it is also almost certain that Soe Win will instruct the military MPs in the next parliament to select Min Aung Hlaing as their vice president. The lower house and the upper house also nominate vice presidents, and then at a joint sitting of both houses, including the military MPs, the new president will be selected from the three vice presidential candidates. While Min Aung Hlaing is not expected to get the presidential post this time round, the army is going to have a powerful say in who finally is voted president.

So now all eyes will be on Soe Win to see if he will differ in any way from his out-going predecessor. Democrat politicians are split on what to expect, but some believe a new face may usher in a new approach. "In comparison to Min Aung Hlaing – who is a tough guy – Soe Win seems open and reasonable," said Win Htein from the NLD.

However Khin Maung Swe, leader of the National Democratic Front believes Soe Win will be even more hard-line than Min Aung Hlaing. The Shan Nationalities League for Democracy (SNLD) leader Hkun Htun Oo insisted that the ethnic minority dealings with Soe Win in the past had not been encouraging. While several Kachin MPs on the other hand were more enthusiastic as they felt he was flexible and sincere when he was Northern Commander.

Min Aung Hlaing certainly presents himself as a tough, confident, no nonsense commander. Even to the extent of making his subordinates in his office wear bulletproof vests. Soe Win on the other hand has the reputation of being a loner, concerned about excessive corruption and prepared to consider dialogue as a means to resolve conflicts and tensions.

That would be good news for Aung San Suu Kyi - in terms of negotiating a coalition government after the next elections and proposed constitutional change - and the ethnic minorities, who will still be pushing for political dialogue on Federalism and are likely to still be in the finishing throes of signing a nation ceasefire agreement, when Soe Win takes over as Commander-in-Chief.

"With Soe Win at the helm, it certainly opens up the possibility of discussions," said Win Htein optimistically.

The writer is a specialist on Myanmar and a former BBC World Service New Editor for the region.