An extended deadline has now passed in Manila where the government's ordered the surrender of nearly 200 rebellious troops who are holed up in a large commercial center they've wired with explosives. They're demanding the government step down.
Negotiations with senior government leaders continued.
The government had originally given the mutineers until 5 p.m. (5 a.m. EDT) to abandon a besieged apartment and shopping complex in the capital's financial district. It was later extended to 7 p.m. (7 a.m. EDT).
President Gloria Macapagal Arroyo had threatened to use force against the mutineers, who have demanded the government resign.
"I am hopeful," said Cabinet Secretary Mike Defensor when asked if the talks would end the standoff between the mutineers and hundreds more troops loyal to the government.
Arroyo declared a "state of rebellion" giving authorities emergency powers to make arrests without warrants and demanded that the mutinous officers and soldiers give themselves up.
Hours after about 200 soldiers occupied the Glorietta center and rigged it with explosives, more than 15 of them surrendered.
The standoff began soon after Arroyo ordered the arrest of junior officers who deserted with their weapons and were believed to be plotting a coup.
Renegade troops in camouflage uniforms set up gun posts and rigged explosives at 3 a.m. around the outside of the Glorietta complex, which includes one of the capital's largest shopping malls.
"We are not attempting to grab power. We are just trying to express our grievances," navy Lt. Sr. Grade Antonio Trillanes, who is among the officers Arroyo ordered arrested Saturday, told reporters.
He said that the explosives were for self-defense. "If they try to take us down, we will be forced to use it," said Trillanes.
Trillanes claimed to have the support of 2,000 officers and soldiers. Radio reports said about 100 men were involved. They were armed with rifles and wore red arm bands with a symbol of sun rays.
"There is absolutely no justification for the actions you have taken," Arroyo told the rogue soldiers in a nationally televised address. "You have already stained the uniform. Do not drench it with dishonor. Your actions are already hovering at the fringes of outright terrorism."
U.S. Ambassador Francis Ricciardone downplayed fears of a nationwide crisis, saying the mutiny was caused by "a small group of men who are evidently rather determined to push with their political point."
Rumors of a coup plot had been spreading for the last week. Arroyo took action Saturday, announcing that she had ordered the military and police to hunt down and "arrest a small band of rogue junior officers and soldiers who have deserted their post and illegally brought weapons with them."
The officers responded in a video released just before the takeover, accusing the government of selling arms and ammunition to Muslim and communist rebels, staging deadly bombings to justify more aid from the United States, and preparing to declare martial law to stay in power.
Australian Ambassador Ruth Pearce initially was prevented from leaving a nearby ritzy apartment complex where a number of foreign diplomats live. But all residents were later evacuated, some left carrying children and luggage. Many appeared alarmed as they passed a rebel machine gun outside the building.
National Security Adviser Roilo Golez said he hoped for negotiations and a peaceful resolution.
"We have to be very prudent about this," he told reporters. "This is similar to the 1989 coup attempt."
There were several coup attempts against former President Corazon Aquino in the late 1980s by officers complaining about corruption.
In a 1989 attempt, rebellious troops also occupied the commercial center. They held onto it, deploying snipers on top of the Intercontinental Hotel and nearby high-rises, for several days until they were persuaded to surrender.
The rebellious officers issued a statement early Sunday talking of disillusionment over corruption and favoritism. Soldiers and officers in the past have complained about low pay; the military is poorly equipped and trained, and hampered by budgetary constraints.
"We demand the resignation of our leaders in the present regime," the statement said. "We are willing to sacrifice our lives today, to pursue a program not tainted with politicking."
Interior Secretary Jose Lina ordered the arrest of Sen. Gregorio Honasan, citing an intelligence report reportedly linking the former army colonel to the mutiny. Honasan, who has been accused of involvement in past coup plots, denied he had any "influence or control" over the mall takeover.
Arroyo was sworn in as president as her predecessor, Joseph Estrada, was forced out in January 2001 by mass protests over alleged corruption. Supporters of Estrada continue to challenge her legitimacy as leader.
Estrada was moved Sunday from a military hospital where he has been detained while on trial on corruption charges to the military's Camp Aguinaldo amid concerns that there might be an effort to free him.
Arroyo has said she won't run in presidential elections next May, although rumors persist that she will change her mind.
Arroyo, a 56-year-old economist, has enjoyed generally solid public support and is one of the staunchest U.S. allies in Asia. The United States has been working closely with the 120,000-strong Philippine military, which has been battling Muslim separatists and communist rebels for the last three decades. But the military remains poorly equipped and trained, hampered by budgetary constraints.