Tanks, armored vehicles and hundreds of Philippines troops encircled one of the capital's most prestigious shopping centers on Sunday as the deadline approached for renegade soldiers to surrender.

An unidentified renegade junior military officer airs his views against the government of  President Gloria Macapagal Arroyo during a press conference inside the Oakwood Hotel in Manila's Makati financial district July 27, 2003.[Reuters]

About 150 renegade soldiers -- mostly junior officers below the rank of captain or enlisted men -- seized the Glorietta shopping center late on Saturday, leaving Australia's ambassador and several other foreigners trapped in adjoining residences.

The soldiers have denied they were staging a coup and instead accused the government of corruption, collusion with Muslim rebels and of planning to declare martial law ahead of next year's scheduled elections.

Australia's ambassador and some other foreigners were briefly trapped in their apartments, but they were later released safely.

"We don't intend to grab power," the rebel officers said in a statement before Australian envoy Ruth Pearce and other foreigners were allowed to leave.

"We are asking the present regime to step down because it is no different from the previous regimes. For this, we are ready to lay down our lives."

But Philippines President Gloria Macapagal Arroyo, issuing a dusk deadline for the renegades to surrender, warned of strong action if the ultimatum was ignored.

"Your actions are already hovering at the fringes of outright terrorism. You will find no support for your actions among our people and the world," she said.

"You have already stained the uniform. Do not drench it with dishonor."

The mutineers said they had no quarrel with civilians and did not want to take hostages.

Australia envoy Pearce told reporters after her release that she was "fine."

A spokeswoman for the Oakwood apartments said all civilians, except for a few staff members, had been allowed to leave. The luxury Intercontinental Hotel nearby was lso evacuated.

The rest of the city was peaceful although armored personnel carriers and truckloads of soldiers were posted outside the gates of the presidential palace. The airport was open and flights were not affected. Radio and television were functioning as usual.

President Gloria Macapagal Arroyo, who has the support of the military command, ordered a manhunt on Saturday for up to 70 junior officers and deserters after days of rumors of a coup plot by a small group of soldiers disgruntled about pay and the pace of internal reforms.

The group entered and took over large parts of the Glorietta complex shortly after midnight without firing a shot.

OUTRIGHT TERRORISM

Government soldiers loyal to President Arroyo ride on a military truck to arrive in a Manila financial district July 27, 2003. Rogue Philippine soldiers were holding the Australian ambassador and two Americans in Manila's financial and diplomatic quarter on Sunday but denied they were staging a coup. [Reuters]

Armed Forces Chief of Staff Narciso Abaya had been authorized to use "reasonable force" if the renegades did not surrender and return to barracks by 5 p.m. (0900 GMT), she said.

The government declared the Makati area as being under a state of rebellion, authorizing the military to use force.

As dawn broke over the capital of 10 million people, armored personnel carriers and army trucks blocked off major roads in the central business district but there were no signs of panic as crowds of the curious gathered.

By midday, many of the loyal soldiers posted around the Glorietta center were resting in the shade, smoking cigarettes. Some had slung up hammocks and others were eating ice-cream.

But they looked ready for action, with many carrying bandoleers full of cartridges.

Renegade soldiers, armed with M-16 rifles and some with machine pistols, appeared briefly outside the Glorietta complex, but most remained holed up inside. Television showed some of them placing explosives within the area.

The rogue troops, wearing red armbands, displayed a red flag similar to the one used by nationalist General Emilio Aguinaldo in a revolt against Spanish colonial forces in 1896 and called themselves the Magdalo group, the name used by Aguinaldo.

The Oakwood building is near the stock exchange, banks, shops, major hotels and residential compounds.

The United States expressed its full support for the "legitimate civilian government of President Arroyo."

"At this time, we have no reason to believe that there is a real threat to the Arroyo government," a State Department spokeswoman said.

Arroyo, who is due to deliver her annual state of the nation address on Monday, has repeatedly maintained she will not run for office next year.

The 113,000-strong Philippine military has no official role in the democratic process but has traditionally played a major role in who holds power.

The Philippines was under martial law for years during the two-decade rule of dictator Ferdinand Marcos, but the army turned against him in a popular uprising in 1986 and has tried to shake off allegations of rights abuses and corruption.

The military played a key role in Arroyo's rise from vice-president in 2001 as a popular revolt drove out Joseph Estrada (news - web sites). Arroyo has faced coup rumors in the past over questions about her legitimacy as leader and graft in her government.

Estrada, who has been detained in a government hospital for months, was moved to an army camp on Sunday but there was no word if this was linked to the mutiny.

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