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Philippine troops were clearing out the last remaining Muslim rebels after a six-day operation in the south that killed dozens of militants and allowed scores of hostages to flee, officials said Saturday.
Police estimated the Moro National Liberation Front (MNLF) gunmen were now holding as few as seven civilian hostages in the southern port city of Zamboanga, compared to more than 100 a day earlier, Interior Secretary Mar Roxas said.
His comments boosted hopes that the crisis, which had left entire neighbourhoods razed to the ground by the gunmen and forced tens of thousands of residents to flee, would soon be resolved.
"By today, it's quite clear that not only is this incursion being contained," Roxas told reporters. "From contained it has evolved into constriction, which is to reduce the operating space of the MNLF. Now it is into clearing."
Relentless day and night operations by at least 3,000 elite government troops have killed 43 rebels while 19 others had been detained, said military spokesman Lieutenant-Colonel Ramon Zagala.
"Right now we are optimistic that our operations are effective and that we are delivering a a significant blow to our enemies," he told AFP.
"We hope that we can finish this calibrated response at the soonest possible time," he said, while refusing to give a timetable.
He cautioned that the remaining gunmen were still dangerous, and the presence of civilians in neighbourhoods where the remnants were hiding out meant the military could only use light weaponry.
He said the military and police forces had suffered six dead while four civilians were also killed.
The optimistic assessment of the operation came hours after Vice President Jejomar Binay offered to broker a ceasefire between the government and MNLF leader Nur Misuari.
Binay, the country's number-two elected official, followed President Benigno Aquino to Zamboanga on Saturday to discuss with the Filipino leader a ceasefire plan that he said he had also raised with Misuari.
The truce was tentatively scheduled to take effect at midnight (1600 GMT) Saturday, a spokesman for the vice president told AFP.
There was no immediate report on what transpired during his meeting with Aquino.
Roxas confirmed the Aquino-Binay meeting had taken place, but said the president had not ordered the military to stop their operations against the MNLF.
The standoff began on Monday, when heavily armed MNLF forces entered Zamboanga's coastal districts and took hostages in a bid to scupper peace talks between another militant group and the government.
At one time the gunmen used nearly 200 civilians as human shields, officials said.
The rebels also forced groups of the hostages to stand between them and attacking military units.
The fighting forced 69,000 people to flee their homes, the civil defence office said.
Nearly 500 houses were torched by the rebels, who shot at fire trucks sent to attend to the blazes, city fire marshal Dominador Zabala told reporters.
The MNLF waged a 25-year guerrilla war for independence before signing a peace treaty in 1996 that granted limited self-rule to the south's Muslim minority.
Misuari, who has accused the government of violating the terms of a 1996 treaty by negotiating a separate deal with a rival faction, had disappeared from public view shortly before the fighting began Monday.
The rival faction, the Moro Islamic Liberation Front (MILF), is in the final stages of peace talks with Manila and is expected to take over an expanded autonomous Muslim region in the south by 2016.
President Aquino said the peace talks with the MILF aimed to end decades of rebellion that had claimed 150,000 lives in the country's Muslim southern regions.