July agreement on ancestral domain issue for Mindanao scrapped amid escalating clashes between govt, paramilitary forces and MILF. Supreme Court issued temporary restraining order on initialled agreement 4 Aug, as opponents of inclusion in new “Bangsamoro Judicial Entity” rallied in North Cotabato. MILF troops occupied 13 towns there; ensuing clashes with security forces displaced estimated 160,000. Separate fighting by MILF faction in Lanao del Norte 18 Aug killed some 24 civilians; tens more killed in govt push that followed. Govt negotiator said 22 Aug Manila no longer interested in deal, MILF must disarm. Malaysia 28 Aug extended its participation in monitoring mission by 3 months.

Talks between Manila and MILF reached agreement on crucial “ancestral domain” issue, which could lead to expansion of autonomous Muslim region in Mindanao. But full details not released and significant hurdles remain. Key issue in talks was timing of referendum in south on joining new autonomous entity: now due 1 year after signing of formal “framework agreement” (scheduled 5-6 Aug in Kuala Lumpur). President Arroyo called on legislature to delay 11 Aug elections due in existing ARMM autonomous region after MILF argued vote would prejudice future expanded entity.

President Arroyo announced new draft of ancestral domain agreement 18 June; MILF indicated willingness to resume talks. High-profile kidnapping of TV news anchor Ces Drilon and crew on Jolo 8 June, allegedly by Abu Sayyaf, ended 17 June.

Basilan clashes 15, 25 May between marines, Moro Islamic Liberation Front (MILF); circumstances unclear. In latter 2 rebels killed, possible Abu Sayyaf involvement. 3 civilians left dead in Zamboanga bomb blast 29 May; no claim of responsibility – military suspected Abu Sayyaf. Moro National Liberation Front (MNLF) factions agreed in Libya 18 May to form transition leadership and unification committee, including MNLF founder Nur Misuari. General Hermogenes Esperon replaced Secretary Jesus Dureza as presidential adviser on peace process 19 May. Malaysia 10 May began withdrawal from International Monitoring Team in Mindanao.

Malaysia threatened pullout of its members of International Monitoring Team in Mindanao confl when current mandate expires Sept 2008, citing lack of progress. Muslimin Sema, mayor of Cotabato and Nur Misuari rival, elected MNLF chair 1 Apr, sidelining Misuari.

Local residents on Jolo island decried “massacre” after troops killed 8 civilians, including 2 children, in Maimbug, Sulu 4 Feb; exact details of operation unclear. Army claimed victims caught in crossfire between troops and Abu Sayyaf, but investigation by human rights commission rejected claims, called for criminal charges. Swiss Centre for Humanitarian Dialogue reported “indiscriminate firing”. Amid claims of assassination plots, President Arroyo upped military and police presence at end-month anti-government rallies in Manila.

New People’s Army (NPA) rebels rejected renewed government offer for ceasefire as step towards talks 24 Jan, demanding instead no preconditions. Clashes that followed NPA attack on army in Davao Oriental 30 Jan killed 5. Large rallies in Mindanao cities urged Manila and MILF to resume talks early month; government said drafting new proposal. U.S. said it would upgrade joint Balikatan military exercises near Moro Islamic Liberation Front (MILF) strongholds.

Talks with MILF rebels broke up 16 December without agreement; group accused government of reneging on earlier agreements on ancestral homeland issue. MILF and rival MNLF signed cooperation agreement after 14 December mediation visit by son of Muammar Gaddhafi, but concrete cooperation unlikely. Army launched new offensives against Abu Sayyaf on Basilan.

Manila and Moro Islamic Liberation Front (MILF) both said breakthrough in ancestral domain talks but details not yet released and further obstacles to permanent deal likely. MILF said only that agreed ancestral domain would cover larger territory than current ARMM region, and hoped final peace agreement might be signed by ARMM legislative elections due August 2008. 13 November explosion outside house of representatives killed 4, including congressman from Basilan; police blamed Abu Sayyaf. Failed coup attempt launched 29 November when 27 renegade soldiers walked out of 2003 mutiny trial and occupied Makati hotel; ended 1 day later with dozens arrested and overnight curfew in Manila.

Government said 23-24 October talks with MILF representatives in Kuala Lumpur yielded agreement on long-contentious ancestral domain issue; details sketchy but exploratory talks to resume 14 November. Former president Joseph Estrada given presidential pardon 25 October, 2 weeks after conviction on plunder charges led to life sentence. 19 October explosion at Manila mall killed 11; police downplayed claim by small Muslim group and suggested gas leak possible cause.