Manila  - The Philippines' inflation rate slowed down to 7.1 per cent in January as prices of food and other basic commodities eased, the government said Thursday.

The January index was down from 8 per cent in December, but up from 4.9 per cent in the same month last year, the National Statistics Office said.

The office said the decline was caused by price decreases in fuel and utilities and slower price increases for food and commodities.

Taipei- Taiwan on Wednesday rejected the Philippines' claim to the disputed Spratly Islands, and its plan to include the mineral- rich South China Sea archipelago within its own territorial waters.

"Historically, geographically and factually, the Spratly Islands and its surrounding waters have long been the traditional territory of the Republic of China, without doubt," said Taiwan's Foreign Ministry in a statement.

Manila  - Communist rebels raided the house of a town mayor in the eastern Philippines, carting away a shotgun and 12 handheld radios, a regional police spokesman said Wednesday.

Superintendent Eliazar Bron said no one was injured when about 20 heavily armed guerrillas barged into the house of Mayor Helen de Castro of Bulan town in Sorsogon province, 390 kilometres south-east of Manila, on Tuesday.

Bron said government troops have been dispatched to pursue the rebels who fled to nearby mountains.

Manila  - Tourist arrivals in the Philippines rose 1.5 per cent in 2008 despite the global economic slowdown, the government said Wednesday.

Tourism Secretary Ace Durano said 3.13 million tourists visited the Philippines last year, up from 3.09 million in 2007.

"The increase in the visitor count in 2008 is greatly attributed to the strong performance of the European markets, led by Russia, which posted a growth of 34 per cent," Durano said.

Manila - Two employees of a lending firm were abducted in the southern Philippines in the latest in a series of kidnappings, police said Wednesday.

The victims, Lea Patris and Ammad Sali, were kidnapped Tuesday in Sumisip town in Basilan province, 900 kilometres south of Manila, while they were collecting payments.

The provincial police chief, Senior Superintendent Salik Macapantar, said a third companion was able to escape and report the incident to police.

Macapantar said police officers and marines were pursuing the kidnappers.

Manila - Ten Muslim separatist rebels surrendered to the armed forces in a southern Philippine province, the military said Tuesday.

The Moro Islamic Liberation Front (MILF) rebels turned themselves over to the army in Lanao del Norte province, 810 kilometres south of Manila, on Monday, said Lieutenant Colonel Ernesto Torres.

Torres said the guerrillas fought under MILF commander Abdullah Macapaar, alias Bravo, who is blamed for leading a series of deadly attacks in the southern region of Mindanao in August 2008.