A disgruntled ex-policeman armed with an assault rifle hijacked a bus carrying more than 20 Hong Kong tourists including children in the Philippine capital on Monday, police said.
The gunman released seven of the tourists, including three children and an elderly man, as well as one of the Filipinos, as the drama near Manila's historic tourist district was played out live on national television.
No shooting was reported but the standoff dragged into the afternoon with no quick resolution in sight.
"He is armed with an M-16 assault rifle," Metro Manila police commander Director Leocadio Santiago said.
The suspect, identified as former senior inspector Rolando Mendoza, also wrote what appeared to be threatening messages on white paper he had stuck on to the glass door.
"Big deal will start after 3.00 pm (0700 GMT) on Monday," one of the messages said. Police negotiators would not say what they thought he meant by that.
Mendoza was discharged in 2008 for his alleged involvement in drug-related crimes and extortion and is demanding that he be reinstated and his case reopened.
Philippine authorities said 22 tourists from Hong Kong were originally on board the bus, along with the local driver and two other Filipinos. Earlier, police had said the tourists were South Koreans.
"We have never had anything like this before -- we are very much concerned," said Joseph Tung, executive director of the Travel Industry Council of Hong Kong. "We hope the tour members will be released as soon as possible."
He said the tourists on the bus were aged between four and 72. They were on a three-day tour and were scheduled to return to Hong Kong late on Monday.
Tung said the council, which represents Hong Kong's travel sector, had not been told of any ransom demands for the hostages' release.
"We have heard nothing like that so far," he said.
Susanna Lau, general manager of tour operator Hong Thai that arranged the trip, said the tour guide had hidden at the back of the bus and had reported the incident to his colleagues by phone.
"He (the gunman) wanted to use his power over the group as (bargaining) chips for his negotiation (to get his job back)," Lau told a press conference in Hong Kong.
Manila city deputy mayor Isko Moreno said that, apart from the foreigners, three Filipinos were also on the bus — the driver, a photographer and an interpreter.
Since Moreno's briefing the photographer had been released, police said.
Moreno said a dedicated telephone line had been installed on the bus, and that the authorities were trying to get the suspect's family involved in the talks.
"We are hoping that he does not harm the hostages," Moreno told local television, adding there had been no indication that anyone had so far been injured.
It was not clear whether Mendoza had released all the children on board, or whether there were still others being held hostage.
The bus was parked in front of a grandstand at Rizal Park, a popular tourist destination just a few blocks from the police headquarters.
Amid China's appeal to solve the solution quickly and without bloodshed, police called in the suspect's brother, who is also a police officer, to help in the negotiation.
"We are doing our best to resolve this as quickly as possible," said Chief Inspector Erwin Margarejo, a police spokesman on the scene, describing the attitude of the suspect as "courteous."
"The use of force is a last resort," he said.
The bus had been isolated and commandos deployed in the area, but Margarejo said he could not give an estimate as to when the drama would end.
"It is a sign that the negotiations resulted in something good," he said, referring to the release of some hostages.
China's state Xinhua news agency said Chinese embassy officials in Manila would help in the negotiations but the foreign ministry in Beijing had no immediate comment.
The hostage-taking came hours after a South Korean man was killed in a separate attack on a vehicle by gunmen elsewhere in Manila. Two of his companions were seized at gunpoint but later released.
The motive for that attack was not clear, although kidnap-for-ransom gangs often target foreign tourists and businessmen in areas near Manila and in the provinces.
Police said the incidents were not related.
Monday's bus hijack recalled a similar hostage-taking in 2007, when a troubled civil engineer armed with a grenade took over a bus and held 30 children but freed them after a 10-hour standoff with police.
The 2007 drama took place near Manila city hall, just off Rizal Park.