The draft TOR seeks to place the war games within Philippine constitutional and legal constraints.
In a statement yesterday, Mrs. Arroyo said the "outstanding issues" stalling the TORs crafting could be resolved through the desire of the Philippines and the US to carry out their fight against terrorism. "Outstanding issues will be resolved through good faith, fairness and accommodation under the limits of each others legal framework," she said.
However, Mrs. Arroyo did not say what specific issues have to be threshed out by Filipino and American officials in their talks in Washington.
"We are confident this issue can be resolved in a manner that will meet both the sincere desire of the United States to help out in the fight against terrorism and the constraints posed by our legal environment," she said.
"The most important thing is that we have a strong a durable alliance for peace, security and development, and that this alliance will continue top work for the achievement of stability and progress in Mindanao," the President said.
Presidential Spokesman Ignacio Bunye said Chief Presidential Legal Counsel Avelino Cruz, along with Defense Undersecretary Feliciano Gacis and Foreign Affairs Assistant Secretary King Sorreta, was scheduled to meet last night in Manila with visiting US Pacific Command chief Adm. Thomas Fargo to discuss the proposed TOR for Balikatan 03-1.
"To thresh out the ground rules for the Balikatan 03-1 and the meeting will be used as the basis for preparing for the US trip of Secretary Cruz," he said.
Bunye said Mrs. Arroyo wanted to make sure that the final TOR would meet the requirements of the Constitution before it is signed by Filipino and American officials.
"And basically constitutional limitations refer to use of combat troops and any possible permanent basing," he said.
"Its very clear that whenever you come up with TOR, these are subject to final review by higher authorities."
Bunye said Cruz would consult Defense Secretary Angelo Reyes and Foreign Affairs Secretary Blas Ople before signing a new TOR with the US.
"The President wants all the legal and constitutional issues (of the TOR on Balikatan 03-1) to be addressed so she gave the instructions to Secretary Nonong Cruz to personally review these documents," he said.
Interviewed yesterday over the "Mr. Exposé" program of former ambassador Ernesto Maceda over radio station dwIZ, Bunye denied speculations that the TOR was being stalled because of the US governments insistence to immediately implement the temporary basing arrangement in the Philippines.
"As far as we know there is no formal request by the United States government," he said. "And as President Arroyo earlier stated that whatever arrangements with the US must be done in accordance with the Constitution, and our Constitution says there should be no permanent foreign military basing in the country."
Reyes said the TOR for Balikatan 03-1 was "still a work in progress" because of certain "sticky points" which have not yet been resolved by the two sides.
"We are still tackling the issue of the terms of reference for Balikatan 03-1, as there are still some sticky points," he said
In a statement from Seoul Tuesday where she was on a state visit, Mrs. Arroyo said she was sending Cruz to the US to finalize ground rules for US troops joining counter-terror exercises in the troubled south later this year.
Mrs. Arroyo said she has decided that the final "terms of reference" (TOR) governing the exercises called Balikatan 03-1 would "be given a final review by my office."
"I am sending the chief presidential legal counsel to the US to thresh out the remaining issues with the American government," Mrs. Arroyo said. "He will work in close consultation with our defense and foreign affairs authorities."
The President stressed her "clear guidelines" to ensure the ground rules would not violate the Constitution, which bars foreign combatants on Philippine soil.
Mrs. Arroyo did not set a date of departure for Cruz.
The proposed exercises, to begin in the second half of the year in the south, seek to help the ill-equipped Philippine military crush the Abu Sayyaf.
About 1,000 US troops were deployed in Mindanao for a similar operation last year, but they were prohibited from joining actual combat patrols.
US forces, however, helped Filipino troops track the Abu Sayyaf, leading to the rescue of American missionary Gracia Burnham and the death of bandit leader Abu Sabaya.
Burnham was one of three US citizens and a group of Filipinos abducted from a beach resort in May 2001. Her husband, Martin Burnham died in the rescue, while Guillermo Sobero of California was beheaded shortly after the kidnapping.
Nationalist groups and some politicians have warned that US help could be a prelude to Washingtons re-establishing a foothold in Asia with its presence in the Philippines, a former colony and site of two strategic American bases shut down more than a decade ago.
Mrs. Arroyo warned Tuesday, however, that the public should not "inject ideological undertones to this issue."
She later said the United States had promised $356 million in security-related assistance, with $47 million allocated to the Balikatan exercises this year.