President Gloria Macapagal Arroyo expressed optimism that other hostages taken by groups in southern Philippines' will be freed soon, following the rescue of Canadian national Pierre Belanger yesterday from gunmen in Davao del Norte.

When asked about military efforts to rescue an American missionary couple and a Filipina nurse in southern Basilan, Arroyo responded: "There are developments but we would rather not telegraph them because the other side gets to hear what we're doing."

Arroyo, nevertheless, cited reports from Lt. Gen. Roy Cimatu, military chief of the southern command (Southcom) on efforts to rescue Americans Martin and Gracia Burnham and Filipina Deborah Yap, who are being held by the Abu Sayyaf.

"From his tactical reports, he seems to be closing in on them," said Arroyo.

The Burnhams and Yap are among several who were kidnapped in May from a posh resort in western Palawan. While Arroyo did not set a deadline for their release, Southcom is optimistic they will be rescued before Christmas.

Lt Col Danilo Servando, Southcom spokesman, said two commanders had assured they would rescue the three hostages before Christmas.

Servando confirmed the U.S. government is monitoring local military efforts to rescue the American couple. He also said some U.S. military experts are still in Zamboanga awaiting the Burnhams' release.

Arroyo, meanwhile, congratulated the joint team of police and military operatives who took part in the rescue of Belanger, a Canadian, who was kidnapped by "Pentagon", a kidnap-for-ransom group, in November.

The President said she was grateful for the good work of the composite team, made up of intelligence operatives from the Armed Forces of the Philippines, the Philippine National Police Anti-Terrorism Task Force, the National Anti-Crime Commission and the Canadian authorities.

Regional police chief Bartolome Baluyot said his men stormed the hide-out of the "Pentagon" gang in the village of Buenavista at around 1:30 a.m. (1730 GMT Saturday), killing two gang members and rescuing Pierre Belanger. He said police intelligence agents found the gang's base camp.

Buenavista is in Davao del Norte province, about 900 kilometers southeast of Manila.

Belanger, a retired man hailing from Canada's capital city, Ottawa, said he ate fish, chicken and canned sardines during more than 45 days of captivity.

He said he was asleep at the time of his rescue yesterday and directed all questions about the fighting to police.

Police reports showed Belanger was abducted by unidentified gunmen while attending a party at a beach resort in Digos City. Belanger had lived with his Filipina wife for the past 10 years in Digos City.

In an interview with reporters in Manila, Belanger said he was puzzled why the "Pentagon" had kidnapped and later demanded such a huge ransom for his release. "I'm retired. I have no business. I'm not rich. Why I was kidnapped? I have no idea."

Police in Davao del Norte earlier suspected Belanger had faked his kidnapping in an effort to get money from his brother, who works in a Catholic college in the same province.

With Belanger's rescue, only one hostage is believed to be in the hands of "Pentagon" – Italian priest Giuseppe Pierantonni, who was abducted in October in Lanao del Norte.