The United States has started to zero in on the source of funding of the Communist Party of the Philippines (CPP), its military arm, the New People's Army (NPA), and its negotiating arm, the National democratic Front (NDF), a military source said.

It could affect the flow of the party's reported $320 million annual funds from local and international donors, said the source.

"This is the reason the CPP is so worried. If the communist-government talks do not succeed, they will lose their funding support locally and abroad," the source explained.

The leftists expressed fear that the U.S. troops, which are now helping the Armed Forces of the Philippines against the Abu Sayyaf in Mindanao, southern Philippines, might shift their attention to the NPA once their first mission is accomplished.

Last year, the U.S. included the CPP-NPA on the list of 32 active terrorist groups worldwide, after the terror attacks in the U.S. last September 11.

As part of the global war on terrorism, donors to the communist movement's coffers could be identified and the flow of money stopped using the money laundering laws of other countries.

The CPP could suffer the same fate as Al Qaida international terror network.

With the help of friendly anti-terrorist countries, the U.S. succeeded in stopping the flow of funds to the Al Qaida. Their funds in various banks were also frozen.

The U.S. is only waiting for a go-signal from the government to start dismantling the CPP's fund pipe-line.

"But since the peace talks are still going on, the government could not act. It will all depend on the outcome of the negotiations," the official said.