Philippines financial capital in chaos as two mayors stand off

MANILA (AFP) - The Philippines' financial capital Makati has been plunged into chaos with two politicians claiming to be mayor, forcing courts to close and delaying government business during a bitter stand-off triggered by graft claims.

Surrounded by hundreds of supporters, Makati mayor Jejomar Erwin Binay has been holed up in city hall since the ombudsman suspended him last week because of an investigation into alleged corrupt practices.

Insisting the graft accusations are trumped up, Binay has refused to cede power to his deputy and rival, Romulo Pena, who insists he is now "acting mayor".

The power struggle is widely seen as a battle between the nation's ruling Liberal Party and main opposition.

Binay is the son of opposition leader, Vice President Jejomar Binay, while Pena is a member of President Benigno Aquino's Liberal Party.

It also threatens to delay the salaries of 8,000 government workers and payments for utilities and services.

Makati's courts closed on the first day of the stand-off last week, and some judges have continued to postpone hearings to avoid the crush of Binay supporters outside the building, family spokesman Joey Salgado told AFP.

He said welfare recipients had also been unable to collect benefits, and warned there was a looming crisis over who had the authority to sign the city's cheques.

If banks do not honour cheques signed by Binay, street lamps and traffic lights will be shut down, taps in government buildings will run dry and garbage collection will stop, according to Salgado.

"This is a very dangerous situation, if their (national government's) actions result in delays in salaries, utilities," he said.

"Any perception of instability would have an effect on the country. They are sending the wrong signal to investors. Makati is the financial centre of the country." From an adjacent old building, with hallways that reek of leaking toilets, Pena issued a memorandum on Friday to all city hall employees asserting his authority.

"All ordinances, official documents and official actions must be submitted and referred to the undersigned for approval and/or appropriate action," Pena said, referring to himself.

Binay's family has said the mayor's suspension is politically motivated as his father continues to dominate presidential polls, ahead of the presumptive nominee of Aquino's party for the 2016 elections, Interior Secretary Mar Roxas.

Makati is the country's largest city in terms of revenue, with 11.9 billion pesos (S$368 million) in earnings from taxes and fees in 2013, according to government data.

The city hosts the country's stock exchange, 82 embassies and consulates, 506 bank offices and 246 business process outsourcing and technology companies.

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