Mrs. Arroyo said the sneak attack proved that the Communist Party of the Philippines (CPP) and its armed wing, the NPA, are "terrorist" organizations.
"These terrorist acts will not go unpunished. Police and military operations will continue," she said in a statement read by Press Secretary Ignacio Bunye.
"We call on the entire citizenry to get involved in the fight against the CPP-NPA, and we exhort the citizenry, especially human rights groups and even the communist organizations who are not engaged in violence, to join us in condeming these latest acts of violence," the statement said.
Defense Secretary Angelo Reyes, a former Armed Forces chief, said the rebels may be trying to "gain some leverage" by stepping up attacks.
"The NPA is trying to project an image of strength and capability to offset their strategic setbacks that they suffered recently," Reyes said.
"They lost a lot of ground these past months militariy and politically," National Security Adviser Roilo Golez said when Washington branded them as terrorists. "Now it appears they want to reopen negotiations so they are trying a show of force which they can’t sustain."
Communist rebels have stepped up attacks in the past days following Mrs. Arroyo’s order for an intensified military campaign against the NPA.
Officials believe the attacks were ordered by CPP founder Jose Maria Sison, who lives in self-exile in the Netherlands. In August, Sison ordered the NPA to attack power lines in response to the President’s order.
Apparently to avoid being considered a terrorist by the Netherlands, he retracted his statement and claimed that he was making a "analytical commentary" on the insurgency and not an order to attack.
Sison founded the CPP in 1969 and began one of the world’s longest-running communist insurgencies. He went into exile in the late 1980s after he was freed from jail by then President Corazon Aquino as a goodwill gesture toward the rebels.
Rebel leaders earlier insisted the CPP is a legitimate political party, decriminalized after the 1986 ouster of the late dictator Ferdinand Marcos.
Last Friday, a band of about 50 NPA rebels, posing as agents of the National Bureau of Investigation and clad in barong Tagalog and military uniforms, entered the remote town of Lopez unmolested.
One rebel entered the station in the guise of filing a complaint while his cohorts waited outside.
However, an apparently suspicious SPO4 Juanito Caballero accosted them. The rebels panicked and opened fire, killing Caballero.
Police chief Superintendent Cesar Santander was also killed and SPO2 Nestor Domingo and SPO2 Raul Paraiso were wounded in the ensuing 30-minute gunbattle, police officials said.
However, Domingo, succumbed to his wounds last night in a hospital, while Paraiso’s condition became stable.
Malacañang offered its sympathies to the families of Santander and Caballero and paid tribute to the bravery of the other officers.
"We condole with the widows and the families of the brave policemen who fell while defending the duly constituted government and the democratic system even as we strongly condemn the treacherous attacks perpetrated by the CPP-NPA," Mrs. Arroyo said.
Ebdane visited Lopez yesterday to inspect the scene and oversee police and military pursuit operations against the raiders. Dozens of soldiers, backed by rocket-firing helicopter gunships, are helping police in tracking down the rebels, police said.
The raid was the second NPA attack on a police station in less than a week.
Last Tuesday, a band of 30 NPA rebels posing as Army soldiers entered the town of Maco in Compostela Valley province and emptied the police station’s armory.
They managed to take the police officers there by surprise who decided not to put up a fight.
Armed Forces chief Gen. Benjamin Defensor said he was not surprised by the increasing NPA attacks. It was a "common practice" of the rebels in the past to attack lightly defended police and military outposts, he said.
Military spokesman Brig. Gen. Edgardo Purificacion, however, admitted the rebels’ use of military uniforms or formal attire was "something new."
Ebdane ordered police commanders nationwide, especially in remote areas, to review their security procedures following stepped-up attacks by the NPA in the past days.
Chief Superintendent Enrique Galang, director of the Southern Luzon police force, meanwhile put all police forces in Quezon on "red" alert.
Last Thursday, the NPA swooped down on two remote villages in Bulacan and destroyed heavy equipment used for quarrying.
The following day, about 40 rebels entered the town of Botolan in Zambales and also destroyed heavy construction equipment.
Despite the attacks, Mrs. Arroyo said the government "will maintain open lines of communication in the hopes of ending the employment of violence and terrorism as a means to attain political ends."
The government suspended formal peace talks in June last year in Oslo, Norway after the rebels assassinated congressmen Rodolfo Aguinaldo of Cagayan and Marcial Punzalan of Quezon.
Officials hoped to reopen talks soon. Bunye said the government is currently reviewing a draft peace agreement to be presented to the rebels.
In August, Washington included the CPP and the estimated 12,000-strong NPA, the CPP’s armed wing, in its list of "terrorist" organizations.
The US government asked other countries to stop funds flowing to the rebels and freeze their assets, if any. The Philippines is seen as the United States’ second front in its global war against terrorism.
Sison said the US action threatened to derail peace talks between the rebels and the Philippine government. — With Non Alquitran, Arnell Ozaeta, Jaime Laude, Artemio Dumlao