The Philippines said Friday it had made progress in efforts to end a tense standoff with China in the South China Sea, but each side was still refusing to remove its ships from the disputed area.

Foreign Secretary Albert del Rosario also said the two countries had agreed to maintain the "status quo" and not take any further provocative action at the tiny islets as they sought to negotiate a resolution.

"We have been able to arrive on some agreements. There are areas where we moved forward and there are areas which still remain a challenge," del Rosario said after meeting with China's ambassador to Manila, Ma Keqing.

"Both sides have agreed not to do anything that would escalate the situation there any further."

In Beijing, Chinese foreign ministry spokesman Liu Weimin gave no sign of compromise as he warned the Philippines that other areas of bilateral relations could be at risk if it did not back down.

"The Philippine side's harassment of Chinese fishing boats and fishermen violates Chinese sovereignty," he said.

"We urge the Philippine side to bear in mind the larger interests of China-Philippine friendship."

The dispute began on Sunday when Philippine authorities found eight Chinese fishing boats at Scarborough Shoal, (230 kilometres, 140 miles) west of the country's main island of Luzon.

The Philippines accused the fishermen of being there illegally, asserting the area was within the country's 200-nautical-mile exclusive economic zone, as recognised by international law.

However China, insisting the shoal was Chinese territory, sent three civilian maritime surveillance ships to prevent the Philippine Navy's largest vessel from arresting the Chinese fishermen.

China claims all of the South China Sea as its own, even waters up to the coasts of other countries.

Aside from the Philippines and China, Taiwan, Vietnam, Malaysia and Brunei also claim all or parts of the waters as their own.

The Philippines withdrew its warship on Thursday, replacing it with a coastguard search-and-rescue vessel in what was widely seen as an effort to lower tensions by taking away the immediate threat of military force.

Del Rosario said the Chinese embassy informed him that one of the three Chinese maritime vessels had also been withdrawn.

However Philippine military chief General Jessie Dellosa said troops reported that three of the eight Chinese fishing boats had apparently left the shoal.

"Only five are left. The three others, we don't know where they are," he told reporters.

The rival claims to the South China Sea have made the sea one of Asia's potential flashpoints for military conflict.

The Philippines and Vietnam complained last year of increasingly aggressive acts by China in staking its claim to the South China Sea.

However this week's standoff is the highest-profile in recent years.

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