MANILA, AUG. 26 (WEDNESDAY) -- Thousands of workers followed a call for a general strike by leftist unions today crippling public transportation in the capital and slowing down work at factories across the country.

The nationwide stoppage went ahead despite President Corazon Aquino's announcement yesterday of a partial rollback in controversial fuel price increases.

It was not clear how effective the strike was because reports from the provinces were incomplete.

In a television announcement from her palace office yesterday, Aquino said she had cut fuel oil import taxes to 15 percent from 20 percent, effectively cutting in half a fuel increase announced Aug. 14.

Aquino attributed her decision to "recent developments abroad," an apparent reference to the recent decline in crude-oil prices. Since early August, the spot price of crude oil on the international free market has fallen $2.

She said earlier government projections of higher crude-oil prices by year's end have been revised. "We expect prices to either drop or remain stable," Aquino said.

Aquino appealed to Filipinos to "at least understand our situation."

Shortly after her speech, the leader of the country's largest leftist labor union, Crispin Beltran, said the general strike would take place as planned. "It is high time we gave this government a lesson," said a spokesman of the radical May 1st Movement.

Union leaders had urged transport and factory workers, teachers and civil servants to join the walkout. The union said it expected more than 2 million people to take part in the strike and protest marches.

Aquino's move, however, appeared to have mollified leaders of the country's largest labor federation, the moderate Trade Union Congress of the Philippines. The federation's secretary general, Sen. Ernesto Herrera, said that although he favors a full rollback of the price increases, his organization has decided against joining the general strike, the state-run Philippine News Agency reported.

The armed forces had gone on highest alert in anticipation of possible violence today. Troops were deployed in key areas to protect workers who wanted to get to their jobs, officials said.

Manila city officials said 400 vehicles including dump trucks and buses were being used to transport commuters stranded by the strike.

Aquino said the fuel tax cut will be funded by diverting 300 million pesos ($15 million) from the Philippine Amusements and Gaming Corp., which operates government casinos. The money will be placed in the government's depleted oil price stabilization fund, which had been used to subsidize oil prices.

{Energy Regulatory Board Chairman Ponciano Mathay announced that the new prices were to go into effect Wednesday. With the price decrease, the cost of regular gasoline will drop from $1.49 to $1.35 a gallon, The Associated Press reported. Before the increase, regular sold for $1.24 a gallon.}

Aquino's decision to roll back fuel prices came in the face of strong public criticism from some of her staunchest supporters and political allies. The influential Manila Chronicle today said the controversial price increases had resulted in an "erosion" of Aquino's vast popularity, and had given her demoralized left-wing opponents a fresh issue with which to attract support.

Since announcing the fuel price increase nearly two weeks ago, Aquino and other government officials had flatly rejected the possibility of a rollback. But the decision sparked the broadest public protests of Aquino's 18-month rule, and growing public unrest appears to have convinced the Philippine president to back down.

Striking jeepney drivers, who provide the country's main form of public transportation, last week crippled transport in several areas of Manila and outlying provinces, and transport strikes intensified Monday in outlying cities and provinces.

Meanwhile, a prosecutor said today that police have charged two men with murder in connection with the Aug. 2 assassinations of Cabinet secretary Jaime Ferrer and his driver. Prosecutor Mario Castro identified the two suspects as members of criminal gangs. He said authorities know who was behind the killings, but declined to name the suspect.

Police had suspected communist assassins in the murders. Ferrer, the secretary of local governments, was an advocate of forming civilian vigilante groups to fight communists, and the rebels had said he was a target for assassination.