"We continue to advise against tourist and non-essential travel to the Philippines," the advisory warned.
Last Sunday, Britain issued a similar travel advisory following a warning by Australia that the Philippines might be a terrorist target, especially by Jemaah Islamiyah, the regional arm of Osama bin Laden’s al-Qaeda terrorist network.
Manila strongly protested against the Australian warning and President Arroyo said security forces were prepared to deal with any threat.
Wellington said the risk of a terrorist attack was "high" because of the visit of US President George W. Bush on Saturday.
It advised its citizens against all travel to Mindanao — particularly Basilan, Sulu and Tawi-Tawi — because of the presence of Muslim rebels and the notorious Abu Sayyaf kidnap gang.
The Abu Sayyaf is considered a terrorist group by the United States and has been linked to al-Qaeda. Last year, US troops conducted training exercises for six months with Philippine forces to help them better fight the Abu Sayyaf.
The advisory likewise urged caution while traveling in Metro Manila and other parts of the country.
"There is a heightened security risk in the Philippines. There are reports that terrorist elements in the region may be planning attacks," the advisory stated.
"New Zealanders traveling throughout the Philippines, including Manila, should exercise extreme caution and be alert to the dangers of kidnapping."
The advisory noted that the police have tightened security around Metro Manila and other "high risk" areas such as airports and seaports.
The Abu Sayyaf has vowed to stage attacks during Bush’s visit to embarrass the Arroyo administration.
Bush is scheduled to make an eight-hour stopover in Manila in what is largely seen as a gesture of thanks to Mrs. Arroyo for her staunch support in the US-led war on terror.
Earlier, police and military officials said the Abu Sayyaf were planning to stage bombings on public transports, prompting authorities to tighten security.
The visit was thrown into doubt by the embarrassing escape of Indonesian Fathur Rohman al-Ghozi — a self-confessed Jemaah Islamiyah bomb expert — from Camp Crame on July 14.
Officials say he was killed on Sunday by security forces in Pigkawayan, North Cotabato, when he ran into a roadblock and tried to shoot it out.
But there are speculations that he was caught much earlier and killed at the best time to boost the Arroyo administration’s anti-terror image. Officials deny that Al-Ghozi was executed.