I also work on a distributed team. While all my teammates are in the US I am the only one working in the Philippines. We use email, chat (yahoo messenger), skype and gotomeeting for communication. We use our internal tool to log our time every day.
This setup works for us and has been going on for almost 2 years now.
I also do some work from the Philippines when I'm there on occasion, but I'm based in the US. One problem I have is the reality of power "brownouts" in the RP interrupting bandwidth.
This setup works for us and has been going on for almost 2 years now.