Thailand rejects army chief's plea for election

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By Nopporn Wong-Anan

BANGKOK (Reuters) - Thailand's army chief told the government on Wednesday to step down and call a snap election as a way out of a deepening political crisis, but the government and protesters rejected the call.

Army chief Anupong Paochinda also pledged he would not launch a coup only two years after the military removed Thaksin Shinawatra as prime minister.

At a news conference in Bangkok, he told the People's Alliance for Democracy (PAD) protest movement to end its crippling siege of Bangkok's international airport and cease its anti-government campaign.

"The prime minister should dissolve parliament and call a snap election," Anupong said in outlining a four-point plan to end political crisis now in its fourth year.

Anupong and other top military brass made a similar intervention on national television last month, fuelling frenzied speculation of another military takeover in the coup-prone country. Now, as then, the government dismissed the idea.

"The prime minister has said many times that he will not quit or dissolve parliament because he has been democratically elected. That still stands," government spokesman Nattawut Saikuar told Channel 3 television.

PAD spokesman Suriyasai Katasila also rejected the plan. "We won't pull out, we won't leave if Somchai does not quit," he told reporters.

Somchai, whom the PAD accuse of being a puppet of Thaksin, his brother-in-law, landed in the northern city of Chiang Mai on his return from an Asia-Pacific summit in Peru, TPBS TV said.

Thai media reports speculated he may declare a state of emergency in Bangkok, where the PAD stormed Suvarnabhumi airport on Tuesday night, stranding thousands of travellers after airport officials cancelled all flights.

After masked PAD members stepped up their action by breaking into the control tower at Suvarnabhumi airport, a rival pro-government group said it would launch its own street action, raising the prospect of clashes.

"What they have done are terrorist acts," Jatuporn Prompan, a ruling party politician and leader of the anti-PAD Democratic Alliance Against Dictatorship (DAAD), told a news conference.

One senior DAAD source said the movement would consider any retreat by the government to be a military coup, and immediately launch a counter street offensive against the army.

"There will be war for sure," the source told Reuters.

VOLATILE MARKETS

The unrest forced the stock market and Thai baht lower in early trade as investors feared it would exacerbate the problems facing the economy, but stocks turned higher by the close amid speculation Somchai would quit.

Thailand's finance minister has said the protests could cause a recession in an economy that depends on tourism and exports, both vulnerable to the global economic slowdown.

The government forecast this week that the economy would grow just 4.5 percent this year, its slowest rate in seven years.

Thousands of passengers slept overnight on benches and luggage carousels at Suvarnabhumi, many angry that airport staff fled when the PAD demonstrators, dressed in the movement's yellow shirts, invaded the terminal.

"We came here and we saw all these people in yellow. We thought they were football fans. Now we're just waiting," said a Dutchman who gave his name as Mark.

Thai Airways, the national carrier, said 16 inbound flights had been diverted to Bangkok's old airport Don Muang, 45 km (30 miles) from Suvarnabhumi, and another three flights to a Vietnam War-era airbase 150 km (90 miles) southeast of Bangkok.

Most airlines halted services to the Thai capital, a regional hub with 125,000 passengers passing through Suvarnabhumi daily.

Police have gone out of their way not to escalate the tension by confronting the PAD, although gunfire broke out on the streets on Tuesday as armed PAD members took on government supporters.

At least 11 people were hurt, officials said, in scenes shown on Thai television that are likely to undermine public support for the PAD, which claims the backing of Bangkok's urban middle classes and elite.

Broadly speaking, Thaksin and the government have the support of rural voters and the urban poor.

(Additional reporting by Martin Petty; Writing by Darren Schuettler; Editing by Ed Cropley and Jeremy Laurence)

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