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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 political crisis threatening to spiral out of control after a gang shot dead an anti-government activist.
Prime Minister Somchai Wongsawat, who has rejected army chief Anupong Pachinda's call to dissolve parliament, will address the nation on television at around 9 p.m. (2 p.m. GMT), his chief of staff told Reuters.
Somchai returned to Thailand from an Asia-Pacific summit to find tempers flaring across the country and threatening to explode into civil unrest.
A gang of government supporters in the northern city of Chiang Mai shot dead an anti-government activist on Wednesday, the first serious violence outside Bangkok.
The victim, a man in his 50s whose son ran a small anti-government radio station, was dragged from his car before being shot, police lieutenant-colonel Atipol Thongdaeng told Reuters.
Increasing the pressure on Somchai, Anupong told reporters in Bangkok the prime minister "should dissolve parliament and call a snap election" to end a crisis now in its fourth year.
The general also told the People's Alliance for Democracy (PAD) street movement to end its crippling siege of Bangkok's Suvarnabhumi airport, where all flights were cancelled, leaving thousands of tourists stranded.
Anupong repeated that he would not launch a coup two years after the military removed former leader Thaksin Shinawatra, saying a putsch would not heal the basic rifts between the Bangkok elite who despise Thaksin, and the rural masses who love him.
He and other top military brass made a similar intervention on 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.
Thai media speculated Somchai may declare a state of emergency in Bangkok, although as with a similar declaration in September, it is unlikely the army would be willing to take any action.
Domestic flights out of Bangkok's old Don Muang airport were also grounded, all but severing air access to the outside world.
"WAR FOR SURE"
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.
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.
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.
Most airlines halted services to the Thai capital, a regional hub with 125,000 passengers passing through Suvarnabhumi daily.
Although the PAD has been campaigning non-stop for six months, it engineered a "final battle" on Monday, telling supporters the government would get parliament to amend the constitution to favour Thaksin, who has been convicted of graft and is now in exile.
(Additional reporting by Martin Petty; Writing by Darren Schuettler; Editing by Ed Cropley and Valerie Lee)
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