Thai PM refuses to quit and mulls protest "measures"

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By Nopporn Wong-Anan

BANGKOK (Reuters) - Thai Prime Minister Somchai Wongsawat rejected his army chief's call Wednesday to quit in the face of anti-government protests which threaten to spiral out of control across the country.

Speaking on national television, Somchai said his government was democratically elected and would continue to work for the "good of the country," despite claims by the People's Alliance for Democracy (PAD) it is the puppet of ousted leader Thaksin Shinawatra.

Somchai's refusal to call a snap election, as army chief Anupong Paochinda said he should at an earlier news conference, heightened speculation of an imminent coup, despite Anupong's stated aversion to such a move.

Somchai returned to Thailand from an Asia-Pacific summit to find tempers flaring across the country and threatening to explode into civil unrest.

In the northern city of Chiang Mai, a pro-government gang shot dead an anti-government activist after dragging him from his car, the first serious violence outside the capital, police said.

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 PAD street movement to end its crippling siege of Bangkok's Suvarnabhumi airport, where all flights were cancelled, leaving thousands of tourists stranded.

A court also issued an injunction telling the group to leave the airport, one of Asia's largest.

Anupong repeated that he would not launch a coup two years after the military removed Thaksin, saying a putsch would not heal the basic rifts between the Bangkok elite who despise Thaksin, and the rural masses who love him.

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

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" 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 Jeremy Laurence)

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