Thai red shirts camped at shopping hub; await plans

BANGKOK (Reuters) - Thousands of "red shirt" protesters were camped at an upmarket shopping district in Thailand's capital on Thursday, awaiting word on how and when they would resume action against the government.

The campaign for new elections, which has lasted more than a month and erupted into savage fighting between protesters and police on Saturday in which at least 22 people were killed, looks set to hit growth in Southeast Asia's second-largest economy.

Calm has returned to Bangkok's streets as Thais celebrated the New Year Songkran holiday this week, but offices, financial markets and businesses were set to reopen on Friday.

"Later today, we will decide what to do tomorrow," protest leader Nattawut Saikua told Reuters Television.

The police and army did not intervene to prevent protesters from gathering and were not in evidence on Thursday after another peaceful night in the Thai capital.

The red shirts, mostly supporters of ousted Prime Minister Thaksin Shinawatra, want Prime Minister Abhisit Vejjajiva to quit immediately have said they will use their base in the Rachaprasong business district as a "final battleground."

Chai Srivikorn, president of the Rachaprasong business association, was quoted by the Post Today newspaper as saying that the cost of the protest to the affluent shopping district was running at about 150 million baht (2.99 million pounds) a day.

Investment bank Morgan Stanley calculates economic growth this year could be cut by 0.2 percentage point due to the impact on tourism, which accounts for 6 percent of gross domestic product in the "Land of Smiles" and employs 1.8 million people.

The government has forecast 4.5 percent growth this year if the protests were not prolonged.

Thailand's stock market, one of Asia's most buoyant this year on the back of a steady influx of foreign funds, fell over 5 percent on Monday before closing 3.64 percent down and is likely to see renewed selling on Friday, analysts said.

LOW PROFILE

Abhisit has kept an unusually low profile, with no public appearance since his last televised broadcast from an army barracks on Monday. The lack of response has added to a sense anxiety about what his administration may do next to try to resolve the deadlock.

The Bangkok Post reported that the military had admitted for the first time that it used live ammunition during Saturday's protests. Previously, it had insisted that only rubber bullets were used and that the deaths were due to "terrorists."

There were signs that the political divide in Thailand between the mostly rural red shirts and the urban, pro-administration "yellow shirts" was likely to grow.

The yellow shirts, whose own street protests led to the ouster of the government backed by Thaksin in 2008, will meet on Sunday to discuss how to end the "terrorism" gripping Bangkok.

"We don't think the dissolution of parliament will resolve the problem," Suriyasai Katasila, leader of the yellow-shirted People's Alliance for Democracy, told Reuters.

Meanwhile, Thaksin, who is in exile after he was sentenced to jail for corruption, said on his Facebook page that he was in Saudi Arabia and refuted rumours that he was ill.

"I have been to Riyadh and Jeddah in Saudi Arabia from April 10-12 at the invitation of a prince of Saudi Arabia to provide consultancy for projects to build two new towns," he wrote.

"So the rumour that I am ill isn't true," he said on his page (http://www.facebook.com/thaksinlive).

(Writing by David Chance; Editing by Raju Gopalakrishnan)