Thai prime minister Abhisit Vejjajiva said today he would soon unveil a "road map" to end a two-month crisis that has killed 27 people, playing down the risk of more violence from anti-government protests.
Thousands of protesters who have paralysed Bangkok showed no sign of leaving the city's main shopping district, a day after Mr Abhisit warned of new "clashes and losses" if they remained.
Speaking in parliament today, Mr Abhisit struck a more conciliatory tone, saying the government hoped to resolve the impasse through talks and that he would soon produce a plan to pull the country back from the brink of civil conflict.
"I will bring a proposal which could provide a political solution or a road map," he said.
"But it has to be from the opinions of every side - not just the government, politicians, protesters and counter-protesters. It has to be a real collective solution," he added.
The British-born, Oxford-educated Mr Abhisit is under intense pressure to end the stalemate that has choked off tourism and prompted the International Crisis Group to warn Thailand could slide into an "undeclared civil war".
The finance minister said last week the protests could cut growth by 2 percentage points if they continued all year. The unrest could also delay an expected interest rate rise in June, say economists, pointing to government data today showing inflation slowing in April, reducing the need for a rate rise.
Thailand's financial markets, closed for a market holiday today, have underperformed regional peers since April 10th, when the protest turned deadly with a gunbattle in the heart of old Bangkok that killed 25 people and wounded more than 800.
Over the past month, the benchmark SET index lost 3.1 per cent, compared with a 1.1 per cent rise in Asia's markets outside of Japan, making Thailand Asia's poorest performer as foreign investors sold $155 million of Thai stocks.
Last week the baht currency suffered its largest weekly loss since January.
Today, thousands of the red-shirted supporters of ousted prime minister Thaksin Shinawatra remained in their 3 sq km (1.2 sq-mile) fortified encampment, continuing to demand parliament be dissolved and an election held within three months.
Army spokesman Sansern Kaewkamnerd told reporters the security forces could use armoured vehicles to disperse the protesters, but did not indicate when such a move might happen.
"Armoured vehicles will be sent in to ensure safety for troops and police," he said. "These vehicles will allow us to move to protesters without using arms if not necessary."
The mostly rural and urban poor red shirts say Mr Abhisit lacks a popular mandate after coming to power in a controversial parliamentary vote 17 months ago and heading a coalition cobbled together with help from the military.
Mr Abhisit has rejected a red shirt proposal for an election in three months, saying he would not negotiate amid threats. He has offered to call an election in December, a year early.
About 1,000 people in a new protest movement known as the "multi-coloureds" rallied in Bangkok's old quarter, urging Mr Abhisit to end what they say are illegal red shirt protests.
Reuters