Thailand's red shirt protesters called off a march to Bangkok's business district today after the army warned they would face bullets and tear gas.
As night fell, thousands of supporters of ousted premier Thaksin Shinawatra gathered across an intersection from the business district, using firecrackers to taunt hundreds of riot police and troops, many armed with M-16 assault rifles.
The red shirts also tightened security in the shopping district they have occupied for 18 days, raising tensions in a bloody six-week protest demanding new elections.
At least two luxury hotels in the shopping district announced they had closed for the rest of this week for safety reasons.
"We will stay here indefinitely," Nattawut Saikua, a protest leader, told reporters in the Rachaprasong district of high-end department stores and luxury hotels, adding they would only hold a rally at a second site in the business area if soldiers leave.
He called off the march after comments by an army spokesman who said troops would be tougher and use weapons if provoked.
Analysts say the protest has evolved into a dangerous standoff between the army and a rogue military faction that supports the red shirts and includes retired generals allied with twice-elected Mr Thaksin, who fled Thailand to escape a prison term for corruption.
While the protesters cancelled their march to the business district, hundreds remained at the entrance to it, where they had stockpiled sharpened bamboo poles, bricks and bottle rockets. Several thousand other red shirts were dug in at the shopping district, about 2km away.
"We can no longer use the soft to hard steps," army spokesman Colonel Sansern Kaewkamnerd told reporters. "If they try to break the line, we will start using tear gas, and if they do break the line, we need to use weapons to deal with them decisively."
He said some protesters were armed with petrol bombs, boards, grenades and dangerous acids.
Last night, Prime Minister Abhisit Vejjajiva again rejected demands to call an election he would almost certainly lose, saying the red shirts must be brought under control.
Both sides want to be in power during a military reshuffle in September. If the Thaksin camp is governing at that time, analysts expect it would bring about major changes by ousting generals allied with Thailand's royalist establishment, a prospect that royalists fear could diminish the power of Thailand's monarchy.
Given the intransigence on both sides after more than a month of protests, analysts fear further violence.
Hotel occupancy is put at just 20 per cent in a country heavily reliant on tourism for jobs.
Despite the tensions, Thai stock prices rallied after falling 8.23 per cent since clashes between troops and demonstrators on April 10th that killed 25 people. Foreign investors resumed buying this week, pushing the index up 5.7 per cent today, its biggest one-day gain in 15 months.
Reuters