UPDATE 2-Thai PM rebuffs demands for dissolving parliament

(Writes through)

By Chalathip Thirasoonthrakul

BANGKOK, March 29 (BestGrowthStock) – Thai Prime Minister Abhisit
Vejjajiva on Monday rebuffed a demand by “red shirt” leaders to
dissolve parliament in 15 days, dashing hopes of an end to an
intensifying political crisis and two weeks of protests.

Abhisit, who enjoys backing of the military and Thailand’s
establishment elite, said immediate dissolution of parliament
was “impossible” but that he was willing to discuss holding
elections before his term expires at the end of next year.

“This is the best approach for the country right now and we
can talk more about it, but if you insist it has to be 15 days,
then I don’t think we’re on the same page,” Abhisit said.

Tens of thousands of protesters were still out on the
street on Monday when the stock market (.SETI: ) ended down
almost 1 percent, losing about 2.6 percent since reaching a
21-month high on Wednesday.

The protesters massed on Sunday outside an army base where
Abhisit has stayed, a day after declaring they were “at
breaking point”, surrounding his Government House office and
forcing thousands of troops to pack up and leave to avert
clashes.

“The unsettling political situation will limit fund inflows
to the Thai stock market,” said Chakkrit Charoenmetachai, an
analyst with Globlex Securities. “Foreign investors have made
huge buys … so they could hold back somewhat now.”

The Finance Ministry said in revised economic forecasts
that the economy could grow 4.5 percent this year, up from 3.5
percent seen in December, but officials said political tension
could throw that out of gear [ID:nSGE62S038].

On Sunday, Abhisit agreed to talks to try to defuse
tensions but appeared evasive, insisting he would act in the
best interests of the country.

The talks resumed on Monday, but no date was set for a
further round.

Analysts say allies of ousted former premier Thaksin
Shinawatra, the assumed leader and financier of the “red
shirts”, were likely to win whenever an election takes place,
raising the possibility of another judicial or military
intervention.

One of the protest leaders, Weng Tojirakarn, said a new
election was the only way to end the deadlock. “There’s no
point buying time,” he told Abhisit.

After two weeks of peaceful rallies, the “red shirts” have
intensified their campaign to topple the government, triggering
fears of clashes between security forces and protesters and a
flurry of negotiations to defuse tensions. [ID:nSGE62D00D]

It appeared they were responding to calls late last week by
the exiled Thaksin for a campaign of “civil disobedience”.

The threat of a flare-up by the protesters and a slew of
mysterious but non-fatal grenade attacks and small bombings on
government buildings, banks, and three state-controlled
television stations have rattled the city of 15 million.

The protests and symbolic attacks continue to draw
attention to the deep divisiveness in Southeast Asia’s
second-biggest economy which has clouded the long-term outlook,
with foreign investment pledges down 15 percent this year.

Stock Market

(Additional reporting by Pracha Hariraksapitak; Writing and
additional reporting by Martin Petty; Editing by Nick Macfie)

UPDATE 2-Thai PM rebuffs demands for dissolving parliament