UPDATE 2-Cambodia rejects Thai request to extradite Thaksin

By Martin Petty PHNOM PENH, Nov 11 (Reuters) - Cambodia refused a request from Thailand on Wednesday to extradite fugitive former Thai premier Thaksin Shinawatra, adding fuel to a widening diplomatic row that threatens to worsen Thailand's political crisis. Cambodia's Foreign Ministry rejected the request just moments after a Thai diplomat submitted it in person, saying it does not recognise Thailand's charges against Thaksin, who was ousted in a 2006 coup and later sentenced to two years in prison for graft. It said Thaksin was toppled by the military after being "overwhelmingly and democratically elected by the Thai people". Thaksin, a billionaire former telecommunications tycoon twice elected in landslides, had been living in self-imposed exile, largely in Dubai, before arriving in Phnom Penh on Tuesday as a guest of Cambodian Prime Minister Hun Sen, who has offered him a job as economic adviser, infuriating the Thai government. The spat looks set to undermine any attempt by Southeast Asian leaders to project a united front in talks with U.S. President Barack Obama on Sunday in Singapore, the first-ever meeting between a U.S. leader and all 10 members of the Association of South East Asian Nations (ASEAN). Thaksin's presence in Cambodia, where he intends to give a speech on Thursday, has fired up passions on both sides of Thailand's political divide while drawing attention to a border where Thai and Cambodian troops have clashed in the past year. Thai Prime Minister Abhisit Vejjajiva said he regretted Cambodia's decision to reject its extradition request but vowed to ensure the row would not get out of hand. "I insist the government will take care of this rationally," he told reporters in Bangkok. "We will not allow any kind of violence, or military action between the two countries, or even close the border, as we don't want to cause any trouble." Abhisit is under pressure to contain the feud, which could embarrass the Thais in front of Obama. Thailand chairs ASEAN this year, and the regional group's meeting with Obama will be led by Abhisit, whose coalition government is on shaky ground. But extremists within the urban elite who despise Thaksin want Abhisit to take bolder retaliation, from closing all border trade to stepping up Thailand's military presence on the border. BACKFIRE Analysts say such moves could backfire. Closing the border could hurt Thailand as much as Cambodia, especially if Cambodia turned to Vietnam for more of its imports. In a joint interview with Hun Sen on Cambodian state-run TVK, Thaksin said the extradition request was not a surprise. "They are hunting me," he said. "I tell the Thai government: 'just forget about me, don't worry about me, I won't harm Thailand. I'm a ex-prime minister who loves his country." Some analysts say the Cambodian move was cooked up to boost Thaksin's chances of wresting back power. "Thaksin wants to cause chaos at home and remind his supporters he's still alive," said Puangthong Pawakapan, a Thai-Cambodian relations specialist at Chulalongkorn University in Bangkok. Thaksin is still immensely popular among Thailand's rural poor and his red-shirted supporters have staged frequent street rallies in Bangkok, calling for his pardon and return. Abhisit's allies, who wear the king's traditional colour of yellow at protests, plan a demonstration of their own on Sunday in Bangkok to denounce Thaksin and the Cambodian government. Hun Sen said he wanted to solve the dispute through peaceful talks but would refuse to discuss Thaksin's extradition. He pledged to help Thailand by supporting Thaksin. "I understand the feeling of the Thai people that they would like Excellency Thaksin to return...he truly wants to serve the Thai people but has not been given the chance," he said. (Additional reporting by Ek Madra in Phnom Penh and Pracha Hariraksapitak in Bangkok; Editing by Jason Szep) Keywords: THAILAND CAMBODIA/ ([e-mail]; [phone]. Reuters messaging [e-mail]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.