Thailand's Prime Minister warned anti-government protesters on Sunday there was a risk of "losses" if they did not get out of a Bangkok shopping district they have closed for a month, but the protesters vowed to stay put. "From now on, what the government will do may risk clashes and losses, but the government knows what it's doing. What needs to be done must be done," Abhisit Vejjajiva said in a weekly televised address. It was not clear what he meant by "losses".
Abhisit held a special cabinet meeting later on Sunday to discuss ways to end the stalemate.
Government spokesman Panitan Wattanayakorn said afterwards that Abhisit had come up with a plan to ease tensions, which would be clarified next week. In the meantime, the authorities would continue trying to persuade protesters to leave.
"The government will send text messages to protesters to tell them about the situation and is hoping they will return home," Panitan told reporters.
But the red-shirted supporters of ousted premier Thaksin Shinawatra who are demanding early elections, said they were staying put, although they agreed to pull back a barrier around 200 metres to give cars access to a big hospital.
Asked by reporters if Abhisit had accepted that, Nattawut Saikua, a protest leader, said: "That's Abhisit's problem. If he wants to do anything, we're prepared for that."
Amid speculation martial law could be imposed to clear the protesters, who have forced ritzy shopping malls and luxury hotels to close, Abhisit appeared to rule that out, saying "this instrument is not needed".
Martial law would give troops more freedom to act to end the rally -- for example, allowing detention without a court order for seven days. However, under a state of emergency declared in the capital on April 7, the security forces already have wide-ranging powers.
Some army commanders, including army chief Anupong Paochinda, are reluctant to use force because of the inevitable bloodshed. On some evenings, tens of thousands of protesters gather in the occupied shopping district, women and children amongst them.
Anupong has called for a political solution, but hopes of a deal faded when British-born Abhisit rejected a red shirt proposal for an election in three months, saying he would not negotiate in the face of threats.
FORCE IF NECESSARY
On Saturday, army spokesman Sansern Kaewkamnerd said the government had ordered police to retake the area around Chulalongkorn Hospital, near the Silom business district, to ensure public safety, using force if necessary.
The red shirt demonstrators caused outrage when about 200 of them barged into the hospital grounds on Thursday, looking for soldiers they thought were there preparing an attack.
Their leaders apologised and removed part of the barricade in the area to allow better access to the hospital. They moved the barricade back further on Sunday to let traffic flow to and from several hospital entrances.
But this appears to have been their only concession and red shirt leader Nattawut said that, as part of the deal, police had even agreed to help reinforce the barrier once it was moved away from the hospital.
"We've agreed with police that we'll bring concrete blocks to close off the area. I've asked police to help carry them there for us and police are OK to do it."
There were several thousand demonstrators at the rally site on Sunday afternoon. Numbers typically swell into the evening. There were no more police than normal and no attempt to dislodge the protesters, Reuters reporters said.
The protest rally is now in its eighth week in the capital and the authorities have found no way to disperse it without the risk of serious casualties.
One bungled attempt to dislodge them from another part of Bangkok on April 10 ended with 25 people dead and more than 800 wounded.
Another person died in still-unexplained grenade attacks on the Silom business district on April 22 and a soldier died in skirmishes on a suburban highway on April 28.
The fault lines are widening between the establishment -- big business, aristocrats, the military brass and the middle class -- and the protesters drawn from the rural and urban poor.
Thaksin lives abroad to escape a jail sentence handed down for corruption.
The crisis has cast a pall over the economy, decimating the tourist industry, closing businesses and depressing consumer confidence. Finance Minister Korn Chatikavanij said on Friday economic growth could be cut by 2 percentage points if it continues all year.
The hospital incursion raised concerns about how much control leaders have over their followers, particularly Major-General Khattiya Sawasdipol and the shadowy "black clad" paramilitaries that have appeared at flashpoints during the rally.