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Thailand to scrap oil deal with Cambodia over Thaksin appointment

Thailand has threatened to scrap a deal on developing energy reserves with Cambodia a day after both nations recalled their ambassadors in a row over Phnom Penh's appointment of ousted Thai premier Thaksin Shinawatra (pictured) as economics adviser.

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AFP - Thailand said Friday it would tear up an oil and gas exploration deal with Cambodia, stoking a row over Phnom Penh's naming of fugitive former Thai premier Thaksin Shinawatra as an economics adviser.

The government in Bangkok also warned that it could seal the border between the two countries, one day after the neighbours both recalled their respective ambassadors due to the dispute over the appointment of Thaksin.

Thai Foreign Minister Kasit Piromya said Bangkok had decided to cancel a 2001 agreement to jointly develop a disputed area in the Gulf of Thailand which was signed during Thaksin's time in power.

Twice-elected Thaksin was ousted in a coup in 2006 and had close relations with Cambodian Prime Minister Hun Sen during his six years in power. Thaksin is now living abroad to avoid a two-year jail term for corruption.

"The Foreign Ministry has decided to terminate the memorandum of understanding between Thailand and Cambodia to develop the overlapping area which was signed by the Thaksin government," Kasit said.

Kasit said the oil and gas exploration deal for a 26,000-square-kilometre (10,038-square-mile) area had made no progress in the last eight years and he would propose to the cabinet on Tuesday that it should be scrapped.

"The ministry believes that the appointment of Thaksin directly affects the agreement as he was fully aware of Thailand's position in dealing with Cambodia," he told reporters by telephone from a regional summit in Tokyo.

Thailand said Thursday that it was halting all ongoing talks with Cambodia, including long-stalled discussions over how to divide up offshore energy resources along their disputed sea border in the Gulf of Thailand.

Thai Deputy Prime Minister Suthep Thaugsuban urged Cambodia earlier Friday to reverse the appointment of Thaksin, which was announced on Wednesday and first floated by Hun Sen at an Asian summit in late October.

"If Cambodia still adopts a hard line and uncompromising attitude, then we must continue to downgrade relations and maybe seal off all border checkpoints," Suthep said.

There were no reports of any incidents along the border so far and trading was going on as normal, Suthep said.

Thailand and Cambodia have fought a series of deadly skirmishes since July 2008 over disputed land around the ancient Preah Vihear temple on the border.

Cambodian cabinet spokesman Phay Siphan said that sealing checkpoints "is not a good thing to do. It means they're isolated, they don't solve the problem."

"This government surely does not represent the Thai will and the Thai interests," Phay Siphan told AFP.

Thailand meanwhile boosted security around the Cambodian Embassy. There have been rallies in recent weeks around the building by anti-Thaksin protesters.

Relations between the two countries nearly reached breaking point in 2003 when a mob burned down Thailand's embassy in Phnom Penh and sacked several Thai-owned businesses.

Suthep meanwhile said there were no plans for Thai Prime Minister Abhisit Vejjajiva to meet his Cambodian counterpart at a summit of Mekong River basin nations in Tokyo starting Friday.

Thaksin remains a hugely influential figure in Thailand, which has been rocked by years of protests by his red-clad supporters and yellow-clad opponents, including rallies that shut down Bangkok's airports last year.

 

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