Bangkok: A prolonged and increasingly violent stand-off between government and red shirt protesters in Bangkok is worsening and could deteriorate into "an undeclared civil war", the International Crisis Group said.
"The Thai political system has broken down and seems incapable of pulling the country back from the brink of widespread conflict," the Brussels-based conflict resolution group said in a report released late on Friday.
"The stand-off in the streets of Bangkok between the government and Red Shirt protesters is worsening and could deteriorate in undeclared civil war."
Thailand should consider help from neutral figures from the international community, drawn perhaps from Nobel peace laureates, to avoid a slide into wider violence, it said.
Clashes between the military and the red shirts, made up of mostly rural and urban poor, have killed 27 people and injured nearly 1,000 in a seven-week-old drive to force early elections.
Dozens of mysterious explosions have hit the capital, including grenade attacks on April 22 in the business district that killed one and wounded scores.
Bangkok anxiously awaits an army operation to eject the Red Shirts from their tent city, fortified with ramshackle barriers of tyres and bamboo poles, which could lead to a bloodbath.
The fault lines are widening between the establishment -- big business, the military brass and an educated middle class -- and the protesters, many of whom support former Prime Minister Thaksin Shinawatra, ousted in a 2006 coup.
Civil society groups brought the government and the protesters together but the talks faltered over when to hold elections. The red shirts offered a 90-day timeframe, but the prime minister rejected that last weekend.
The crisis comes as Thailand faces its first prospect of royal succession in more than six decades.
The government has stepped up accusations that the red shirt movement has republican leanings - a provocative claim in a country where many consider the king almost divine - and that key figures are part of a loose network to overthrow the monarchy.
The report recommended the creation of a high-level group of international figures, noting that Nobel Laureate and East Timor President Jose Ramos Horta was in Bangkok this week at his own initiative and could be joined by other figures.
The group should bring the two sides together to end the military operation and limit the protests "to a small, more symbolic number of people who do not disrupt life in Bangkok".
It could also begin negotiations on an interim government of national unity and preparations for elections.
The government is unlikely to welcome such mediation. The foreign minister this week upbraided Western diplomats for talking with red shirt leaders at the encampment, which lies near embassies in the area that could be affected by violence.
Remove barricades
The crisis has cast a pall over the economy, decimating the tourist industry, closing businesses and depressing consumer sentiment. Finance Minister Korn Chatikavanij said Thailand's economic growth rate could be cut by two percentage points if it continues all year.
Deputy Prime Minister Suthep Thaugsuban ordered police to dismantle the red-shirts' barricades by the entrance to Chulalongkorn Hospital, which protesters raided on Thursday night, thinking troops were hiding there.
"I have this time made a clear order that metropolitan police must remove the blockage," Suthep said. "If they fail to comply with the order, I will have others to do the job."
Sometimes called "tomatoes" for a perceived sympathy for the red shirts, police have been lukewarm at best in checking the seven-week protests.
Nor are the red shirts in unison. Their leaders ordered the barricade removed from the hospital on Friday, only to have a rogue major-general who has overseem their security restore it.
They again demanded their supporters remove the barricade after apologising for the raid that forced the hospital to close and evacuate patients.
It was their second setback in a week after security forces on Wednesday stopped an attempt to hold "mobile rallies" outside their 3 sq-km (1.2 sq-mile) camp/
The incursion raised concerns about how much control leaders have over their followers, particularly over Maj-Gen Khattiya Sawasdipol and the shadowy "black clad" paramilitaries that have appeared amongst the red shirts as their defenders.
Prime Minister Abhisit said in a statement after the hospital raid that the government would not allow "intimidation of the public and will act according to necessity to prevent that".
The red shirts have ignored repeated warnings like that.
Royalist "yellow shirts", who besieged Bangkok's airports for a week in 2008 in a campaign to topple a pro-Thaksin government, have re-emerged to demand military action to disperse the red shirts, warning they could again take matters in their own hands.
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