By Anuchit Nguyen and Daniel Ten Kate
Nov. 6 (Bloomberg) -- Thailand will reconsider agreements with Cambodia after the government in Phnom Penh named fugitive former Thai Prime Minister Thaksin Shinawatra as an economic adviser, threatening to fan tensions that recently led to gun battles along their border.

Thailand recalled its ambassador from Cambodia yesterday and will now review all accords signed with the country, Thai Prime Minister Abhisit Vejjajiva told reporters in Bangkok. Thaksin’s appointment is an “interference in Thailand’s domestic affairs and failure to respect Thailand’s judicial system,” the Foreign Ministry said in a statement. The move “hurts the feelings of most Thais,” Abhisit said.

Cambodian leader Hun Sen sparked a diplomatic row last month by comparing Thaksin to Aung San Suu Kyi, Myanmar’s detained opposition leader. Hun Sen said he wouldn’t extradite Thaksin, ousted from office in Thailand in a 2006 coup and living in exile after fleeing a two-year prison sentence for abuse of power.

Thaksin has engineered anti-government protests from abroad since he left the country, attacking Abhisit and preparing his allies for a fresh election. President Barack Obama, on his first trip to Asia, is scheduled to co-chair with Abhisit a Nov. 15 summit of Southeast Asian leaders that will include Hun Sen.

A Twitter message posted on Thaksin’s Web site yesterday said the decision to recall the ambassador was “childish” and an “overreaction.” Thaksin lives in Dubai and travels frequently. His spokesman, Phongthep Thepkanjana, didn’t answer calls to his mobile phone.

Border Temple

Relations between the two countries have deteriorated since July 2008, when a Thai court ordered a pro-Thaksin government to withdraw support for Cambodia’s bid to list the Preah Vihear temple as a United Nations World Heritage site. The temple is near an area of land the two countries dispute. Gun battles near the site since then have killed at least six soldiers.

If Thaksin “were actually there and coordinating his people from a base, that would cause problems,” said Robert Broadfoot, managing director of Hong Kong-based Political & Economic Risk Consultancy Ltd. “I don’t think either Hun Sen or the Thais will allow this to spin out of control. Cambodia is just taking the opportunity to get back at what was really a Thai mistake” in objecting to the temple listing.

Cambodian government spokesman Khieu Kanharith didn’t answer calls to his cell phone.

Thailand last recalled its ambassador in 2003, when Cambodians burned down the embassy and attacked Thai businesses. Thaksin was Thailand’s prime minister at the time.

Energy Reserves

Thai and Cambodian officials had set up committees to work on demarcating their 803-kilometer (499-mile) land and sea border. The two countries have yet to reconcile 10,422 square miles of disputed waters in the Gulf of Thailand that may contain oil and gas reserves.

Thaksin or his allies have won Thailand’s past four elections since 2001. Since the coup, courts have disbanded two parties linked to him, including the winner of the 2007 election last year that allowed Abhisit to form a coalition. The Thaksin- linked Puea Thai party remains the largest in Parliament.

Thaksin, a billionaire-turned-politician, has claimed the judicial system is biased against him. His opponents say he’s corrupt and wants to upend Thailand’s monarchy.

To contact the reporters on this story: Anuchit Nguyen in Bangkok at anguyen@bloomberg.net; Daniel Ten Kate in Bangkok

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