Speaking in Cambodia yesterday after attending an informal meeting of Asean finance ministers, Thanong said that when Parliament can be reconvened, a new premier should be elected who is well versed in both these areas.

"Although we are in the process of political reform, [the new premier] should [also] set priorities on how to drive the economy forward. Besides, people should be invited to participate in the constitutional reform - people who are acceptable to all sides, have a leadership vision, and can coordinate with all parties."

Asked if he will return to be finance minister, Thanong said: "It's up to the Thai Rak Thai Party. I am not the party's administration, but I am ready to offer my hands."

Caretaker Prime Minister Thaksin Shinawatra announced earlier this week that he would step down as leader of a new government following months of mass protests demanding his resignation. He said a Cabinet meeting earlier this week was his last before taking a break.

Thanong said the other Asean finance ministers had asked him about the situation in Thailand.

"After Thaksin announced he was standing back from politics, foreign investors and our neighbours thought the situation in Thailand had become much clearer. They still believe in the fundamentals of the Thai economy."

Thanong said that despite the political turmoil and the need for a new government, he believed the economy would grow by at least 5 per cent this year.

"This level is considered moderate because of positive trends in economic factors that we have seen from early this year: exports, tourism and an improved investment atmosphere," he said. "We have started to correct the trade deficit, in spite of spiralling oil prices."

The caretaker finance minister said the political situation had not been worrisome when it first began. But after the impasse continued for three months, foreigners started to worry.

"When Thaksin decided to step down, there was much clarity," he said. "However, a majority of foreigners thought that even though there were differences of opinion in Thai society, Thais tend to compromise to solve conflicts rather than resorting to violence."

Thanong said that while the new interim government has to speed up constitutional reform, it also had to keep foreigners informed, to encourage them to invest in Thailand. When the new government is sworn in, it will have to proceed with the mega-projects - especially the water resource management project, to support the industrial and agricultural sectors, and the logistics project, because Thailand currently ranks among those countries with the highest transportation costs.

Meanwhile, the Asean finance ministers agreed to cooperate in combating external risks affecting regional economies, such as bird flu, US deficits and spiralling oil prices. They also set up a joint committee to consider how currency fluctuations can be limited.

Thanong said the ministers believed that overall Asean economic growth should reach 5.8 per cent this year.

The meeting set up a working group to formulate guidelines for creating regional immunity to US current-account deficits. The present deficit has affected the movement of currency in Asean countries. Among other things, the group will consider promoting the exchange of regional currencies instead of using the US dollar.

The meeting also discussed preparations for the third Asean finance ministers' road show, in which foreigners will be invited to participate in big infrastructure projects and capital markets in the region. The road show will be staged in Hong Kong on September 14 and during the annual International Monetary Fund/World Bank meeting in Singapore on September 16.

Thailand will host the 11th meeting of Asean finance ministers in March next year.