* Thai PM rules out snap election
* PM says people entitled to protest within law
By Sebastian Tong
LONDON, April 2 (Reuters) - Thailand's prime minister on Thursday ruled out a snap election to resolve a long-running political crisis and said a week-long street campaign would not deflect the government from staving off an economic slowdown.
Thousands of supporters of ex-prime minister Thaksin Shinawatra have camped outside Government House since last Thursday in a bid to force out Prime Minister Abhisit Vejjajiva and trigger new elections.
"We think at the moment the country is better served with stability, with the government addressing the immediate needs of the people against the impact of the economic crisis," Abhisit told Reuters on the sidelines of the Group of 20 (G20) summit in London where he represented regional grouping ASEAN.
Abhisit, who was elected by Thai legislators in December, said the protesters have had minimal impact on his government so far.
"So long as people want to exercise their constitutional right (to protest) within limits of the law, they are entitled to do so. We've had big protests over the last couple of months without any violence and without any disruptions and we think that would continue to be the case," said the 44-year-old Oxford graduate.
Abhisit said the government was preparing for a second round of stimulus measures that included public infrastructure works that would help bring the economy back into positive growth by the end of the year.
The economy is expected to shrink 2-3 percent this year according to several forecasts and the Asian Development Bank said this week that political instability -- sparked off in 2006 after the ousting of former telecoms billionaire Thaksin in a bloodless coup -- could delay the implementation of government stimulus measures.
Abhisit said he was confident violence could be avoided despite the impasse between pro- and anti-Thaksin supporters and said he did not see a similar disruption on the scale of last year's siege of Bangkok's airport by anti-Thaksin protesters.
"The mood of the country is clear. The Thai people want to move on. We won't see a repeat of what we saw last year." (Editing by Charles Dick)