Bangkok  - Thousands of travellers were stranded at Bangkok's Suvarnabhumi International Airport Wednesday after their flights were cancelled because of a siege on the facility by anti-government protestors who have pledged to stay until the prime minister resigns.

The closure of the country's main airport has dealt an immediate blow to the country's tourism industry, the leading industry earner of foreign exchange for the kingdom.

"The damage done is huge," said Chaisak Angsawan, director general of the Department of Aviation. He estimated that Suvarnabhumi handles 370 flights a day, all of which have been cancelled or diverted to other airports.

The protestors took control of the airport's entrances about 9 pm (1400 GMT) Tuesday, forcing the Airports of Thailand to announce the cancellation of departing flights for security reasons. Incoming flights were being diverted to other airports.

The demonstrators, who had virtually taken control of the airport, only allowed Flight 809 of Iran Airlines to leave the facility as it was taking 416 Thai Muslims to Tehran before flying to Saudi Arabia for the haj.

The airport closure comes as Thailand is entering its peak tourism season, November through February, which has already been impacted by high oil prices, the global financial crisis and months of escalating political confrontation in Bangkok.

"We are breaking our own rice bowl," said Wichit Na-Ranong, a hotelier in Phuket province and head of the Thai Tourism Federation.

Wichit warned that if tourist arrivals fell 50 per cent this peak season, the country stands to lose 100 billion baht (2.9 billion dollars).

Thousands of followers of the People's Alliance for Democracy (PAD) descended on Suvarnabhumi Tuesday evening in a bid to prevent the return of Thai Prime Minister Somchai Wongsawat from the Asia Pacific Economic Cooperation summit in Peru.

Although the PAD's original aim had been to prevent Somchai's return, it has threatened to stay at Suvarnabhumi until the prime minister steps down.

"We will gather at the airport until Prime Minister Somchai resigns," said PAD spokesman Panthep Wongpuapan, according to The Nation news website.

The PAD - a loose alliance of disparate groups bound together by their hatred of Thaksin Shinawatra, a billionaire telecommunications tycoon who was prime minister from 2001 to 2006 - has been using increasingly violent tactics to overthrow the government and force Somchai, who is Thaksin's brother-in-law, to resign.

Thai police and the politically powerful military have refrained from cracking down on the movement, which has support from a broad swath of Thai society, including members of Thailand's political elite.

Political observers said they saw no easy resolution to the confrontation between the PAD and the government, meaning the standoff was likely to be protracted.

"The country is at war, ... a war of legitimacy," said Panitan Wattanayagorn, a political scientist at Bangkok's Chulalongkorn University. "Both sides have a kind of legitimacy but not enough to get rid of the other."

Somchai leads an elected government, but the PAD claims he is a proxy for Thaksin, who dominated Thai politics from 2001 to 2006 with a mix of authoritarian rule and populist policies designed to win the support of the voting masses.

Although living in self-imposed exile, Thaksin still controls the Thai government through his money, political cronies and relations.

Last month, Thailand's Supreme Court sentenced Thaksin to two years in jail for abuse of power for allowing his wife to successfully bid on a plot of land at a 2003 government auction.

PAD leader Sondhi Limthongkul has dubbed this week's protest the "final battle," vowing to bring the government down by Wednesday, after holding continuous street protests and demonstrations in Bangkok for six months.

The PAD on August 26 successfully seized and occupied Government House, the seat of the executive branch of the government. (dpa)