BANGKOK - Shaken tourists wander the street in the aftermath of bloody political battles next to Bangkok's iconic backpacker strip, photographing smashed cars and pointing to bullet holes in the walls.

Sarah Colvin, from Britain, says many overseas visitors are packing their bags in the wake of clashes between anti-government Red Shirts and security forces, which have left 21 people dead and more than 800 injured.

"People started running and screaming. We were being shot at," said Colvin, one of many foreigners caught up in Saturday night's conflict that spread into the Khaosan Road district, a hub for travellers.

"It shook us up a lot. We needed Valium to sleep," said the 19-year-old. "A lot of people we've spoken to are getting out of here."

"I won't be coming back to Bangkok. Maybe the islands, but not Bangkok. I'm going to leave tonight. Yesterday was really scary," said Flavia Kupka, 32, a waitress from New Zealand on her first visit to the "Land of Smiles".

The kingdom has been beset by repeated demonstrations by rival red and yellow-clad protest groups, hitting an economy that sank into recession last year for the first time since 2000 amid a severe global economic crisis.

One of the most damaging protests in late 2008 saw the pro-establishment Yellow Shirts blockade Bangkok's two airports for nine days, stranding hordes of angry travellers.

But Saturday's violence, which followed almost a month of rallies by the Reds, was the country's worst for 18 years and shocked visitors as it spread into the area famous for its cheap hotels, nightlife and shopping.

"There were bullets coming all over us. Bombs as well, petrol bombs within about 10 feet of us," said factory worker Tony Doohan from Ireland, standing by debris and pools of blood covered with Thai flags and red roses.

"I saw Red Shirts with a gun they must have stolen off the cops. They all had sticks and were throwing glass bottles... anything they could find really," the 25-year-old said. "It's a bad time to be here."

The retail and tourism sectors have taken a battering by the Reds' weeks of protests -- especially since they took over Bangkok's main commercial hub on April 3, disrupting traffic and causing major shopping centres to close.

The Thai Retailers Association said Thursday -- a day after a state of emergency was declared -- that the protesters' occupation of that district had caused more than one billion baht (about 31 million dollars) in losses.

At the Dang Derm Hotel on Khaosan Road, receptionist Jaringa Jaiya said Sunday that fearful guests had begun checking out after the violence intensified.

"Sure it will be bad for business. I think visitors will be shocked that this happened in Thailand. People want to get out of Bangkok," she said.

April is the month of Songkran, a water festival for the Thai new year, and usually attracts thousands of tourists. Bookings were already down this year, and now the celebrations are reported to have been cancelled in Khaosan.

Hong Kong was one of the countries to step up warnings over the city late Saturday, raising its travel alert for Bangkok to the highest level of "black" meaning that travellers' safety would be under "severe threat".

But not all visitors were deterred from a return trip to the kingdom, famous for its paradise beaches, fiery cuisine and glittering temples.

"We were told they didn't want to hurt tourists because they live off tourism. It was scary but it wouldn't put us off coming again," said Danish backpacker Charlotte Stage, 19.

"Both the Reds and the army were really nice to us," added French tourist Eva Minassian. "They were actually protecting us -- both sides -- so I don't think we're very much in danger".

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