Filed at 1:18 a.m. ET

BANGKOK (Reuters) - Muslim separatism was not driving the unprecedented violence in southern Thailand, Prime Minister Thaksin Shiniwatra said Saturday, but local media reported the military is looking into its links with regional militant groups.

No one has a very clear idea why scores of Muslim youths attacked security posts in three southern, Muslim-majority provinces, where troops and police shot dead 108 machete-wielding Islamic militants.

The prime minister suggested in his weekly radio address that the young attackers were being used by drugs traffickers and smuggling syndicates.

But local newspapers quoted military intelligence officials as saying at least some of the insurgents had contacts with Jemaah Islamiah (JI), a Southeast Asian Muslim network that is seeking to establish an Islamic state across much of the region.

One of the militants killed in the Wednesday violence had the letters ``JI'' emblazoned on the back of his green shirt.

Authorities in the region say the group is linked to Osama bin Laden's al Qaeda network.

``Some claim that separatists were behind the violence,'' Thaksin said. ``There are mixed factors, but one thing for sure is that those insurgents were used. There were some people behind them. Those people could be manipulated as they were poor.''

Smugglers and drug traffickers have tried to build networks by using impressionable youth, and the ideology of separatism was just a cover for their criminal activities, Thaksin said.

``I do not believe that there truly is a separatist ideology.''

But his interior minister, Bhokin Balakula, told reporters Friday that while criminals and drug traffickers were involved, ``separatists are the main players here.''

A senior general said the army, which quelled a low-key separatist insurgency in the hilly, impoverished region in the 1970s and 1980s, could face thousands more rebels.

TRAINING ABROAD

The Bangkok Post Saturday quoted a military source confirming that the leaders of the uprising were linked to JI and likely had received training abroad.

One of the leaders of Wednesday's uprising, Mama Mateeyoh, who was arrested after leading eight other rebels in an attack on an army outpost in Yala province, also reportedly wore a T-shirt with the letters JI on the front and back.

Thaksin said five policemen and soldiers were killed and 15 injured in the violence. He said 17 insurgents were arrested and six were wounded.

Thailand is reeling from the worst case of separatist violence to hit a country that is famous for its beach resorts and titillating night life.

Security guards in Bangkok were inspecting cars for bombs at office buildings Saturday. Thai stocks ended at a one-month low Friday, despite strong economic data for March, mostly due to spooked foreign investors dumping Thai shares.

Tourism officials fretted after the outlawed Pattani United Liberation Organization warned tourists to stay away from the three southernmost provinces, as well as the holiday spots of Phuket and Krabi.

Across the border in Muslim-majority Malaysia, Prime Minister Abdullah Ahmad Badawi said his country was willing to offer refuge to Thais fleeing the trouble.

``It will not be refugee camps but some arrangements must be made,'' the official Bernama news agency quoted Abdullah as saying.

``They will want a place of refuge until peace returns to their area and, with the uncertainty at present, naturally they will want to come over here,'' he said.

Relations between the neighbors have been strained since Thai officials said in March militants behind renewed violence in the area had taken refuge in Malaysia.

``Some foreign countries seem to be trying to interfere in our internal affairs, but just let me handle it,'' Thaksin said in his radio address. ``If they do not understand us, never mind. We do not rely on them.

``I have met some leaders from Muslim countries, and they have understood the situation. However, there are a few that still do not understand, never mind.''

In Geneva, Acting United Nations High Commissioner for Human Rights Bertrand Ramcharan called on Thai authorities to carry out ``swift and transparent investigations'' of the violence.

STUNNED FAMILIES

Southern Thailand was quiet Saturday as stunned families tried to understand what drove their children to attack heavily armed security posts with knifes and machetes.

Thaksin said he has directed relevant ministries to help create about 100,000 jobs for Muslims in the south.

``I have also directed officials to build at least a soccer field in each village. Every village must have one soccer field, Muslims youths love playing soccer,'' Thaksin said.

Among the dead in Wednesday's violence were 19 soccer players, an entire team from the same Muslim village.

Analysts said methods used by the attackers, who were lightly armed and totally unprepared for the response from fully alert Thai troops, suggested they were too poorly organized to have undergone full-scale al Qaeda training.

But the high body count, especially at the Pattani mosque, might fuel Muslim resentment and play into the hands of the likes of al Qaeda, they said.