Cambodia said yesterday it had appointed fugitive former Thai prime minister Thaksin Shinawatra economic adviser to premier Hun Sen in a move that adds to tensions between the countries.

The appointment was announced on state television almost two weeks after Hun Sen first riled Thailand by offering safe haven to Thaksin, who was ousted in a coup in 2006 and is living abroad to avoid a jail term for corruption.

"Thaksin has already been appointed by royal decree... as personal adviser to Cambodian Prime Minister Hun Sen and the adviser to the Cambodian government in charge of economy," said a government statement read on television.

"Allowing Thaksin to stay in Cambodia is virtuous behaviour...good friends need to help each other in difficult circumstances," it added.

The statement went on to call charges against Thaksin "politically motivated" and vowed not to extradite him if he "decides to stay in Cambodia or travels in and out of Cambodia in order to fulfill his duties".