"We do not liaise with individuals, we liaise with the government. Therefore diplomatic ties with the government will continue," Malaysian Prime Minister Abdullah Ahmad Badawi was quoted as saying by the Bernama news agency late on Thursday.

"There will continue to be cooperation," he said.

Thaksin, who resigned on Tuesday after months of demonstrations, has appointed his deputy Chidchai Vanasatidya to replace him as caretaker prime minister.

Abdullah said he was confident Thailand would resolve its problems.

"We wish them the best of luck and we know they'll be able to handle it in the best manner possible," he said.

MalaysiaThai relations were put to the test late last year over a group of 131 Thai Muslims who fled over the border from their homes in southern Thailand, citing fear of persecution by Thaksin's administration.

Their flight triggered a diplomatic row between Thailand and Muslimdominated Malaysia, who insisted the group should not be forced to return if their safety could not be assured.

At the height of the row in October, Thailand's foreign minister declared he had stopped speaking with Malaysia.

Relations began to improve in December, after Malaysia extradited one of the 131, a Thai man wanted for his links to a Muslim insurgency in Thailand's south.

Meanwhile, Cambodia's Prime Minister Hun Sen expressed regret for the plight of his embattled Thai counterpart.

"His party still runs the country. I regret his leaving, however Thai people solve Thai problems the Thai way," he said. "Cambodians solve problems the Cambodian way."

Hun Sen had been on friendly terms with Thaksin and some had claimed he had even modelled some of his policies on the Thai leader's strategies.

Agencies and The Nation