Oct. 16 (Bloomberg) -- Malaysia ruled out sanctions against Myanmar, its Southeast Asian neighbor, and pledged support for United Nations efforts to stop the junta's crackdown on pro- democracy campaigners.

``Nobody can talk when you are threatening with all sorts of things,'' Malaysian Foreign Minister Syed Hamid Albar told reporters today in Kuala Lumpur after meeting UN envoy Ibrahim Gambari. ``We must leave it to the UN.''

Japan's government said today it will cancel a 552 million- yen ($4.7 million) grant to Myanmar, joining the U.S. and European Union in calling for restraint from the regime. Syed Hamid said Myanmar should hold further discussions with Gambari, though he stopped short of making specific demands of the junta.

Myanmar's military regime deployed soldiers on the streets of the former capital, Yangon, on Sept. 26 to crush the biggest anti-government protests in almost 20 years. Security forces clubbed and shot at demonstrators, and at least 30 people were killed, the Australian government said.

The introduction of democracy in Myanmar must be led by the people rather than imposed by other powers, Syed Hamid said. Engaging with Gambari, who met junta leaders this month, is the best way for Myanmar to win international support, he said.

The 10-nation Association of Southeast Asian Nations won't eject Myanmar, Syed Hamid said today. Asean admitted Myanmar as a member in 1997, against U.S. and European wishes. The bloc has been criticized by Western nations for not doing enough to promote democratic change in Myanmar, formerly known as Burma.

Trading Partner

Malaysia's trade with Myanmar in 2006 was worth 1.06 billion ringgit ($313 million), the third-smallest total among Malaysia's Asean trading partners, the Malaysian government said.

Gambari faces a ``formidable task'' trying to build consensus among Myanmar's neighbors and persuade the junta to take steps toward democracy, Asean Secretary-General Ong Keng Yong said in Singapore yesterday. The UN envoy is scheduled to visit Indonesia, India, China and Japan this week.

To contact the reporter on this story: Angus Whitley in Kuala Lumpur at awhitley1@bloomberg.net.

Last Updated: October 16, 2007 06:10 EDT