Riot police scattered about 100 government supporters who had been chanting "Lead on, Kibaki!" in central Nairobi, sending businesspeople scurrying for cover. The police forced the protesters into shops and nearby alleys.

"The opposition has to recognise Kibaki is president," trader Julius Kuria said in the panicked crowd. Workers hung out of nearby windows after a canister landed in their office.

The east African nation descended into chaos after Kibaki's disputed re-election on December 27 in which opposition leader Raila Odinga cried foul. More than 650 people have been killed since then in ethnic violence and clashes with the security forces.

Since the election police have banned street protests, almost all of which have been by the opposition. The government and the opposition accuse each other of genocide.

Kibaki and Odinga have not met despite pressure from Western powers like the United States, Britain and the European Union.

Veteran negotiator Annan is due to meet both sides and push for direct negotiations, a step which eluded Ghanaian President John Kufuor, the head of the African Union, earlier this month.

"Short of getting them both in chokehold and banging their heads together, Mr Annan has very little leverage on either President Kibaki and Mr Odinga or their respective entourages of myopic warmongers and sycophants," columnist Macharia Gaitho wrote in the Daily Nation, Kenya's leading newspaper.

But diplomats hope Annan, a Nobel Peace laureate whose negotiating experience ranges from Israel to Darfur, can help bring Kibaki and Odinga into some sort of power-sharing arrangement, possibly before a fresh vote.

"They just need some time to cool down their nerves," former Mozambican President Joaquim Chissano, who has also tried to mediate in the Kenyan crisis, told Reuters.

TEARGAS AND MACHETES

Weeks of bloodletting in a nation long seen as one of east Africa's most stable has undermined its democratic credentials and laid bare tribal sentiments that lie behind its politics.

Scenes of police firing teargas and live ammunition in the slums of Nairobi, or of bloodied victims of machete and spear attacks in the picturesque Rift Valley, have damaged Kenya's image as a tourist haven and regional trade and aid hub.

Kenya's shilling neared an 11-month low against the dollar.

In Nairobi's Mathare slum, hundreds of residents were sheltering in tents set up by charities on the edge of the neighbourhood after fleeing their homes fearing more trouble.

"There are also some families sheltering in churches and mosques," said aid worker Azhar Chaudhry, handing out beans.

Some outside attempts to get involved in the crisis have had a prickly reception.

The government has taken out full-page adverts in newspapers accusing Western powers, the international media and rights groups of fanning unrest by questioning the election result.

It also summoned British High Commissioner Adam Wood on Monday to voice anger at Britain's critical stance.

U.S. ambassador Michael Ranneberger dismissed the adverts on Tuesday as "scurrilous propaganda".

Ugandan President Yoweri Museveni also flew into Nairobi on Tuesday to try to mediate, though as one of few African leaders to have congratulated Kibaki on his win, his efforts have already been met with scorn by opposition supporters.

"Museveni leave Kenyans alone," read one banner in the Nairobi slum of Kibera during a recent protest.

The opposition has called more protests from Thursday.

But political sources told Reuters the ODM would cancel the protests if Annan asked it to, as a sign of good faith.