Jordan's King Abdullah II urged President Bashar al-Assad to step down as the Syrian regime stood defiant even as EU states piled on extra pressure and activists said 40 people were killed.
Syria stood increasingly isolated with the European Union showering praise on the Arab League for its weekend decision to suspend Syria's membership in the bloc over its lethal crackdown on protests.
In the first such call by an Arab leader for Assad to quit, King Abdullah said in remarks aired on the BBC: "I believe, if I were in his shoes, I would step down."
"I would step down and make sure whoever comes behind me has the ability to change the status quo that we're seeing."
But Syrian Foreign Minister Walid Muallem told a packed news conference that Damascus would not budge despite the "dangerous" and "shameful" Arab League move to suspend its membership.
"The decision of the Arab League to suspend Syria represents a dangerous step," Muallem said.
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"Today there is a crisis in Syria which pays the price of its strong positions. Syria will not budge and will emerge stronger... and plots against Syria will fail."
On the ground, Syrian security forces shot dead at least 16 civilians in the flashpoint southern province of Daraa while 19 regime forces were killed in clashes with suspected army deserters, a rights group said.
The Britain-based Syrian Observatory for Human Rights said the civilians were killed by gunfire from checkpoints manned by security forces across Daraa, the cradle of eight months of anti-regime protests.
Security forces also killed two people in the flashpoint central city of Homs, it said.
The EU said it "salutes and fully supports" the Arab League's suspension of Syria for failing to implement a plan to end violence that has left 3,500 dead since mid-March, according to the United Nations.
It "shows the increasing isolation of the Syrian regime," the EU said, adding that the bloc "stands ready to engage with representative members of the opposition... such as the Syrian National Council."
EU foreign policy chief Catherine Ashton said she had been in touch with Arab League chief Nabil al-Arabi on how to protect civilians. "We will keep in touch and see what can be done."
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In new sanctions, EU ministers agreed to stop Syria accessing funds from the European Investment Bank (EIB).
They also blacklisted a further 18 Syrians, mostly members of the military, bringing to 74 the members of Assad's inner circle hit in past months by an EU assets freeze and travel ban.
French Foreign Minister Alain Juppe said fresh pressure was needed due to the "bloody stubbornness" of the regime.
In Damascus, Muallem slammed international interference, blaming Washington for "encouraging acts of violence" and said there was a spike in operations by "armed groups" in Syria.
He blamed this violence for delays in withdrawing troops from the streets, as the Arab League had demanded.
Assad has come under mounting global pressure over the bloody security crackdown in response to unprecedented democracy protests against his regime.
EU foreign ministers said the continuing bloodshed in Syria, despite the hopes raised by the Arab peace plan, called for international action.
"The European Union will continue to press for strong UN action to increase international pressure and urges all members of the Security Council to assume their responsibilities," a joint statement said.
Sweden's Carl Bildt -- who said the Arab League "demonstrated the muscle that is necessary by suspending Syria -- said the UN should now explore the dispatch of observers or a UN humanitarian mission.
The Arab League too announced plans to send a 500-strong delegation of observers to Syria, including human rights activists, media and military experts, to assess the situation and study measures to protect civilians.
But he warned that Syria must give guarantees and sign a memorandum of understanding "spelling out out the duties and rights of all the parties."
Arab foreign ministers are due to set a date for the mission on Wednesday, on the sidelines of a meeting in Rabat, according to an official of the Cairo-based Arab League.
The ministers had met on November 2, when they drew up a plan under which Syria would pull troops back from protest hubs and free arrested demonstrators.
The meeting gave Syria 15 days to comply with the plan and on Saturday the Arab bloc decided that Damascus had failed to keep its side of the bargain and 18 of the 22 members voted in favour of suspending Syria.
The suspension is due to go into effect from Wednesday.