EU said near deal to sanction Turkey over Cyprus

BRUSSELS, Dec 11 (Reuters) European Union foreign ministers said they were close to a deal today on how to penalise Turkey for failing to normalise trade with Cyprus, without breaking off talks with the EU's biggest candidate.

After hours of wrangling in closed-door session, several ministers said a deal seemed possible based on the European Commission's proposal for a partial freeze in Ankara's entry negotiations.

''We are close -- at least according to my assessment -- to a compromise solution, but negotiations are going on,'' Slovakian Foreign Minister Jan Kubis told reporters.

Dutch Foreign Minister Ben Bot said all ministers agreed on the EU executive's proposal to suspend eight of the 35 chapters or policy areas into which the talks are divided.

The sticking point was how to satisfy demands by Cyprus, Greece and Austria for an explicit time frame to review Turkey's compliance, without setting a deadline that Ankara's supporters said would be seen as an unacceptable ultimatum, diplomats said.

While some EU countries would shed no tears if talks with the large, Muslim nation collapsed, most say Europe must embrace a key strategic partner to bridge the Western and Islamic worlds and secure a future energy hub.

If ministers fail to agree on the review clause, the Turkey issue will go to a regular EU summit on Thursday and Friday.

''We must not destroy in a few days something that has grown over many years,'' German Foreign Minister Frank-Walter Steinmeier said. ''This is not, as people in some member states demand, a discussion about breaking off the accession process.'' Britain, Italy, Sweden and other supporters of Turkey said the EU executive's proposal was too harsh. But diplomats said a ''critical mass'' was building in support of the Commission plan, led by heavyweights France and Germany.

''PRETEXTS'' Turkey, which does not recognise the Greek Cypriot government, has said it will start opening ports if the EU makes good on a 2004 pledge to end the economic isolation of Turkish Cypriot northern Cyprus, which Nicosia is blocking.

Turkish Foreign Minister Abdullah Gul said the decision had ''ominous potential'' to reshape his country's ties with the bloc.

''Pressuring Turkey to fulfil unilateral conditions while ignoring other obligations carries the risk of derailing the process,'' he wrote in the International Herald Tribune.

Austrian Foreign Minister Ursula Plassnik said the EU should freeze part of the talks and conduct a fresh assessment in 2008.

Britain, Turkey's most vocal supporter, said talks must go on. ''It is enormously in the strategic interests of the EU and well as in the interests of Turkey for negotiations on reform in Turkey and for negotiations towards Turkey's membership to continue,'' British Foreign Secretary Margaret Beckett said.

Cyprus has been split since Turkish troops invaded in 1974 after a brief Greek Cypriot coup backed by Greece. The EU admitted the divided island as a member in 2004, represented only by the Greek Cypriot government.

The Commission's proposal would slow the 14-month-old talks, due anyway to last more than a decade, but not kill them. But Gul said some in the EU were using Cyprus as an excuse.

Ankara made an oral offer last week to open a major port to traffic from Cyprus and said it would do more if the EU allowed direct trade with the Turkish Cypriots. But EU President Finland said that was not enough and Cyprus rejected the offer.

Turkey's Foreign Ministry made a rare appeal for unity among state institutions, including the powerful military, yesterday, after criticism of its offer to the EU by the powerful army General Staff and President Ahmet Necdet Sezer.

REUTERS PDM RN2204