Ecevit faces challenge from old political ally

One day after quitting the Turkish government, the former foreign minister, Ismail Cem, launched a political party aimed at toppling the ailing Prime Minister, Bulent Ecevit, and pressing for EU membership.

The leaders of the social democratic movement that has emerged from the ashes of Mr Ecevit's government are a band of reformists dubbed "the white Turks' dream team".

Urbane, Western-educated, pro-Europe and more at home in Washington than eastern Anatolia, this is a group that represents the Turkey Europe loves to do business with.

They include the former deputy prime minister, Husamettin Ozkan, who was Mr Ecevit's right-hand man for years and is experienced in politics. The economy minister, Kemal Dervis, expressed his support for the new party.

Mr Cem, 62, said: "The job ahead of us is to turn a modern, social democratic majority into the ruling power. This is what we have set out to do."

He added: "A key element of our programme will be to make Turkey a member of the EU, to complete the requirements. Turkey must not miss this chance. We are determined to take necessary measures."

His move, in effect, snuffs out any hope of resurrecting Mr Ecevit's career. As foreign minister for five years, Mr Cem was one of the longest serving ministers and possibly the most internationally respected politician in the government. Fluent in English and French, he is credited with having created a lasting rapprochement with Turkey's long-time foe Greece, referring to his counterpart George Papandreou as "one of my closest friends".

EU diplomats praised Mr Cem's efforts. One said: "He has been an extremely important foreign minister in a very important country."

Stocks jumped four per cent and Turkey's international bonds also surged on news of the formation of the party.

Mr Dervis is a former World Bank vice-president who was flown in from Washington last year to steer the country out of financial crisis after a devastating devaluation. He is the architect of a sweeping economic reform plan backed by the International Monetary Fund and is widely respected in international financial circles.

Mr Dervis resigned on Thursday but was persuaded to retract his decision because of fears it would panic already jittery financial markets, crush a $16bn (£10bn) IMF-backed economic reform programme and spark further instability

Although he supports Mr Cem's new movement, he will for the moment remain an independent.

Turkey's coalition Nationalist Action Party (MHP) leader, Devlet Bahceli, said he saw little use for Mr Dervis. The MHP is now the largest party in Turkey's 550-seat parliament with 127 seats.

Mr Ecevit's Democratic Left Party (DSP) has suffered 44 defections and now holds just 84 seats in parliament.

The veteran leader, 77, has been away from normal duties since falling ill in May, but has refused to resign. He has reiterated he will not stand down or call elections earlier than the scheduled date of 2004.

He said: "We have to carry on until the end. At this stage I am on top of my duties."

However, he added he would have no choice but to leave government if the coalition loses its already slim majority in the parliament.

Mr Ecevit also announced he was appointed Sukru Sina Gurel, a man with a reputation as a hawk on the EU and Cyprus, to replace Mr Cem.

The new party may be assured of the urban, pro-Western vote but it is not clear whether it will resonate with the voters outside the big cities. The sight of Mr Dervis in tennis shorts last year prompted a flurry of comment – tennis and shorts on a man were seen as alien by many Turks.

The mainstream media has embraced Mr Cem's movement as the only centrist party capable of giving religious conservative and ultra-nationalist parties a run for their money. Opinion polls indicate that, if elections were held today, the new Islamist AK party, led by Tayyip Erdogan, the charismatic and youthful former mayor of Istanbul, would win.

The Islamists and nationalists are hugely popular in the inner cities and Anatolian hinterland, places hardest hit by the worst recession in recent Turkish memory that has seen more than half the value wiped off the currency and millions of people laid off. The IMF-backed economic rescue plan has not been popular with many Turks. But the prospect of an Islamist win is deeply unsettling to the powerful and staunchly secularist generals, as well as their Western allies.

Elections, expected to be held in the autumn, will now pit two different sides of Turkey against each other. The biggest challenge for Mr Cem's party will be to convince voters that Europe matters, and that it is a voice for change.