Turkish minister says graft is main public enemy

ISTANBUL, Turkey (Reuters) -- Interior Minister Saadettin Tantan said on Monday that corruption threatened Turkey's economic and political stability and was a chief source of finance for armed Islamic and Kurdish rebels.

The ex-police chief made no direct reference to Turkey's bid to join the European Union, but analysts say a deep-seated culture of back-handers and influence-peddling could slow progress towards membership. The EU will formally tell Ankara next week what political changes it expects for talks to start.

"The corruption economy is Turkey's number one threat," Tantan told academics and reporters at a conference on corruption at an Istanbul university. "It lies at the root of many of our country's problems and poses a future threat to our society and constitutional regime."

He described a Turkey in which "thieves and exploiters who should be locked up are able to wander among us as respected people and are even greeted with bowing and scraping."

Corruption imposes a great burden on the economy and companies as Turkey tries to secure a foothold in European markets, bring down costs and cut inflation under an IMF-backed anti-inflation plan. Some analysts describe it as an "unseen tax."

High-level corruption was most notoriously exposed in 1996, when a car crash revealed links between far-right organized crime and the state. The scandal prompted nationwide protests and calls for a clean-up but prosecutions have gone nowhere.

Under Tantan, the Interior Ministry has made high-profile arrests and launched investigations into bribery and dishonesty among businessmen and middle-ranking state officials.

The minister, stressing the economic costs corruption imposes on a developing economy such as Turkey's, warned that it also financed the radical Islam and violent Kurdish nationalism the military has identified as primary threats to the country.

"Unless we understand that corruption is the main source of radical Islam, terrorism, dirty politics and a state that does not function, and take the necessary steps to drain the swamp, we will spend all our time swatting mosquitoes," he said.

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