BRUSSELS (Reuters) - EU leaders broke a diplomatic deadlock on Friday and imposed sanctions on Belarus after hours of summit talks, assuring Cyprus that the bloc would also punish Turkey if it continues oil and gas drilling in disputed areas of the Mediterranean.
The deal on sanctions against about 40 officials accused of rigging August's presidential election in Belarus means the EU can make good on a promise to support pro-democracy protesters in Minsk and regain some credibility after weeks of delays.
"The European Union is taking action against those who stand in the way of democracy," German Chancellor Angela Merkel said after fraught discussions among the 27 EU member states that dragged past midnight. "I think that is an important signal."
While Britain and Canada have imposed sanctions on Minsk to show support for pro-democracy demonstrations there, the impasse in the EU, where decisions are taken by unanimity, has dented the credibility of the bloc's foreign policy, diplomats say.
Cyprus, one of the EU's smallest countries, had blocked the action against Belarus for a month, insisting that sanctions also be imposed on its neighbour Turkey for oil and gas exploration along the coast of the Mediterranean island.
Germany pushed back against a tough stand on Turkey, fearing it would disrupt efforts to cool tensions with EU member Greece.
Turkey, both a candidate to join the EU and a member of NATO, has slid towards authoritarianism under President Tayyip Erdogan but remains a strategically located partner that the EU cannot ignore.
In a sign that the diplomatic stand-off is easing at least between Athens and Ankara, NATO announced on Thursday that the two alliance members had set up a "military de-confliction mechanism" to avoid accidental clashes at sea.
'CLEAR SANCTIONS THREAT'
The compromise struck at the summit that satisfied Cyprus was an agreement to review Turkey's behaviour in December and impose sanctions then if its "provocations" have not stopped.
"The EU issues a clear threat of sanctions against Turkey should it continue to violate international law," Austrian Chancellor Sebastian Kurz said on Twitter after the meeting.
European Council President Charles Michel described it as a "double strategy" towards Ankara, offering closer relations on trade and other fronts but holding out the threat of sanctions if it fails to de-escalate tensions in the Mediterranean.
"It was the most that Merkel would bear," said an EU diplomat after the talks. "She felt the Union should give Turkey a chance for another few weeks. But Turkey has been put on notice and the ball is in its court."
(Additional reporting by John Chalmers and Philip Blenkinsop in Brussels; Writing by Robin Emmott and John Chalmers. Editing by Gerry Doyle)