* Davutoglu among architects of ruling party policy
* Shares common vision with president-elect Erdogan
* Foreign policy has left Turkey isolated
* Economy, security challenges lie ahead
By Jonny Hogg and Tulay Karadeniz
ANKARA, Aug 25 By temperament they appear opposites, but Turkey's softly spoken new prime minister and the man he replaces - firebrand president-elect Tayyip Erdogan - share a deep bond based on a determination to restore Turkey to its former glories.
Outgoing foreign minister Ahmet Davutoglu will be confirmed by the ruling AK party as its new chairman this week and will become prime minister after Erdogan is sworn in as Turkey's first directly elected head of state on Aug. 28.
The appointment of Davutoglu, who owes much of his political success to Erdogan, is a further sign that modern Turkey's most powerful leader has little intention of loosening his grip on the day-to-day running of the country as president, a role that until now has been largely ceremonial.
But Davutoglu, an academic and foreign policy theorist who spent years advising the government behind the scenes before becoming foreign minister, has in recent years emerged as a political force in his own right.
The 55-year old devout Sunni Muslim has helped mould a vision that has seen the AK party dominate the political landscape, mixing nationalism, Islamism, and an ideological approach to foreign and domestic policy, according to Saban Kardas of the Ankara-based think-tank ORSAM.
"Davutoglu offers a very interesting mix of ideology and realism. And idealism does not mean just Islamism; it's more than that," Kardas told Reuters.
"Rebuilding Turkic and Ottoman identity is a big driver, and this is where Erdogan shares a lot with him."
In what now looks to have been an audition for his future role, Davutoglu delivered a campaign speech in his religiously conservative hometown of Konya ahead of local elections in March, after Erdogan lost his voice and was forced to rest.
In a fiery address more associated with the style of his political mentor, Davutoglu painted a picture of an ever more powerful Turkey, helping the oppressed of the world in the face of plots and treachery.
"If you all come together and this nation stands behind us, nobody can stop our march ... They will not be able to halt us. With God's permission they will not be able to lower (the Turkish) red flag," he said, as thousands cheered.
SECTARIAN OR PRINCIPLED?
The underpinnings of Davutoglu's domestic and foreign policy were largely laid out before his political career took off in his 2001 book "Strategic Depth". Its emphasis on Turkey coming to terms with its past and reviving long-neglected regional relations led some to label it "neo-Ottomanism", a charge Davutoglu himself strongly rejects.
As Erdogan's foreign policy advisor, he played a key role in negotiations between Syria and Israel, and was seen as the architect of Turkey's close ties with the Palestinian Islamist group Hamas, making Ankara for a time an important negotiator.
After becoming foreign minister in 2009 his efforts to build bridges intensified in a then-praised "zero problems with the neighbours" policy. But the Arab Spring uprisings and wars in neighbouring Iraq and Syria left the policy in tatters and drew criticism that Turkey was ceding neutrality for a sectarian agenda.
Its outspoken support for the Sunni Muslim Brotherhood of Egypt's deposed president Mohamed Mursi left Turkey without full diplomatic relations with the Arab world's most populous nation, and set it at odds with the Gulf Arab states whose investment has helped Turkey to prosper over the past decade.
Its vociferous calls for intervention to topple Syrian leader Bashar al-Assad and an open border policy that allowed refugees out but foreign fighters in looks now to have been a miscalculation, with Assad holding fast and Islamist militants posing the greater threat to the stability of the region.
"I think (internationally) there's an understanding that Turkish foreign policy has failed. Davutoglu is no longer the zero-problems, softly spoken person he was," said one European diplomat in Ankara.
Davutoglu has, in interviews, taken strong exception to the characterisation of the Middle East as a "quagmire". He sees Turkey's mission as one of re-civilising a region that was once the birthplace of civilisation.
"We will work day and night until colonialists are removed from the Middle East. We will raise up a great torch of humanity from the Middle East which they call a quagmire, with God's permission," he said in a speech earlier this year.
Government officials and commentators dismiss suggestions that Turkey's foreign policy, from Syria to Egypt, has been either sectarian or naive, saying it is rooted in firm principle.
Ibrahim Kalin, one of Erdogan's top foreign policy advisors, denied that its policy had left it isolated in the region, but said last year that if it were, it would be "a worthy solitude".
"When you try to follow a principled policy with some basic ethical norms, it takes away some flexibility. In Turkish policy I see some long-term thinking," said ORSAM's Kardas.
Though highly respected within the AK bureaucracy, sceptics wonder if Davutoglu has the profile with core voters to lead the party to the stronger majority it will need in parliamentary elections next June for Erdogan to achieve his aim of changing the constitution and creating an executive presidency.
The father of four, married to a gynaecologist, was among those given the job of thanking Erdogan's supporters for delivering him the presidency, crowds greeting him with chants of "prime minister, prime minister".
Yet there is a sense that he will be hanging on Erdogan's coat-tails. The president-elect has made it clear that he will exercise the full powers of his new post even under the terms of the current constitution.
"He's a name that won't prevent Erdogan from being dominant until the next elections," said Diba Nigar Goksel, editor-in-chief of the Istanbul-based Turkish Policy Quarterly.
Analysts see little dramatic change in policy direction under Davutoglu, who speaks English, German and Arabic, and whose views, in public at least, chime with Erdogan's.
A new constitution, advancing the Kurdish peace process and fighting the "parallel state" - a term Erdogan uses for the network of ally-turned-arch-foe, U.S.-based cleric Fethullah Gulen - were among the priorities laid out by the president-elect as he announced Davutoglu's nomination.
But there are choppy waters ahead.
The economic growth that has underpinned the AK party's success over more than a decade is slowing, and it is likely to face stronger calls for more robust action to help contain the chaos across its southern borders with Iraq and Syria.
According to Goksel, Davutoglu's success will depend to a large extent on the role he is expected to play - first or second fiddle.
"If it's creating a system of working with the president until the next elections, or a new constitution, then why not? But if it's being head of the executive for the next five years, that's a different question," she said. (Additional reporting by Daren Butler in Istanbul; Editing by Nick Tattersall and Will Waterman)