ISTANBUL/ANKARA Turkish Prime Minister Tayyip Erdogan told protesters on Friday he would put redevelopment plans for an Istanbul park on hold until a court rules, striking a markedly more conciliatory tone after two weeks of fierce anti-government demonstrations.
Financial markets rose on hopes that environmentalists who oppose the construction on Gezi Park would be satisfied, but it remained unclear whether other protesters with a wide variety of grievances against Erdogan would go home.
Erdogan's gesture at an overnight meeting was largely symbolic as the government is required by law to respect the court decision on an action brought by the environmentalists trying to block the plan.
However, it contrasted with Erdogan's earlier defiance when he attacked protesters on Taksim Square who accuse him of autocratic behavior, and insisted the redevelopment would go ahead in the adjacent park.
"Of course the government respects judicial rulings and is obliged to implement them," said Huseyin Celik, deputy chairman of the ruling AK Party who also attended in the talks. "Until the judicial ruling is finalized there will not be any action whatsoever on Gezi Park."
A police crackdown on peaceful campaigners in the park two weeks ago provoked an unprecedented wave of protest against Erdogan and his AK Party - an association of centrists and conservative religious elements - drawing in secularists, nationalists, professionals, unionists and students.
At the overnight meeting, Erdogan met a delegation made up largely of actors and artists but also including two members of the umbrella protest group Taksim Solidarity - hours after saying his patience had run out and warning protesters occupying Gezi Park to leave.
The delegation welcomed what they said was Erdogan's promise to respect the outcome of the court case filed against the plans to build a replica Ottoman-era barracks. This commitment followed an offer on Wednesday of a referendum on the plans if the court found in the government's favor.
"The prime minister said that if the results of the public vote turned out in a way which would leave this area as a park, they will abide by it," Tayfun Kahraman of the protest group told reporters following the meeting.
"His comments that the project will not be executed until the judiciary makes its decision is tonight's positive result."
Taksim Solidarity said in a subsequent statement the group would decide as a whole what course of action to take after consulting on the meeting, leaving it unclear whether they would continue their protest.
Financial markets, recently under pressure due to the protests and a general sell-off in emerging economies, welcomed the apparent easing of tensions. The lira rose for a third straight day to its level before the protests started, while bond yields dropped and shares rallied 2.7 percent.
Five-year credit default swaps, the cost of insuring Turkish debt against default, fell 12 basis points to 157 bps, according to Markit, their lowest level since June 5, after hitting 10-month highs in the previous session.
Market unease has been deepened by images of police firing tear gas and water cannon day after day in cities including the capital of Ankara, while youths threw stones and petrol bombs in Turkey's worst unrest in years. Three people, including a police officer, died and about 5,000 were injured, according to the Turkish Medical Association.
Celik said the meeting had been positive but he reiterated Erdogan's position that the occupation had to end. "Our government has been very tolerant, as tolerant as it goes in a democracy, but I don't think the government will leave that place under occupation for long," he said.
In Istanbul, the city's governor Huseyin Avni Mutlu said he sensed flexibility among the protesters after holding five hours of talks with them in a cafe by the Bosphorus strait. "We felt they showed sensitivity...and did not have an unyielding stance regarding staying there (in the park)," Mutlu told reporters.
Erdogan has already discussed the plans to build over the park with various people who support the protesters, but had initially refused to meet with Taksim Solidarity, which is at the heart of the campaign to protect it.
Late on Thursday, he appeared to suggest that hundreds of protesters, camped out in a ramshackle settlement of tents in Gezi Park, could be forcibly evicted, although Mutlu said later there were no such immediate plans.
"Our patience is at an end. I am making my warning for the last time. I say to the mothers and fathers, please take your children in hand and bring them out ... Gezi Park does not belong to occupying forces but to the people," Erdogan said.
Taksim, where police fired teargas and sent thousands scurrying into side streets two nights ago, was crowded but calm overnight. Some of the assembled masses chanted and danced, while others listened to a concert pianist who played through the night amid the protesters as riot police looked on.
The government proposed a referendum on the plans to build on the park, one of the only concessions Erdogan has offered, after he met a group who back the protests on Wednesday.
The United States has voiced concern about reports of excessive use of police force, while the European Parliament warned the government on Thursday against using harsh measures against peaceful protestors and urged Erdogan to take a "unifying and conciliatory" stance.
The comments were not welcomed by Ankara.
"Turkey is not a nation that needs to be taught a lesson in any way on these topics by any country or by any group of countries," Foreign Minister Ahmet Davutoglu said.
Erdogan, who has accused foreign forces, international media and market speculators of stoking unrest and trying to undermine the economy, said he would reveal on Friday details of what he called a "game being played with Turkey."
"It is as if the whole of Turkey is on fire, as if the whole of Turkey is collapsing," he said of some media coverage, describing it as "deceptive and unethical."
(Additional reporting by Ece Toksabay in Istanbul and Jonathon Burch in Ankara; Writing by Nick Tattersall; Editing by Jon Boyle and David Stamp)