ISTANBUL - Arab nations burst into applause Thursday as Turkey's prime minister walked to the podium at a summit, reflecting Turkey's meteoric rise on the world stage amid disputes over Israel's blockade of Gaza and U.N. sanctions against Iran.

The Turkish-Arab Economic Forum opened with calls for an international investigation into the May 31 Israeli commando raid on aid ships bound for Gaza, a topic emphasized by Turkish Prime Minister Recep Tayyip Erdogan.

"Are we going to remain silent over the murder of nine people? We can't turn a blind eye to this banditry in international waters," Erdogan told the Turkish-Arab Economic Forum. "This can't continue as it is."

Arab league chief Amr Moussa also accused Israel of continued "atrocity and assault" in violation of human rights and international law, and praised Turkey for challenging Israel on the raid that left eight Turkish activists and a Turkish-American teenager dead.

Israel insists its commandoes acted in self-defence after being attacked by pro-Palestinian activists on the aid ships.

Moussa said the nine dead "are our martyrs as well."

Turkey's popularity in the Muslim world has surged as it led the world in condemning Israel for the raid on ships trying to break Israel's blockade of Gaza. Turkey — a non-Arab, predominantly Muslim country — also won favour among Arab allies for objecting to new sanctions against Iran, which the U.N. Security Council passed Wednesday after rejecting an Iranian nuclear fuel swap-deal brokered by Ankara.

During the forum, Turkey and the Arab countries of Syria, Jordan and Lebanon, said they would set up a council to create "a zone of free movement of goods and persons" among them, and urged others to join what Turkish Foreign Minister Ahmet Davutoglu said should not be seen as an alternative to the European Union.

He said Turkey was still eager to join the EU, but that the bloc "cannot and should not restrict (Turkey's) relations with its neighbours."

On Thursday, Turkey and 20 Arab nations also issued a joint statement expressing "grave concern and condemnation for the Israeli aggression" on the Gaza-bound aid ships.

They called on the United Nations to investigate in a "credible, thorough and transparent manner" Israel's deadly boarding of the ship.

The statement said the nations would work together "until Israel is held accountable and the siege of the Gaza Strip is lifted."

The countries also called for "the establishment of a viable, independent Palestinian State."

Earlier, Erdogan said his country would still work to keep the nuclear swap-deal Turkey brokered to resolve the Iranian dispute on the table.

He strongly rejected allegations in the West that Turkey was shifting toward the East, describing such claims as "evil intentioned" and attempts to prevent Turkey from establishing relations with the Arab world.

Erdogan stressed Turkey's commitment to its membership bid in the European Union, but at the same time accused the EU countries of not being sincere and raising obstacles.

Lebanon's Prime Minister Saad Hariri and other foreign ministers from about 15 other Arab nations also attended the summit.

Hariri said the Middle East was suffering under Israel's "criminal and barbaric" attitude.

"We support Turkey's demands not only about the international investigation, but for Israel to apologize," Egyptian Foreign Minister Ahmed Aboul Gheit said. "We support Turkey's demand to try those behind these acts."

Turkey also says Israel's partial easing of its Gaza blockade was not enough. At another summit in Istanbul earlier this week, Turkey and 21 Asian countries urged Israel to join the nuclear nonproliferation treaty and place its nuclear capabilities under the safeguards of the International Atomic Agency.

Turkey said Israel should not be left out from any scrutiny of its alleged nuclear arsenal, which Israel has never confirmed, and also said Iran should be able to use nuclear energy for peaceful purposes.

Although courting membership in the European Union, Turkey has also strengthened its ties with its Arab neighbours by mediating several conflicts, cultivating new relationships with former rivals such as Syria and Iran, forging free trade zones and gradually lifting mutual visa requirements.

The economic forum, set up in 2007, aims to build on a trade volume that soared to $29 billion last year between Turkey and Arab League countries, from $13 billion in 2004.

Erdogan said direct investments from the Middle East, Gulf and North African countries had reached a total of $8 billion in Turkey over the last five years — a figure that could be improved.

"These figures do not reflect our real potential, and we must work together harder to promote our economic and trade relations," Erdogan said. "We aim to create a free trade area with Arab countries."

Turkey already has free-trade agreements with Egypt, Jordan, Morocco, Syria, Palestinian territories and Tunisia, and is negotiating similar deals with Lebanon and Libya, he said.

Turkey also lifted entry visa requirements for Jordanians, Libyans, Syrians and Lebanese and would like to extend "the free-trade and visa-free zone" to other countries in the region, Erdogan said.

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Associated Press Writer Suzan Fraser in Ankara contributed to this report.