BRUSSELS: European Union leaders will on Thursday consider diplomatic and economic incentives to encourage strategic southeastern neighbour Turkey to continue improving often fraught ties with the EU and promote stability.

Relations with Ankara are on the table at a video summit of the 27 EU nations as the bloc plots a way forward after an alarming spike in tensions last year over Turkey's gas exploration in the eastern Mediterranean.

European Council President Charles Michel, who chairs the meeting, said the bloc want to step up "engagement with Turkey in a phased, conditional and reversible manner".

The EU is trying to build on recent conciliatory moves from Turkish President Recep Tayyip Erdogan and has put sanctions over drilling in Cypriot waters on hold.

Brussels has been encouraged by the resumption of talks with Greece over a disputed maritime border and by plans to restart UN peace efforts for divided EU member state Cyprus.

But there are deep concerns over Ankara's recent moves to shut down an opposition party and its departure from a treaty on violence against women.

The EU "needs to work on concrete proposals for a 'positive agenda' that fosters a constructive dynamic, including in terms of regional stability," Italian Prime Minister Mario Draghi told lawmakers.

But he insisted on "the importance of avoiding divisive initiatives and the need to respect human rights" and described Ankara's withdrawal from the Istanbul Convention as a "serious step backwards".