ANKARA -- Economy Minister Kemal Dervis resigned from Turkey's crumbling coalition government on Saturday, pledging to devote his efforts to uniting an array of center-left parties ahead of November 3 general elections, Reuters said.

If he can encourage rival party leaders to bury axes that have been kept polished in years of feuding, Dervis will have greatly increased the chances of stable government in EU candidate and NATO member Turkey.

The United States and the IMF, which has pledged or paid out some $30 billion to prop up Turkey's feverish economy, would also welcome a single strong pro-Western party, especially with a looming U.S.-led strike on Turkey's southern neighbor Iraq.

"I am resigning from the government today," Dervis told reporters, warning of the consequences for Turkey's economy and EU membership ambitions of allowing a split vote in the polls.

"Everyone has to think about November 4. On that day it will be hard to say that we made a mistake, the cost would be high.

Turkey has some important and difficult jobs ahead," he said.

Some 23 parties will run for election, most separated more by the personality of their leaders than by policy.

Dervis gave no hint as to which party he might join, but has been seen as close to former foreign minister Ismail Cem's New Turkey Party, itself founded by MPs who split away from Prime Minister Bulent Ecevit's Democratic Left Party.

"I think that political fragmentation is a serious problem and that we must overcome it. That is where I will devote my efforts," Dervis said.

After Dervis's resignations, Cem said in a statement that the New Turkey Party would gain from the participation of Dervis.

"Dervis has already made his approach to the New Turkey clear. In line with his previous announcements, his participation will give a new momentum to the New Turkey Party, which is already growing fast," the statement said.

_____ Market Expectation _______ The resignation ends weeks of speculation on Turkey's volatile financial markets over when the architect of Turkey's $16 billion IMF deal would launch his own electoral campaign.

Dervis, a former World Bank bureaucrat, was brought to Turkey after a February 2001 financial crisis to manage recovery and win international lending support.

"I'm an economist, not a politician," he said on Saturday.

Markets had slumped the last time Dervis tried to resign but a muted response to widespread predictions he would quit on Friday suggest investors would now prefer to see him actively building the next government than impotent in the cabinet.

Ecevit earlier this week told Dervis to either stop canvassing rival parties or quit. Nationalist Action Party (MHP) leader Devlet Bahceli also demanded Dervis's resignation several times.

"Dervis's resignation occupied Turkey's agenda long enough.

This is already a delayed decision," Bahceli said following the resignation.

Dervis briefly resigned in July, apparently to join a new party led by Cem, but market turmoil and presidential pressure made him step back.

Haluk Burumcekci, chief economist at Disbank in Istanbul, said investors were now accustomed to the idea he would quit.

"We expect a limited reaction to the resignation first because it was expected and already priced-in and secondly there is a downwards trend in both interest rates and the dollar and I think that will not reverse," he said.

The IMF this week also hinted it would be ready to see Dervis abandon his role implementing the loan pact, which it said did not stand or fall "on the basis of one individual".

The IMF plan has removed many economic institutions such as the Central Bank from political control, meaning free spending in order to win electoral support is no longer the option it once was for incumbent governments.

Dervis said he was battling a culture that has seen far more divorces than unions across the political spectrum. Turkish parties are dominated by leaders who often serve for life and who nurse bitter feuds with rival party chiefs.

"Wish me luck," he said.

Opinion polls ahead of the election suggest that many parties could fail to get the 10 percent of the national vote needed to win seats in Parliament.

That could hand a strong parliamentary position to the Justice and Development Party (AKP), whose Islamist roots make many fear a clash with Turkey's staunchly secularist military.