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BERLIN, March 9 (Reuters) - German Chancellor Angela Merkel told Turkey to stop using Nazi references in an escalating row between the NATO allies over the cancellation of Turkish ministers' rallies in Germany, only for the Turkish foreign minister to repeat the same comparison.
Turkey is fuming that some German authorities, citing security concerns, have stopped its ministers from campaigning among Germany's large Turkish community for President Tayyip Erdogan's bid to boost his powers in a referendum on April 16.
Berlin, meanwhile, is angry about the arrest of a Turkish-German journalist in Istanbul held on terrorism charges and has repeatedly called for his release.
Merkel spoke unusually bluntly in the Bundestag lower house of parliament, saying she was saddened by the deep differences which were dividing the allies despite common causes, such as fighting Islamist terrorism.
She said they should try to overcome their differences but that Nazi comparisons were unjustifiable and "so misplaced that you can't seriously comment on them".
"These comparisons of Germany with Nazism must stop. They are unworthy of the close ties between Germany and Turkey and of our peoples," the centre-right chancellor said.
However, Turkey's Foreign Minister effectively repeated the comparison within hours, saying that he was not calling the current German government Nazis but that their actions were reminiscent of that era.
On Sunday, Erdogan described the cancellations as "fascist actions" reminiscent of the Nazi era.
Merkel stressed that while she was open to dialogue with Turkey, an aspiring member of the European Union, but any talks had to be based on democratic values.
"From our point of view it's worth making every endeavour to advocate for German-Turkish relations but on the basis of our values and our expectations and with clarity," she said.
She said that the roughly 3 million people with Turkish ties living in Germany were part of German society, but she warned that domestic conflicts should not spill over into Germany. Many workers came to Germany after World War Two and helped to transform the economy into Europe's powerhouse.
Bilateral ties have deteriorated significantly in the last year over a series of rows, from a legal case over a German comedian who poked fun at Erdogan to a parliamentary vote calling the 1915 massacre of Armenians by Ottoman forces "genocide".
Relations between the EU and Turkey have soured further since July's failed coup in Turkey, with Germany and others criticising the scale of Erdogan's crackdown on suspected coup supporters. (Reporting by Michelle Martin and Madeline Chambers; Editing by Hugh Lawson)