Turkish President Recep Tayyip Erdogan sharply escalated a diplomatic confrontation with the Netherlands, blaming the nation's "corrupt" character for the 1995 massacre of thousands of Bosnians under the watch of a Dutch contingent of peacekeepers.

"We know the Dutch from the Srebrenica massacre. We know how their character is corrupt from the massacre of 8000 Bosnians," Erdogan said today in a televised speech in Ankara.

He spoke a day after Turkey announced it would bar the Dutch ambassador from re-entering the country in retaliation for the Netherlands' decision to deny entry to Turkish ministers campaigning to expand Erdogan's powers.

The Srebrenica massacre - one of the deadliest crimes in Europe since the end of World War II - was perpetrated in July 1995 by Serb forces who rounded up thousands of Muslims, most of them men and boys.

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About 400 Dutch peacekeepers failed to prevent the atrocity in the mostly Muslim Bosnian city, which had been declared a United Nations safe area.

Dutch Prime Minister Mark Rutte, in an interview on RTLZ television, called the Turkish leader's comments "hysterical" and "unbelievable".

Erdogan "is on TV three times a day. He's pumping it up further and further," Rutte said before a general election which begins tonight NZT.

Rutte's Liberals are being pushed hard by the anti-Islam, anti-EU Freedom Party of Geert Wilders.

"I am angry," Rutte said. "At some point, talks need to be held. We will not stoop to this level."

Erdogan has clashed with European leaders this month as he seeks to build support among Turkish expatriates for an April 16 referendum on transferring sweeping powers to the presidency.

European officials been vocal in their disapproval of the plebiscite, saying it would undermine democracy in a Nato member state and European Union membership applicant. About three million Turks outside their country can vote, though fewer than half of them did so in the last general election in 2015.

In his speech, Erdogan lashed out again at German Chancellor Angela Merkel for siding with the Netherlands.

The diplomatic spat began in Germany after officials there cancelled pro-referendum rallies by Turkish ministers. Erdogan shot back, accusing Germany of using "Nazi practices" and of supporting "terrorist organisations," including the separatist Kurdish PKK group. Merkel's chief spokesman, Steffen Seibert, dismissed the allegations as "clearly absurd".

"Fascism that has surfaced in Europe is affecting all Muslims and foreigners in a negative way," Erdogan said today. "Europe is a very important continent that can't be left to the mercy of bandit states."

Yesterday, he had accused Europe of shirking its obligations under a 2016 deal that was to stem the flow of refugees from Turkey to Europe in return for waiving travel visas for Turkish citizens. The Foreign Ministry today accused the European Union of fuelling hostility towards Turks and foreigners in general by siding with the Netherlands.

In addition to barring the re-entry of the Dutch ambassador, Turkey's deputy Premier, Numan Kurtulmus, said his country would suspend all high-level meetings with the Netherlands and deny Dutch diplomats permission to fly in and out of Turkey. Parliament has also been advised to abolish a friendship group with the Netherlands, Kurtulmus said.

"There is a deep crisis and it's not Turkey's fault," he said. "The Netherlands must take steps to mend ties."