KUWAIT, Nov 10 (Reuters) - Saudi Prince Alwaleed bin Talal, a senior member of the ruling family, says it is high time for the kingdom to speed up political and economic reforms and take a hard look inward to root out Islamic extremism.

In remarks published on Monday, Alwaleed, a nephew of King Fahd, said: "We should stop beating around the bush, we have to wake up now: Why this extremism?"

Alwaleed is one of the world's richest men, with investments in major firms around the world and a personal fortune estimated in 2002 at $20 billion.

"We've begun to acknowledge the problem in an indirect manner but not in the core," he told Kuwait's al-Rai al-Aam newspaper.

He said there was consensus in the ruling family on the need to reform the absolute monarchy, especially following September 11, 2001, attacks on U.S. cities.

Washington has said the September 11 attacks were planned by Saudi-born al Qaeda leader Osama bin Laden. Fifteen of the 19 hijackers were Saudis.

The interview was made shortly before suspected al Qaeda suicide bombers blew up a car in Riyadh on Sunday, killing 18 civilians and wounding more than 120 others.

Alwaleed said reforms should tackle religious extremism in the birthplace of Islam, not just fighting armed militants "since ideological extremism leads to armed extremism".