U.S. Offers $1 Billion In Aid To Georgia

President Bush on Wednesday announced $1 billion in new economic aid to Georgia to help the pro-Western former Soviet republic rebuild after Russia's invasion.

"Georgia has a strong economic foundation and leaders with an impressive record of reform," Bush said in his statement on the aid package that was obtained by The Associated Press. "Our additional economic assistance will help the people of Georgia recover from the assault on their country, and continue to build a prosperous and competitive economy."

Vice President Dick Cheney, due in Georgia on Thursday, planned to make the massive aid package a major highlight of his discussions with Georgian President Mikhail Saakashvili. Cheney, in Azerbaijan on Wednesday, is on a tour of three former Soviet republics that are wary of Russia's intentions in what Moscow likes to call its "near abroad."

The administration is delaying an announcement on some sort of punishment of Russia for its actions against Georgia and its refusal thus far to comply with a French-brokered cease-fire. However, the decision to shower tiny Georgia with such substantial aid and have Cheney talk about it in Moscow's backyard would likely be seen by the Kremlin as highly provocative, if not a punitive measure in and of itself.

That said, the U.S. has found during this conflict that it has little leverage with newly enriched and empowered Russia. Moscow has recognized the independence of the two separatist regions in Georgia that are at the heart of the conflict, but has drawn condemnations but little else from the United States and Europe.

Georgia, a former Soviet Republic and U.S. ally, is an impoverished country wedged between Russia and Turkey on the Black Sea.

After years of tensions, the recent fighting began Aug. 7 when Georgian forces went into its breakaway province of South Ossetia in hopes of re-establishing control over it. Russian forces repelled the offensive and pushed deep into Georgia proper.

Both sides signed the cease-fire in mid-August, but Russia has ignored its requirement for all forces to return to prewar positions.

Bush said the money will meet both humanitarian needs, such as helping to resettle families that were displaced, and helping Georgia to rebuild infrastructure and boost its economy.

He said more than half of the funds will be made available in the near term. That leaves a sizable portion up to the discretion of a future Congress and the next White House occupant.

Bush feels confident in that area, as both the Democratic and Republican presidential candidates, Barack Obama and John McCain, have expressed strong support for Georgia's embattled government and Bush's approach to Russia's invasion.

The president also directed his defense, trade, transportation, treasury, diplomatic and commerce chiefs to expand their support for Georgia's economic recovery.

On trade, Bush said the United States would negotiate a deal to provide preferential access to Georgian exports. The president said his commerce secretary would dispatch a trade mission to Georgia in the coming weeks. And Bush said his government would work with international partners to make sure that U.S. aid was getting delivered, quickly, to those in Georgia who need it the most.

The money pales in comparison to the $2 billion a year the U.S. gives Israel, the largest recipient.

The International Monetary Fund also announced it has agreed to lend Georgia $750 million for economic recovery.

Meanwhile, a U.S. Navy flagship sailed toward Georgia with a cargo of humanitarian aid Wednesday. The USS Mount Whitney, the flagship of the Navy's 6th Fleet in the Mediterranean, crossed through the Dardanelles and Bosporus into the Black Sea, which Russia shares with three NATO nations and two others seeking to join the alliance: Georgia and Ukraine.

Russian leaders have lashed out at the U.S. for sending humanitarian aid to Georgia aboard military ships, part of their campaign portraying the United States as a belligerent troublemaker that pushed Georgia into war and continues to compromise security in a volatile region.

The appearance of the Mount Whitney was likely to stoke Russia's ire further. As the command ship of the fleet based in Naples, Italy, it has special electronic and communications equipment it uses to transmit orders and information.

Two other U.S. military ships a missile destroyer and Coast Guard cutter have delivered aid to Georgia since the five-day war in early August, which prompted the worst crisis in Russia's relations with the West since the Cold War.

"We don't understand what American ships are doing on Georgian shores," Russian Prime Minister Vladimir Putin said Tuesday. "The second question is why the humanitarian aid is being delivered on naval vessels armed with the newest rocket systems."