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The invitation to the president was made to offer support and encouragement to Georgia for the path that it has chosen, so I trust that noble Lords will not be surprised or disappointed to hear me echo many of the positive statements that have been made in this debate. Like the noble Baroness, we recognise and celebrate Georgia’s strong desire for democratic prosperity.

Georgia has travelled a remarkable distance since the rose revolution that brought President Saakashvili to power in 2003. Then, Georgia was a country beset by internal strife and economic problems, as the noble and right reverend Lord, Lord Harries of Pentregarth, graphically illustrated. Despite formidable challenges, it has developed into an important regional actor and increasingly an international player. Georgia’s leadership can rightly be proud of her achievements so far, especially her strong economic growth and democratic reform. Economic growth was 9.4 per cent in 2006 and a staggering 13 per cent in the first quarter of this year. That is quite remarkable.

Serious efforts have been made to tackle corruption and crime, but these must continue. We are very conscious of the huge amount of work that Georgia has put into her reform efforts and we encourage her to continue along this path. It is vital that the Georgian Government ensure that reforms made in legislative terms are implemented properly and that their sustainability can be demonstrated.

The noble Baroness and other noble Lords rightly mentioned the conflict in South Ossetia. It is of the utmost importance that the internal conflicts over the separatist regions of Abkhazia and South Ossetia are resolved peacefully. This is crucial for the stability, security and long-term development of Georgia and the wider Caucasus region. The ongoing conflicts in these two regions hinder Georgia’s development to some extent and complicate its relations with its neighbours. We fully support the efforts of the UN and the OSCE to find lasting political settlements in Abkhazia and South Ossetia that respect Georgia’s territorial integrity within its internationally recognised borders. We urge patience and confidence-building dialogue with all parties. Long-lasting and sustainable solutions to these conflicts can be obtained only through peaceful negotiations between the sides. We also fully support UN efforts in working to remedy the deplorable situation with regard to internally displaced persons.

We attach great importance to this issue. On 1 October 2002, Sir Brian Fall was appointed as the UK’s special representative for Georgia—an appointment later expanded to cover the whole of the South Caucasus. Sir Brian is a senior UK representative on the Group of Friends of the UN Secretary-General, which aims to help the Georgians and Abkhaz to find a peaceful solution to the dispute. He regularly discusses the conflicts and other issues with senior members of the Georgian Government. We hope that the reforms that Georgia is currently undertaking will help it to move closer to resolving the conflicts. Stronger links with the outside world and greater prosperity will make Georgia the most attractive option for the would-be separatists.

The UK provides support to Georgia on conflict prevention programmes funded through the Global Conflict Prevention Pool. Our approach to civil-society building in Georgia has largely concentrated on encouraging dialogue across the various conflict divides and on developing the capacity of NGOs, journalists and other key groups to better address conflict-related issues. We consider the work of NGOs to be hugely important and commend their effective work across the conflict divide.

The noble Earl, Lord Sandwich, mentioned UNOMIG, the UN observer mission in Georgia. The UK is one of 28 nations contributing military personnel—we provide five. I will gladly write with further information about what we believe the mission is achieving at present.

Noble Lords will have gathered from my remarks so far that Georgia and the situation in and around Georgia are of interest and importance to the UK. This is exemplified by the high-level dialogue that we have with Georgia, most recently during the president’s visit last month. The UK stands ready to help Georgia in her desire to become a stable, prosperous, democratic and well governed state. We welcome Georgia’s aspirations to Euro-Atlantic values, and we support her sovereignty and territorial integrity, which we see as vital factors in maintaining stability in the whole region.

I am grateful for the warm support of the noble and right reverend Lord, Lord Harries of Pentregarth, for the work of our embassy in Tbilisi. He asked about DfID and other assistance. The Department for International Development has been providing support to the Georgian Government since 1992 and expects to spend around £3.5 million this year on a range of projects, including in the areas of public financial management, health, regional development and good governance. We also expect to provide assistance to the Georgian Minister for Euro-Atlantic Integration to help to support the implementation, monitoring and reporting requirements of work arising from its new EU action plan.

The UK share of overseas development assistance to Georgia in 2005 was £8 million. The two largest chunks of this came from the European Commission and the World Bank’s International Development Association. Following Georgia’s good economic growth and arrival at lower-middle income status, DfID will close its bilateral programme to Georgia at the end of 2008. However, the UK will continue its contribution to Georgia’s development agenda through multilateral channels.

At the end of last year, Georgia took two welcome steps in deepening its relationship with Europe. In September, the NATO alliance agreed to open an intensified dialogue with Georgia and, in November, Georgia and the European Union signed a European Neighbourhood Policy action plan. This policy holds out the prospect of a closer relationship with, and greater assistance from, the European Union in return for progress on internal reforms. We encourage Georgia to embrace the European Neighbourhood Policy as a tool to help it to move closer to EU standards. In answer to the noble Earl, Lord Sandwich, the European Neighbourhood Policy does not prejudice future applications for EU membership by eligible countries. We hope that the processes involved and the active support of her partners in both the EU and NATO will encourage Georgia to do what is necessary to move closer to embodying the Euro-Atlantic values that we share with her.

The noble Earl, Lord Sandwich, asked about the alleviation of poverty and the millennium development goals. I do not have an answer this evening, but I shall certainly write to him. Georgia has preferential market access to the EU under the generalised system of preferences, and we are encouraging it to make full use of it. The European Commission has begun a process to look at the feasibility of a free-trade agreement with Georgia. I do not have a reply about microcredit and small enterprises, but I will gladly write about that.

It is clear, as the noble and right reverend Lord, Lord Harries, said, that democracy is a matter not just of elections but strong institutions and respect for human rights. There are a number of human rights issues in Georgia that our embassy in Tbilisi continues to monitor

We regularly raise these issues in our bilateral discussions with the Georgian Government and support our European partners, the OSCE and the Council of Europe. We have particular concerns over the situation in prisons. The justice sector as a whole needs serious attention, and places of detention are perhaps the most public illustration of the reforms needed. We believe that there is more work to be done on reform of the judiciary to ensure that its independence is fully protected and demonstrated. There is an apparent willingness at the highest level of the Georgian Government to reform the judiciary. This has been supported by the standards set under the EU action plan and in Georgia’s progress towards NATO membership, and the acknowledgement that external foreign investment needs the support of a strong and independent judiciary. The UK has, through our high-level visitors, used these political and economic levers to highlight the need to drive forward the pace of reform in the justice sector, particularly in improvements in prisons.

Many noble Lords have understandably raised the question of NATO. We, of course, welcome Georgia's developing relationship with NATO. Georgia has participated through an individual partnership action plan in 2004 and, on the basis of progress made, was granted an intensified dialogue with NATO in September 2006. We have been pleased to see these steps forward in Georgia’s relations with the alliance, particularly as they will help nourish not only military and defence reforms but the wider reforms that will help Georgia to develop sustainably.

The processes are designed to support and stimulate modernisation and reform, promoting Georgia’s development as a secure, stable and successful country, including with a view to conflict resolution. The responsibility lies with Georgia to prove to allies that she can be a stable partner. We are sure that that is what the Government of Georgia are committed to doing. We support NATO’s open-door policy, based on the principles of performance and commitment to NATO values, and Georgia's aspirations for eventual membership.

We are grateful for Georgia’s significant support to international operations. I note the views expressed by the noble Lord, Lord Dykes, but I warmly welcome President Saakashvili’s pledge of support to the ongoing missions in Kosovo, Iraq and Afghanistan. From this summer, we anticipate that Georgia will become the third largest troop-contributing nation in Iraq, after the US and UK.

As noble Lords have said, Georgia is experiencing a difficult period in its relations with Russia; but Russia and Georgia need to develop a constructive neighbourly relationship, and our aim is to support them in producing the conditions for that. We have urged both sides to show restraint towards each other, and welcome the fact that the rhetoric has calmed over the past few months. However, Russian transport restrictions as well as economic restrictions against Georgian produce remain in place. We have urged the Russian authorities, both bilaterally and through the EU, to lift these measures and will continue to do so. We also encourage Russia to use its significant influence with the de facto regimes in South Ossetia and Abkhazia to work towards sustainable solutions to these conflicts.

The noble Baroness, Lady Rawlings, understandably raised the summit at Samara. Despite difficulties in the UK and EU relationships with Russia it is important that we continue to engage. The EU and Russia are serious international players with a number of shared interests. The recent summit was part of that engagement process, in which a substantial range of issues were discussed. The EU also raised human rights. Chancellor Merkel was clear at the summit, in private and public, about the importance of protecting peaceful freedom of assembly in Russia. We fully align ourselves with those sentiments.

The noble and right reverend Lord, Lord Harries, asked for an assurance that member states of the European Union were working together. The reported statement of Mr Barroso, president of the European Commission, that a difficulty with one member state was a difficulty with the European Union, says it all.

Georgia is a key energy transit state and has positioned itself strategically to help Europe meet its energy needs. It hosts the significant Baku-Tbilisi-Cheyhan oil pipeline, opened in 2006, and the Baku-Tbilisi-Erzerum gas pipeline, which opened in 2007. These are both important arteries, enabling Caspian gas and particularly oil to reach western markets. The noble Baroness, Lady Rawlings, asked whether the Russians were not just using energy as a form of political and diplomatic power. The energy relationship with Russia must be seen firmly within a G8 context, in which context we will continue to engage with Russia.

In conclusion, Georgia has made the most enormous strides but still has some way to travel on the road to becoming a stable, secure and democratic modern European state. This evening’s debate has been about the current situation in Georgia, but we should not forget that Georgian reforms are a work in progress. We recognise Georgia as a partner in our international agenda, in the promotion of sustainable development and reduction of poverty underpinned by human rights, in energy security and in building an effective EU in a secure neighbourhood. The Government will continue to support Georgia towards the goals that it has set itself.

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