U.S. says Moscow's membership in global clubs at stake

By Susan Cornwell

WASHINGTON (Reuters) - Russia's integration into international institutions like the World Trade Organization is at risk because of Moscow's military operations in Georgia, a senior U.S. official said on Tuesday.

The United States may also cancel a naval exercise with Russia to indicate its disapproval of Moscow's attacks on its neighbor, American officials said.

"Russia has a lot to lose" if it ignores international pressure to stop its attacks on Georgia, withdraw its forces from the former Soviet republic and enter into serious negotiations on the future of Georgia's breakaway areas, the senior U.S. official said.

Russian President Dmitry Medvedev ordered a halt to military operations in Georgia earlier Tuesday in support of an international peace plan promoted by French President Nicolas Sarkozy.

But Georgia cast doubt on Moscow's announcement and U.S. officials could not confirm the Russian attacks had stopped.

"It is very important now that all parties cease fire," U.S. Secretary of State Condoleezza Rice told reporters.

"The Russians need to stop their military operations as they have apparently said that they will. But those military operations really do now need to stop," she said.

The crisis began Thursday when Georgia sent forces to retake South Ossetia, a pro-Russian province that threw off Georgian rule in the 1990s. Moscow responded with a massive counter-attack deep into Georgia proper.

As Washington sought ways to leverage its demands on Moscow, the senior U.S. official noted the Medvedev government had sought membership in the WTO, the Organization for Economic Cooperation and Development, and continued participation in the Group of Eight nations.

"Frankly, the entire Medvedev agenda is at stake here," the official said, speaking on condition of anonymity. The United States would like to see that agenda succeed, but "that's what's at stake when Russia engages in behavior that looks like it's from another time."

"They need to think about whether they haven't achieved some tactical objectives at the expense of some strategic objectives," another senior official said.

A decision to cancel the naval exercise with Russia would be one of Washington's first concrete actions of protest.

The annual exercise also involves vessels from Britain and France and was due to begin within the next week in the Pacific Ocean near the Russian city, Vladivostok.

"In all likelihood it will be canceled," a senior defense official said, speaking on condition of anonymity.

President George W. Bush said on Monday that Russia's actions had "substantially damaged Russia's standing in the world" and jeopardized its relations with the West.