Georgia urges smart EU sanctions after conflict

By Marcin Grajewski

BRUSSELS (Reuters) - Georgia's prime minister urged European Union leaders on Sunday to impose "smart" sanctions against officials and firms doing business with Georgian breakaway regions recognised by Russia after a military action.

Lado Gurgenidze said the EU's summit on Monday should also authorise a civilian mission to monitor the buffer zones next to South Ossetia and Abkhazia, which could evolve into an international peacekeeping operation.

He told Reuters in an interview in Brussels that Georgia counted on a faster integration with the EU and on receiving about $2 billion (1.09 billion pounds) in foreign aid to repair the damage caused by Russia's military action in his Caucasian republic.

"What we hope will start happening as a result of this summit is the introduction of a set of so-called smart sanctions, which would not be punitive in nature," he said on the eve of meetings with some of the EU's 27 leaders.

He said the sanctions, such as visa bans and asset freezes, should hit "officials, business and ... individuals who do business in the separatist controlled areas of Georgia without proper registration with Georgian authorities."

He played down prospects for wider punitive sanctions against Russia. "I am not saying Georgia would not welcome some kind of across-the-border sanctions, but this is for European leaders to discuss."

EU leaders are expected to issue a verbal condemnation of Moscow, but France, Germany and others have blocked calls from eastern European states for a tougher stance, including possible punitive action.

Gurgenidze said smart sanctions would encourage Russia to honour its accord with French President Nicolas Sarkozy to withdraw its forces from undisputed Georgian territories.

OBSERVER MISSION

The crisis erupted this month when Georgian forces tried to retake the separatist province of South Ossetia and Russia launched an overwhelming counter-attack.

Russian forces swept the Georgian army out of the rebel region and are still occupying some areas of Georgia proper. It has since defied the West by recognising the independence of South Ossetia and Abkhazia, another rebel region.

Gurgenidze said he hoped the EU would send a civilian mission of observers to the buffer zones controlled by Russians.

"Europe can do a lot, starting with sending a mission of civilian monitors, which would lead to an international peacekeeping mechanism that would replace the presence of Russian troops," he said.

Georgia hopes to receive about $2 billion in international aid to repair roads, buildings and other infrastructure and help its economy return on a path of fast economic growth, which reached more than 12 percent last year.

Gurgenidze said the EU should speed up its integration with Georgia to ensure its economic and political reforms are not reversed. He suggested the EU's current "eastern partnership" proposals may not be sufficient.