Hannah Cleaver in Tbilisi -

The buzzword in Georgia at the moment is NATO, while talk of joining the EU has been quietly shelved despite the EU flag flying on almost all of Tbilisi's government buildings.

On Tuesday, US President George Bush signed into law the NATO Freedom Consolidation Act of 2007, which supports the expansion of the alliance to include Georgia, as well as Albania, Croatia, Macedonia and Ukraine in 2008.

Unlike most of the other countries in the former Soviet Union, Georgia needs security more than it needs the trade. NATO brings a host of intangible but immediate benefits, while the chance of this tiny republic in the Caucasus becoming part of Europe is as remote as Tbilisi is from Brussels.

For Georgian President Mikhail Saakashvili, who together with Ukrainian President Viktor Yushchenko expressed their readiness to join NATO at a joint press conference on March 1, membership of the military alliance brings security guarantees against a hostile Russia, tightens bonds to the US, helps catalyse pan-regional institution building and should give an impetus to internal reform.

The EU plans have been dropped partly because politicians have woken up to the realization of just what it would demand of the economy, and a quiet word from Brussels that such hopes were unrealistic. So NATO membership has been made number-one foreign policy strategy.

Need for steel

The need for some steel in Georgia's security arrangements are real given the occasional border clashes stemming from Saakashvili's attempts to bring two breakaway regions supported by Moscow back into the fold. Tbilisi has also been in a tense standoff with Moscow since last year, with all communication and trade blocked. Post is not crossing the border and many Georgians have been expelled, with no idea about when they can go back to their jobs and lives in Russia.

Rarely seeing eye-to-eye

And despite rumours that flights between Tbilisi and Moscow could resume this summer, there is no reason to think the two governments will do much to improve relations - the mutual enmity is of use to both Putin and Saakashvili in rallying their people behind them. The Georgian public rates Russia as the country's biggest political and economic threat.

The intention of Georgia to join NATO solidifies its strategic leanings towards the US, while continuing overtures to Europe, as well as maintaining the prospect of strengthening trade and political links. It is also a crowd-pleaser, with more than 80% of the population in favour, according to opinion polls from the International Republican Institute.

Batu Kutelia, Georgia's deputy defence minister with responsibility for NATO integration, stresses that the membership process is about far more than making sure his tanks match those of the other members of the trans-Atlantic alliance.

The Intensive Dialogue on membership issues, the NATO integration stage that Georgia is now in, concerns broad political developments, so that Georgia becomes the kind of country that can enter negotiations to join NATO – namely a stable democracy, working under the rule of law.

"This forms one of the main aspects of the whole domestic reform programme in the whole country," says Kutelia in his office at the Ministry of Defence in Tbilisi, before listing the Euro-centric bodies - the Organisation of Security & Cooperation in Europe, the Council of Europe and the EU - that Georgia will have to impress to get the green light from NATO.

"The main point in reforming the country to be able to join NATO is to ensure security in the country and join the European family. This is part of our whole political agenda," he says.

Military reform is necessary, but he says other crucial areas include judicial reform, fighting corruption, improving basic human rights and encouraging sustainable economic development.

He says Georgia has made enormous strides in tackling corruption, with the World Bank ranking it the best reforming country in that respect this year, up from second last year. But he admits that a concerted effort is needed to reform the courts, saying careful appointment of judges was necessary, a concern mirrored on the streets. Just 23% of those asked in the recent poll by the International Republican Institute expressed confidence in the courts, down from 34% last year.

Many criticise the courts as little more than rubberstamps for the public prosecutor, with anecdotes abounding on the streets of Tbilisi about people being given several years in prison for having a stolen mobile phone. The recent case of a 15-year-old boy who was jailed for seven years for a stabbing - the same sentence as handed to two adults convicted of murder - sparked international concern.

And while the economy may be steadily making progress up the enormous hill it still has to climb, people are feeling less secure personally, according to the poll. Just 21% said they thought no-one was afraid to express their political views openly; in October 2004, that figure was 44%.

Broadly, the mood of the people has taken a sizeable dip since Mikhail Saakashvili's "Rose Revolution" of 2003. This is largely to be expected, as reality takes over from the wild hopes and expectations engendered by the change of direction. But while levels of satisfaction with political developments have drooped from previous rates of 60% and more, they seem to have stabilised at sustainable levels.

Nearly half the respondents of the International Republican Institute poll said they felt Georgia was moving in the right direction, while nearly 40% said the economic situation had improved over the last three months, while half said their financial situation had remained the same during that time. Half the population said they were satisfied with the way democracy was developing.

The biggest challenges to Georgia's progress in general – and Kutelia suggests also to joining NATO – are the situations in the two breakaway regions of Abkhazia and South Ossetia.

Breakaway fiefs

Both regions have de facto authorities independent of the Georgian government. While that of South Ossetia can be seen as largely a Russian puppet, the one in Abkhazia could be said to have more realistic claim to represent those people still living in the region - most ethnic Georgians having been expelled.

The Georgian government is spending a huge amount of energy and resources on these regions - Abkhazia is a wealthy and important area, while the struggle over South Ossetia involves Russia and so cannot be swept under the carpet.

"The regions, South Ossetia and Abkhazia, are undermining our economy, costing a lot of money to keep a so-called peace," says Kutelia. "If we didn't have these conflicts we could take these resources for other things. "My biggest wish is to sort out the regions - we would progress three times as fast to join NATO, we would have better resources, and the economy would be better and we would have more stability and security," he says.

Perhaps a sign of how MATO membership will help resolve these territorial issues came on Tuesday, when US Secretary of State Condoleezza Rice urged Russia to respect Georgia's territorial integrity and to stop supporting separatist republics within the South Caucasus nation.

"We expect Russia to have influence with its neighbours - you always have influence with your neighbours - but that it ought to take the character of respect for the independence of those states and in the case of Georgia, respect for the territorial integrity of Georgia, which means doing nothing to suggest that the separatist movements in South Ossetia or in Abkhazia have any claim to independence," Rice told reporters.

Georgia is also a prime mover in a regional development which, although still embryonic, could help redefine the Black Sea area and eventually even form a political and economic bloc.

At the end of March, the Georgian government hosted the first Tbilisi International Conference, with the theme, "Countering Terrorism and Drug Trafficking."

Azerbaijan, Armenia and Turkey were all strongly represented, at ministerial and deputy ministerial level, while Romania, Bulgaria, Moldova and even Lithuania also sent delegations. NATO was also on hand, while the European Commission also made an appearance, as did other Western countries, and there was even a small delegation from Russia.

One delegate from the NATO group commented that the material discussed was far from ground-breaking, but the fact such countries were meeting in a regional block was interesting and boded well for the future.

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