By David Brunnstrom
BRUSSELS (Reuters) - International donors met on Wednesday to pledge funds to help Georgia recover after its August war with Russia, and the country's prime minister said it appeared on course to meet a target of $3.25 billion (2 billion pounds).
The U.N. and World Bank estimate Georgia needs this amount over the next three years to help tens of thousands of people forced from their homes and to repair infrastructure.
At a meeting in Brussels chaired by the European Commission and the World Bank, Georgian Prime Minister Lado Gurgenidze praised the generosity of donors and added: "We look on course for achieving the declared target."
EU External Relations Commissioner Benita Ferrero-Waldner said the meeting aimed to provide direct support for Georgia's people but was also "a political symbol of solidarity."
European Commission President Jose Manuel Barroso told the meeting there was a moral imperative to help a neighbour in need, but that it was also in the European Union's interest.
"Any conflict on Europe's borders clearly has implications for European security and stability," he said. "This particular conflict also has potential costs for Europe in terms of our energy security and our diversification strategy."
Georgia is a key energy transit route, and Barroso noted that all three main transit routes were disrupted during the conflict with Russia as well as oil transportation by rail.
HELPING GEORGIA HELPS EU
"Giving ourselves the means to help increase economic, political and infrastructural security in Georgia ... is also a way of helping ourselves too," he said.
Russia sent in troops after Georgia tried to retake a breakaway pro-Russian region. Moscow has since withdrawn soldiers from Georgia proper, but the West accused Moscow of a disproportionate use of force.
Russian bombing raids hit mainly military targets, but Tbilisi also reported damage to civilian infrastructure and risks to its economic growth and investment.
The United States has offered at least $1 billion to help Georgia rebuild. The European Commission, the European Union's executive, has promised up to 500 million euros (403 million pounds) to 2010 and Ferrero-Waldner wants the EU's 27 states to match that figure.
Japan's Parliamentary Vice Minister for Foreign Affairs Yasutoshi Nishimura told reporters Japan would provide 200 million euros for energy and other projects.
The European Investment Bank said it was allocating more than 200 million euros for loans to infrastructure projects for 2009 and 2010, including energy projects, rehabilitation of railways and reconstruction of the runway at Tbilisi airport.
German Deputy Foreign Minister Gernot Erler told reporters Germany would give another 33.7 million euros in addition to 100 million euros of the European Commission pledge.
World Bank Vice President Shigeo Katsu said Georgia was facing a dual shock from the war and the global financial crisis and it was vital to keep reforms on track.
The central bank in Tbilisi said last month international institutions had pledged a loan package of about $1 billion to help soften the impact of the conflict on the banking sector, which has had to scale down expectations of foreign investment.
Last month the IMF approved a $750 million loan program aimed at rebuilding Georgia's currency reserves and restoring investor confidence.
(Additional reporting by Ilona Wissenbach; Editing by Matthew Jones)
