Georgia to hold elections in January

GEORGIA decided yesterday to hold an election on January 4 to replace ousted president Eduard Shevardnadze as its interim leaders sought to make a fresh start and rescue the stricken economy.

Deputies voted, 155-0, in favour of the poll date after turning out in force to answer an appeal by Mikhail Saakashvili, leader of the anti-Shevardnadze resistance, who said boycotting the session could destabilise the volatile Caucasus state.

"The purpose is to overcome this difficult situation. Each of us carries a huge responsibility but I hope we will begin a new era of our country's development," interim president Nino Burdzhanadze told the session before the vote was taken.

Fixing a new date for a presidential election is a key step in ensuring stability after street protests in three tumultuous weeks culminated in the resignation of Eduard Shevardnadze on Sunday.

Earlier, Georgia's new leaders claimed a new scalp from among Mr Shevardnadze's old allies forcing the resignation of state minister Mr Avtandil Dzhorbenadze.

His departure had been on the cards since Ms Burdzhanadze had denounced him for Georgia's economic plight and for organising the disputed November 2 parliamentary election that triggered the street protests and finally brought r Shevardnadze down.

The session took place as one separatist leader said he planned to meet the heads of two other separatist territories in Moscow to form a tough common stance toward Tbilisi after the downfall of Mr Shevardnadze.

The gathering in the Russian capital of officials from Abkhazia, South Ossetia and Adzhara will come as a sharp reminder for the new Georgian leadership of the separatist passions pent up in the small country of 4.5 million people.

Ms Burdzhanadze earlier warned Georgia stood on the brink of "economic collapse" after the bloodless ouster of Mr Shevardnadze and said drastic steps had to be taken to reverse the situation.

She told top officials in a televised broadcast the legacy of economic decline left by his discredited administration was "even worse than we thought".

"The situation is very difficult. Yesterday's data shows that we are facing economic collapse," she said, adding the situation called for radical measures.

She gave no specific details beyond urging state enterprises to work at full capacity. But her warning clearly prefaced fresh appeals to the West to help her impoverished former Soviet country where the average monthly income is about $40.

"We have to ask our foreign colleagues to help us in this situation," she said.

The 11-year rule of Mr Shevardnadze, a former Soviet minister who won plaudits in the West for helping end the Cold War, was marked by rising poverty, chronic corruption and separatist rebellions in the volatile Caucasus state of 4.5 million people.

The Supreme Court, meanwhile, formally cleared the way for a separate new parliamentary election by quashing the results of most of the disputed November ballot.

Georgia's new leaders, including Mr Saakashvili, a US-educated lawyer who led anti-Shevardnadze protests and is tipped as a possible future president, face an uphill battle to turn around the country's fortunes.

The West is carefully monitoring the situation because of plans to build an oil pipeline across Georgia from Azerbaijan to the Mediterranean sea.

Georgia has fallen out with the International Monetary Fund, which refused to lend it money under a poverty reduction programme until the Shevardnadze government dealt with mass corruption and tax evasion.

Sources close to the Paris Club of official creditors said Georgia would have to mend fences with the IMF before it has any chance of a debt relief deal with wealthy nations. It has $1.78 billion in foreign debt including some $600m to the Paris Club.

Ms Burdzhanadze secured some support from northern neighbour Russia with promises that Moscow would maintain its vital supplies of electricity to Georgia.