EU offers closer ties to eastern neighbours

By Marcin Grajewski

BRUSSELS (Reuters) - The European Union proposed boosting its ties with Ukraine, Georgia and four other former Soviet republics on Wednesday in a move likely to irk Russia, which views the region as within its sphere of influence. European Commission President Jose Manuel Barroso said the plan, which offers financial aid, conditional free trade pacts and easier travel for the countries' citizens, gained urgency when Russia's briefly attacked Georgia in August.

"Today we are proposing an ambitious initiative to enhance our support to six partners in eastern Europe and the Caucasus," Barroso told a news conference. "Events in Georgia in August had influenced this process."

Under the scheme, called the "Eastern Partnership," the 27-nation EU would negotiate new association agreements with Ukraine, Georgia, Armenia, Azerbaijan, Moldova and Belarus in reward for democratic and free market reforms.

It provides notably for closer cooperation on energy with the countries, which are either rich in oil and gas or are key for transit of energy from Russia and other states.

It offers some 350 million euros (300 million pounds) in new aid for the countries for strengthening state institutions, border control and assistance for small companies.

The plan, although modest and not offering any EU membership prospects is likely to irate Russia, which regards the countries as its backyard, diplomats say.

But Barroso said Russia had no right to be concerned.

"There is no Cold War, there should not be any spheres of influence... I believe all countries have the right to decide where to go," he said.