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he US has announced $1bn (£564m) of aid to Georgia for reconstruction after the conflict with Russia.

Secretary of State Condoleezza Rice said the aid would be used to rebuild houses and infrastructure - but not for military purposes.

Georgia has requested $2bn in funding from the international community.

Fighting between Russia and Georgia began on 7 August after the Georgian military tried to retake the breakaway region of South Ossetia by force.

Russian forces launched a counter-attack and the conflict ended with the ejection of Georgian troops from both South Ossetia and another breakaway region, Abkhazia.

Russia has since recognised the independence of both regions.

Nicaragua, whose leftist government fiercely opposes the US, now appears to have become the second nation to recognise their independence.

President Daniel Ortega said in a speech: "The government of Nicaragua recognises the independence of the republics of South Ossetia and Abkhazia and we are completely with the Russian government's position."

'Simple message'

Announcing the aid package, Ms Rice said the US was "responding to what we consider to be urgent needs".

"With our full support and the support of the entire free world, a democratic Georgia will survive, will rebuild and will thrive."

On Wednesday, the International Monetary Fund (IMF) also announced that Georgia was to receive a $750m (£422m) loan.

The IMF agreed in principle to offer the help amid concerns that Georgia's growth would be seriously hampered by the recent war.

The US announcement came on the day Vice-President Dick Cheney began a visit in the region - but not Russia.

In Azerbaijan, he said he was bringing "a clear and simple message for the people of Azerbaijan and the entire region: the United States has a deep and abiding interest in your well-being and security".

Mr Cheney will next go to Georgia and Ukraine.

In Georgia, he is expected to stress US support for President Mikhail Saakashvili - the man the Kremlin dismissed on Tuesday as a "political corpse" whose leadership it did not recognise.

No fear

Russia's President Dmitry Medvedev has also accused the US of helping Tbilisi build its war machine and called on America to review its relations with the Georgian authorities.

Faced with a chorus of international calls for Russia's isolation, Mr Medvedev has said Moscow does not fear being expelled from the G8 group of rich nations nor does it fear Nato cutting ties with his country.

Early this week, European Union leaders agreed to suspend talks on a new partnership agreement with Moscow until Russian troops have withdrawn from Georgia. But they did not threaten sanctions.

Russia's Prime Minister Vladimir Putin, who stepped down as president earlier this year, praised the European Union's "common sense".

But he warned that Moscow would respond to the growing presence of Nato warships in the Black Sea, where Russia's navy has a huge presence.