Jeff Mason
Reuters

3:14 p.m. CST, January 30, 2012

WASHINGTON (Reuters) - President Barack Obama said on Monday the United States and Georgia were exploring the possibility of a free trade agreement to expand commerce and strengthen trade relations.

In a White House meeting with Georgian President Mikheil Saakashvili, Obama said the two countries had agreed to start a dialogue that would look at various trading options "including the possibility of a free trade agreement."

He did not lay out a timetable for the process.

"Obviously there's a lot of work to be done and there are going to be a lot of options that are going to be explored," Obama told reporters in the Oval Office, with Saakashvili sitting beside him.

"The key point though is we think it's a win-win for the United States and for Georgia as we continue to find opportunities for businesses to invest in Georgia, for us to be able to sell Georgia our goods and services, and Georgia to be able to sell theirs as well."

Saakashvili said a free trade pact would help Georgia in its evolution as a nation.

"It's very important that you mentioned, obviously, (the) prospect of a free trade agreement with Georgia because that's going to attract lots of additional activity to my country and basically help in our nation-building process," he said.

Obama's comments come less than a week after he made a pitch in his annual State of the Union speech for closer U.S. trade relations with Russia, which fought a brief war with neighboring Georgia in 2008.

The Obama administration plans to push the U.S. Congress this year to approve "permanent normal trade relations" with Russia by removing a Cold War-era trade provision known as the Jackson-Vanik amendment.

That provision tied U.S. trade relations with centrally controlled economies to rights of Jews and other religious minorities to emigrate freely.

However, the measure is inconsistent with the rules of the World Trade Organization, which Russia is expected to enter this year. A parallel trade initiative with Georgia could help smooth the way for the Russia trade vote, which is expected to be difficult because of concern about how committed Moscow is to democracy and human rights and its relationship with Iran.

During his meeting with Saakashvili, Obama also said the United States would continue to support Georgia's aspirations to become a member of NATO.