In April 1987, British Prime Minister Margaret Thatcher visited Moscow and Tbilisi on what she described as “the most fascinating and most important visit” she had made as prime minister. The Iron Lady’s visit fully revealed the cracks in the Soviet system and gave her the resolve to work with President Reagan to break the tyranny of communism.

Now, 25 years later, modern Georgia is implementing reforms that encapsulate Mrs. Thatcher’s belief in democracy, free markets, a strong defense and liberty. President Mikheil Saakashvili came to power after the peaceful 2003 Rose Revolution and has set his focus on gaining membership in the European Union and NATO. Though Georgia still has a long way to go, it is making solid progress. Its northern neighbor, Russia, provides a stark contrast. There, democratic freedoms are in retreat; corruption is endemic, and the future is bleak. Vladimir Putin’s Russia is starting to show the same cracks evident in the Soviet Union a quarter-century ago.

Before Mrs. Thatcher came into power, Britain was known as the sick man of Europe. Today, Europe is the sick man of the world. Yet thanks to its Thatcherite agenda of liberalizing the economy, cutting bureaucracy and fighting corruption, Georgia is making solid economic progress. For example, its budget deficit fell to 3.7 percent of gross domestic product (GDP) in 2011, from 6.6 percent a year earlier. Its economy is expected to grow 5.5 percent this year. The 2012 Index of Economic Freedom, published by the Heritage Foundation, ranked Georgia 34th out of 184 countries - a striking improvement from its 2003 ranking as 113th. Georgia enjoys greater economic freedom than 26 other European nations, including France, Spain and Belgium.

Georgia also has made significant progress in tackling corruption. Transparency International’s Global Corruption Barometer (2010) ranked Georgia first in the world in terms of improvement on that front.

Georgia also has implemented major defense reforms to ensure it can operate effectively alongside NATO - even though it is not yet a NATO member. Moreover, Georgia spends around 4 percent of GDP on defense - a level of investment NATO members (which spend on average only 1.6 percent) would do well to emulate.

While many NATO members have announced troop reductions in Afghanistan for 2012, Georgia has committed more troops to the mission this year - doubling its contribution in Helmand province. This will make Georgia the largest per capita troop-contributing nation in the International Security Assistance Force. This is not surprising. When Russia invaded Georgia in 2008, it was the second-largest troop contributor in Iraq, trailing only the United States. When it comes to defense, Georgia is a serious player.

Mr. Saakashvili has handled Georgia’s difficult relations with Russia responsibly and pragmatically. He has made a “nonuse of force” pledge regarding the occupied territories of Abkhazia and South Ossetia - something Russia has failed to do. Knowing the benefits of the global economy, Georgia also has demonstrated a responsible approach with the recent deal, clearing the way for Russian membership in the World Trade Organization.

The West can do much to encourage Georgia to stay on the road of reform. For starters, more European countries should show a little appreciation by formally declaring Russia’s occupation of Abkhazia and South Ossetia to be just that: an occupation. If 10,000 Russian troops permanently based on 20 percent of Georgia’s territory is not an occupation, what is? Yet most European nations have remained mute. The United Kingdom and other European partners should join France and the United States in a statement unequivocally condemning the illegitimate Russian occupation.

The West also should sell high-end defensive anti-tank and anti-aircraft weaponry to Tbilisi. Georgiahas proved itself a reliable security partner in the Balkans, Iraq and now Afghanistan. Its military deserves all the defensive weaponry it needs. Georgians must have been puzzled to see Libyan rebels - some of them allegedly linked to al Qaeda - armed with the latest anti-tank weaponry while the West continues to deny Tbilisi the equivalent weapons. Furthermore, at the May 20-21 NATO Summit in Chicago, the alliance should reaffirm its support for eventual Georgian membership.

Georgia has a long way to go to fulfill its Euro-Atlantic ambitions, but real progress is being made. The principles that Margaret Thatcher epitomized when she visited Tbilisi in 1987 still ring true. U.S. policy toward Russia cannot be based on resets or wishful thinking. If Georgia slips back intoRussia’s orbit instead of being drawn into the European family of nations, the West will have no one to blame but itself.