This is the second traditional address on the eve of Independence Day. This is a time for me to briefly review what has happened in Georgia over the past year. Since 26 May last year, and in the last few years in general, it has been a very dynamic, very interesting and certainly historic time.

First of all, it should be said that Georgia has become a state. We were not a state before. We were a divided, destroyed, miserable country, in whose future no-one believed, including its own people. I have studied overseas a lot, you have also travelled a lot abroad, and, in the Soviet period, we were proud that we were Georgians, that we were strong, that we were better than everyone else. By the way, we are better than many. That was the stereotype for Georgians, that they were proud of their country and homeland.

In the 1990s this fell to the earth. Georgians were embarrassed to say they were Georgians. I have seen this. I have seen us both proud and embarrassed. Today, every Georgian can be proud of their country

Today, saying I am Georgian sounds very special. Georgia has regained its dignity. For me that is the greatest success. We have restored our dignity, our pride, we have managed to stand proud.

Georgia is now at the zenith of its international fame. Never before in modern history have so many people in the world known what Georgia is and so many people in the world envied our country.

The leader of the free world, President Bush, comes to Tbilisi and says Georgia is a shining example to the whole world. Georgia is a worthy example to the whole world. Never before in our history has Georgia been so famous.

Of course, our people deserve all of this. It has not happened easily. Of course, I know well what difficulties there are in this country. I know what hardship there is, I know examples of despair. Everyday I hear hundreds of stories about this, I look around, I travel. I am probably one of the most travelled presidents in the world, in that sense, because I go everywhere. However, I do not have right not to see the country's potential.

Of course, there has been hard work for me personally and for my friends. This year I lost my closest brother-in-arms, friend and most important adviser, Zurab Zhvania. For me personally this was a great tragedy, for the country it was a tragedy. For me it took several months to slowly recover, although I did not have the right to show that outwardly.

When President Bush was here, my best governor and one of my best friends, Bezhan Kalandadze, died. On the one hand I had to appear in a good mood but on the other hand I had only learnt about it a few hours before.

However, despite this - and it is our duty to these people - we have managed to survive these heavy blows. We lost 16 soldiers in Tskhinvali [South Ossetia], which for me personally was a great tragedy as for the general public who suffered those attacks.

However, I am certain we are on the right road. Now, I will call on myself and others to be less hasty. We do not have the right to make mistakes. We do not have the right not to look where we are going. We should follow things up and finish them. We should not be afraid of anything. We do not have the right to retreat.

We have a duty to the whole world - it is not just Bush who is saying that Georgia is a worthy example, many others have said it. I was always certain that it was Georgia's spiritual mission, despite the small size of our country, despite the fact that many of our people had left in recent years, as part of the world's history. Now the time has come to fulfil our spiritual, historic mission.

We do not have the right to fail in the eyes of our people or in the eyes of the world and humanity. I am certain of that.

Asked Questions

TV company Rustavi-2, Davit Kikalishvili

Mr President, it would probably be symbolic to say a few words before 26 May about the Russian military bases. Russian Federation President Vladimir Putin said that it would be good if after the Russian contingent's withdrawal there were no other foreign military bases on Georgian territory. What is your position on this?

Mikheil Saakashvili

The most important thing that has happened in Georgia over the past year is that it has become a state. It cannot be described as anything else. This is a very important for each of us, because our people have made us a major factor in the region.

We do not want Georgia to be just a corridor. Today we opened the oil pipeline and for Georgia that is a very important fact. However, as for being a corridor, a bridge-head, being a platform for foreign armies, we want to have our own army, our economy, we will develop ourselves.

There is hope that a decision on the withdrawal of Russian forces will be reached. We have taken a principled stand on that. We do not want to alienate Russia, we are not so blind as not to understand what importance a good relationship with Russia has. However, everyone should understand that banging a fist on the table and similar ways of dealing with Georgia are not possible. By the way, I think that the Russian president clearly understands that.

Sometimes you may have seen on some TV channel a politician who makes your hair stand on end. They talk a lot, I am one of their favourite heroes, in terms of the attention I get from Russian channels. There is already a series about me, my past and future. I watch that without a problem, because it will pass. This is a fever. We should ignore this propaganda and agitation.

It is not possible for people who have such great dreams, and there are some in the political spectrum, although I do not think they are the majority any longer, to so easily prevent Georgia becoming stronger.

We will do everything possible to make sure that none of our neighbours feels threatened. We will do everything possible to make sure that Russia does not feel there are problems from Georgia, because we really don't need that. We have enough of our own problems.

However, we will solve the issue of bases with the Russians. We have addressed a final withdrawal with them. We will address many other more important issues with them. We want them to be settled peaceful.

Georgia will have a very important changes this year and next year. Today, the opening of the Baku-Tbilisi-Ceyhan pipeline was not the completion of Georgia's gaining energy independence but the beginning. The final completion will be next year when gas starts flowing from the Sah Daniz project and we will have an alternative source of gas. We will not be dependent on one source, although we hope that we will have beneficial commercial relations with the other source, but at the same time we want an alternative.

Also, in the security sphere, next year we will complete our security reforms. From next year we will have all the defence guarantees that a sovereign state, albeit a small sovereign state, should have, so that no-one will blackmail us.

I repeat, we should do everything possible to ensure that we have very close, friendly relations with Russia. This hysteria should stop. Everyone should realize that this country is free, our country is independent. This should be a dignified, warm, friendly, neighbourly relationship between two independent countries. Please, Giorgi.

Giorgi Akhvlediani, Imedi TV

Mr President, you have already looked back at the past year, but have you managed to fulfil every promise, every plan and do everything you wished? What were you not able to do in this past year that upsets you the most? On 26 May you will inspect the Independence Day parade for the second time.

Mikheil Saakashvili

I want to begin with the parade. A miracle has taken place in the Georgian army. I think that all of the defence ministers have done very well, and I would like to especially acknowledge [Irakli] Okruashvili's work in the past months.

We do not want tomorrow's parade to be provocative. From the point of view of modernizing our equipment, this year we have immeasurably better equipment, of better quality and in some areas we have more of it than last year. Last year we brought out everything we had. We do not intend tomorrow to be sabre-rattling. We are bringing out our soldiers, who are more numerous than last year, although we still have one of the smallest armies in the region, but we should be the best equipped - that is happening very quickly - and the best trained and the most highly motivated.

I am also especially proud of our reservists. This area is one of the attributes of a state. A state cannot have self-respect and a feeling of dignity if it does not have armed forces. Before, parents did not want to allow their children to join the army. Now people are queuing up for their children to join.

This is a psychological revolution, because traditionally Georgians did not serve in the Soviet army. I was a rare exception. I served for two years, although, of course, it was another country's army, but it was a kind of school for me and has been very useful in hindsight. This has changed. This is our army, these are our boys, of whom we are all very proud. They are our officers, who should become the elite of our society.

Returning to your question, what has changed in the past year? Georgia has begun to fulfil its functions as a state. A simple example. Until the end of last year, if you were attacked you used not to be able to call the police or call an ambulance on 03. You could ring for hours. Once, last year, when I had food poisoning, I waited for an ambulance for 50 minutes. I did not introduce this just because I was waiting. Georgia now has a functioning police force, which everyone loves and which is very effective. It does not physically abuse people and it finds criminals, it arrives quickly and is well equipped. They no longer have incomes from corruption, not because there is no corruption, but because they have good salaries and therefore they have dignity and pride. The public should always make the police aware that they value them if we want to keep them this way.

From tomorrow, we will have a free ambulance service throughout the country, as I have dreamed for a long time, although only now do we have the resources.

Throughout Georgia roads are being built. Last year was for cleaning the state apparatus of corruption and consolidating state bodies. It was a year for consolidation.

This year is the year to start building. Equipment has been brought in, roads are being laid in the whole of Tbilisi, and in the regions, Kutaisi, Zugdidi, Guria and Ajaria. Roads are being built everywhere, in Kakheti and so on.

Facades are being repaired and not just in Tbilisi. In Sighnaghi, one of my favourite towns, all the facades are being painted. You will not recognize Batumi when you go there, it will be pristine just like in the song. I know that every family in Georgia is preparing to go to Ajaria and I want to ask them to go, because that is one of the best ways for us to help each other.

There are transport reforms throughout Georgia. We will bring in hundreds more buses, so that we have normal, European, civilized transport, not like Bombay. I do not have anything against mini-buses, because people work on them too and they have their problems, but if we are European country, we cannot be like some Asian or African city. We should have European looking towns and villages.

As for energy, this year we will be able to build generating capacity - as I said before this is the beginning of us achieving energy independence. When I came to office, power from Russia was cut off. It is possible this might happen this year. Pray it doesn't happen, but it could. We need our own generating capacity.

We are doing everything possible to make sure that, fundamentally, this extra capacity is achieved by the autumn. By 23 November I want to open the first new or renovated power station so that in the winter we are not asking why it has been turned off or why the line is down. This sort of thing will happen, but I think there will be a very major improvement.

The installation of electricity meters throughout the country is proceeding rapidly. What couldn't be done in the past four years has now been done, because we have been very strict. We told them that we would take it very seriously, right up to bringing in prosecutors and conducting investigations. This strictness has had results. The installation of meters is twenty times faster now than only three or four months ago. If not this year, I am sure that by the end of next year this problem will be solved.

Foreign Minister Salome Zourabichvili is working brilliantly. I travel with her often and watch how people relate to her and to us. We have now become a subject in international relations, not just an object.

That pride I felt standing before millions of Ukrainians on 31 December, in the name of Georgia, the whole of Ukraine applauded and waved our flag. That is an unrepeatable event in Georgia's history. A millennium will pass and Ukrainians and Georgians will remember it. Ten centuries will pass and we and the Americans will remember it. Therefore, we should value that.

Irakli Maisuradze, Mze TV

Mr President, you have mentioned the brilliant work of the foreign minister and other ministers. In this period, how do you assess the work of the cabinet as a whole and what will be your future policy? Will you replace ministers?

Mikheil Saakashvili

Last year was more or less a year for experimenting. You may have noticed that our personnel policy has become very stable. Apart from salaries, civil servants need a sense of stability, so that the arrival of a new minister does not mean their automatic dismissal. This concerns civil servants at all levels. We should now greatly reduce licensing requirements and permits. We should clear the way for business. This is a very important factor. New businessmen have already appeared, but new business will not appear if there is no feeling of stability in the civil service

When George Bush was here, I turned on the TV and watched several channels. Some cynics with wise expressions were saying: So what, Bush travels to all sorts of countries, it is not a big deal. Well, he has never visited this kind of country, I am talking in terms of size and budget and so on. In Georgia's history there has never been a visit like it. The man came and said that we were the world's main example and main inspiration, that we, the Georgian people, inspired revolutions in Ukraine, Moldova, Lebanon, events in Iraq. So, when someone says that this is nothing - I'm talking about a certain part of our political spectrum - what is this? I have faith in our people. A lot of mud will be thrown, a lot of falsehoods and lies will be said. Take the airport, for example. As soon as anything is done, dozens of foul-mouthed people will appear in this so-called political spectrum, because their mentality goes like this: If I haven't done it, it can't be good.

But against this background there are our people, our people who have survived many hardships, our people who destroyed the Soviet Union, it was the Georgian national movement [that did it]. By the way, the US president said that our people made the Rose Revolution with their own hands. It was our people who created the celebration in Freedom Square on 10 May, which was watched by the whole world with admiration. It was our people in Ajaria who performed a miracle last year. Our people are very wise and very clever. They were very oppressed for decades and centuries, but this oppression has given them more common sense. It is not our goal to restrict criticism. They can all appear on any channel and demonstrate their stupidity to the full, because our people are clever enough to recognize busybodies.

We should understand the issue of settling our [separatists] conflicts is linked to the doubling of Georgia's economy, and I intend to do this during my term of office, I intend to do that together with our people again. Those who sit and say that Saakashvili cannot resolve the Abkhazia issue, well, yes, Saakashvili cannot do it, but together we can. If our people are constantly told and convinced that they cannot do anything, then we will not be able to resolve this problem. Everyone should help build the economy, we are removing all the barriers, we have simplified taxes, we are removing licences and permits, but people themselves should build the economy, I cannot go and do it.

This translation is published with permission from BBC Monitoring, Reading, UK

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of the President of Georgia