Pushing back against an increasingly aggressive Moscow, President Bush said Wednesday the U.S. will send an extra $1 billion to Georgia to help the pro-Western former Soviet republic in the wake of Russia's invasion.

"Georgia has a strong economic foundation and leaders with an impressive record of reform," Bush said in a statement. "Our additional economic assistance will help the people of Georgia recover from the assault on their country, and continue to build a prosperous and competitive economy."

Vice President Dick Cheney, due in Georgia on Thursday, planned to make the massive aid package a major highlight of his discussions with Georgian President Mikhail Saakashvili. Cheney is on a tour of three former Soviet republics that are wary of Russia's intentions in what Moscow likes to call its "near abroad" sphere of influence and what Cheney termed while in Azerbaijan on Wednesday "the shadow of the Russian invasion of Georgia."

"The free world cannot allow the destiny of a small independent country to be determined by the aggression of a larger neighbor," Secretary of State Condoleezza Rice told reporters at the State Department in a simultaneous announcement with Bush.

She mocked Russia for its recognition of the two separatist regions in Georgia that are at the heart of the conflict that broke out last month, and for its failure to garner international backing.

"Almost no one followed suit, I might note. It isn't really an impressive list to have Abkhazia and South Ossetia recognize each other," she said.

Also in tandem with Bush, the International Monetary Fund announced it has agreed to lend Georgia $750 million for economic recovery.

The administration is delaying an announcement on some sort of punishment of Russia for its actions against Georgia and its refusal thus far to comply with a French-brokered cease-fire. However, the decision to shower tiny Georgia with such substantial aid and have Cheney talk about it in Moscow's backyard will likely be seen by the Kremlin as highly provocative, if not a punitive measure in and of itself.

The dollar total is half the $2 billion a year the U.S. gives Israel, its largest aid recipient. But the sizable amount still shows the strategic importance the U.S. places on both supporting Saakashvili's Western-leaning government and countering the desire by a newly resurgent and energy-rich Moscow for greater regional influence.

Cheney made a point in Azerbaijan of saying that Washington has "a deep and abiding interest" in the region's stability.

That said, the U.S. has found during this conflict that it has little leverage with Russia. Moscow has drawn condemnations from the United States and Europe, but little else. Meanwhile on Wednesday, Russia closed its embassy in Georgia, following Georgia's severing of diplomatic ties with Moscow.

After years of tensions, the recent fighting began Aug. 7 when Georgian forces went into its breakaway province of South Ossetia in hopes of re-establishing control. Russian forces repelled the offensive and pushed deep into Georgia proper.

Both sides signed the cease-fire in mid-August, but Russia has ignored its requirement for all forces to return to prewar positions.

Bush said the money will meet humanitarian needs, such as helping to resettle families that were displaced. The U.S. already has provided $30 million in humanitarian relief since the conflict began.

The United States has sent two military ships bearing aid to Georgia, and the USS Mount Whitney — the flagship of the Navy's 6th Fleet — steamed through the Dardanelles early Wednesday and was expected to pass through the Bosporus later in the day. The two Turkish-controlled straits link the Mediterranean to the Black Sea.

The new funds are also aimed at helping impoverished Georgia, wedged between Russia and Turkey on the Black Sea, to rebuild infrastructure and boost an economy that has been growing but is nowhere near grown.

Georgia wants to rebuild and modernize its badly routed military. Though U.S. officials emphasized that none of the current package was for military aid, there was no effort to rule that out for the future. Russia has accused the United States of delivering arms on the U.S. warships that have docked in Georgian ports with humanitarian supplies.

Rice said that $570 million of the funds will be made available in the remaining months of the Bush administration, though Congress will have to approve $200 million of that. That also leaves a sizable portion — $430 million — up to the budgeting discretion of next year's Congress and the new president.

But Bush feels confident in that area, as both the Democratic and Republican presidential candidates, Barack Obama and John McCain, have expressed strong support for Georgia's embattled government and Bush's approach to Russia's invasion.

On trade, Bush said the United States would negotiate a deal to provide preferential access to Georgian exports. The president said his commerce secretary would dispatch a trade mission to Georgia in the coming weeks.