Irakly Okruashvili was sacked as defense minister Friday and appointed economics minister in the post-Soviet Caucasus state, the reshuffle seen by analysts as a move to defuse an acute diplomatic crisis with Russia.
Okruashvili, a Georgian Defense Ministry "hawk," is known for strong-worded remarks, which has outraged Moscow. He promised to see the New Year in in breakaway, pro-Russian South Ossetia and said Russia is doomed to defeat in potential warfare with Georgia.
The new job is seen as a lower position for Okruashvili, Western-educated President Mikheil Saakashvili's ally, who had a considerable influence on domestic and foreign policies.
But Prime Minister Zurab Nogaideli hailed the appointment and Okruashvili's performance on the previous post Saturday.
"The economy, economic growth, was one of the most crucial spheres for us in 2006, and it will be vital in 2007," Nogaideli said, adding the new minister will give a boost to the country's economic development.
The former economics minister, Irakly Chogovadze, was appointed president of the International Oil and Gas Corporation.
The reshuffle came ahead of an independence referendum in South Ossetia and a summit of the post-Soviet Commonwealth of Independent States in Belarus, where Saakashvili reportedly hopes to meet with the Russian president in a bid to heal the rift over Georgia's breakaway regions and other sensitive issues.
The brief arrests of Russian army officers on spying charges in Georgia in September aggravated the already strained relations between the former Soviet allies. Russia responded by suspending travel and mail links with the small Caucasus nation and clamped down on Georgians working in its territory. The restrictions are still in force.
Earlier this week, Georgia postponed parliamentary debate on a draft resolution calling for the withdrawal from the CIS, criticized by some members as ineffective and Russian-dominated.
