"Georgia has been attacked by a formidable force, it is a brutal attack with the use of air force, tanks and even the trademark cyber attack."
In the port of Poti, the Russian fighter jets hit container tankers and a shipbuilding plant, Vato Lezhava, Georgia's deputy economic development minister, told the Reuters news agency.
He said between eight and 11 Russian jets were involved in the attack.
Other Georgian officials reported attacks at a military base in Vaziani, a military airport in Marneuli and near the Baku-Tbilisi-Ceyhan oil pipeline.
Irakli Alasania, Georgia's UN ambassador to the UN, said Russia had "started a full-scale military invasion".
Russian tanks rolled into South Ossetia in support of the separatists who had come under bombardment from Georgian forces since a brief ceasefire on Thursday night.
the Russian peacekeeping force in the region said on Friday that it would not pullout despite losing at least 10 soldiers in heavy fighting with Georgian forces around Tshkinvali.
"We're not going anywhere and we are going to continue to fulfil the task that we were assigned," Marat Kulakhmetov, head of the contingent, said, according to Russia's Interfax news agency.
Georgia and South Ossetia have both claimed that they now control the capital, after heavy bombardments from Russian artillery had at one point reportedly pushed back Georgian forces.
"The entire city of Tskhinvali is currently controlled by units of South Ossetia's defence forces," Irina Gagloyeva, a spokeswoman for the South Ossetian authorities, was quoted by Interfax news agency as saying.
However, that statement came shortly after Mikheil Saakashvili, Georgia's president, said in a televised address that his forces controlled almost all of the territory.
"Georgian forces are controlling the entire territory of South Ossetia except Java ... We are fully in control of Tskhinvali," he said.
A spokesman for Vladimir Boldyrev, Russia's army chief, was quoted as saying that Russian tank and artillery units had destroyed Georgian positions around the city.
"The positions from which Georgian troops were firing ... have been destroyed by fire from artillery and tank units of the 58th army," Igor Konashenkov, the spokesman, said.
Eduard Kokoity, the South Ossetian separatist leader, told Russia's Interfax news agency earlier on Friday that 1,400 South Ossetians had been killed in the fighting.
About 1,400 died. We will check these figures, but the order of the numbers is around this. We have this on the basis of reports from relatives."
The Georgian military says it has "liberated" the area, while some sources say Tskhinvali has been virtually destroyed and Russian troops are on the point of entering the city.
Russian news agencies quoted witnesses and officials as saying hundreds of civilians had been killed.
Buildings were ablaze and dead Georgian soldiers could be seen alongside destroyed tanks in the streets.
South Ossetia government spokeswoman Gagloyeva said that Georgian forces were firing on "residential parts" of the capital.
Hospital 'not functioning'
The International Committee of the Red Cross (ICRC) said that the main hospital in Tskhinvali had ceased functioning.
Local medical officials told the organisation that the Respublika Hospital closed hours after Georgia launched its military offensive.
|Tskhinvali's main hospital has reportedly stopped functioning [Reuters]
Maia Kardova, an ICRC spokeswoman in Tbilisi, the Georgian capital, said the news is "very alarming" because emergency access to South Ossetia has been cut off since fighting began early on Friday.
She said ambulances are unable to reach wounded civilians in the city.
Saakashvili said he was urgently recalling 2,000 troops serving in Iraq, in response to the fighting in South Ossetia.
"One brigade of Georgian forces is in Iraq and we are calling it home tomorrow," he said.
Georgia's interior ministry said the country's air force had shot down at least five Russian aircraft, but the claim could not be independently verified.
Shota Utiashvili, a spokesman at the Georgian ministry, said: "The Georgian air force has downed at least five Russian aircraft. Bitter fighting is ongoing in Tskhinvali [the South Ossetian capital]."