Russia Backpaddles
// The Russian Ambassador Returns to Georgia
Russian President Vladimir Putin announced his decision yesterday to send Ambassador Vyacheslav Kovalenko back to Georgia. Kommersant has learned that transportation and postal ties may soon be restored between the two countries as well. The Kremlin decided to lift the its sanctions on Georgia because they not only failed to be effective, they are making Georgia less dependent on Russia.
Putin announced the lifting of one of the most significant sanctions against Georgia yesterday. He invited Ambassador to Tbilisi Vyacheslav Kovalenko to the Kremlin and announced that he intends to take steps to normalize relations with Georgia. The first step will be the return of the ambassador, who left Georgia in October at the height of the Russian-Georgian conflict.
Kovalenko already knew that he was being sent back to Georgia when he arrived at the Kremlin. A Kommersant source in the Russian Foreign Ministry said yesterday that rumor had been circulating for a long time about his return. The source added that the decision was made not by the ministry, but by the presidential administration. Therefore, the source did not know the date of Kovalenko's departure for Tbilisi.
As the meeting between the president and ambassador wound up, Putin reminded him where he was going. “To a country,” the president explained, “with which Russia has had more than simply a long history of friendly and good neighborly relations. You are going to a country with which Russia has had a shared destiny throughout many centuries. Unfortunately, over the past few years we have been faced with certain problems.” He did not explain why he decided to put those problems behind them at this moment, but recalled that “the first such step – and a significant one – was made in December 2006 when we signed agreements and contracts to deliver Russian energy resources to Georgia based on market principles, but in the amounts that Georgia requires.”
Kommersant has learned that the decision to lift the sanctions was made last week. A meeting of the Security Council dedicated to Russian-Georgian relations was held at the presidential residence in Novo-Ogarevo last Saturday. The consequences of the sanctions imposed by Moscow on the Mikhail Saakashvili regime last October were analyzed. It is hard to say what data the participants had at their disposal, but generally accessible statistics show that the situation in Georgia is not as deplorable as they had expected in Moscow.
According to an International Monetary Fund report published in December, for instance, the Russian embargo had no substantial effect on the Georgian economy. IMF experts estimated that the Georgian GDP grew by 8 percent in 2006. Russian sanctions could result in it falling to 6-7 percent in 2007 and in an increase of Georgia's foreign debt to $250-300 million. The authors of the report suggested, however, that the negative effects of the Russian sanctions may have been compensated for by foreign aid. In addition, they note, the Georgian government was able to reduce inflation to 10 percent in 2006 and, they predicted, inflation could be lowered to 6 percent this year. Kakha Bendukidze, Georgian State Minister for Reforms, told Kommersant yesterday that Georgia's losses “are known to all: 1-1.5 percent of the GDP, or $150 million. That's not a lot.”
Thus, the Kremlin's expectation that the sanctions would nearly equal the downfall of the Saakashvili government was not met. On the contrary, Russia's influence was diminished by the blockade. Only one element of the Russian strategy actually backfired. That was energy blackmail. After President of Azerbaijan Ilham Aliyev unambiguously promised Georgia its natural gas, and Turkey seconded that proposal, Gazprom was only able to sell it a minimal volume of gas at $230 per 1000 cu. m. And the blockade encouraged Georgian economic development. Georgian business began to find new markets for its products, and economic ties between Georgia and Turkey, Iran and Azerbaijan are stronger than ever before.
But the anti-Georgian campaign negatively reflected on Russia's image both in Georgia and the West. Pro-Russian politicians in Georgia were undermined and public support for the countries entrance into NATO rose significantly. Kremlin strategists obviously came to the conclusion that only lifting the sanctions could remedy the situation.
Yesterday evening, Russian Foreign Minister Sergey Lavrov caked his Georgian colleague Gela Bezhuashvili to inform him of the return of the Russian ambassador. “The Georgian side welcomed the decision of the Russian leadership,” Tbilisi officially announced, noting as well that the ministers “discussed ways of settling problematic questions, emphasized the need for improving relations and activating cooperation and agreed on a continuation of contacts.”
The news from Moscow was uplifting for Georgian politicians. “The return of the Russian ambassador is the victory of Georgia,” stated chairman of the parliamentary committee on Euro-integration David Bakradze. “We won because our people were united. If we are also so united, any blackmail or pressure from Russia will end in the same disarray as the story of the grandiose recall of the ambassador and his return to Tbilisi. And Georgia didn't concede on a single principle issue for it.”
Apparently other advances toward Tbilisi may be made after the return of the Russian diplomatic mission. Kommersant has learned that postal and transportation ties may be restored in the near future. Evidence of this is the fact that members of the State Duma began openly to support the lifting of the sanctions yesterday. Deputy chairman of the committee on international affairs Leonid Slutsky called for the removal of the postal and transportation blockade of Georgia, saying that “average citizens should not be hostages of political games.”
All of the sanctions imposed by Russian agencies on Georgia were motivated by technical, not political causes. Therefore, the same agencies will have to retract their charges against their Georgian colleagues. Director of public relations of federal state unitary enterprise Post Office of Russia Sergey Grigorenko told Kommersant yesterday that “no instructions have been received by postal units yet, but, if Georgia will fulfill all norms and guarantee the safety of the mail, exchange will be resumed in its previous volume.”
At Aeroflot, Kommersant was informed that flights to Georgia were cancelled until the end of the winter schedule, that is, until March 24. Last year, before the deterioration of Russian-Georgian relations, Aeroflot made six Moscow-Tbilisi flights per week. An Aeroflot spokesman said that the company would be ready to examine the possibility of resuming flights after the appropriate instructions were received from authorities. Siberia Airlines made four Moscow-Tbilisi and one Moscow-Kutaisi flights per week last year before they were cancelled. It is also waiting for instructions from aviation authorities. The Russian Transportation Ministry is officially refusing to comment on the situation. Unofficially, they say in the ministry that they are “waiting for a start from above.”
In Russian railways, they mentioned that direct passenger service to Georgia was eliminated due to economic reasons. Two trailer cars on the Moscow-Baku train went to Tbilisi weekly, carrying fewer than 600 passengers per month. No decision had been made to restore those connections as of last night.
The Price of Prohibition
The gradual ban imposed on the importation of foodstuffs from Georgia to Russia between December 2005 and May 2006 had a significant negative impact on the Georgian economy. Georgian Finance Minister Alexi Alexishvili estimated that the country lost up to $250 million as a result of limits placed on economic ties with Russia. That is 2.05 percent of the country's GDP and more than a quarter of its commercial export, which amounted to $870 million in 2005, according to the Georgian Ministry of Economic Development. Of that amount, 20.8 percent, or $180 million, is accounted for by natural grape wine (9.2%), nuts (7.7%) and mineral water (3.9%). The remaining $70 million is attributable to vegetables, fruits, herbs, honey and other plant products that the Georgian Economics Ministry considers too insignificant to publish statistics about. By comparison, copper ore accounted for 4.4 percent, finished gold 3.9 percent and nitrogen fertilizer 3.8 percent.
Experts say that even if Russia lifts all its economic sanctions, Georgia is unlikely to regain its 2005 level of export. “Georgian wine in bottles made up 9 percent of the Russian market for wines. Borjomi accounted for 13 percent of the Russian market for bottled water,” said Igor Makurin, general director of the RVR Communications consulting agency. “During the time of the ban, the niche that was freed was occupied by goods from other producers.” It will not be easy to get Georgian products back into stores either. “The prohibitions were imposed because of insufficient quality and variances from Russian standards, and that means that consumers will be wary of them,” Makurin added.
Svetlana Mentyukova
Chronicle of the Russian-Georgian Standoff
Relations between the to countries go bad quickly after the election of Georgian President Mikhail Saakashvili on January 4, 2004.
On May 31, Russia reacts sharply to the location of Georgian special forces in South Ossetia.
On June 12, Georgian Prime Minister Zurab Zhvania accuses Russian peacekeepers of illegally delivering arms to South Ossetia.
On August 13, the Georgian parliament demands that the mandate of the Russian peacekeeping forces in South Ossetia be terminated and that they be replaced with international forces after the motorcade of the prime minister of Georgia is fired on in South Ossetia.
On September 13, Russia declares a blockade of transportation links with Georgia, which was not implemented, and the restoration of rail links with Abkhazia, which were cut in 1992.
On February 15, 2005, a Georgian Foreign Ministry spokesmen say that they are ready to “outlaw” the Russian military bases in Georgia.
On September 5, Gazprom announces that it is raising it prices for Georgia from $62.30 per 1000 cu. m. of natural gas to $110.
On September 27, the Georgian parliament passes a resolution on the withdrawal of Russian peacekeepers from Abkhazia and South Ossetia. Saakashvili does not support their proposal.
On December 19, the Russian Federal Service for Supervision for Protection of Consumer Rights (Rospotrebnadzor) bans the import of plant products from Georgia.
On March 31, 2006, commander of Russian infantry forces Alexey Maslov and Georgian Deputy Minister of Defense Mamuka Kudava sign an agreement on the withdrawal of Russian military bases from Georgia.
On April 11, Rospotrebnadzor bans Georgian alcohol products and on May 4 it bans the Georgian mineral waters Borjomi and Nabeglavi.
On May 15, the first echelon of dissolved 62nd Russian Military Base in Akhalkalaki departs for Russia with armored vehicles.
On June 13, the presidents of Russia and Georgia meet in St. Petersburg. No decision result from that meeting.
On September 28, six Russian officers are taken into custody in Tbilisi on suspicion of espionage. Russia recalls its ambassador, stops issuing visas and begins evacuating the families of diplomats.
On October 1, Putin calls Georgia's actions “state terrorism with seizure of hostages.”
On October 2, Russia severs transportation and postal links with Georgia and announces that it will stop all cash transfers between the two countries. The Russian officers are released the same day.
On October 6, inspections are begun in Russia of restaurants, casinos and private companies owned by Georgians. Mass deportations of Georgian illegal immigrants begins. A total of more than 1000 people are deported. The police make daily announcements of the capture of Georgian “godfathers.” Gazprom announces that it is raising the price of gas for Georgia from $110 to $235 per 1000 cu. m.
On November 10, Georgian Defense Minister Irakly Okruashvili, who is considered to have a confrontational attitude toward Russia, is dismissed.
On November 28, Putin speaks with Saakashvili three times at the CIS summit in Minsk, but the dialog did not progress beyond mutual recriminations.
Mikhail Zygar, Sergey Ryzhkin, Renata Yambaeva; Vladimir Novikov, Tbilisi
All the Article in Russian as of Jan. 19, 2007
|
