Abkhazia faces a dilemma between closer integration with Russia, which could bring an effective loss of its independence hopes, and long term internal troubles as a result of a decrepit economy and extensive corruption. Avoiding Russia would be suicidal but trying to balance it could bring some results – thence comes Sokhumi’s expressed willingness to reach a certain rapprochement with Tbilisi to alleviate economic woes.
Georgia’s Russia-controlled Abkhazia is facing deep economic crisis. Lack of reforms, extensive corruption, the pandemic-related problems of the stalled tourism sector and difficulties of extracting financial aid from its patron – Russia, create some long-term troubles for the separatist region.
This dire situation is well-understood in Abkhazia itself and it pushes the region to seek an understanding with Tbilisi, however limited it could potentially be. This sentiment is reflected in the new Abkhaz “foreign policy concept,” recently signed by the region’s de-facto leader Aslan Bzhania.
The document enshrines the ideas of “priority of national interests, active response to external challenges and threats, multilevel external contacts, [and] openness to cooperation based on equality and mutual respect.” 11 goals for foreign policy are enumerated, among which “strengthening strategic partnership with Russia” and the need to enhance “mutually beneficial relations” with other countries, including facilitation of international recognition of the region are perhaps major, but widely expected points in the document.
However, most surprising, even revolutionary, is a section of the document on the passage of a “resolution of the Georgian-Abkhaz conflict and normalization of relations with Georgia.” While in geopolitical terms the willingness to find a certain understanding with Tbilisi is driven by Abkhazia’s long-term internal and foreign policy failures, Bzhania’s decision of potential rapprochement reverberates poorly within the Abkhaz society. A group of Abkhaz war veterans, “Aruaa,” expressed particular skepticism over the Abkhaz-Georgian conflict resolution part of the concept, in particular, the point 2.3, which seeks to set up negotiation platforms to discuss relations with Tbilisi.
To reach a limited understanding with Tbilisi will be extremely difficult amid Abkhazia’s volatile political system, though the signals for enhancing a direct dialogue with the Georgian government has been evident ever since Bzhania came to power in early 2020. He is more of a realist in foreign policy. Abkhazia faces a traditional problem peculiar to small players. Sokhumi sees long-term dangers with a close association with Russia. Too close relations could bring better economic and military support, but it is also fraught with dangers of de-facto annexation. After all, Abkhazia, in a striking difference to another Russia-controlled Georgian region of South Ossetia, has never pursued an integrationist approach with Russia.
It is this dilemma between closer cooperation with Russia and deep fear of Russian intentions that will haunt the Abkhazian political class for the foreseeable future. This was revealed in various discussion preceding and following the November 23 signing of the “formation of common social and economic space” between Sokhumi and Moscow. The program, based on the 2014 Russo-Abkhaz “Treaty of Alliance and Strategic Partnership,” envisages harmonization of the Abkhaz and Russian legislation.
Most importantly, in addition to obliging the Abkhaz side to make legislative and administrative amendments according to the Russian law in social, economic, health and political spheres, there is also a stipulation on simplification of legal procedures for the Russian investors. These stipulations are in terms of obtaining residence permit and registering work activities and harmonization of tax legislation with Russian model. As a manifestation of the rigorousness in bilateral ties, Bzhania held a series of meetings on December 11-18 with Russian authorities during his Moscow trip. It involved meetings with Moscow Government Minister and Head of the Department for Foreign Economic Activity and International Relations Sergei Cheryomin and Head of Moscow House of Compatriots Petr Gladkov; Russian Finance Minister Anton Siluanov and Head of Russian Federal Tax Service Daniil Yegorov; Russian Agriculture Minister Dmitry Patrushev; First Deputy Chief of Staff of the Russian Presidential Administration Sergey Kiriyenko and Russian Transport Minister Vitaly Savelyev; Russian Health Minister Mikhail Murashko and Deputy Head of the Russian Presidential Administration Dmitry Kozak. With Kozak Bzhania discussed the 2020-2022 Investment Program.
Ideally, this could help a decrepit Abkhazian economy, but a high pace of harmonization with Russian laws also increases chances for future merger with Russia.
In these circumstances a classical geopolitical game would require a small and dependent player to seek closer ties with other actors. Abkhazia might be doing exactly this by seeking more stable relations with Tbilisi despite fundamental differences. This is echoed in a recent interview by Sergei Shamba, currently the head of the security council of the occupied region. Shamba stated that “when there is a conflict, you need to talk” and that though Sokhumi and Tbilisi would not retreat from their respective fundamental interests, “between these extreme positions there are always questions where compromise solutions can be found.” As a token of benevolence, Shamba suggested that Sokhumi and Tbilisi “could start talking about the opening of transport communications – a railroad, air traffic.”
Despite Abkhazia’s hopes, much depends on Russia itself, which now faces a different problem: it has so far failed to produce a long-term vision for all the separatist regions it controls. Creating a unified economic space with all the separatist territories is not an option as little economic benefit is expected. Moreover, more financing has to be dedicated to the regions, whose populations could otherwise turn increasingly disenchanted with hopes they pinned on Russia. Indeed, the system is difficult to navigate for Russia since while in the first years following the collapse of the Soviet Union, Russia had to manage breakaway conflicts only in small and poor Georgia and Moldova. Moscow’s responsibilities have increased significantly by late 2020 with Donbas and now Nagorno-Karabakh conflicts now added to its strategy.
Nor can the Russian leadership entice states around the world to recognize the independence of breakaway entities. For instance, in the case of Abkhazia and South Ossetia, only Syria, Nicaragua, Venezuela, and Nauru have extended them recognition. This trend is not likely to change anytime soon. Moscow simply does not have sufficient resources – and in any case, US laws withholding financial aid from states that recognize the independence of separatist territories throughout the former Soviet space remains a major disincentive.
Nor does Russia have any long-term economic vision for the breakaway territories. Dire economic straits have inevitably caused populations to flee toward abundant medical, trade, and educational possibilities other countries provide. Usually these are territories from which the separatist forces initially tried to break away. The Kremlin has failed to transform those entities into secure and economically stable lands. Crime levels as well as high-level corruption and active black markets have been on an upward trajectory, which undermines the effectiveness of financial largesse Moscow has to provide on a regular basis.
Over the past several years, there have been hints in the media about rising discontent within the Russian political elite on how the breakaway territories are being run. Questions have been raised about how Russian money is being spent and about the increasingly predatory nature of the separatist political elites, who are focused on extracting as much economic benefit as they can from Moscow. As a result, it has become increasingly difficult for the leaders in non-recognized entities to secure Russian funding.
Therefore, Abkhazia should be discussed within a wider context, though circumstances on the ground too are important. Major rapprochement between Sokhumi and Tbilisi is highly unlikely but provided the willingness from both sides remains into 2021, certain understanding on economic re-engagement could follow, especially in the time when Russia is actively pushing for re-opening of trade routes in the South Caucasus.
Author’s note: first published in caucasuswatch
Latvia developed new tasks for NATO soldiers
Member of the Latvian Saemas’ national association “Everything for Latvia!” and Freedom”/LNNK Jānis Dombrava stated the need to attract NATO troops to resolve the migration crisis. This is reported by la.lv. In his opinion, illegal migration from the Middle East to Europe may acquire the feature of an invasion. He believes that under the guise of refugees, foreign military and intelligence officers can enter the country. To his mind, in this case, the involvement of the alliance forces is more reasonable and effective than the actions of the European border agencies. Dombrava also noted that in the face of an increase in the flow of refugees, the government may even neglect the observance of human rights.
The Canadian-led battlegroup in Latvia at Camp Ādaži consists of approximately 1512 soldiers, as well as military equipment, including tanks and armoured fighting vehicles.
Though the main task of the battlegroup in Latvia is country’s defence in case of military aggression, Latvian officials unilaterally invented new tasks for NATO soldiers So, it is absolutely clear, that Latvian politicians are ready to allow NATO troops to resolve any problem even without legal basis. Such deification and complete trust could lead to the full substitution of NATO’s real tasks in Latvia.
It should be noted that NATO troops are very far from being ideal soldiers. Their inappropriate behaviour is very often in a centre of scandals. The recent incidents prove the existing problems within NATO contingents in the Baltic States.
They are not always ready to fulfill their tasks during military exercises and training. And in this situation Latvian politicians call to use them as border guards! It is nonsense! It seems as if it is time to narrow their tasks rather than to widen them. They are just guests for some time in the territory of the Baltic States. It could happen that they would decide who will enter Latvia and who will be forbidden to cross the border!
Changes are Possible: Which Reforms does Ukraine Need Now?
The past 16 months have tested our resilience to sudden, unexpected, and prolonged shocks. As for an individual, resilience for a country or economy is reflected in how well it has prepared for an uncertain future.
A look around the globe reveals how resilient countries have been to the COVID-19 pandemic. Some have done well, others less so. The costs of having done less well are almost always borne by the poor. It is for this reason the World Bank and the international community more broadly urge—and provide support to—countries to undertake economic and structural reforms, not just for today’s challenges but tomorrow’s.
One country where the dialogue on reform has been longstanding and intense is Ukraine. This is particularly true since the economic crisis of 2014-2015 in the wake of the Maidan Revolution, when the economy collapsed, and poverty skyrocketed. Many feared the COVID pandemic would have similar effects on the country.
The good news is that thanks to a sustained, even if often difficult, movement on reforms, Ukraine is better positioned to emerge from the pandemic than many expected. Our initial projection in the World Bank, for example, was that the economy would contract by nearly 8 percent in 2020; the actual decline was half that. Gross international reserves at end-2020 were US$10 billion higher than projected. Most important, there are far fewer poor than anticipated.
Let’s consider three reform areas which have contributed to these outcomes.
First, no area of the economy contributed more to the economic crisis of 2014-2015 than the banking sector. Powerful interests captured the largest banks, distorted the flow of capital, and strangled economic activity. Fortunately, Ukraine developed a framework to resolve and recapitalize banks and strengthen supervision. Privatbank was nationalized and is now earning profits. It is now being prepared for privatization.
Second, COVID halted and threatened to reverse a five-year trend in poverty reduction. Thanks to reforms of the social safety net, Ukraine is avoiding this reversal. A few years back, the government was spending some 4.7 percent of GDP on social programs with limited poverty impact. Nearly half these resources went to an energy subsidy that expanded to cover one-in-two of the country’s households.
Since 2018, the Government has been restructuring the system by reducing broad subsidies and targeting resources to the poor. This is working. Transfers going to the poorest one-fifth of the population are rising significantly—from just 37 percent in 2019 to 50 percent this year and are projected to reach 55 percent in 2023.
Third, the health system itself. Ukrainians live a decade less than their EU neighbors. Basic epidemiological vulnerabilities are exacerbated by a health delivery system centered around outdated hospitals and an excessive reliance on out-of-pocket spending. In 2017, Ukraine passed a landmark health financing law defining a package of primary care for all Ukrainians, free-of-charge. The law is transforming Ukraine’s constitutional commitment to free health care from an aspiration into specific critical services that are actually being delivered.
The performance of these sectors, which were on the “front line” during COVID, demonstrate the payoff of reforms. The job now is to tackle the outstanding challenges.
The first is to reduce the reach of the public sector in the economy. Ukraine has some 3,500 companies owned by the state—most of them loss-making—in sectors from machine building to hotels. Ukraine needs far fewer SOEs. Those that remain must be better managed.
Ukraine has demonstrated that progress can be made in this area. The first round of corporate governance reforms has been successfully implemented at state-owned banks. Naftogaz was unbundled in 2020. The electricity sector too is being gradually liberalized. Tariffs have increased and reforms are expected to support investment in aging electricity-producing and transmitting infrastructure. Investments in renewable energy are also surging.
But there are developments of concern, including a recent removal of the CEO of an SOE which raised concerns among Ukraine’s friends eager to see management independence of these enterprises. Management functions of SOE supervisory boards and their members need to remain free of interference.
The second challenge is to strengthen the rule of law. Over recent years, the country has established—and has committed to protect—new institutions to combat corruption. These need to be allowed to function professionally and independently. And they need to be supported by a judicial system defined by integrity and transparency. The move to re-establish an independent High Qualification Council is a welcome step in this direction.
Finally, we know change is possible because after nearly twenty years, Ukraine on July first opened its agricultural land market. Farmers are now free to sell their land which will help unleash the country’s greatest potential source of economic growth and employment.
Ukraine has demonstrated its ability to undertake tough reforms and, thanks to the COVID-19 pandemic, has seen the real-life benefits of these reforms. The World Bank looks forward to providing continued assistance as the country takes on new challenges on the way to closer European integration.
This article was first published in European Pravda via World Bank
Liberal Development at Stake as LGBT+ Flags Burn in Georgia
Protests against Georgia’s LGBT+ Pride parade turned ugly in Tbilisi on July 5 when members of the community were hunted down and attacked, around 50 journalists beaten up and the offices of various organizations vandalized. Tensions continued the following day, despite a heavy police presence.
On the face of it, the Georgian state condemned the violence. President Salome Zourabichvili was among the first with a clear statement supporting freedom of expression, members of parliament did likewise and the Ministry of Internal Affairs condemned any form of violence.
But behind the scenes, another less tolerant message had been spread before the attacks. Anxiety about this year’s events had been rising as a result of statements by the government and clergy. Prime Minister Irakli Garibashvili suggested the march “poses a threat of civil strife.” The Georgian Orthodox Church meanwhile condemned the event, saying it, “contains signs of provocation, conflicts with socially recognized moral norms and aims to legalize grave sin.”
For many, these statements signified tacit approval for the abuse of peaceful demonstrators. Meanwhile, the near-complete absence of security at the outset of the five-day event was all too obvious in Tbilisi’s streets and caused a public outcry. Many alleged the government was less focused on public safety than on upcoming elections where will need support from socially conservative voters and the powerful clergy, in a country where more than 80% of the population is tied to the Georgian Orthodox Church.
The violence brought a joint statement of condemnation from Western embassies. “Violence is simply unacceptable and cannot be excused,” it said. The Pride event was not the first and had previously been used by anti-gay groups. Violence was widespread in 2013 — and the reality of attacks against sexual minorities in Georgia remains ever-present.
In a socially conservative country such as Georgia, antagonism to all things liberal can run deep. Resistance to non-traditional sexual and religious mores divides society. This in turn causes political tension and polarization and can drown out discussion of other problems the country is marred in. It very obviously damages the country’s reputation abroad, where the treatment of minorities is considered a key marker of democratic progress and readiness for further involvement in European institutions.
That is why this violence should also be seen from a broader perspective. It is a challenge to liberal ideas and ultimately to the liberal world order.
A country can be democratic, have a multiplicity of parties, active election campaigns, and other features characteristic of rule by popular consent. But democracies can also be ruled by illiberal methods, used for the preservation of political power, the denigration of opposing political forces, and most of all the use of religious and nationalist sentiments to raise or lower tensions.
It happens across Eurasia, and Georgia is no exception. These are hybrid democracies with nominally democratic rule. Armenia, Georgia, Kyrgyzstan, and others have increasingly more in common, despite geographic distance and cultural differences.
Hungary too has been treading this path. Its recent law banning the supposed propagation of LGBT+ materials in schools must be repealed, European Commission President Ursula von der Leyen said on July 7. “This legislation uses the protection of children . . . to discriminate against people because of their sexual orientation . . . It is a disgrace,” she said.
One of the defining features of illiberalism is agility in appropriating ideas on state governance and molding them to the illiberal agenda.
It is true that a mere 30 years since the collapse of the Soviet Union is not enough to have built a truly liberal democratic state. Generations born and raised in the Soviet period or in the troubled 1990s still dominate the political landscape. This means that a different worldview still prevails. It favors democratic development but is also violently nationalistic in opposing liberal state-building.
Georgia’s growing illiberalism has to be understood in the context of the Russian gravitational pull. Blaming all the internal problems of Russia’s neighbors has become mainstream thinking among opposition politicians, NGOs, and sometimes even government figures. Exaggeration is commonplace, but when looking at the illiberal challenge from a long-term perspective, it becomes clear where Russia has succeeded in its illiberal goals. It is determined to stop Georgia from joining NATO and the EU. Partly as a result, the process drags on and this causes friction across society. Belief in the ultimate success of the liberal agenda is meanwhile undermined and alternatives are sought. Hybrid illiberal governments are the most plausible development. The next stage could well be a total abandonment of Euro-Atlantic aspirations.
Indeed what seemed irrevocable now seems probable, if not real. Pushback against Georgia’s Euro-Atlantic choice is growing stronger. Protesters in front of the parliament in central Tbilisi violently brought tore the EU flag. Twice.
The message of anti-liberal groups has also been evolving. There has been significant growth in their messaging. The anti-pride sentiment is evolving into a wider resistance to the Western way of life and Georgia’s Western foreign policy path, perhaps because it is easily attacked and misrepresented.
To deal with this, Western support is important, but much depends on Georgian governments and the population at large. A pushback against radicalism and anti-liberalism should come in the guise of time and resources for the development of stronger and currently faltering institutions. Urgency in addressing these problems has never been higher — internal and foreign challenges converge and present a fundamental challenge to what Georgia has been pursuing since the days of Eduard Shevardnadze – the Western path to development.
Author’s note: first published at cepa
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