Central European
Policy Institute
A think-tank by the Slovak
Atlantic Commission
CEPI
is
a
regional
governmental
non-
organization
based in Bratislava, Slovakia.
Its mission is to help Central
Europe
become
a
more
effective actor in the EU,
NATO and other international
organisations. It does so by
helping
governments
and
thinkers in the region craft
common
responses
to
challenges, and by giving
them a platform to consult
and co-ordinate. We believe
that while the EU and NATO
work well in many regards,
Central
Europe
can
improve them further.
help
The West has had a convenient
partner
in
Georgia's
Mikhail
Saakashvili. His strength as a leader as
well as his failures of judgement neatly
matched the limited ambitions of
many European countries for this
former Soviet republic. Saakashvili –
who has served as president since
2004 and for most of that time
controlled the rest of the government
and enjoyed huge majorities in the
parliament – has been a zealous
reformer. He has turned a state where
corruption
was
rampant
and
electricity rare into a good place to
invest. And he has brought political
stability to a republic which, until last
month, had never seen a peaceful
exchange of power. But he has also
blundered into a war with Russia in
2008, and sometimes
behaved
erratically.
This has suited many in Western
Europe in particular: Georgia has
been stable and prosperous enough
since the war to require little of their
attention – unlike, for example,
neighbouring
Azerbaijan
and
Armenia, which seem on the verge of
conflict
with each
other. But
Saakashvili's Georgia was also too
much of a liability – too dependent on
its mercurial president – to seriously
deserve the membership in NATO that
its population wants, and that the
alliance promised in 2008 to give it: a
promise that a number of allies
have regretted and would rather
forget. The defeat of Saakashvili's
party in October parliamentary
elections – the president will now
have to share power with former
opposition leader Bidzina Ivanishvili
as prime minister – upends the
West’s cozy relationship with
Georgia.
Two new futures seem possible for
the
country,
which
present
different challenges for Europe and
the US. Ivanishvili could fail to form
a
working
relationship
with
Saakashvili or hold together the
broad coalition of parties that he
heads. Georgia's economy would
sour, possibly requiring another
bailout (the country had received
one right after the 2008 war).
Political instability would likely
follow. Alternatively, the new prime
minister could perform too well to
Europe's and America's liking: if he
tries genuinely hard to improve
relations
with
Russia
while
continuing to demand NATO
membership for Georgia (both of
which he promised to do), and if
he also proves a good leader –
thus demonstrating that Georgia is
a pluralistic democracy with
multiple competent parties – NATO
risks looking duplicitous if it
continues to reject Georgia's
application.
Because few allies are keen to enlarge the alliance
in the face of Russian opposition, Ivanishvili's success
as prime minister could, paradoxically, also turn out
to be a problem for the West.
It takes two to tango
On first indications, Georgia seems headed for
turmoil rather than a better future. The prime
minister and president – who were briefly allied after
the 2003 'Rose revolution' which brought Saakashvili
to power – cannot stand each other. While little is
known of the reclusive Ivanishvili, in an interview for
the October 27-28 issue of the Financial Times he
implied that his primary reason for going into politics
was to protect himself and his family from
persecution by Saakashvili. Within days of coming to
power Ivanishvili cut the budget of the presidential
administration, arrested Saakashvili's two close allies
(former interior minister and chief of defense), and
told the president to move out of his palace. Some
of these steps are reasonable when taken in
isolation: for example, the presidential palace is an
oversized and expensive indulgence. But taken
together, Ivanishvili's deeds suggest that he is bent
on revenge against Saakashvili.
The president, for his part, had accused Ivanishvili
before the elections of being the Kremlin's stooge,
and warned that the opposition would roll back the
political and economic achievements of the last
ten years. The charge of questionable loyalty in
particular seems to be a deliberate exaggeration:
having made his fortune (equivalent to half of
Georgia's annual GDP) in Russia, Ivanishvili put a lot
of it into Georgian schools, hospitals and operas; he
even partly equipped the country's police with his
own money. The new prime minister seems no less a
patriot than Saakashvili, whose accusations have
only made the accuser look desperate. Given the
strength of his dislike of Ivanishvili, Saakashvili
surprised many when he readily accepted his
party's defeat at the polls, thus saving Georgia from
a political crisis and international isolation – and,
importantly, giving himself a shot at a comeback at
next elections. But unless Ivanishvili repays
statesmanship in kind, Georgia will descend into
political chaos soon.
Even if the prime minister finds a modus vivendi with
the president, it is not evident how Ivanishvili
proposes to improve Georgia's economy and the
lot of its people. Under Saakashvili, the government
has gone to extraordinary lengths to unshackle
Georgia's potential: among other things, it
disbanded the corrupt transport police and
abolished government agencies, such as the one
responsible for food safety, which it saw as standing
in the way of growth (Tbilisi later reinstated the
agency at the EU’s urging). Georgia rocketed up
the rankings measuring the ease of doing business
and investment flowed in, though interest in
Georgia dipped since the 2008 war. Reforms,
however, have brought too few improvements to
ordinary people’s living standards, and some lost
privileges that they had enjoyed under the previous
regime. Outside investment has mainly gone into
real estate in the capital. Foreign money restored
Tbilisi from post-Soviet greyness into its original
splendour – but it has also made housing in the city
affordable to only the most privileged Georgians.
Western observers based in Kutaisi, Georgia's
second largest city, say that hot water is available
only for an hour a day. Roads remains decrepit and
unemployment high: despite the government's
stimulus spending on a new parliament in Kutaisi
and hotels in Batumi on the Black Sea coast, 16 per
cent of Georgians are officially out of job, and the
official figures are too optimistic. Social safety net is
practically non-existent and people rely on their
extended family and remittances from the
estimated 800,000-1 million Georgians living abroad.
And although petty corruption is basically nonexistent, local business has been largely controlled
by families and clans linked to President Saakashvili.
No wonder that many ordinary citizens craved a
change of government.
The incoming coalition, however, has said little
about how it plans to address the voters’
grievances. The officials' views on the economy
remain an enigma; the new government has
announced little on the subject beyond (rightly)
planning to disband the many monopolies that
emerged under Saakashvili. The coalition was
assembled in haste, its parties come from very
different political backgrounds, and while there are
some distinguished politicians in its ranks it also
includes a retired AC Milan football star as energy
minister.
The main burden of keeping the coalition together
rests with Ivanishvili, whose money, along with
shared dislike of Saakashvili, has united the
opposition.
However,
Ivanishvili
told
some
interviewers before the elections that he would
retire from politics in two years. That seems barely
enough time to begin implementation of the
government's programme, much less to see it
through. Unless the coalition transforms into a proper
party, it risks splintering and losing the capacity to
govern. Under Mikhail Saakashvili, power in Georgia
was too concentrated: the president ruled
unconstrained by the parliament (in which his party
controlled 75 per cent of seats), and many
Georgians, especially the urban elites in Tbilisi, have
tired of his authoritarian style. But the election has
now dispersed power too widely: between two
strong and seemingly incompatible leaders, one of
who leads a hotchpotch coalition.
How to help Georgia and why
The West has strong reasons to want the Tbilisi
government to do well. When the country is poorly
governed, human calamity follows: Georgia has
been through two wars since independence. The
country's weakness invites interference from Russia,
which supported separatists in Abkhazia and South
Ossetia in both those wars. And when Moscow
‘engages’ in Georgia, tensions rise in NATO
between those countries that continue to worry
about Russia, and those who think such fears
misplaced. Georgia caused one of the most serious
recent diplomatic rifts among the NATO
governments. At the 2008 summit in Bucharest, the
US and mostly Central European allies fought to
accelerate Georgia's accession to deter Russia from
mischief, while Germany and other allies argued
that such step would provoke Russia's ire. The
summit ended in a poor compromise that promised
Georgia a membership eventually, while deferring
the moment into indefinite future. When war with
Russia broke out shortly thereafter, each group
blamed the other for letting Tbilisi down. If Georgia
were to be governed well and enjoy reasonably
good relations with Russia, relations among Western
countries, too, would benefit. The allies may be
divided on Georgia's eventual membership in NATO
but none wants the country's fate to undermine
solidarity within the alliance.
The influence of the US and Europe in Tbilisi remains
strong. Ivanishvili has re-affirmed that he wants
Georgia to enter NATO and the EU (as does the
majority of the Georgians). Though few European
policymakers expected Ivanishvili to win – and some
said so semi-publicly, which will have won them no
favours with the new prime minister – the country's
pursuit of Western integration gives the EU and
NATO capitals real leverage in Tbilisi. The West has
already played a role in ensuring a democratic
transfer of power after the elections, by mediating
between the government and the opposition.
President Saakashvili conceded defeat in part to
maintain the goodwill of the West.
Europe’s and America’s most urgent task in Georgia
is to help its top two leaders create a working
relationship for the sake of their country. For now,
the president is the more co-operative of the two.
The EU should make clear to Prime Minister Ivanishvili
that it will only continue aid and technical
assistance to Georgia if the country has a
functioning government capable of building
democratic institutions and continuing with
economic reforms. Foreign ministers or heads of
states from EU countries should back up EU officials
with personal visits – in foreign policy, the capitals
continue to carry more weight than EU institutions
themselves. The best outcome for the EU is a
Georgia without political and economic crises; one
whose dialogue with Brussels revolves around which
forms of assistance can best help the country
strengthen its economy and democracy.
The West should not be afraid of Ivanishvili's vow to
improve relations with Russia, which the prime
minister made during the campaign, and which
some in Central Europe see as a sign that he is too
close to Moscow. Georgia’s economy would
benefit greatly if trade barriers with Russia, a big and
growing market immediately to the north, came
down. Russia’s entry into the WTO will ease some of
the blockages; Western capitals should use their
influence in Moscow to press it to further liberalise
trade with Tbilisi. There is a real risk that Saakashvili
will see Ivanishvili’s efforts to improve relations with
Russia as a good tool to weaken the new
government; many Georgians remain wary of
Moscow’s intentions. EU officials and the key
capitals should lean on the president not to
sabotage Ivanishvili’s Russia policy. Irrespective of
whether Moscow responds positively to the new
prime minister’s overtures, the Tbilisi government has
little to lose – and a lot of goodwill in the West to
gain – from trying to patch up the relationship.
Among other benefits, this would ease the fear of
some NATO countries that Georgia’s prejudices
about Russia make the country too volatile to ever
become a member of the alliance. One related risk
to Tbilisi is that Russia may not embrace the new
Georgian government without trying to force it to
integrate into the Moscow-dominated Eurasian
Economic Union, and eschew the pursuit of EU
membership. On this point, Western capitals should
stand firm: countries such as Georgia should be free
to choose with who they affiliate without ultimata
from third parties.
A pleasant problem to have
If the West's main challenge in Georgia used to be
to curb the president's enthusiasm for NATO
membership and his propensity to pick battles with
Moscow, after elections, domestic instability is
quickly becoming the main worry – and a serious
one. Ivanishvili should be a transition figure, who
moves Georgia from a one-man system towards a
more inclusive one. But to succeed, the prime
minister needs to move beyond the zero-sum view
of the relationship with Saakashvili. Ivanishvili's ire is
understandable: in opposition, the Georgian Dream
suffered many wounds including a nearly $80 million
fine for campaign violations, and cautiousness –
even ignorance – from Tbilisi-based Western
diplomats. But with power comes responsibility, and
it is the prime minister's turn to become more
inclusive.
EU and NATO officials and capitals should stay
active but neutral in the tussle between the
president and the prime minister, while guiding both
sides towards common sense. To increase their
leverage, the US and its European allies should spell
out clearly that they will seriously consider Georgia's
application for NATO, assuming that the president
and the prime minister take real steps towards
integration. Such gesture would require NATO
countries to overcome their divisions on Georgia's
membership – no easy feat, given the divisions at
the summit in Bucharest. But Ivanishvili's vow to
improve relations with Russia should help to narrow
the differences among the allies. At any rate, a
dispute over whether to grant admission to a
democratic, stable and prosperous Georgia is a far
better problem for the West to have than the
immediate and real prospect of gridlock and
partisan sniping in Tbilisi.
Balázs Jarábik is Associate Fellow at CEPI and Madrid-based FRIDE.
Disclaimer: The views and opinions expressed herein are those of the authors and do not necessarily reflect those of
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