Both Georgian and Russian officials have expressed a desire to improve their bilateral relationship. Yet Moscow and Tbilisi each seem to be waiting for the other to take the initiative in overcoming the divisive economic and political issues separating them. In addition, Georgia’s intensified campaign to move closer to NATO will present a major near-term obstacle to an enduring resolution of Georgian-Russian tensions, even if the alliance members themselves remain divided over how to treat Georgia.

BACKGROUND: In his January 20 inauguration address, newly reelected Georgian President Mikhail Saakashvili offered to “extend the hand of partnership and cooperation to Russia. Georgia and Russia should be friends, should come closer together, and we should stand shoulder to shoulder.”

The week before, in his first news conference after winning reelection, Saakashvili invited Russian President Vladimir Putin to visit Georgia: “We really hope that President Putin will find the time and the opportunity to come to Georgia. We believe that, against the background of this cold winter, we should begin a thaw in our relations.” Saakashvili added that “one of my main regrets is that during my first presidential term relations Russia were spoiled.” Saakashvili later stressed that he was prepared to go to Russia if that would help normalize relations: “If I am invited, I am always ready to travel to Moscow.”

Georgia’s new Foreign Minister, David Bakradze, affirmed that achieving “good-neighborly relations with Russia [was] important for Georgia” because “Russia is one of Georgia's major partners, including in resolving problems that arouse Georgia's concern and creating a positive moment, which may happen in Georgian-Russian cooperation.” The Georgian Foreign Ministry is establishing a new department for Russian affairs that Saakashvili said “will work to improve relations with Russia.”

Despite Moscow’s having cast aspersions on the legitimacy of the January 5 ballot, Putin formally congratulated Saakashvili on his victory after Georgia's central election commission officially declared Saakashvili the winner, with 53.47% of the vote. “I congratulate you on your re-election to the post of President of Georgia,” Putin wrote. “It is my hope that the upcoming period will bring constructive development in the relations between our countries.”

Furthermore, although some observers expected that the Russian government would boycott Saakashvili’s inauguration or send a low-level representative, Foreign Minister Sergei Lavrov himself led the Russian delegation to the January 20 ceremony. He was the highest-ranking Russian government official to visit Tbilisi since the October 2006 spy scandal. Lavrov said that his delegation’s “participation in the Georgian president's inauguration ceremony confirms Russia's sincere and deep intention to normalize relations with Georgia.” Lavrov subsequently told Bakradze that Russia intended “to work in a constructive way to improve interstate relations.”

Yet, it remains unclear whether Russian leaders genuinely anticipate resolving their numerous differences with Tbilisi. Responding to Saakashvili’s overtures, Russian State Duma Speaker Boris Gryzlov told Interfax that, “I think we should welcome any proposals and ideas aimed at restoring the historically friendly relations between Russia and Georgia. Yet we wish these statements were supplemented with particular deeds.” Russia’s Ambassador to Georgia, Vyacheslav Kovelenko, likewise said “Russia is seeking to normalize relations and friendship. Russia expects Georgia to make a specific step, actions that could be regarded as a drive to normalize relations.”

The Russian government has yet to commit to lifting the numerous economic sanctions it has levied against Georgia since early 2006. Moscow’s unilateral measures have included severing direct transportation and postal links between the two countries, imposing new visa restrictions, prohibiting the importation of Georgian wine and mineral waters into Russia, and carrying out mass forced repatriations of ethnic Georgians working in Russia. According to the Georgian government, exports to Russia in 2007 amounted only to $53 million, a 30 percent decline from the previous year. As a result, only 9.8 percent of Georgia's foreign trade in 2007 involved Russia, a 3.9 percent decrease from 2006.

IMPLICATIONS: One of the most important variables affecting Russian-Georgian relations in the near term will be the evolution of Tbilisi’s relations with NATO. Georgia already has negotiated an Individual Partnership Action Plan with NATO and is seeking a Membership Action Plan at the early April 2008 NATO summit in Bucharest, en route to full membership at a later date.

In his inaugural address, Saakashvili reaffirmed his intent to continue Georgia’s “Euro-Atlantic orientation” and pursue deeper relations with NATO and the European Union. According to an International Republican Institute September 2007 survey, 81 percent of Georgians surveyed support joining the EU. Polls indicate a similar level of support among Georgians for NATO membership.

In the recent presidential elections, Saakashvili was even more direct in affirming his intent to deepen Tbilisi’s ties with NATO. In late December, he told Georgian TV that, “In case I am elected president for another term, Georgia will become a NATO member during my second term of office.” All of Saakashvili’s main opponents for president also professed to support Georgia’s joining NATO, with only one fringe candidate dissenting. On January 5, concurrently with the presidential ballot, the Georgian people voted overwhelmingly (by 72.5 percent) in favor of a referendum endorsing the country’s entry into NATO.

The day before Saakashvili’s inauguration, Matthew Bryza, U.S. Deputy Assistant Secretary of State for European and Eurasian Affairs, told a January 19 Tbilisi press conference that better relations between Georgia and Russia would facilitate the realization of Georgia’s membership aspirations. “We believe a positive relationship between Georgia and Russia will actually help us achieve our shared goal with regard to Georgia's NATO aspirations.” Bryza noted that Georgia, like any European country, would need to continue to rely on Russia for at least some of its energy supplies. He also downplayed the significance of the referendum: “Certainly, the opinion of the population is always taken into account but membership is first of all granted to states meeting NATO criteria.”

Russian officials have made clear they oppose NATO’s further expansion into former Soviet territory. Likewise, they have repeatedly objected to NATO’s further expansion eastward, especially into the Caucasus. Russian government representatives also have blamed the alliance’s past membership enlargement for disrupting the European balance of power established after the end of the Cold War by the Conventional Forces in Europe Treaty. Finally, some Russian officials have intimated that Moscow might increase its military presence in Georgia’s separatist regions of Abkhazia and South Ossetia in retaliation, if NATO governments recognize Kosovo’s independence from Serbia.

Dmitri Rogozin, Russia’s controversial new Ambassador to NATO, has gone so far as to argue that Georgia is unfit for NATO membership: “Georgia has not settled a single substantial question in a manner that confirms the country's independent existence – neither economic, nor political, nor in the area of territorial integrity, nor in the military area, (proving that) the country doesn't correspond to any of the NATO criteria.” Rogozin attributed the widespread popular support for the NATO referendum to Georgians’ desire to inveigle the alliance into helping Tbilisi employ coercive means to reassert control over the country’s pro-Moscow separatist regions: “Georgians essentially voted for an exterior force to help them resolve their problems of territorial integrity.”

Even without NATO membership, Georgia’s booming economy, which experienced 12 percent GDP growth in 2007, has provided the government with the resources to strengthen its armed forces considerably in recent years. The Georgian defense budget has been one of the fastest growing in the world. The government has purchased large quantities of Western military equipment, transformed the Georgian army into a professional force by abolishing conscription and moving toward an all-volunteer system, and deployed 2,000 Georgian soldiers to Iraq.

CONCLUSIONS: The agenda for NATO’s summit in Bucharest is expected to include the issue of a Membership Action Plan (MAP) for Georgia. Some NATO governments favor advancing Georgia’s membership process to the next stage by offering the MAP. They hope that the possibility of NATO membership will, as in Eastern Europe during the 1990s, serve to moderate Georgia’s foreign and defense polices as well as discourage Russian adventurism in the Northern Caucasus.

Other members, however, worry that offering Tbilisi a more explicit Western security guarantee could encourage Georgians to consider using their newly strengthened military, which has benefited from substantial recent increases in government defense spending, to reoccupy the country’s separatist regions. They also fear further antagonizing Moscow at a time when Russian-NATO relations are already strained over other issues and when some Russian officials appear open to considering new initiatives to improve Moscow-Tbilisi relations now that Saakashvili is likely to remain Georgian president for several more years.

AUTHOR’S BIO: Richard Weitz is Senior Fellow and Director of Project Management at the Hudson Institute.