Russia’s invasion of Georgia has gone far beyond the worst expectations of possible developments in the South Ossetia and Abkhazia conflicts. Moscow wants to dominate regions it perceives to be its sphere of influence. Its actions have sent a shock-wave throughout the CIS, and will strongly impact on developments in the South Caucasus and beyond. In different ways, the invasion, and the lack of a strong western response, is likely to consolidate Moscow’s influence on both Armenia and Azerbaijan.

BACKGROUND: As Moscow’s military intervention has moved far beyond the breakaway South Ossetia and Abkhazia, Georgian-Russian relations have hit a catastrophic low. Russia is attempting to restore its superpower status, send an unequivocal message to the U.S. and EU that it cannot be ignored in foreign policy agenda-setting and decision-making, and that it will not allow a further NATO enlargement to its sensitive southern flank, or accept Kosovo’s Western-orchestrated independence without repercussions. In other words, that Russia has a say in what choices its neighbors make. Before resorting to disproportionate military force in Georgia, Russia had pursued the same strategic goals by diplomatic, economic and political pressures, be it in Georgia, Ukraine or the Baltics. In Georgia, it had also meddled with the Abkhaz and South Ossetian conflicts.

After the 2003 Rose Revolution, as Tbilisi prioritized the restoration of its territorial integrity and pro-Western choices, its pro-peace rhetoric was accompanied by assertive and sometimes militant demarches for reunification, and to counter Russia’s meddling in the regions. Georgia struggled to change the political and peacekeeping arrangements dominated by Russia and the realities on the ground. A miscalculated operation launched by Tbilisi resulted in hostilities in South Ossetia in 2004. Since 2006, Tbilisi promoted the role of ‘alternative’ Ossetian and Abkhaz authorities, both based in territories controlled by Tbilisi and staffed by loyal Ossetians, or ethnic Georgians, in the latter conflict those displaced from Abkhazia.

Besides irritating Moscow, these measures also led to plummeting confidence across the conflict divides. Security in both conflict zones deteriorated over the past two to three years, and negotiations further stalled. Abkhazia and South Ossetia grew further isolated from Georgia proper than they had been in the decade following the wars of early 1990s. Realizing that diplomacy alone was not going to help to quickly reunite their country’s integrity, hawks in the Georgian government had been drafting plans to re-take at least parts of the conflict zones by force, despite strong warnings of Georgia’s Western allies.

Russia had been badly meddling in Abkhazia and South Ossetia, but Tbilisi’s longer terms policies toward the conflict regions also contributed to setting the context for the current standoff. Takes on how the recent violent confrontation was sparked off differ. While Tbilisi may well have used disproportionate force against Ossetians, Russia’s aggression against Georgia appears well prepared and pre-meditated. It is a coercive statement which reaches far beyond Georgia’s conflict zones.

IMPLICATIONS: The Russian strategy in Georgia is to ensure Moscow’s continued strong influence in the country’s internal affairs. Russian actions outside of South Ossetia and Abkhazia are emboldened by the weak reaction of the West which had limited its intervention (at least so far) to declarations of support for Georgia’s territorial integrity, humanitarian aid, and plans for an observation mission to monitor the withdrawal of the Russian military and the ceasefire. Moscow has signed a six-point ceasefire plan but has so far interpreted it in the loosest possible manner, if not violated it. As the Russian army has dug in positions along key roads and taken under control many strategic locations in Georgia, the U.S. and EU risk having to simply agree to Moscow’s game-plan.

This is likely to prevent Georgia’s integration into NATO. It will, at least in the short-to-mid term, prevent Georgia from re-incorporating Abkhazia and South Ossetia, and may undermine the consolidation of Georgia proper. Foreign investment risks plummeting, and trade will suffer from instability and the destruction of infrastructure. And while the people presently appear united around the leadership, internal tensions may follow after economic problems hit, casualty tolls are fully reported and the extent of the humanitarian disaster sinks in.

The shock-waves the Russian intervention is sending through the entire CIS aside, these developments will have a profound impact on the South Caucasus as a region. Both Armenia and Azerbaijan may suffer economically due to the ensuing instability and the damage to Georgia’s infrastructure.

The developments in Georgia present a complex economic and security dilemma for Baku. Azerbaijan’s impressive economic growth rests on export of Caspian gas and oil, and its exports depend on the Baku-Ceyhan-Tbilisi pipeline, which crosses Georgian territory, as the overwhelming export route. Long-term instability in Georgia that would hamper oil and gas export would directly impact Azerbaijan’s economic growth. Russia’s military presence in Georgia, and its resulting leverage over the country’s stability, can impact on exports of Caspian oil and gas through the BTC pipeline, which was reportedly interrupted on August 12.

Azerbaijan’s maneuvering space has hence shrunk significantly. Disappointed by the weak American reaction to the Russian aggression, Azerbaijan is likely to revisit its top foreign policy priority, namely NATO integration, and become more cooperative with Russia in an attempt to avoid further disruptions in oil export. Confronted with a forceful Russian reaction in Georgia, Azerbaijan is now less likely to resort to use of force to restore its territorial integrity in Nagorno Karabakh. The speedy resolution of the Nagorno Karabakh dispute is even less likely as Russia will continue to use it as a lever to meddle into the internal developments of both Armenia and Azerbaijan.

The Armenian regime of President Sarkisyan is relatively weak internally. Sarkisyan, who assumed power following deadly clashes with demonstrators who protested the rigged February 2008 presidential elections, has not managed to bridge the deep rift in the Armenian society and secure broad legitimacy.  With weak democratic and human rights credentials, the regime is pressed to deliver in terms of economic performance (Armenia has since 2001 enjoyed double digit growth rates).

The events in Georgia will impact Armenia and its regime in two ways. Firstly, Armenia’s economic prospects will worsen. Currently, the bulk of the land-locked Armenia’s foreign trade is carried out through Georgia, via which Armenia also gets natural gas (though a new gas pipeline linking Armenia with Iran is near completion). Armenia is in a state of war with Azerbaijan, and it does not have diplomatic relations with Turkey, its neighbor to the west. Borders are closed, and direct trade has been suspended. Should land trade with Georgia be suspended or severely impeded, the only remaining land trading partner for Armenia would be Iran. Yet the infrastructure linking those two countries is limited.

In the absence of strong economic growth, it is possible that internal pressures on the regime will grow further. On the other hand, the relatively weak Western reaction to violence in Armenia in March 2008, and its preoccupation with any reaction to the Georgian situation increase the risk of a potential use of authoritarian means to solidify its power. The foreign policy course of Armenia will remain essentially unchanged, i.e. closely coordinating with the Russian Federation, while formally maintaining, at least for a while longer, a “policy of complementarity”. 

CONCLUSIONS: There is a great risk of Georgia’s longer-term destabilization. Its internal conflicts in Abkhazia and South Ossetia are unlikely to be resolved, and Russian meddling in the country is likely to undermine its stability, security and economy.  Russia’s intervention there will have a profound impact also on the South Caucasus and the entire CIS. It also signifies a broader geopolitical shift in which Russia is securing a stronger role in world affairs.

AUTHORS’ BIO: Dr. Blanka Hancilova is analyst of international relations with a focus on the CIS and the co-founder of Apreco Consulting Group.  Magdalena Frichova has worked on conflict issues in the South Caucasus since 1999, most recently as Project Director for the International Crisis Group.