Hell in Heaven
The opportunities we have lost.
There is a legend which is very popular in the Caucasus; it says that after the fall of the Tower of Babel, when God gave away land to different nations, the place where he wanted to settle himself he gave to the Caucasus people.
Indeed, it is hardly possible to find another land which provides people with such opportunities. The Caucasus region has everything - fertile land and a beneficial geographic location, as well as all kinds of natural resources. But what matters more is the talented people, who proved their ability to think in a creative way and overcome difficulties even in the Soviet era.
The Caucasus entrepreneurs unpopular among the Soviet bureaucrats produced valuable goods very hard to find in Brezhnev's era, even though they did it for their own sake.
But why in today’s conditions of free initiative and free-trade markets and private business, are the Caucasus countries some of the poorest in the post Soviet area? The answer is obvious - conflicts, which split the entire region, do not let us benefit from the potential.
It is enough to list some of the projects which were not realized due to political confrontation and ethnic conflicts, for example in Georgia.
Since the outbreak of war in Abkhazia in August 1992, there has been no rail traffic between Russia, Georgia and Abkhazia through Abkhazian territory. During the years, the sides have been holding negotiations to restart traffic, but these attempts have failed as a range of new problems have appeared, particularly the problem of refugees. On the other hand, a resolution to this problem would ease the movement of people, goods and services in this huge region, including Turkey and Iran, as well as restoring traffic operations on the Azerbaijan-Armenia-Turkey railroad.
Meanwhile, dealing with strategic economic problems, Tbilisi has to look at Baku and Yerevan. For example, since 1990's, the Armenian authorities have claimed again and again that direct delivery of Azerbaijani oil and gas to the west "threatens Armenian interests, since it increases the potential of Azerbaijan.”
On the other hand, following the restoration of traffic on the Yerevan-Tbilisi-Vladikavkaz route, Baku officials expressed anxiety.
In the mid 1990's, Gazprom intended to install a Russia-Turkey pipeline through the territory of Georgia within the frames of the Blue Stream project. The then head of the Russian energy giant, Ram Vyahere, visited Georgia several times and held negotiations with then president Eduard Shevardnadze, but since Moscow was not sure that this transit pipeline wouldn’t become apolitical lever of pressure on Russia, the decision was taken in favor of the more expensive project to lay a pipeline via the Black Sea.
Besides this, Gazprom expressed its intention to privatize a strategic pipeline Russia-Georgia-Armenia, in return for gas and oil delivery to Georgia on a long term basis. But the Georgian government can never consider this opportunity, since it immediately faces strong opposition and accusations that it is surrendering territory to Russia.
The shortest and fastest path from the Central and Eastern Caucasus to the Black Sea and Turkey runs through the territory of South Ossetia. But this route is closed. Some Georgian journalists cynically joke that the "real" (though unrecognized by Georgia) border with South Ossetia is the one with the highest security level. However in the near past on the Georgian-Ossetian border there was an active energy market which attracted entrepreneurs from Azerbaijan and Armenia. It was considered a symbol of «Caucasian free trade" and development under peaceful conditions and cooperation. Nowadays nobody even remembers this place, where Georgians, Ossetians, Ingush, Armenians, and Azerbaijani, did business side by side. Nobody, that is except those who lost income and friends, representatives of so-called hostile sides, cursed by the "god of trade".
Attracting investments is a frequently discussed question in Georgia. And almost everyone shares the opinion that the most logical investor for the Georgian market is Russia. Over and over again, the Russian company Vimm Bil Dan has made an investment proposal on the privatization of the brand Borjomi, according to which the company promised to keep the brand and spend millions of dollars on production development. In the case of the realization of this project it is doubtful that Moscow would have banned the import of Borjomi mineral water in 2006, so as not to harm to one of the most successful Russian companies.
Even after the outbreak of the Russian-Georgian conflict in August 2008, electricity supplies to Georgia were not stopped for even a second, since the energy system of the country belongs to Russian affiliated companies. Not a single missile fell near energy system objects.
Tourism in the Caucasus deserves a separate discussion. Abkhazia and Adjara, the real pearls of the Black Sea region, the mountainous resorts of Bakuriani and Gudauti, as well as Tskhaltubo haven't reached the level of popularity they enjoyed during the Soviet period. Although nowadays there are endless opportunities to develop tourist infrastructure.
Georgii Kalatozishvili, Tbilisi. Exclusively for VC.
