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Georgia Kicks Off 2018 with Caucasus Trade Conflict

Three days into 2018, Georgia already is finding it hard to keep one resolution – an agreement to let third countries use breakaway Abkhazia and South Ossetia as trade corridors from Georgia to Russia under force majeure conditions.  
 
The deal, signed on December 19 with SGS, a Swiss certification-inspection-verification firm, has been on the table since 2011, part of Georgia's nod to Russia joining the World Trade Organization. It would only apply in extreme weather – a heavy snowfall or a landslide, for instance – when Georgia’s sole official border point with Russia, at Upper Lars, is unusable.  
 
That may sound routine, but, nonetheless, this is one controversial resolution.
 
First, of course, are Georgian fears that the agreement means that Tbilisi has caved in to the muscle-flexing Kremlin. The
fact that the terms of the Georgian government’s contract with SGS have not been made public appears to have furthered these misgivings. Letting Armenian cognac take a shortcut to Russia via South Ossetia, the thinking seems to go, is one step away from essentially recognizing South Ossetia as an independent state and/or legitimizing Russia's role in that territory.
 
In response, Georgian Foreign Minister Mikheil Janelidze has emphasized that the terms, timing and type of any delivery to or from Georgian-controlled territory via the breakaways would depend on Georgia alone.
 
The second source of complaints, though, is perhaps still trickier to address – Azerbaijan.
 
Some pro-government Azerbaijani MPs see the deal as a way to help along Baku’s longtime foe, Armenia, embargoed by Azerbaijan for its military activities in and around separatist Nagorno Karabakh.
 
Upper Lars currently is the only land option for Armenian cargo trucks to reach Russia, one of the country's largest markets. Since the trucks routinely lose out when snow or other inclement weather closes the Georgian-Russian checkpoin, the Armenian government has long pressed Tbilisi for the option to use Abkhazia and South Ossetia as alternative routes.

As if a way to say thanks for the SGS deal, Armenian President Serzh Sargsyan during his December 25 state visit to Georgia touched on the delights to be had trading within the Eurasian Economic Union or joining in on Armenia's free-trade zone with Iran.

But this chumminess rings alarm bells for Azerbaijan, which, to date, has had the dibs on transit relationships with Georgia. Parliamentary Speaker Ogtay Asadov speculated darkly that “Probably someone wants to break this alliance.” A joint parliamentary group will hash matters over further with Georgia, the pro-government Trend reported.
 
SGS, though, is no stranger to Azerbaijan. The company’s Baku branch has worked with the state-run SOCAR before, and an Azerbaijani, Teymur Abbasov, runs SGS’ operations for Russia and Eastern Europe.
 
Nonetheless, Tbilisi’s argument that the SGS deal would not just benefit Armenia appears to have fallen on deaf ears in Azerbaijan.
 
Meanwhile, Baku’s complaints are fueling Georgian opposition criticism of the agreement in turn. “In reality, Georgia’s government has agreed to a capitulant position with Russia that puts under threat not only our strategic partner’s strategic interests, but completely puts under threat the country’s sovereignty," fumed Khatia Dekanoidze, a member of the United National Movement. 
 
For now, though, the deal remains incomplete. Russia must have its own contract with SGS before any breakaway trade corridor can open. Negotiations continue since the Russian side’s demands are “unacceptable for us,” Georgian Prime Minister Giorgi Kvirikashvili told parliament without elaboration.
 
What could change that remains unclear. Maybe it falls under another New Year's resolution.
 

Georgia Kicks Off 2018 with Caucasus Trade Conflict

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