In latest weeks, tensions have mounted between Russia and its neighbour Georgia amid a series of spats and sometimes violent anti-Russian demonstrations in the capital Tbilisi.
Lawmakers in Russia’s parliament, the Duma, unanimously endorsed Tuesday’s resolution calling for sanctions against Georgia.
Something surprisingly, President Vladimir Putin dismissed that call, stating it was more essential to repair strained relations with Russia’s larger neighbour than to react to “scumbags” provocations. He also said he was against imposing sanctions on Georgia, “out of regard for the Georgian people.”
Analysts are now questioning how the scenario might evolve in the unexpected southern Caucasus area, given tense ties between Russia and Georgia following a military confrontation between the two countries in 2008 and ongoing bitterness over breakaway pro-Russian areas in Georgia – South Ossetia and Abkhazia.
What Has Happened?
Russia has accused Georgia’s opposition of provoking anti-Russian protests in its capital Tbilisi on June 20, in particular. The protests were triggered by public outrage from the speaker’s chair at the address of a Russian legislator in the Georgian parliament.
Thousands of Georgians took to Tbilisi capital’s roads to protest, and protests finished with protesters attempting to storm the building of the legislature. A reported 240 individuals in the conflicts were harmed. Since then, tensions have gone up and protests have continued.
In Georgia, the anti-Russian sentiment is powerful considering the 2008 military conflict it fought and lost with Russia. Russia further irritated Georgia by acknowledging the self-proclaimed states of South Ossetia and Abkhazia as a breakaway.
As such, a Russian State Duma deputy’s parliamentary address in June was commonly viewed as offering Russia a platform in the Georgian parliament–not a common move in a nation that is still bitter about what is commonly viewed as Russia’s 20 per cent occupation of Georgia’s sovereign land in South Ossetia and Abkhazia. Things got worse when a Georgian television presenter ran an expletive-laden rant on Sunday against President Putin, calling him a “stinking invader” and a “dog.”
How Did Russia React?
It’s not surprising that Russia wasn’t pleased with the rant. On Monday, the Kremlin said the nation had failed to “pacify anti-Russian sides” by the Georgian authorities.
In his weekly press briefing on Monday, Kremlin spokesperson Dmitry Peskov said the “insults” of the Georgian television presenter were “completely unacceptable.” The Prime Minister of Georgia, Mamuka Bakhtadze, also hurried to smooth tensions, stating “this is a war of provocateurs against their nation, a filthy and disgusting game with state and citizen safety.”
Russia has already taken steps to suspend trade with Georgia, a nation with aspirations to join NATO and the European Union (such as Ukraine). Flights between Russia and Georgia ceased Monday after Putin signed a decree temporarily prohibiting all flights between nations to “provide safety for Russian people,” revealed Russian news agency Tass.
How Would Russia Hurt Georgia?
The flight ban is already hitting the tourism industry in Georgia and resorts in the Black Sea where thousands of Russians flock every year. The Georgian Hotel and Restaurant Federation’s head told Tass Monday news agency that 80% of Russian hotel bookings had been cancelled. Georgia’s National Tourism Administration thinks that Russia’s likely loss to the country’s economy will be around $710 million from a decreased tourism flow.
According to William Jackson, chief emerging market economist at Capital Economics, the financial hit could be important for Georgia if tensions worsen.
“Until recently, Georgia’s economy was doing well–growing by about 5% a year. But Russia is a significant export market and tourist source, so these tensions are going to weigh on economic growth, “observed Jackson.
Declining export and tourism earnings will also lead to a further widening of Georgia’s present account deficit, which is already big at about 8% of GDP, said Jackson, making the economy more dependent on foreign investment inflows. “That might put pressure on the currency and increase inflation,” he advised.