EurasiaNet Business & Economics - In Georgia's and Russia's Shadows, A Breakaway Celebration

BUSINESS & ECONOMICS

IN GEORGIA’S AND RUSSIA’S SHADOWS, A BREAKAWAY CELEBRATION
Troy Etulain 8/11/03

While the self-declared autonomous republic of Abkhazia maintains a paltry economy and has never won recognition from Georgia, some people in its capital are ready to celebrate. September 30 marks the tenth anniversary of Abkhazia’s break from Georgia. And even as Georgia protests Russian support for efforts to restore rail traffic from Russia’s port city of Sochi to Sukhumi, the Abkhazian capital, workers all over that city are preparing for visitors.

A new Sukhumi-to-Sochi express ferry service began operations July 26, although it arrived late and left with little fanfare. The fanfare apparently will come in September. All over Sukhumi, storeowners are refurbishing sidewalks. City workers have nearly completed renovations of Sukhumi’s football stadium. They are installing new cement tiles along the city’s waterfront promenade and restoring the wall’s obelisks. The walkway is famous among locals for its pink and white oleander, cypress and palm trees. The renovations are being paid for in part with funds raised by a telethon earlier in 2003.

Plans call for hundreds of Sukhumi residents to gather on September 30 to lay bouquets on martyrs’ graves, watch a military parade and see a performance in the stadium. Planners expect citizens to then descend on the waterfront promenade for a selection of live music. Workers have been restoring the Ritsa Hotel, which faces the Black Sea; the Hotel Abkhazia across the street is still searching for additional investors to back its remodeling.

Sukhumi boosters and some residents say that Abkhazia has experienced a long-desired spike in economic activity, largely in anticipation of the anniversary. Yet in several cases, the developments have been partial and imperfect. The self-declared republic depends on Georgia and Russia for infrastructure, commerce and transportation. Despite Russia’s recent maneuvers to supply electricity in large parts of Georgia, the countries remain basically at odds over how to recognize and serve Abkhazians. [For background, see the Eurasia Insight archives].

Progress has stalled and lurched, but it has left evidence. In August 2002, a company called Magticom established mobile phone connections throughout much of Abkhazia. Workers recently began clearing a site for a new bowling alley, although its date of completion remains unclear. There are now modern gas stations, yet supply lags demand significantly enough that small Soviet tanker trucks sell gasoline from a central city park and other set locations.

Leonid Lolua, Sukhumi’s head administrator, encourages economic optimism but warns that the city’s economy is still smaller than it was before the bloody 1992-93 war with Georgia. He cites fisheries and shoe factories that have resumed operations, albeit not at full capacity. The administration is trying to stimulate the economy through its own payroll. In early July, the Abkhaz government completed a two-step doubling of government salaries that began at the beginning of the year. Locals generally report that pensions are paid on time.

Where can the economy go? Lolua, who led construction of Sukhumi’s airport during the Soviet era, spins a tale of urban revival. On his office wall, he has hung an ambitious plan of urban renewal that Lolua expects to take a couple of decades. Most notable is a new broad stripe of parks and fountains that will sweep down from the currently burned out old government building to the waterfront, requiring the removal of some buildings that stand in the way. Lolua says he has decided not to allow construction of any new buildings taller than four or five stories in the city in order not to destroy its charm and character.

To some public figures, this sort of iconography bears little relation to the kind of development Sukhumi needs. Oleg Damenia, a seasoned opposition leader, criticized the notion that the renovations and new hotels constitute progress. "Proof of development lies in the quality of life of people in a society," he says. To Damenia, the self-declared republic’s lack of an anti-monopoly policy makes income inequality persistent. He argues that corruption is a much more urgent problem than a dilapidated waterfront.

A more potent and immediate economic booster may come from intensifying relations with Russia. Employees of the Astina real estate agency in Sukhumi say that Russians are by far their best customers. Although business has gotten better every year since "the war," the past year has reportedly been particularly strong. Currently one-bedroom apartments in the heart of Sukhumi sell for around $3,000, with homes vacated by fleeing Georgians bringing in about $500 less. Georgia and Russia have quarreled over Moscow’s dealings with Sukhumi, but these fights have not made Russian officials or businesses shy about courting Abkhazians. [For background, see the Eurasia Insight archives].

For several years, Russian tourists have traveled down the coast to Abkhazia in the summer and Abkhaz students have gone to Sochi to study each fall. Now, economic ties are growing more formal. Sukhumi has joined an association of southern Russian cities, seeking city-to-city assistance. Lolua, asserting the association’s integrity, has said that the administrators of these 12 cities will top the invitation list to the September 30 celebrations. On July 22, a shipment of 12 city buses, medical, educational and sports equipment arrived from the Moscow city government. In a similar spirit, the city government of Krasnodar has expressed a desire to renovate a school in central Sukhumi.

Repairs to schools and to trade routes � the latter of which depend in part on Georgia � would change the city’s complexion more meaningfully than the anniversary celebrations can. Despite the anniversary fanfare, road police still lower their red and white bars every night to block traffic to and from the city. They are enforcing a tacit nighttime curfew, evidence of a conflict that remains unsettled and a constant threat of violence. [For background, see the Eurasia Insight archives]. Indeed, foreigners are repeatedly warned about their personal safety in the republic. United Nations staff members are reportedly not allowed to walk about the city without permission from their security personnel. In this unsettled environment, glittering hotels and raucous music may not shine as brightly or as long as some would hope.

Editor�s Note: Troy Etulain is a freelance journalist based in Georgia.

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