Anyway, the election results are a big surprise. Just a couple of months ago very senior Georgian politicians were expecting something like a 50% to 30% victory for Saakahsvili, and were saying that the main danger from Ivanishvili was not for this round of elections, but for the next electoral cycle where he could build on his 30% to make the leap towards a proper majority.

Of liberalism and social democracy

The reasons for the elections results are manifold. The most important is basically too right wing a government. In his near-decade in power Saakashvili achieved huge successes in state building. The list of achievements is very long and has been so often quoted by Georgia apologists and friendly lobbyists that many people are tired of it. However, what Saakashvili achieved is no mean feat. He drastically reduced low-level corruption when it comes to the interaction between the citizen and the state – from traffic police to construction-permit issuers. He attracted significant investments, and most importantly (re)built the skeleton of a more or less functioning state, starting with the police and tax-inspectorate, then moving on to courts, universities, and municipal services (Here is a good book from the World Bank chronicling Georgia’s reforms). All was supplemented with a huge deregulation drive – that ranged from cutting red-tape and giving as free a hand to investors to drastic liberalisation of visa procedures for as many countries as possible. Georgia was open to anyone who would come to spend money or invest – from Iranian or Turks going to casinos in Batumi, to Russian, Kazakh or Gulf investors. Georgia now occupies the formidable 16^th place in the Cost of Doing Business ranking and for several years held the title of the most reformist country in the world.

Georgia’s success has two key ingredients that are now becoming its weaknesses. The first was that the reforms were conducted with a firm hand, uncompromising manner and in a very centralised decision-making style. This was good for the speed and depth of reforms, but Saakashvili’s governing style alienated many of the better off, including a good chunk of the Tbilisi elite. The second was an extremely liberal approach to the business environment, as well as a preference for various ‘grand projet’ from producing a Georgian armoured vehicle (called Didgori) to a Georgian tablet computer, and from posh hotels (Tbilisi has two Marriots, a Radisson SAS, and a Sheraton) to ‘public service halls’ built by famous world architects. Such an approach attracted investments and increased tax-revenue, but created few jobs. And there has been little redistribution. All this alienated the poorer parts of society. Budgetary spending went into good salaries for the public sector (a key factor for the fight against corruption), rebuilding of the police (as an institution, and literary as a series of new glass buildings across the country), army, or roads. But not enough of it was properly redistributed via things such as pensions or support for agriculture. What was good for business was not always good for social protection. Ultra-liberalism generated growth and budgetary revenue, but was not enough to creating jobs or reducing substantially poverty. Between 2003 and 2012 Georgia’s GDP doubled in purchasing power parity (and rose by 3.5 times in nominal terms), and yet poverty was reduced from 28% to 24% only.  Saakashvili’s administration understood this, and the plan was to move the focus of the government from ‘liberalism’ to ‘social-democracy’, but this approach is too new to have visible effects.

So what explains Saakashvili’s success – quick, centralised, determined, non-consensual decision-making, deregulation, liberalism, and business-is-king attitude, also explains why parts of society grew increasingly disillusioned – from the elite that disliked political centralisation, to the underprivileged ones who got did not benefit from the growing economic pie. Another part of the explanation is politics. For a decade Saakashvili was so dominant and politically ruthless to his political opponents, than in the end all of them were forced to join forces under a single political roof – that of Bidzina Ivanishvili.

What next?   

In slightly over a year Saakashvili’s second presidential mandate will come to an end. So far he refused to say what he would do next. He was pondering his options, including the potential scenario where we would stay on as a prime-minister or speaker of the parliament. The parliamentary election results now make it much more difficult for Saakashvili to choose his options without facing strong opposition. Whatever will Saakashvili do (except from stepping aside from politics) will be much more difficult to achieve and contested in Georgia. But it also might strengthen his determination to continue the fight by staying in politics in a belief that the current opposition would just destroy his legacy, and his achievements are not irreversible enough for Georgian politics to move to a post-Saakashvili phase.

Either way Saakashvili’s defeat, is both good and bad for Georgia. It is bad because it is unclear what Ivanishvili stands for except being anti-Saakashvili and whether his party is committed enough to continue supporting Georgia transformation not just into a more pluralistic state, but into a better functioning state that continues to fight corruption, attract investments and modernise the country. But the election results can also be good news because even though not all opposition victories lead to or strengthen democracy (many of them actually don’t), fundamentally all democracies are built through victories and defeats of all governments. Benjamin Franklin once said that ‘our critics are our friends; they show us our faults’. So if these elections become a Franklin moment for Saakashvili making him and his party deliver better for the population at large and refocus their governance style and agenda – these elections might be turned from a short-term defeat into a longer-term victory.

Appearances can be deceptive

Money and a careful foreign policy between various great power interests made Azerbaijan the ultimate balancer and a fairly arrogant regional player. But the Azerbaijani system is more fragile than the country’s foreign partners think. The foundations of that system are increasingly shaky for several reasons.

One key factor is decreasing oil production. Oil production peaked in 2010; it will go down by half by 2017 and two-thirds by 2019. The hope is that new gas reserves will make up for the difference in incomes. This might compensate the fall in revenues, but only partly and insufficiently. The problem is also compounded by pretty profligate spending and a lack of institutionalised rules on how to use the oil money. Other oil-producing countries like Russia or Kazakhstan are more disciplined in ‘parking’ oil money in reserve funds. These are needed for ‘rainy days’ as well as insulating national economies from inflationary pressures, excessive liquidity, Dutch disease [the apparent relationship between the increase in exploitation of natural resources and a decline in the manufacturing sector] and the volatility of oil prices.

Azerbaijan, though, is using much more of its oil money for current expenses: the country’s oil reserve fund SOFAZ transfers half of its annual income to the state budget. Some of this money has been invested in the future – infrastructure, motorways, and scholarships for studies abroad. Some has been spent on barely productive vanity projects from fountains to posh palaces. But most of it seems to have been siphoned off.  One estimate suggests that a kilometre of highway costs on average $18 mln in Azerbaijan, compared to $5.9 million in the US, $6.9 mln in the EU, $2.2 mln in China, $17.6 mln in Russia.

Politics and the economy

With the shaky foundations of the status quo, Azerbaijan does not have much time to diversify its economy. But it is not apparently doing much. The country’s elite has been for years in a comfortable, but corrosive equilibrium. The economy is riddled with monopolies and cartels with various highly ranked officials and their families controlling different sectors of the economy – from the import of bananas to road building. Unsurprisingly, the prices in the country are very high for everything, since they are pushed up by both cartels and currency appreciation stemming from an excessive inflow of oil money.

Politically, the situation is not totally unhealthy, but less and less so. From 1969 until 2003 Azerbaijan’s political life was (on and off) dominated by Heydar Aliev, once a KGB boss, then first Communist party secretary, then president of independent Azerbaijan. His son, Ilham Aliev inherited the post in 2003. But local experts say that whereas Heydar Aliev, for all (or perhaps due to) his Soviet background was primarily a ‘statesman’, the current president is primarily a ‘businessman’. Under him the elite’s corrupt money-making has morphed from a side-benefit and instrument of governance into the raison d’être of government.

Negative political trends are plenty, among them the removal of constitutional limits  on the number of presidential terms, the jailing of bloggers and the denial of visas to Council of Europe rapporteurs. This is matched by a sleazy ‘caviar diplomacy‘ offensive among the European political elite, as outlined in a recent report by the European Stability Initiative. Perhaps not hugely important, but indicative of the political climate and trends in the country, has been the toughening of visa requirements for EU and US citizens (who until a few years ago could receive visas on arrival at the airport, but not any more). A side-story of that is the surprising situation when Azerbaijan’s most strategic of all partners, Turkey, has a visa-free travel regime with countries ranging from Morocco to Kazakhstan, and from Serbia to Syria (and soon with Russia and Ukraine), but not with Azerbaijan.

For all the complications of Azerbaijan’s political and economic situation, the country is not only strategically important but also has great potential. It is not just some oil-cursed sultanate. Its elite is autocratic and corrupt, but is in a different league from the bloody or bizarre dictators of Central Asia. Azerbaijan is in many ways stuck somewhere in between resource-rich countries that made it, and those that didn’t; halfway, as it were, between Dubai, Bahrain or Qatar one the one hand, and Angola or Nigeria on the other. Azerbaijan ranks (place 66 in the world) above Croatia, Romania and Turkey in the cost of doing business, but is behind Armenia and Kazakhstan. Its global competitiveness index (place 55) is better than that of Slovakia, Bulgaria, or Serbia, but lags behind Oman, Tunisia or Sri-Lanka. Azerbaijan has still a lot to improve, but its starting point is not too bad.

The way forward

Fundamentally, Azerbaijan faces a huge contradiction between the entrenched interests of the elite and the need to build a post-oil economy. For that it needs to open up. Its economy, its borders and its political system. Joining the World Trade Organisation and then signing a deep and comprehensive free trade agreement (DCFTA) with the EU should be the country’s next priorities. It could also present a more open face to the world by abolishing visas for the citizens of Turkey, EU and US citizens at least.

It does not have much time to waste, nor much money to pour down the thirsty throats of so many corrupt vested interests. Ultimately, its president has to decide whether he wants his cronies to continue enjoying monopolistic rents and ballooning bank accounts, or to sacrifice some of their incomes for the sake of actually developing a post-oil economy. In the end it is not just the future of Azerbaijan that depends on this, but also that of the ruling family which might be too weak to survive a rapid contraction of oil revenues.

Published in OpenDemocracy, 27 September 2012

Certainly, it is not youth movements, but authoritarian regimes and ‘ripe contexts’ that are the causes of revolutions. This sounds self-evident, but both revolutionaries and counter-revolutionaries seem to often miss it (though it is impossible to know whether a revolutionary situation is ‘ripe’ before it actually happens). I still remember the avalanches of venom deployed against youth movements as ‘fifth columns of foreign powers’, not just in Russian, Azeri or Serbian media, but also in plenty of (leftish) European newspapers (the Guardian seemed to excell at that). Many of them implied that youth movements, not authoritarian mismanagement were the causes of revolutions. But it is also indicative how Kefaya failed to lead to anything meaningful in Egypt in 2005, whereas the 2011 protests toppled Mubarak without any Kefaya-like organisation.

I spent most of the last week in Morocco looking into how the revolutions in Tunisia and Egypt affected the political dynamics there. The current wave of protests in Morocco are led by the ‘20 February movement‘ (or here), which stages big manifestations once a month (the first big demonstration was on 20 February), and smaller protests, sit-ins and flashmobs in between. Speaking to some activists from the movement (in their early twenties) I was pretty suprised that they never heard of Kefaya, let alone Otpor or their field manual Gene Shapr’s ‘From Dictatorship to Democracy‘. The current movements seem to be a different breed than the movements in 2000-2005.

From telegraph to sms to Facebook

One difference is how the media, the public and the protesters themselves talk of the way protests are organised. Remember – one of the first things the Bolsheviks did in 1917 was to seize the post and telegraph as the key means of communications. The failed 1991 Putsch in Russia and the 1993 stand-off between Eltsin and the Parliament saw big clashes at Ostankino, where the main Russian TV channels are. Controlling the TV was crucial for mobilising or keeping the public at home.

In 2003-2004 all the attention was on the hugely ‘innovative’ fact that protesters coordinated their actions or called for protests through sms (rather than more old-school leaflets, newspapers, radio or TV). Sms ‘democratised’, accelerated and simplified communication. Through sms protesters could circumvent TV and radio when they wanted to broaden their appeal and speed up coordination. It takes a few seconds to sms a dozen persons, and much longer to call them landline-to-landline. But sms is old-school now, as well. It is used of course, but does not excite the imagination of the media or the regimes. It is Facebook and Twitter that are the focus of attention (though the Russian FSB just said the already old-school Gmail, Hotmail and Skype are a threat to Russia becuase they cannot be ‘monitored’).

From ‘youth movements’ to ‘rainbow movements’

But the 2011 protesters are different not because just Facebook and Twitter replaced sms. They are different in a deeper sense. The current protest movements are not stricto sensu youth movements, but a blend of young urban middle-class facebookers, mild and not so mild conservative islamists, and (sometimes radical) leftists. Compared to the 2000-2005 wave of youth movements the current protest movements can be equally romantic, but they are less organised, with no chain of command, no training, and ultimately more fluid. This is sometimes a weakness (only the Muslim Bortherhood seemed organised enough to provide the public good of  crowd management during the protests in Egypt). But it is also partly a strength since they are also more inclusive and more open to people that are not urban middle-class kids and their social base is ultimately larger. This also makes them more dangerous to the regimes. Mubarak could outdo Kefaya, but not the fuzzier and less organised coalition without a name that took to the streets this year.

Seen from Ukraine, Moldova or most of the new EU member states one of the most irritating aspects of the European neighbourhood policy is that it dumps together the Southern and the Eastern neighbours of the EU. The Eastern neighbours tend to be rather arrogant about the Mediterannean neighbours of the EU. The argument goes that you cannot approach ‘European’ neighbours of the EU and ‘neighbours of Europe’ like Morocco or Syria through the same policy lenses; the East is culturally European and some would like to join the EU (Ukraine, Moldova and Georgia), whereas the South is civilisationally different and has no aspirations of EU membership etc.

Overall, I agree with the argument for differentiation. I do believe EU’s neighbourhood policy can only be effective if it approaches each of its neighbours individually, and that there can be no similar policy prescriptions to Moldova, Tunisia, Georgia, Egypt and Ukraine. This being sad, however, the debates on East vs South debates in the ENP miss two big points.

First, the negative effects of having a single policy framework, called ENP, for Morocco and Ukraine are overblown. Insufficient reforms, not differentiation is the real issue. In real life there is little Ukraine or Georgia did not get, because Morocco or Lebanon are also part of the ENP. (In a similar vein think of Croatia that is part of the same policy Stabilisation and Association framework as Albania, but is far ahead in terms of EU accession). I cannot remember a single issue where the EU would say: ‘Hang on, we cannot give this to Ukraine because Lebanon is also part of the ENP.’ And there have been dozens of times when the EU or its member states said: ‘Hang on, we cannot give this to the Eastern partner X or Y because they are not implementing the necessary reforms’ or ‘because we do not want further enlargement’ or because ‘this would create problems with Russia’. None of these reasons had anything to do with the Southern neighbours. To put it in other words, Ukraine did not get an offer of EU membership or a visa free regime with the EU not because Morocco is also part of the ENP but for entirely different reasons – Ukraine’s political mess and non-reformism, coupled with EU’s enlargement fatigue and the series of institutional crises in the EU.

Actually the real problem with differentiation lies not in the Eastern vs Southern dimension, but among the Eastern neighbours themselves (and this includes Russia). Very often if the EU is in theory ready to give something to country X, but then there is huge pressure to give it to countries Y and Z as well, and the EU ends up not giving anything to anybody, in order not to create precedents. I have personally heard the leader of an EU member state who is generally sceptical of enlargement saying that ‘If it was only for Moldova, the EU would give Moldova an EU accession perspective tomorrow [Moldova is too small to matter and easy to swallow -n.a.], but there is Ukraine… and we cannot give this to Ukraine, nor can we treat the two differently’. There are also plenty of cases where insufficient differentiation among the Eastern neighbours is much more of an issue than insufficient differentiation between the Southern and Eastern neighbours.

Second, the arrogance of the Eastern neighbours is also less justified than a few years ago. Most of the Eastern neighbours have already consolidated or are rapidly consolidating centralised political regimes, coupled with oligarchic and pretty corrupt economic systems. In real life Morocco is often more reformist (though not more democratic) and Lebanon is more pluralist than many of EU’s eastern neighbours. And this was even before decision-makers in the EU started to stake their hopes on successful consolidation of political pluralism in Tunisia.

The zeal with which the argument for delinking the Southern and Eastern neighbourhoods is perhaps understandable, but largely misses the point. Real differentiation is achieved through reforms, not branding.

Coming up with coherent EU responses to today’s ‘revolutions’ is more difficult. The problem for the EU is not so much the lack of visibility, but the lack of a clear-cut position with which to be visible. Back in 2003-2005, EU’s sympathies were clear (though not always as explicitly articulated at revolutionaries wanted it), but now the EU is struck by the scale of events and is mainly stuck on the fence. As Daniel Korski asks: “Should the EU back the protests, support what has been a friendly regime or sit uncomfortably on the fence?”

The fence-sitting moment (for many it is a ‘fence-sitting eternity’) is something which comes up at every single revolutionary situation the EU is supposed to have a view on. It is always uncomfortable, but sometimes it is easier to choose sides than other. Responding to Belarus’ suppression of post-election protests last December was relatively ‘easy’. It might not be effective, but there was no room for fence-sitting, and the EU was practically pre-determined to reimpose sanctions on Lukashenko and his cronies. Of course this was tried before and hasn’t worked. But what else can the EU do? After years of sanctions since the late 90s, the EU tried to engage with Lukashenko for the last few years, but engagement was pushed aside by the repression of post-electoral protests. To a certain extent, the new set of sanctions are not introduced to change Lukashenko, but for EU’s peace of mind and modicum of self-respect. So the EU policy on Belarus came full circle – sanctions, then engagement and now sanctions again. Nothing worked in the end. (Though engagement seemed to bring some moderate progress, which proved unsustainable however.)

But Albania, Tunisia and Egypt are much more complicated when it comes to having coherent reactions and choosing on which side of the fence to put the EU. The reasons are many-fold. To begin with, the EU is relatively disappointed  with the value and sustainability of coloured revolutions. Mostly because of Ukraine’s Orange failure (see the blog post on ‘Ukraine fatigue’), but Lebanon (which just saw Hariri Jr ousted and a Hezbollah-backed prime-minister brought in) has hardly been a success story. Georgia has been a decent success in terms of reforms, but the 2008 war have tarnished its reputation and fueled ‘Georgia fatigue’ in the EU and US. Either way the EU burned its fingers on having high hopes in successful revolutionary mid-term outcomes in the neighbourhood. Add to that an Obama administration that seems to have a preference for realist-type engagements. And a general and increasing lack of self-confidence in the West because of the ‘rise of the rest’. What you get out of this is a mix of extreme caution and counter-revolutionary instincts in both the EU and the US.

Then, if you go through the latest set of revolutions country by country, the choices are even tougher. Albania has an EU accession perspective and has just received the possibility of visa-free travel to the EU, supposedly for structural reforms in the law-enforcement sector. So the Albanian government is supposed to be a respectable, democratic partner of the EU. You cannot treat it like Kuchma’s Ukraine or Shevardnadze’ Georgia. But then 3 people were left dead in Albania during the latest riots, the government’s legitimacy is seriously questioned, the country seems to be in a process of self-destruction, and the crisis is not over yet, even if all the media attention is on Egypt now. But the EU still cannot jump off its fence, because a legitimate question is how on earth did Albania get a visa-free regime just 3 months ago if the governments is so bad?

Tunisia, an authoritarian, but reformist state in the Southern neighbourhood also presented the EU with a set of hard choices. Tunisia was one of those cases where the EU was confused when it came to taking attitudes towards their reformism/democracy performance.  Still, Tunisia benefited from a lot of EU support. In the World Bank’s Cost of Doing Business index Tunisia was ahead of Croatia and Montenegro (but in the Press Freedom it was behind Lybia and Uzbekistan). Anyway, Tunisia was small, geopolitically not-so-important and Islamists were not a first-order issue. So EU’s fence sitting for most of the revolution had relatively limited costs. But Egypt is of an entirely different magnitude.

Egypt has a rather institutionalised, deep-rooted Islamist opposition network – the Muslim Brotherhood (which Tunisia never had). It is also an indispensable ally and cool-head in the whole Israel-Palestine set of issues. The choice in Egypt is much more difficult than choosing to support Yushchenko vs Kuchma, or ‘whoever’ against Lukashenko. Finding yourself on the wrong side of the fence in Egypt has huge implications for all kinds of issues – from Israel to how the EU is seen throughout the Muslim world and among European Muslims. The problem though is that there is no fence in Egypt to sit on. The revolutionary logic of such situations is that you can only be with or against the revolutionaries. Sitting on the fence equals opposing the street. And this is what the EU might increasingly become associated with, as it thinks is sits on the fence.

In a sense, the 90s was a simpler world in which Meciar, Tudjman or Milosevic were undemocratic and non-reformist; whereas Dzurinda, Mesic, and Djindjic were both reformist and democratic. The good and the bad guys were obvious; the black was clearly distinguishable from the white. And the EU’s approach to these governments was shaped by this unbreakable link between reformism and democracy.

But it seems that the Eastern neighbourhood is different. There is much more grey than black and white. Categorising the likes of Yuschenko, Timoshenko, Saakashvili, Putin and Medvedev is more difficult. The link between being reformist and being democratic is much more blurred. Some are reformist, but less democratic; some are more democratic, but less reformist; and some are neither reformist, nor democratic.

Think of the following examples. ‘Orange Ukraine’ in 2005-2010 was the most democratic post-Soviet state with a vibrant media, lively parliament and vociferous opposition. But it was hardly reformist. Few deep reforms were even tried, let alone successfully implemented. The successive governments either did not want or could not fight corruption and try to reform state institutions like the police or customs. The elites were too divided. This prevented political monopolisation, but also made it too difficult to push for reforms which were not backed by a large political consensus. What made Ukraine democratic, also made it non-reformist.

Georgia was the opposite of Ukraine. It has been the most reformist state in the post-Soviet state in the last 20 years. The state budget increased something like 20 times since Saakashvili came to power in 2004. The sources of increased revenues were the fight against corruption, radically improved tax collection, and significant inflows of foreign investments (due to the cutting of red tape, improvement of business climate, and persistent courting of foreign investors).  The police has been reformed and corruption drastically reduced. Georgian police is amazingly efficient and non-corrupt by post-Soviet standards (even though it can be quite politicised). Georgia is also in the top of the costs of doing business ranking of the World Bank. No other post-Soviet state (the Baltics aside) have managed to modernise from such a low base as successfully as Georgia did.

But Georgia’s achievements on the democratic front have been less clear-cut. Politics is monopolised,  the opposition is virtually absent from the parliament; it is often vilified and sometimes harassed (though parts, but not all, of the opposition have also had questionable dealings with foreign intelligence, exiled oligarchs and allegedly prepared coup d’etats).  The media is less free than a few years ago. There are fewer ‘independent’ or ‘opposition’ TV channels. Certainly, the November 2007 events (police clashes with protesters left 500 people wounded and the police smashed the Imedi TV station) have not re-occurred. The government kind of learned the lessons. In spring 2009 protesters blocked Tbilisi city centre for months in a row almost without any incident with the police. A visible improvement from 2007. But then the situation has not reverted to the pre-2007 status quo ante either. There has been no visible worsening of the democratic situation in Georgia,  but no visible improvement either. And there is also wide-spread talk of Saakashvili continuing as a prime-minister after his term expires in 2013 (under a revamped constitution that beefs up the PM’s powers).  So Georgia seems to be a clear cut case of a state that is reformist, but less pluralist than ‘Orange Ukraine’.

Whereas divided politics made Ukraine pluralist, but too divided to implement difficult reforms; Georgia’s single-party government with large popular support is strong enough to push for reforms, but there are fewer checks on it and less space for political pluralism. (The international ratings capture this. Georgia’s is 12th in the World Bank’s Cost of Doing Business ranking (proxy indicator for reformism), and Ukraine is 147th. But in the Ecomomist Democracy Index Georgia is 103rd when it comes to democracy, and Ukraine at 67th place (before Yanukovich I assume) scored better than Montenegro.)

In the end the EU is quite dissapointed with with both – Ukraine’s democratic non-reformism, as well as with Georgia’s semi-democratic reformism. The EU developed a ‘Georgia fatigue’ and a ‘Ukraine fatigue’, ie became disappointed and uninterested. The one country that so far managed to avoid such EU fatigue is MOldova. It even provokes visible levels of EU enthusiasm. It is because is managed to be as pluralist as Orange Ukraine, but also more reformist. International ratings capture this. Moldova is 90th place in the Costs of Doing Business, and 65th in the Democracy Index (on a par with Serbia). Less reformist, but more democratic than Georgia; more reformist and similarly democratic to Orange Ukraine. But maintaining this reputation and continuing to improve its ‘reformist’ credentials will still be very hard work.

This disconnect between democracy and reformism is not unusual. Think of ideas such as ‘enlightened authoritarianism’ or ‘the Singapore model’. They both imply reformism without democracy. Also think of the ‘reformist’ Morocco, and ‘pluralist’, ‘divided’, but often politically stuck, Lebanon.

But this disconnect between ‘reformism’ and ‘democracy’ still creates problems for how the EU thinks of its neighbours and how it designs policies that aim at rewarding ‘progress’. Most of the EU hopes to see its Eastern partners  being both democratic and reformist. But this might be a bit too much to expect. The EU should probably lower the expectations bar and accept that having either ‘reformism’ or ‘pluralism’ are already good achievements that deserve more support, not ‘fatigue’. At the end of the day most other EU neighbours are neither reformist, nor democratic. Both East and South.

PS: All this being said, I do not believe in the model of undemocratic reformism in the Eastern neighbourhood. I do not buy the argument that ‘authoritarian modernisation’ China-style is something that should or could be emulated in the EU’s neighbourhood. Too many authoritarian states extol the ‘Chinese modernisation’ argument domestically or internationally, explicitly or implicitly, to explain their non-democratic non-reformism. Perhaps ‘authoritarian modernisation’ is a model that has succeeded in a number of cases (Singapore, China, South Korea), but in 90% of the cases authoritarianism is used to crush decent and benefit from corruption, rather than modernise. Most of EU’s neighbours fall in those 90 percent of non-democratic non-reformists, and are likely to do so for the foreseeable future.

At the beginning of this year Armenia became the first country of the Eastern neighbourhood where the EU deployed a mission of eight advisers across a whole set of state institutions. Because the project was considered a success the EU is about to send an additional six persons.

Initially EU’s political ambitions were relatively high – it wanted to send not just technical advisors to line ministries, but also the presidency and the office of the prime-minister. This was scaled back, though, after Armenia backtracked due to alleged concerns by Russia that the EU is too intrusive. And it was not clear anyway how much ‘political’ advice Armenia wanted, since its politics remain more autocratic than that of Ukraine, Moldova or Georgia.

The end result is that most EU advisors are technical experts working in the ombudsman’s office, ministry of economy, ministry of finance (one working on customs, and another on fiscal policies), and the foreign ministry (helping the ministry to set up a diplomatic academy). The recently announced extension of the team should include a deputy team leader, a communications officer and more advisors to the ministry of finance (on tax audits) and economy (one on intellectual property rights; another on  on sanytary and phyto-sanitary standards; and a third one on barriers to trade).

Even though the official name of the EU mission has the pompous name of “High-level EU advisory group” – neither the EU, nor Armenia boast about it. Both keep a low-profile.

A Russian proverb says that if you advance quietly, you make it further (“tishe edesh, dalshe budesh”). It might be, or might not be, the case of Armenia. Its politics is very centralised and in terms of values it is much further away from the EU than Ukraine, Moldova and partly Georgia. I also see no progress in the investigation of the post-election violence of March 2008 which left at least 10 persons dead. And anyway, so far Armenia seems more systematic in attracting European expertise to promote some reforms than the much noisier pro-Europeans like Ukraine and Moldova (Georgia is full of advisors from the US and some EU member states). Another friend of mine, Jana Kobzova, says that “Ukraine and Moldova have democracy, but no governance; while Belarus has better governance, but not democracy”. Seems like Armenia might fit into the second category – less democracy, but better governance.

OFFTOPIC: A fact I find interesting (and suprising) about Armenia is that Belgium and Russia have roughly the same share of Armenia’s foreign trade. Russia is a strategic ally of Armenia and is geographically close. And Belgium’s position vis-a-vis the South Caucasus… no need to explain. Though the explanation is that Armenia is processing diamonds for Antwerpen’s diamond industry.

Behind this carefully calibrated phrase lies the story of EU’s failure to engage in conflict-resolution. In late 2004 Russia vetoed the extension of the mandate of the 150-strong  OSCE border monitoring mission in Georgia. Tbilisi invited the EU to take over the international monitoring of the Georgia-Russian border. Back in 2005 France (which later lead the peacekeeping effort in 2008) lead the ‘Nyet’ camp with the diplomatic support of Spain, Italy, Greece and partly Germany against EU involvement in the messy Caucasian affairs. As a result of that, instead of the requested 150 monitors, the EU only sent 3 persons as part of a so-called EU Special Representative’s Border Support Team. The team was later extended to 12 persons. This clearly was the most important EU failure to deploy conflict-prevention mechanisms in Georgia and engage in conflict-settlement.

School in Kemerti, north of Tskhinvali, rebuild by the OSCE with EU money (04.2008).

Throughout 2007-2008 the EU also tried to beef-up the team with two police and two border-liaison officers who were supposed to develop some kind of institutionalised dialogue with Abkhazia and South Ossetia on police and border-management related issues. Internal foot-dragging by some EU member states worried that this would irritate Russia (with Greece apparently taking the lead), and then the August 2008 war disrupted the process of extending the EU border support team.

In parallel to that, the EU spent over EUR 30 million before 2008 on post-conflict reconstruction around the conflict zones of Abkhazia and South Ossetia, but failed to have a political and security strategy vis-a-vis these conflicts. Now, for example many, if not most, of the schools built in South Ossetia on EU money lie in ruins. This is what happens when throwing money at conflict zones is not backed up by political strategies. (At a much larger scale the dilemma is the same in Afghanistan and Iraq where building infrastructure or providing electricity is of little use if you do not ensure security).

Railway station in Tskhinvali rebuilt with EU money. Even before the war there were no rail tracks so the station was useless.

It is perhaps difficult to speculate now, but I am almost sure that if there was a strong international presence on the ground (read an EU monitoring mission) before the war, the chances chances of war would have been drastically reduced. And this is not benefit of hindsight. This is what many people (including in the EU institutions) said for years in the run up to the war.

In the end, the EU paid twice. Having failed to deploy 150 monitors in Georgia in 2005 in order not to irritate Russia, the EU ended up deploying close to 300 monitors in 2008 and paying close to EUR 1 billion to the international fund for post-conflict rehabilitation of Georgia. The war of 2008 became one of the worst crisis in EU-Russia relations since the end of the Cold War.

The lessons is the same any book or EU document on conflict prevention tell you – preventing is cheaper and better than managing the consequences of a conflict. The European security strategy also says that the EU “should be ready to act before a crisis occurs. Conflict prevention and threat prevention cannot start too early.” The more concrete lessons though are the following:

• “Not irritating Russia” is not a policy. Security crises in the neighbourhood such as Georgia end up worsening EU relations with both Russia and its neighbours. The EU has to do what it takes to contribute to stability in the neighbourhood, hence creating the basis for good relations with Russia and the Eastern partnership states as well. Ignoring conflicts makes matters worse for everyone. Conflicts need to be managed and prevented, and “avoiding irritation” is a poor excuse for inaction.
• It is late to pursue conflict prevention on Georgia, but it is not late to do that in Nagorno-Karabkh, Transnistria and Crimea. In the last two there is little danger of war, and EU’s preferred strategies of conflict-prevention through socio-economic instruments are just the right thing to do.
• On Georgia: the EU monitoring mission will have to stay engaged for the long term. International peacekeepers have been deployed in Cyprus for 35 years leaving room for wounds to heel and bonna fidae negotiations to be conducted.

Among the more interesting results are (see page 35 of this opinion poll):

• Georgia comes first in pro-EU sentiment  with 36% being in favour of integration with the EU. But it also comes first in pro-independence sentiment with 48% (not willing to join any integrationist blocks). Unsurprisingly only 3% want integration into a Russian-led Union.
• Moldova comes second in pro-EU sentiment with 33% in favour of joining the EU (with 26% in favour of joining a Russian-led union). Among the post-Soviet states, Moldova also has the lowest degree of support for its own ‘full independence’ (20%).
• In Belarus, interestingly enough 23% want integration with Russia, while 20% want integration into the EU (and 28% want full independence). It is almost suprising that almost as the number of Belarussians that want integration into the EU and integration with Russia is almost equal.
• In Ukraine – 20% want integration into the EU and 34% integration into a Russia-Ukraine-Belarus-Kazakhstan union (and 12% back into the USSR), while 23% want full ‘nezalezhnost’ (independence).
• In Russia 36% don’t want any integration with other states or groups oif states, while 20% want the restoration of USSR and 15% want a union with Belarus, Ukraine and Kazahstan. Thus Russia itself is split between a go-it-alone attitude and a desire to reintegrate some of its former periphery.
• Perhaps surprisingly, in Latvia (and EU member state) only 31% want integration into the EU (10% integration with Russia) and 35% want full independence. Thus pro-EU sentiment in Latvia is lower than in Georgia and Moldova.

UPDATE: As the comments below attest – this poll is neither uncontroversial, not uncotested. The reason I put it on this blog is because I think many in the EU are hubristic abouts EU’s soft power. Way too many think EU’s power of attraction and magnetism works almost automatically, and the EU will transform its neighbours almost by default, simply because the EU attractive, it provides the best way of organising international relations and its successes are uncontested. Unfortunately, this is not so. The EU will have to invest much more political will and resources into its foreign policy if it really wants to shape its neighbourhood and the world at large. The hubris of soft power is not a good recipe for an effective foreign policy. I believe the EU is the best model of organising international relations, but its soft power is not automatic and good models do not always win.

UPDATE 2: The numbers on the foreign policy orientation of Ukraine have raised some controversy. I was not analysing Ukraine’s public opinion, but one specific opinion poll. However, it is fair to supply more data on Ukraine. After some digging – here is more data on Ukraine’s public opinion on the foreign policy orientation of the country. The Razumkov centre supplies the following:

Question 1: Does Ukraine need to join the European Union?

• Yes – 43% in December 2008 (compared to 65% in 2002, 0r 54% in 2007).
• No – 35% in 2008 (compared to 14% in 2002 and 29 in 2007)

Question 2: which foreign policy direction should be a priority for Ukraine (Russia, EU, USA, CIS)?

• in favour of the EU – 27.5% (compared to 39% in 2005)
• in favour of Russia 51% (compared to 34 in 2005)

If you add the attitudes towards NATO it seems like Ukrainian public opinion is less enthusiastic about both NATO and EU than in was in 2002-2003-2005.

If you ask me, I would also consider the Razumkov Centre opinion polls more reliable than the Eurasia monitor.

on Moldova:  if the question is “are you in favour of joining the EU?” – 72% are in favour (IPP poll, March 2009)

Scott Pegg launched the debate on de facto states with a book published over a decade ago. He referred mainly to North Cyprus, Taiwan, Somaliland, and Tamil Eelam. Dov Lynch took the debate into the post-Soviet space with his book on the “Engaging Eurasia’s Separatist States: Unresolved Conflicts and De Facto States”. The argument in both books is that secessionist regions which control a more or less well-defined territory, population and have a set of state-like institutions can be termed as “de facto states”. They are unrecognised, but de facto independent.

The truth is of course more complicated because most “de facto” states have always relied on various levels of external support to ensure their security and/or economic development (think of Taiwan, North Cyprus or Abkhazia). So the term has always been relative. Abkhazia, South Ossetia and Transnistria have outsourced a large chunk of their de facto independence to Russia: their borders have been de facto guarded by Russian peacekeepers, the Russian rouble was the official currency of Abkhazia and South Ossetia (Transnistria has its own currency), some functions in the de facto governments (especially in South Ossetia) have been outsourced to Russia etc. There has always a large degree of “de facto integration” of Abkhazia and South Ossetia into Russia which was limiting their claims of being “de facto independent”. And still they were accepted by most analysts as “de facto states”. But the Russian recognition of Abkhazia and South Ossetia’s independence is accelerating the loss of their “de facto independence” if not by will, then by default.

The paradox is that until August 2008 Abkhazia and South Ossetia were unrecognised, but de facto independent; after August 2008 they became partly recognised, but not de facto independent anymore. If the secessionist wars of 1992-1993 were their “wars for independence”, the August 2008 war is becoming the war that marked the loss of (their however limited) “de facto independence”. The 2008 was won by Russia, not the secessionist entities. Both Abkhazia and South Ossetia are quickly evolving from being “de facto states” to becoming “de facto Russian regions”. Most South Ossetians welcome that, but the Abkhaz are more ambivalent (for those who understand Russian see the photo of an article from an Abkhaz newspaper a month ago). For example a recent statement by Abkhaz opposition activists argues that “all the functions that ensure the sovereignty and independence of our state are ceded to an external party.” One can agree or nor with such a statement, but such a debate in Abkhazia is taking place. Either way, the trend towards de facto integration into Russia is near inevitable and near irreversible, for at least a couple of decades.

All the regional actors willingly or unwillingly contribute to this. Russia feels comfortable being the only gate to the world for the secessionist entities. It vetoed and expelled the OSCE mission from South Ossetia and the UN mission from Abkhazia, which will certainly contribute to their greater isolation. Georgia, at its turn, is also contributing to the greater isolation of the secessionist entities through its “law on occupied territories“. Georgian policies only increase the reliance of the secessionist entities on Russia. As for the EU, there are more and more cases of EU member states refusing visas to residents of Abkhazia. But Abkhazia and South Ossetia also contribute to their own self-isolation by refusing many international contacts for symbolic reasons (such as refusing to let the EU Monitoring Mission on their territories, or refusing to meet EU ambassadors to Georgia because they are ambassadors “to Georgia”). Such trends are hardly in the long-term interest of any of the actors in the conflict,  but they are the result of previous policy choices made by all these actors themselves.