BACKGROUND: One and half years after the elections, South Ossetia faces several parallel crises, with budgetary and health care being the most severe. Although both have deep roots and are partly structural, Gagloyev’s government accelerated their onset. The common denominator was the appointment of incompetent and unprepared persons to key positions.

In the local healthcare system, already facing a severe lack of personnel and technical equipment, the new de facto health minister, Agunda Pliyeva, unexpectedly worsened the crisis. Pliyeva, facing a slow collapse of the hospital in Tskhinvali due to long-term brain drain, chose an extraordinarily arrogant and aggressive communication strategy. At the height of the dispute with the remaining medical staff, Pliyeva, contrary to tradition, refused to give any awards on the Day of the Employee of the Healthcare System, saying that not a single employee deserved them.

This attitude led to an additional mass exodus of local doctors to Russia in the summer of 2023. At that point, only one surgeon remained in the Tskhinvali hospital, and the Deputy Minister of the Ministry of Health, Rodion Siukayev, had to take over responsibilities as a second surgeon. The situation led to several deaths from otherwise banal medical conditions, causing widespread anger among local residents.

Kazbek Tsarikayev’s appointment as Finance Minister in April 2023 caused immediate distrust among local activists. Tsarikayev previously served as the Minister of Finance of North Ossetia-Alania, but was dismissed after a year in office due to alleged incompetence. In South Ossetia, Tsarikaev, who received the nickname “Biden” due to his alleged dementia, managed to turn most of the department’s key employees against him in a matter of weeks. Among other things, he moved several high-ranking officials out of their offices to crowded common spaces so that he could set up his own break room in the premises.

However, Gagloyev, advised by the influential head of his administration Alan Dzhioev, ignored their complaints until the de facto Minister of Finance visited Moscow in August. Tsarikaev tried to convince the Russian Ministry of Finance that South Ossetia would run a surplus. At the same time, however, many employees of the local public administration already had their salaries delayed for several months, and sporadic protests appeared in the region. According to local economists, the budget deficit might reach at least 300 million roubles by the end of the 2023. The inspection trip of Russian officials to Tskhinvali revealed serious irregularities, after which it was impossible for Tsarikayev to continue in office. Nevertheless, the damage had already been done.

If Gagloyev’s administration fails to appoint competent cadres as ministers and to negotiate additional financial aid and a concession from Russian demands for government downsizing with Moscow, many families in South Ossetia could find themselves without paychecks during the New Year holidays.

However, Gagloyev’s problem in this regard is that, unlike other de facto presidents, even after one and a half year in office he still lacks both a competent and complete team at home and relevant contacts in the Russian government.

IMPLICATIONS: Gagloyev encountered these two serious problems immediately after taking office. As a candidate few initially counted on, he lacked both a sufficiently large team and connections in Moscow. Gagloyev’s relative Arsen Gagloyev became the apparent key to solving these problems. Arsen, Deputy Head of one Gazprom Department, convinced Alan Gagloyev that he has influential contacts inside the Russian government.

On June 10, 2022, Gagloyev appointed Arsen’s son-in-law, Alan Dzhioev, as the new head of the presidential administration. According to local experts, Arsen Gagloyev and Dzhioev convinced the president that he depended on their skills and contacts and increasingly isolated him from the rest of his team. This trend culminated in June 2023 when the president fired a large part of the cabinet and state administration with ties to de facto Prime Minister Konstantin Dzhussoev – thus undermining his influence.

The June “purges” removed many popular politicians and officials while leaving Dzhioev's extremely unpopular nominees – his relative and Finance Minister Tsarikayev and protégée Health Minister Pliyeva in their posts. The fact that Tsarikayev and Pliyeva have retained their positions despite an unprecedented budget crisis and the de facto collapse of the healthcare system led many residents to believe that Gagloyev has become only a nominal figure in the hands of Arsen Gagloyev and Dzhioev.

This assumption is also confirmed by the fact that Gagloyev took care of Dzhioev and his nominees even after Moscow allegedly began to demand their departure in the context of the deepening crisis in South Ossetia. In October 2023, under pressure from Moscow, Gagloyev initiated another government reshuffle. The president dismissed Tsarikayev shortly before the full impact of the budget crisis and moved Pliyeva to another lucrative position within the health department. According to local experts, Moscow wanted to see the popular and competent Minister of Justice Oleg Gagloyev as the new head of the presidential administration. However, the de facto president decided to install Dzhioev as Minister of Justice and to make him deputy prime minister. At the same time, he moved Oleg Gagloyev to head the newly created Ministry of Labour and Social Protection.

This solution will allow Dzhioev to preserve his prestige and, at the same time, survive the crisis as the head of one of the few functioning departments. Oleg Gagloyev, on the other hand, will get the chance to fail as head of a department with which he has little experience. The changes thus will not resolve the paralysis of Gagloyev’s cabinet but are instead likely to deepen them even more.

As Gagloyev is increasingly perceived as being a passive puppet, unable to fulfil any of his pre-election promises, his supporters are set to fail miserably in the upcoming parliamentary elections notwithstanding the size of Russian financial aid. Although South Ossetia is a de facto presidential republic, the overwhelming victory of the opposition in the elections could lead to a situation in which Gagloyev would have no other option but to resign from his post. This situation could pave the way for Bibilov’s political return.

According to local legislation, a citizen who has been outside the territory of South Ossetia for the past ten years cannot run in early elections. This exludes Bibilov, who lives in the occupied territories of Ukraine, from running. Nevertheless, according to local experts, several loopholes could enable Bibilov’s candidacy. For example, the census will not apply to the former president if he confirms that he studied or received medical treatment in the occupied territories. His candidacy is therefore likely.

CONCLUSIONS: The elimination of relevant opposition candidates for the 2022 elections functioned as a ticking time bomb. While it did not allow Bibilov to win the elections immediately, it put an unprepared cabinet in office, which may not survive the parliamentary elections. It is uncertain whether this strategy will allow the largely unpopular former president to return to power. However, it significantly contributed to the acceleration of the crisis in South Ossetia, which may cripple the de facto republic for years to come.

Although much of the population believes that the local government, not Russia, bears primary responsibility for the crisis, Moscow may face more substantial pressure to help the region this time. Hundreds of ethnic Ossetians fight in Russian ranks in Ukraine, many of them as volunteers. In a situation where several hundred Ossetians have already died in battle, Moscow has a choice between two options. It can pump a significant amount of wartime funds into South Ossetia, or risk a decline in the morale and determination of ethnic Ossetians on the Ukrainian fronts.

AUTHOR'S BIO: Tomáš Baranec is the Founder and Executive Director of the Centre for Black Sea Studies as well as a Research Fellow and Head of the Caucasus Program of the Slovak think tank Strategic Analysis. He currently works as a field researcher on the Georgian-Ossetian ABL. Tomas studied Balkan, Central European and Eurasian Studies at Charles University in Prague.