By Erik Davtyan (15/10/2014 issue of the CACI Analyst)

On September 16, Armenia’s Foreign Minister Edward Nalbandian received James Warlick, the U.S. co-chair of the OSCE Minsk Group. The last meeting with co-chairs in Armenia took place on May 16, 2014 in the framework of a regional visit to the South Caucasus. Nalbandian and Warlick exchanged views on issues raised at the September 4 meeting between the presidents of Armenia and Azerbaijan in Newport, on the initiative of U.S. Secretary of State John Kerry. They also emphasized the importance of the upcoming Paris meeting between Presidents Sargsyan and Aliyev, due to take place in October on the initiative of French President François Hollande.

Presenting the aim of the visit at his press conference at the U.S. Embassy in Armenia, Warlick said it “aims at continuing the discussions which took place during the trilateral meeting in Wales between the Armenian and Azerbaijani presidents and U.S. Secretary of State John Kerry.” Characterizing the Wales meeting as “fruitful and sincere,” the U.S. co-chair stated that the actual negotiations should be held at some other level. Instead of organizing random meetings between the presidents or ministers of foreign affairs of Armenia and Azerbaijan, the parties should launch an official negotiating process which will surely be welcomed by the OSCE Minsk Group co-chairs.

Warlick’s visit to Armenia was also remarkable for his exclusive interview to Yerkir Media TV on September 16. Presenting his viewpoint on the issue of Nagorno-Karabakh, the U.S. co-chair said that “the voice of the de facto authorities of Nagorno-Karabakh should be heard and that is why the co-chairs travel there on a regular basis and meet with the de facto authorities.” This was in fact a rare statement coming from a co-chair, because it emphasized the role of the Nagorno-Karabakh authorities in the resolution process.

Commenting on the current activity of the OSCE Minsk Group co-chairs, Kayts Minasyan, an analyst at the Center of Strategic Studies of France, underlined the fact that Warlick came to the South Caucasus without his French and Russian counterparts, a move stipulated by the tense relations between Russia and the West. During a press conference, the head of the “Modus Vivendi” center Ara Papian said that Warlick’s statement on the upcoming regulation of the Karabakh negotiation process was merely “a diplomatic wish, rather than reality,” because the parties are far from resolving the conflict. The vice-president of the Caucasus Institute, Sergey Minasyan, shared the view that the format of meetings between the presidents of Armenia and Azerbaijan may yield some progress not in the negotiating process per se, but in “setting some mechanisms of influence along the line of contact.” Likewise, Armenian MP Sukias Avetisyan stressed the importance of organizing regular meetings at the presidential level.

According to a public opinion poll organized by the Z-PR poll center, 64 percent of the population in Yerevan believes that the visit of the U.S.co-chair will only contribute to initiating new meetings at the presidential level, while 21 percent think the recent activation of the regulation process is a consequence of the increasing international tension. The remaining 15 percent believes that the U.S. is seeking to keep the Nagorno-Karabakh negotiation process very active, even causing unexpected developments.

The intense activity of the OSCE Minsk Group co-chairs in September was also a consequence of recent negotiations between the Armenian and Azerbaijani foreign ministers, which took place on the sidelines of the UN General Assembly’s 69th session in New York. The ministers had an extended meeting with Warlick and his Russian and French colleagues, Igor Popov and Pierre Andrieu, along with Ambassador Andrzej Kasprzyk, the personal representative of the OSCE chairperson-in-office. After discussing the details of the upcoming meeting between Sargsyan and Aliyev, foreign ministers Nalbandian and Mammadyarov held talks in a tête-à-tête format, concerning predominantly the regulation process of the Nagorno-Karabakh conflict. The Nalbandian-Mammadyarov talks, as the U.S. co-chair emphasized, “were conducted in a constructive atmosphere.” Later, the co-chairs had a meeting with the OSCE Chairperson-in-Office (CiO), Didier Burkhalter, and discussed the latest developments in the peace process, hoping that the presidential meeting in Paris will be productive.

By Oleg Salimov (10/01/2014 issue of the CACI Analyst)

Tajikistan’s President Rakhmon met with China’s leader Xi Jinping right after the recent SCO summit in Dushanbe. It was Jinping’s first visit to Tajikistan. The official meeting concluded in the signing of 16 contracts and agreements on cooperation. In general, the agreements and contracts covered three major areas, such as economy, agriculture, and banking. The leaders also signed separate agreements on extradition and exchange of convicted persons.  The connotation of the official visit is a continuation of China’s political and economic expansion in Tajikistan.

Tajikistan’s major financial achievement in the meeting between Rakhmon and Jinping was securing a grant for trade and technology development in the amount of RMB 300 million (approximately US$ 49 million) and the approval of lax export credit from China’s Ministry of Trade (the amount is yet to be announced). The RMB 300 million grant is the second non-repayable financial aid to Tajikistan after a similar RMB 150 million grant provided in 2012 by China’s then leader Hu Jintao to Tajikistan during Rakhmon’s official visit to Beijing.

According to Tajikistan’s Ministry of Economic Development, the amount of China’s total credit to Tajikistan exceeds US$ 800 million. The latest agreement between Tajikistan’s government and China’s Export – Import Bank foresees the prospect of a US$ 400 million credit from China for various developmental projects in Tajikistan. In providing development and consumer credits to Tajikistan, China pursues its own economic goals of finding and supplying new markets. The previous lax credits from China were primarily aimed at developing transportation connections between Tajikistan and China. Thus, the road from Dushanbe in Tajikistan to the Xinjiang Uighur autonomous region in China allowed for an increase in the export of Chinese goods to Tajikistan. The recent approval of lax export credit to Tajikistan is a predictable step intended to increase China’s exports even further.

In turn, Tajikistan falls greatly behind in trade turnover with China. According to Tajikistan’s Statistics Agency, the China-Tajikistan trade in 2013 reached a record US$ 682 million, with China’s share amounting to US$ 595.7 million and Tajikistan’s to only US$ 86.3 million. Tajikistan’s production industry also suffers from unbalanced trade with China. Raw materials such as aluminum, cotton, and leather are the primary export items from Tajikistan to China, whereas ready products, goods, and equipment are the main importing categories from China. This significantly undermines Tajik light and textile industry.

During his visit, Jinping announced the official construction start of Tajikistan’s part of the Central Asia – China gas pipeline. This is the fourth branch of a massive system of gas pipelines designed to supply China with natural gas from Turkmenistan. The construction agreement for the fourth branch was signed on September 12, 2013, in Bishkek at the SCO summit.

The two first branches go through Kazakhstan and Uzbekistan and deliver 69 billion cubic meters of natural gas annually (bcm/y). The third branch went into service in May 2014. It was constructed alongside the first two with a projected capability of 25 bcm/y. The fourth branch will transit 25 bcm/y from Turkmenistan to China through Tajikistan. The total length of the pipeline which also passes the territory of Uzbekistan and Kyrgyzstan is 3,700 kilometers. The length of Tajikistan’s part is 400 kilometers. China is the primary investor, constructor, and consumer of the project.

According to Saidakhmad Sharofiddinov, the head of Tajiktransgas (a state company representing Tajikistan in the project), there is no immediate plans of importing Turkmen natural gas to Tajikistan although the country desperately needs gas for its industrial and residential consumer purposes. The completion of the pipeline is expected in 2016. Putting high hopes on the pipeline, Tajikistan cherishes the idea of constructing a railroad alongside the pipeline. The realization of this idea will completely depend on China’s willingness to invest in it as Tajikistan lacks financial, technological, and other capabilities to initiate the project. 

As expected, the meeting between Rakhmon and Jinping in its form and content repeated the previous meetings of Tajik and Chinese leaders. China continues its aggressive expansion in Tajikistan’s economy through credits and grants, which serve China’s needs while simultaneously suppressing the political will of Tajikistan’s government who sees no other alternatives to China’s financial aid and investment. The presumable development of Tajikistan’s energy sector is another backdrop for the country’s economy as its industrial complex has become a passive observer in a China – Tajikistan project with China supplying material, equipment, and even the workforce for constructing energy infrastructure for its own consumption. The reluctance of Tajikistan’s government to recognize China’s one-sided approach in their bilateral relationship is increasingly hollowing out Tajikistan’s political and economic independence.

By Eka Janashia (10/01/2014 issue of the CACI Analyst)

A dispute between Georgia’s President Giorgi Margvelashvili and Prime Minister Irakli Gharibashvili gained momentum in mid-September, as both the head of state and the head of government decided to attend the September 23 Climate Summit at the UN headquarters in New York.

PM Gharibashvili declared his intention to participate September’s UN General Debates in July. Meanwhile the President’s office declared that Margvelashvili received a personal invitation from the UN Secretary General Ban Ki-moon though the Ministry of Foreign Affairs (MFA) withheld the letter.

Deputy Foreign Minister David Zalkaniani later explained that the UN invitation was initially mistakenly addressed to former President Mikheil Saakashvili and the MFA had to resend it, causing the delay. To verify their respective versions, both sides disclosed their correspondence while Georgia came close to the diplomatic embarrassment of sending two simultaneous delegations to the UN.

Finally, Margvelashvili was dissuaded from attending the UN Summit. Commenting on the outcome, he said that “serious, organized efforts were undertaken against the visit of the Georgian President and as a result of these efforts the visit to the United States is thwarted.”

The embarrassing episode was not the first sign of discord between Margvelashvili and the leadership of the Georgian Dream (GD) coalition in general, and between the president and PM in particular.

According to former PM Ivanishvili, the disagreement started with Margvelashvili’s decision to use the glass-dome presidential palace constructed during Saakashvili’s presidency and, in Ivanishvili’s words, associated with “violence, evil and indecency” (See the 04/02/2014 issue of the CACI Analyst). Margvelashvili, however, claimed that the tensions stemmed from the ruling coalition’s attempts to make him an “obedient” figure complying with the instructions of GD and the PM.

Another spat took place ahead of Georgia’s signing of the Association Agreement (AA) with the EU in June. The question of who would sign the AA became a subject of heated debate among constitutionalists, politicians, analysts and even ordinary people. Margvelashvili expressed his readiness to delegate his right to sign the treaty to the PM but the latter argued that Georgian constitution grants him sufficient competence to sing the agreement. Although most lawyers maintained that the AA should be signed by the president, it was the PM who signed it and the president was not even invited for the AA’s ratification ceremony in the parliament.

On August 1, Gharibashvili did not attend a session of the National Security Council (NSC) presided by Margvelashvili. The meeting was intended to discuss Georgia’s preparation for the upcoming NATO summit in Wales. Notably, the role of the NSC itself has been marginalized since November 2013 when the PM formed the Security and Crisis Management Council partially duplicating the NSC’s functions. On the same day, the GD parliamentary majority voted against the president’s Supreme Court judge nominees.

Several days later, the Prosecutor’s Office lamented that despite its request, Margvelashvili did not declassify a portion of the 2009-2013 spending records from the Special State Protection Service (SSPS). Part of those secret documents were publicized in April 2013. Another part, falling under President Margvelashvili’s competence, remained confidential.

Margvelashvili responded that he is empowered to contemplate sensitive matters such as declassification of secret information as long as the law allows him to do so and that no one can pressure him to do otherwise.

Some analysts suggest that vague and implicit clauses of the amended Georgian constitution, which came into force in 2013, fueled the conflict between the head of state and the head of government. Clause 69, paragraph 2 of the Georgian constitution states that “the president represents Georgia in foreign relations.” Nevertheless, clause 78, paragraph 1.4 entitles this competence to the PM as well, saying that the “prime minister … represent[s] Georgia in foreign relations within his competence” and meanwhile charges the cabinet with the responsibility to implement foreign policy. These clauses of the current constitution are likely to prompt confrontation rather than clarifying responsibilities.

However, the true reason for the disagreement between the president and PM likely has little to do with disagreements over foreign policy. Both politicians emerged through Ivanishvili’s clout, thanks to the allegiance they proclaimed to him. As Margvelashvili’s loyalty faded, the GD leadership increased pressure on him. As soon as Ivanishvili begun to publicly criticize the president, the PM and other ministers quickly replicated the move. This suggests that political power in Georgia is still concentrated to Ivanishvili’s informal rule.

After months of simmering conflict, it is still not clear whether Margvelashvili will stay within the GD coalition or endeavor his own political game. However, he recently reminded the public that in the case of a political crisis, he retains a right to resign or dismiss the parliament.