Why oligarchic capitalism is harmful to Abkhazia | Discussion

The concerns of Abkhazian society regarding large projects, for example the still to be passed “apartment law”, which are being actively lobbied for by President Aslan Bzhania with an eye toward oligarchic money, have become quite apparent.

In the latest episode of the program Conversation, editor of Chegemskaya Pravda, Inal Khashig, discussed with historian and political scientist Astamur Tania why the reliance on major Russian business has not worked and what it means for relations between Sukhumi and Moscow.

Full text of the interview:

Inal Khashig: Good afternoon, this is Chegemskaya Pravda. It’s August and many people are on vacation, but we’re still here. In September, with the return of Parliament from recess, a new political season will begin, including the presidential election campaign. And we have a special guest today—our regular expert, Astamur Tania.

I’ll start by saying that after the president’s failure with the apartment project, he was counting on the support of Parliament, which, according to his calculations, had a majority of supporters. However, despite expectations, these people did not vote for the project, possibly influenced by public opinion or their own view of the situation. As a result, the project was withdrawn.

This is not just about this project—it’s clear that there is tension between the president and Parliament. Given that there are fewer than six months left before the next presidential election, how will these events affect the political landscape of the country?

Parliament often takes on the role of resolving crises caused by the executive branch’s decisions. We have a legally elected president, and state institutions function based on the Constitution.

Astamur Tania: First of all, good afternoon. Secondly, let’s talk about global politics. Given dynamic and numerous subjective factors in our society, it’s difficult to predict anything. Recently, I saw an interview with a government representative who said that the legitimacy of the executive power and the president should not be questioned. However, in my opinion, they are confusing legitimacy with legality. Legitimacy is primarily a socio-psychological assessment of how society perceives and supports power.

It is important to note that we have a legally elected president, and state institutions function based on the Constitution. However, from the point of view of legitimacy, the executive power is losing trust, while the role of Parliament is growing. Parliament often takes on the role of resolving crises caused by the decisions of the executive branch. Thus, there is a redistribution of authority between governing institutions. Unfortunately, we lack a sociological service that could help understand public sentiment and its reaction to the decisions of the authorities.

As a result, we can only measure public sentiment through rallies and protests. This is not such a difficult task—many countries already have institutions that help navigate the socio-political space and check the legitimacy of what is happening. To avoid political manipulation, a simple verification is needed. Even if there is no state service, specialists can be hired to conduct research quickly and effectively, providing a representative sample.

Then both the authorities and the opposition will understand the real situation, including politician ratings. This way, there won’t be just subjective judgments. And, of course, it feels like the support for the authorities is decreasing. This is evident from how the deputies react. They, being connected to their constituents, respond to public opinion. This shows that deputies are expressing the demands of society. 

Opponents of all the bills lobbied by Bzhania are perceived as almost anti-Russian elements.

Inal Khashig: Well, Aslan Bzhania often emphasizes projects that he links with Russia. There have been many rumors and speculations that if we don’t accept them, our relations with Russia will worsen. Starting with Pitsunda, this thesis constantly appeared in discussions, as Moscow’s involvement in the matters was actively lobbied by Bzhania. Although lobbying for these projects continues, nothing significant has happened in relations between Moscow and Sukhum; everything remains quite stable and predictable. I think excessive speculation on this topic has led to this perception.

Opponents of all the bills lobbied by Bzhania are seen almost as anti-Russian elements. Recently, opposition organizations held a roundtable and discussed relations with Russia, emphasizing that there are no political forces in Abkhazia that would pursue an anti-Russian policy. But the question arises as to how interested Moscow is in supporting a particular candidate, such as Bzhania, ahead of the elections. I recall 2004, when Moscow, for reasons unknown to me, supported one candidate—Raul Khajimba—while dismissing the others. Since then, Moscow’s policy has become more flexible. How do you think this flexibility will hold up?

The idea of solving Abkhazia’s problems through oligarchic capital seems to me harmful and unlikely to be realized.

Astamur Tania: It can be assumed that, first of all, lessons were learned from those events. Yes, the situation in relations between Abkhazia and Russia has radically changed. Now it is a state allied with Russia. No political force in Abkhazia questions the advisability of this alliance. I don’t think there are influential forces in Russia expecting any changes in this regard—whoever comes to power in Abkhazia will adhere to this line, as there are no alternatives to it in terms of security or economics. The situation is quite stable. Of course, some politicians are tempted to gain support from the Kremlin. This is reflected in the political space when external forces attempt to influence internal processes. 

But if we look at the agenda proposed by Abkhazian society, including the opposition and its supporters, we can see that recent actions by the authorities have caused dissatisfaction not only among the opposition but also among some members of the intelligentsia and war veterans. They have opposed these decisions based on the traditional agenda for Abkhazian society, which was formed during the Soviet era—defending political rights and demographic issues.

These topics have always been sensitive for Abkhazians. It could be said that the Abkhazian national movement was also created by external forces, but that is absurd. The current authorities include people who were leaders of that national liberation movement. They should compare the agenda of that time with the current agenda of Abkhazian society. 

Therefore, unnecessary tension and political polarization should be avoided. If the authorities say they want to attract investors, for example for apartments, and are counting on large Russian businesses, creating such political instability will only scare away potential investors. They might want to offer tax incentives to large foreign investors, but in Abkhazia, this is uncharted territory. In the end, it results in political instability.

Many people are willing to invest significant capital in Abkhazia, but the idea of solving Abkhazia’s problems through major oligarchic capital seems harmful and unlikely to be realized. It is better to work with smaller players who, for example, are willing to build a hotel or invest in another small project. When you protect the economic interests of one business structure, you push out local businesses, which leads to tension. In Abkhazian conditions, this is not feasible. 

Also, when the legitimacy of the authorities declines, they begin to rely on security forces. However, in Abkhazia, there are unlikely to be many people ready to unconditionally follow any orders from the authorities. When making decisions, you need to consider the characteristics of society and its historical goals. If you go against these goals, it will not be beneficial. So I don’t think any significant political forces in Russia will seriously intervene in these matters. Perhaps there is hope for financial assistance from oligarchs, but this will not be a long-term solution. Of course, one could try to win elections if the opposition is fragmented, but governing under such conditions will be impossible. The authorities must consider the opinion of the people.

Inal Khashig: But, of course, many reacted negatively to President Aslan Bzhania’s interview with Russian media on “Russia 24.” There, he mentioned that the rejection of the law on parliaments, public unrest, and protests are linked to the influence of foreign intelligence agencies. It creates the impression that foreign agents are opposing the president’s will, and that all opposition actions and resistance from civil society are somehow connected to foreign intelligence involvement. What do you think? You were close to many presidents…

Astamur Tania: Not many.

Inal Khashig: Well, to some. Maybe when they reach a certain stage, they lose touch with society? In a small society, when you label half the citizens as agents of foreign intelligence services, it seems like extreme detachment from reality.

In Abkhazia, there is a whole group of people who know how to earn and work. They even organize themselves to defend their rights, like tour guides. Economic activity is growing, and it needs to be supported. Abkhazia should not become a territory for large investors and monopolists.

Astamur Tania: Such statements are noticed by supporters of the current government as well. They do not support such assertions and are not ready for such polarization or to pit themselves against another part of Abkhazian society. In our society, such statements erode connections and go against the traditional structure. Few are willing to support this position. One could count on the fingers of one hand those in the government who think this way. This is clearly a mistaken statement.

I recall how a major businessman came here; on the first day, he was thrilled with Abkhazia, thinking that money could easily be made. But after interacting and getting familiar with the situation, he left without investing anything. He said, “Your lands are worth millions, but you don’t get a penny.” It sounds harsh, but there is some truth to it. Large businesses go where they can get a significant return, and for that, resources and consumers are needed. If they are absent, development will not happen. 

Take the airport project, for example. It’s a good idea, but whom will it serve? And what issues will remain unresolved, besides political and demographic ones? We see that without power generation and treatment facilities, apartments will just burden our economy and energy resources.

I don’t think these projects are realistically feasible. It’s better to work with local investors who are already active in the hospitality and resort business in Abkhazia and support their initiatives. There is a whole group of people in Abkhazia who know how to earn and work. They even organize themselves to defend their rights, like tour guides. Economic activity is growing, and it needs to be supported. 

Abkhazia should not become a territory for large investors and monopolists. Our situation is too unstable. Even if they build apartments and tens of thousands of people move in, it will be a significant challenge. Will we be able to handle it? I don’t know. Our history teaches us caution: Abkhazians went from being a majority to just 17%, and attempts were made to strip them of their political rights. This issue falls into the same category. So the idea that quickly bringing in people with large amounts of money will produce results is false. We need to work strategically, including with Russian investors, and avoid monopolism.

It seems to me that there is currently a battle of oligarchs taking place on Abkhazian soil.

Inal Khashig: You know, I generally don’t believe in large economic projects that are imposed from above and lobbied for. In an environment of unchecked corruption, where officials try to convince us that a project is vital for Abkhazia while using all possible methods, I have serious doubts about their sincerity and lack of personal interest. Even if we legalized drug trafficking and created a state corporation for it, the business would still be unprofitable because it’s managed by the government.

The people responsible for it would benefit, while the state would be left with debts. It’s similar to the current situation with the airport: a businessman invested 200 million in project documentation, and now these funds are being demanded from the Abkhazian government because it decided that the project isn’t suitable. The money was taken and given to someone else. But it seems that there is now a battle of oligarchs taking place on Abkhazian soil. The oligarch who lost 200 million will surely recover it either from the Abkhazian government or from those responsible for the project.

Astamur Tania: According to both political and economic rules, the weaker side always pays for “broken pots.” It turns out that the weaker side is the Abkhazian side. Those who make decisions here are not held accountable for accumulated debts or ineffective economic policies. This applies not only to debts but to many other issues. I believe that focusing on large projects and such relationships is a dead-end path. It is necessary to work under more complex and diverse conditions.

Inal Khashig: We need to change the management system itself. When the benefits that can actually be gained disappear into the pockets of officials or other unknown places, the state and society receive nothing but debt. So before talking about projects that supposedly will pull Abkhazia’s economy forward and make it advanced, we need to start with a reform of the management system and a fight against corruption. When there are no reforms or efforts to combat corruption, many questions arise. For example, the authorities promised that we would receive 50 million a month, 600 million a year. Where is this 600 million?

Astamur Tania: Well, they probably came up with it on a calculator. This applies to the recent initiatives as well. It’s good that at this stage we’ve at least slowed down, even if it’s a bit late. The consequences could have been negative even for those who decided to participate. The executive branch also wouldn’t have been able to implement it for a number of objective reasons. This isn’t a laboratory—there’s a society here with its established views and interests that won’t be ignored. This could have led to numerous social, economic, and political problems that would be difficult to solve. So our executive branch should take a look around before making any decisions.

Inal Khashig: I’d like to discuss one more point—the appointment of Sergey Shamba as Minister of Foreign Affairs after a 14-year hiatus. How do you perceive this?

Right now, we have a situation where a trusted and high-ranking negotiator is truly needed.

Astamur Tania: Everything is understood in comparison. Shamba’s name is associated with establishing good traditions in the Ministry of Foreign Affairs, as he held that position for a long time. I think with his return, the ministry’s work will become more predictable. He is also likely to be more open to dialogue with different segments of society and the expert community, with which he actively interacted in the past. So, let’s see; everything looks optimistic for now.

Yes, he mentioned the need for negotiations. You once said that a negotiator is needed, and I think we are in a situation where a trusted and high-ranking negotiator is truly required. The situation in the region is changing, including in Georgia, where elections are coming up that might impact stability. Experience and background are necessary to respond to such changes, and I believe that is related to Sergey Shamba’s appointment.

Inal Khashig: I hope so. Shamba is a very open and communicative politician. I will try to invite him to the next show to discuss Abkhazian foreign policy and the challenges we need to address. To conclude, I want to say that we discussed today with an eye on the future with Astamur Tania, our regular expert. Remember, you can watch our show on the Chegemskaya Pravda channel on Facebook, on the website, and on my Telegram channel Inal Khashig ⁠— Chegemskaya Pravda. Thank you, and goodbye.

Terms, place names, opinions and ideas suggested by the author of the publication are her / his own and do not necessarily coincide with the opinions and ideas of JAMnews or its individual employees. JAMnews reserves the right to remove comments on posts that are deemed offensive, threatening, violent or otherwise ethically unacceptable.