Monthly Archives: October 2006

06TBILISI2866, A/S FRIED’S MEETING WITH GEORGIAN FOREIGN MINISTER

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Reference ID Created Released Classification Origin
06TBILISI2866 2006-10-30 08:34 2011-08-30 01:44 CONFIDENTIAL Embassy Tbilisi

VZCZCXRO3595
OO RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSI #2866/01 3030834
ZNY CCCCC ZZH
O 300834Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4487
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE

C O N F I D E N T I A L SECTION 01 OF 03 TBILISI 002866 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR DAS BRYZA AND EUR/CARC 
 
E.O. 12958: DECL: 10/18/2016 
TAGS: PREL GG
SUBJECT: A/S FRIED'S MEETING WITH GEORGIAN FOREIGN MINISTER 
BEZHUASHVILI 
 
 
Classified By: Ambassador John F. Tefft for reasons 1.4(b) & (d). 
 
Summary 
------- 
1. (C) Georgian Foreign Minister Gela Bezhuashvili told A/S 
Fried October 18 that recent Russian statements and actions 
indicated that Russia had decided to launch an all-out 
diplomatic assault on Georgia, trying to marginalize the U.S. 
from the Group of Friends, targeting GUAM, and working to 
divide the EU on Georgia.  Bezhuashvili said he hoped to 
resume discussions with Russian Foreign Minister Lavrov on 
the margins of the November 1 BSEC ministerial, and he 
expressed openness to a German idea of Parliament Speaker 
Burjanadze traveling to Moscow.  Fried stressed that 
confrontations with Russia worked against Georgia's long-term 
interests, in large part by raising concerns in Europe, and 
he questioned whether Georgia should invest so much of its 
political capital on the issue where Russia has the most 
leverage: the separatist conflicts.  Bezhuashvili said the 
Georgian government was very worried about a Russian-prompted 
gas crisis this winter.  He said he and Energy Minister 
Gilauri would travel to Iran in the coming days to discuss 
buying Iranian gas if Russian and Azeri options prove 
impossible.  Fried urged caution in dealing with Iran.  End 
Summary. 
 
Relations with Russia 
--------------------- 
2. (C) Fried began the lunch meeting by stressing U.S. 
concerns about Georgia's deteriorating relations with Russia 
and the negative effect this deterioration was having on 
European views of Georgia.  He asked Bezhuashvili where he 
saw the situation going.  Bezhuashvili noted that Russian 
President Putin had recently been quoted as saying he would 
like to hear from his military and civilian advisors how 
"protected" Georgia was by its patrons abroad.  Bezhuashvili 
said it was his opinion that Russia had decided to launch an 
all-out diplomatic offensive to test Georgia's international 
support.  Examples of this include the Russian efforts to get 
a reference to the Georgian operation in the Kodori Gorge 
into the recent UN Security Council resolution on Abkhazia, 
working to marginalize the U.S. from other members of the 
Group of Friends, targeting GUAM through approaches to 
Moldova and possibly Ukraine, working to divide the EU, and 
even attempting to influence Washington through public 
relations firms.  Nevertheless, Bezhuashvili thought the 
Russians had made mistakes in this campaign, especially in 
allowing xenophobic rhetoric and deporting large numbers of 
Georgians from Russia.  Noting that one Georgian citizen had 
recently died after being held for twenty days awaiting 
deportation, Bezhuashvili said the Georgians had been working 
with lawyers on a strong interstate case to take to the 
European Court of Human Rights. 
 
3. (C) Bezhuashvili said he had had difficulty contacting 
Russian Foreign Minister Lavrov over the last two weeks, and 
he understood from his Azeri counterpart that Lavrov had 
indicated he needed "some time" before resuming dialogue with 
Georgia.  Bezhuashvili said he intended to travel to Moscow 
for the November 1 BSEC Ministerial -- an event he would not 
normally attend -- in order to meet with Lavrov.  He added, 
however, that Lavrov had all but admitted in previous 
conversations that the MFA was not at the center of Russian 
policy making on Georgia.  Bezhuashvili said he could only 
guess that the FSB, GRU, and Presidential Administration had 
taken the lead.  He said that in the past Lavrov had often 
been unable to answer his questions about what Russia wanted 
from Georgia, although Lavrov had assured him Russia would 
not annex Georgian territory.  Bezhuashvili said his deputy 
had recently asked Lavrov at a CIS Ministerial in Minsk when 
Russian Embassy personnel would return to Tbilisi. 
Bezhuashvili told Fried that Georgia would be ready to help 
the Russians find a face-saving way to return.  He said 
Christoph Heusgen, foreign policy advisor to German 
Chancellor Merkel, had recently told the Georgians that 
Merkel had suggested to Putin that Georgian Parliament 
Speaker Burjanadze visit Moscow, and Putin had agreed. 
Bezhuashvili said this was not a bad idea, as a follow-up to 
his own meeting with Lavrov at BSEC.  Bezhuashvili said 
Georgian behavior toward Russia over the past two weeks had 
been careful and responsible.  Fried asked about Defense 
Minister Okruashvili's reported comments to the press that 
war with Russia was inevitable; Bezhuashvili said he talked 
to Okruashvili himself and this report was a fabrication. 
 
4. (C) Fried said there was concern in Washington that 
Russia's efforts to isolate Georgia and to prevent its 
integration with the West were having some success, and that 
European governments had been greatly concerned by the 
confrontation over the Russian spies.  Fried said that he too 
 
TBILISI 00002866  002 OF 003 
 
 
had been angered by the xenophobic Russian response to the 
incident, but he stressed that Georgia was still on the 
tactical defensive, playing on a field laid out by the 
Russians.  He said that Georgia faced a choice -- previously 
faced by the Baltic states and others in t
he former Communist 
bloc -- between the short-term gratification of quarreling 
with Russia and the achievement of long-term goals.  He 
stressed that the Europeans feared being drawn into 
Russian-Georgian conflicts.  He added that there are certain 
issues where the Russians have leverage: the economy 
(although that is a wasting asset) and the frozen conflicts. 
Fried said that, given this, he questioned the Georgians' 
decision to make the conflicts their top priority; it was the 
one issue where the Russians had the most opportunity to 
thwart them and to generate crises that would weaken Western 
support for Georgia. 
 
5. (C) Fried asked Bezhuashvili if he was happy with 
developments over the past six months.  Bezhuashvili said yes 
and no -- "maybe more no than yes" -- but argued that some 
positives had come out of the spy scandal.  He said the 
Western media and governments could now no longer ignore 
Russian human rights violations and the parallels between the 
current treatment of Georgians in Russia to the treatment of 
Jews decades ago.  Deputy Foreign Minister Batu Kutelia, who 
until recently was Georgia's intelligence chief, said the 
publicity given to the spying arrests also had an internal 
purpose: to deter the growing number of Georgians who 
accepted money from the Russians in exchange for information. 
 Separately, at a dinner that night, the new head of the 
intelligence services, Ana Zhvania, argued that the internal 
threat to Georgia from Russian spies -- and those whom they 
pay off -- is growing and that the public handling of the spy 
case was needed to act as a deterrent to domestic spying by 
Georgians. 
 
The Conflicts 
------------- 
6. (C) Bezhuashvili agreed the conflicts were a weak point 
for Georgia, although he thought the Russians would continue 
to create problems with the conflicts even if Georgia put 
less emphasis on them.  Or alternatively, he speculated that 
Russia might begin to propagandize within Georgia that the 
Saakashvili government was downplaying its most visible 
pledge: to re-unite the country.  Fried agreed that Georgia 
could not be passive on the conflicts, but he advised 
focusing on areas where the Europeans agreed and where there 
was some chance of progress, such as the donors' economic 
rehabilitation project in South Ossetia, and efforts to 
internationalize the peacekeepers and police.  Bezhuashvili 
said the government was in a permanent dialogue with 
Parliament, which was pushing for Georgia to end Russian 
peacekeeping.  Bezhuashvili said that in his view it is not 
the right time for such a decision, but added that it could 
not be stopped forever.  He asked if the U.S. thought the 
Georgian call for new negotiating formats for the conflicts 
-- especially South Ossetia -- was counterproductive.  Fried 
said he agreed that current formats were unbalanced, but an 
endless confrontation over them was not in the Georgians' 
interest.  Turning to Kodori, Fried said the U.S. did not 
object in principle to the Georgian operation, although the 
violations of the 1994 Moscow Agreement that accompanied it 
had hurt the Georgians in the UN Security Council resolution 
debate and should not be repeated.  He said Georgia now had 
the opportunity to make Kodori a real success. 
 
7. (C) On Abkhazia, Fried said one asset was that de facto 
president Bagapsh did not appear to be a "100 percent" 
Russian creature.  Bezhuashvili and Kutelia disagreed, noting 
that while it was true that Bagapsh came from a more Abkhaz 
nationalist background than others in the de facto 
administration, given the tremendous Russian leverage in 
Abkhazia his actions were in practice no different than his 
more pro-Russian colleagues.  Kutelia noted that even Beslan 
Butba, a prominent Abkhaz businessman and member of the de 
facto parliament who (despite living primarily on Moscow) is 
personally anti-Russian, told Kutelia earlier this year that 
he was forced to break off his contacts with Georgian 
officials. 
 
The Politics of Gas 
------------------- 
8. (C) Bezhuashvili said the government was greatly concerned 
about a winter gas crisis.  While he had doubts that the 
Russians would again cut off the gas completely, he predicted 
they would insist on a large increase in price.  Bezhuashvili 
confirmed that the Russians were pressing Azerbaijan not to 
sell gas to Georgia.  He said the Azeris had asked Georgia 
for "more time to assess" after the Russians had told them 
they would lose the same amount of gas from Russia that they 
 
TBILISI 00002866  003 OF 003 
 
 
sell to Georgia.  Fried told Bezhuashvili to exercise great 
caution if Georgia gets involved in gas talks with Iran. 
Bezhuashvili said that in fact he and Energy Minister Gilauri 
were likely to travel to Iran October 21 or 22, assuming they 
received a positive report from a Georgian technical team 
arriving in Iran October 19.  He said Georgia had wanted to 
send only Gilauri, but the Iranians had insisted on 
Bezhuashvili as well, and had urged Georgia to characterize 
the visit as broader than only energy issues.  Bezhuashvili 
told Fried that gas was the only issue Georgia was interested 
in discussing, and added that any purchases from Iran would 
be conditional on Russian and Azeri sources being unworkable, 
and on the Iranian price being reasonable.  He said he 
recognized that the Iranians could be colluding with Russia, 
but explained that circumstances obligated the Georgian 
government to explore all alternatives. 
 
9. (U) A/S Fried cleared this message. 
TEFFT

Wikileaks

06TBILISI2855, INITIAL RESULTS OF USDA’S TRADE MISSION TO GEORGIA

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Reference ID Created Released Classification Origin
06TBILISI2855 2006-10-27 11:14 2011-08-30 01:44 UNCLASSIFIED Embassy Tbilisi

VZCZCXRO2137
PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHSI #2855 3001114
ZNR UUUUU ZZH
P 271114Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC PRIORITY 4472
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY

UNCLAS TBILISI 002855 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR/CARC AND EB/TPA/ABT 
USDA FOR BARBIERI 
 
E.O. 12958: N/A 
TAGS: EAGR ETRD EINV GG
SUBJECT: INITIAL RESULTS OF USDA'S TRADE MISSION TO GEORGIA 
 
 
1. In May, 2006, USDA led the first ever Agribusiness Trade 
and Investment Mission (TIM) to Georgia, which was funded by 
the Freedom Support Act.  The goal of the TIM was to 
facilitate investments and trade between the U.S. and 
Georgian companies, suppliers, and distributors.  With the 
current state of Russia-Georgia economic relations, it is now 
even more important for Georgia to expand its markets to the 
west.  The trade mission included 12 small and medium-sized 
enterprises specializing in equipment distribution, wine 
imports, cattle genetics, dried fruit and vegetables, coffee, 
meals ready to eat, processed goods and agricultural 
processing.  Embassy Tbilisi and USDA coordinated with a 
local Georgian-American events planning contractor, local 
business associations, and the GoG to provide participants 
with specialized presentations on Georgia's business climate, 
over 200 matchmaking meetings with local companies, and 20 
site visits. 
 
2. According to USDA, the mission resulted in negotiations on 
several export and investment projects.  Flatness 
Incorporated has plans to build two artificial insemination 
centers in Georgia to improve cattle.  Total investment in 
the project should be approximately USD 1 million.  Food Pro 
International is negotiating three deals with agricultural 
processing and production companies to update equipment and 
manufacturing techniques.  FoodSource, Inc. is negotiating a 
deal to export California walnuts for estimated sales of USD 
200 thousand, and is working with a Georgian grower to import 
hazelnuts from Georgia.  BlackDot Coffee is preparing to ship 
around 2,000 pounds of coffee per month starting in early 
2007. Additionally, Hima Beverage Brokerage imported to the 
U.S. several shipments of Georgian wine, and is working with 
the Georgian Wine Industry and USDA to establish a greater 
market share in the U.S.  Mission will be happy to support 
future similar trade missions. 
TEFFT

Wikileaks

06TBILISI2789, UN AND CIS CONDUCT JOINT PATROL OF KODORI GORGE

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Reference ID Created Released Classification Origin
06TBILISI2789 2006-10-20 08:10 2011-08-30 01:44 CONFIDENTIAL Embassy Tbilisi

VZCZCXRO5345
OO RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSI #2789 2930810
ZNY CCCCC ZZH
O 200810Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4406
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE

C O N F I D E N T I A L TBILISI 002789 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR DAS BRYZA AND EUR/CARC 
 
E.O. 12958: DECL: 10/17/2016 
TAGS: PREL PGOV GG
SUBJECT: UN AND CIS CONDUCT JOINT PATROL OF KODORI GORGE 
 
 
Classified By: Ambassador John F. Tefft for reasons 1.4(b) & (d). 
 
1. (C) A joint UNOMIG-CIS patrol visited the 
Georgian-controlled Upper Kodori Gorge October 12, the first 
such international monitoring mission since Georgian forces 
re-established control over the area from local warlord Emzar 
Kvitsiani in July.  Georgian Deputy State Minister for 
Conflict Resolution Ruslan Abashidze told us October 12 that 
the patrol seemed to have gone smoothly, adding that the 
Russians in the CIS contingent were in a "bad mood" because 
"nothing special" was happening.  He said the monitors had 
asked questions about the presence of weapons seized from 
warlord Kvitsiani, but noted that this did not appear to be a 
major problem because the weapons were in a secure, guarded 
building and were clearly introduced into the region by 
someone other than the Georgians. 
 
2. (U) UNOMIG released a statement October 13 summarizing the 
results of the patrol (e-mailed to CARC), which they said 
covered a "substantial area" of Upper Kodori.  The statement 
said the patrol was informed that 550 Georgian law 
enforcement personnel were in Kodori; monitors checked the 
identity documents of some of these individuals, all of whom 
were found to work for the Ministry of Internal Affairs.  The 
monitors reported finding no deployed heavy weapons, although 
they did note that some of the weapons reportedly seized in 
the initial operation were heavy weapons; the statement cited 
six 120 mm mortars, six 82 mm mortars, a 76 mm anti-aircraft 
gun, an unserviceable ZSU 23-4 turret without a chassis, some 
MANPADS, and ammunition.  The monitors asked Georgian law 
enforcement authorities for an inventory of these weapons so 
that their disposal could be jointly monitored.  They called 
for regular patrolling of Kodori in order to sustain the 
transparency achieved through this patrol.  Press reports 
quoted CIS peacekeepers expressing concerns about what they 
described as large stockpiles of arms. 
 
TEFFT

Wikileaks

06TBILISI2754, SOUTH OSSETIA TALKS AT AN IMPASSE

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Reference ID Created Released Classification Origin
06TBILISI2754 2006-10-17 13:42 2011-08-30 01:44 CONFIDENTIAL Embassy Tbilisi

VZCZCXRO1665
OO RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSI #2754/01 2901342
ZNY CCCCC ZZH
O 171342Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4369
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE

C O N F I D E N T I A L SECTION 01 OF 02 TBILISI 002754 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR DAS BRYZA AND EUR/CARC 
 
E.O. 12958: DECL: 10/17/2016 
TAGS: PREL OSCE PGOV GG
SUBJECT: SOUTH OSSETIA TALKS AT AN IMPASSE 
 
 
Classified By: Ambassador John F. Tefft for reasons 1.4(b) & (d). 
 
Summary 
------- 
1. (C) As described by OSCE, the October 12-13 Joint Control 
Commission (JCC) meeting in Vladikavkaz produced few real 
results because the Georgians and the other sides deadlocked 
over the Georgian proposal to change the format of the 
discussions.  The commander of the Joint Peacekeeping Forces 
(JPKF) presented a report blaming both sides for an increase 
in violations.  The only bright spot in the meeting was all 
participants' welcoming of the recently launched economic 
rehabilitation project in the region.  Russian 
representatives told OSCE privately that they believe 
hardliners have taken control over policy making in Georgia. 
End Summary. 
 
Airing the Differences 
---------------------- 
2. (C) OSCE Deputy Head of Mission Veselin Nikolaev told us 
October 16 that getting the participants to the Vladikavkaz 
meeting was a saga in itself, given the Russian closure of 
the Upper Lars-Kazbegi border crossing and air routes, and 
was resolved only at the last minute when all sides agreed to 
a charter flight from Tbilisi to Vladikavkaz.  Once there, 
the discussions made little progress.  The Georgians insisted 
on changing to a bilateral format (Georgia-South Ossetia), 
with OSCE chairing and Russia, the U.S., and EU as 
participants, before discussing agenda items on a settlement 
of the conflict or on law enforcement cooperation.  The other 
sides strongly resisted this change, with the Russian 
co-chair commenting that he felt he was attending the 
"funeral of the JCC."  Nikolaev told us that, given the 
starkly opposed positions of the sides, he thought invoking 
the "political format" of the "authorized delegations of the 
sides" might be a face-saving way out of the impasse.  When 
this was proposed, however, the Russians said they had no 
instructions.  The Russian co-chair told Nikolaev privately 
that, while he personally had no objection to the proposal, 
he thought Moscow was unlikely to accept it. 
 
3. (C) Nikolaev said the JPKF commander, General Kulakhmetov, 
delivered a report to the JCC on the increasing number of 
violations of existing agreements, blaming the South 
Ossetians primarily for construction of fortifications and 
the Georgians primarily for unauthorized police checkpoints. 
The Georgians dismissed Kulakhmetov's report as biased. 
Nikolaev admitted to us that Kulakhmetov had seemed 
particularly careful not to anger the South Ossetians in his 
remarks, adding that he would have a better understanding of 
Kulakhmetov's overall assessment when OSCE obtains the 
written version of the report.  Nikolaev said there was one 
bright spot in the discussions: all participants welcomed the 
recent launch of the donors' economic rehabilitation program 
in South Ossetia. 
 
Russian Conspiracy Theories 
--------------------------- 
4. (C) Nikolaev said the Russian representatives had told him 
privately in Vladikavkaz that they believed Georgian co-chair 
Merab Antadze's uncompromising stance at the meeting 
indicated he was under the control of Defense Minister 
Okruashvili -- and that they believed Okruashvili had gained 
the upper hand over President Saakashvili.  Nikolaev told us 
he personally found this "far-fetched," especially the 
Russians' speculation that an incident might be arranged 
(apparently by Okruashvili) to remove Saakashvili "as 
happened with the late Prime Minister Zhvania."  (Note: 
Zhvania died in 2005 from accidental carbon monoxide 
poisoning.  End Note.)  Nikolaev said the Russians frequently 
make such comments about Okruashvili, on whom they appear to 
be "fixated."  Nikolaev said he spoke in Vladikavkaz with 
some of the evacuated officials from the Russian Embassy in 
Tbilisi, and they predicted the Embassy would go back to full 
staffing as soon as some event provided a public 
justification for it. 
 
Comment 
------- 
5. (C) There was no discussion in Vladikavkaz of when the JCC 
might meet again, although Nikolaev thought that the planned 
visit next week of Belgian MFA representative Pierre 
Chevalier to Moscow, Tbilisi, and South Ossetia might push 
things forward.  For now the talks are in stalemate, with 
OSCE working to preserve the JCC as a forum for dialogue, if 
nothing else.  None of the other participants seem equally 
motivated to keep discussion going, although none want to be 
seen as responsible for scuttling it either.  At this point 
the economic program -- complete with its steering committee 
incorporating the sides and international donors -- is the 
only forum that seems to have broad, enthusiastic support. 
 
TBILISI 00002754  002 OF 002 
 
 
 
TEFFT

Wikileaks

06TBILISI2709, UN-CIS KODORI PATROL SCHEDULED, WHILE ABKHAZ TALK

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If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol).Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #06TBILISI2709.
Reference ID Created Released Classification Origin
06TBILISI2709 2006-10-11 13:26 2011-08-30 01:44 CONFIDENTIAL Embassy Tbilisi

VZCZCXYZ0001
PP RUEHWEB

DE RUEHSI #2709 2841326
ZNY CCCCC ZZH
P 111326Z OCT 06
FM AMEMBASSY TBILISI
TO SECSTATE WASHDC PRIORITY 4314

C O N F I D E N T I A L TBILISI 002709 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR DAS BRYZA AND EUR/CARC 
 
E.O. 12958: DECL: 10/10/2016 
TAGS: PGOV PREL GG
SUBJECT: UN-CIS KODORI PATROL SCHEDULED, WHILE ABKHAZ TALK 
TOUGH ON UNOMIG MANDATE 
 
REF: TBILISI 2672 
 
Classified By: Ambassador John F, Tefft for reasons 1.4(b) & (d). 
 
1. (C) Georgian Deputy State Minister for Conflict Resolution 
Ruslan Abashidze told us October 9 that the main questions 
about the modalities of a UNOMIG monitoring patrol of the 
Upper Kodori Gorge with participation of CIS peacekeepers 
(reftel) had been resolved.  He said an agreement was reached 
October 7 on the size of the CIS presence -- four officers in 
two cars -- and on their security: they would carry only 
personal firearms, not automatic weapons.  Abashidze said the 
patrol was scheduled for October 12.  He said the Georgians' 
agreement was for one patrol, with a second "under 
consideration" if the first went well. 
 
2. (SBU) Abashidze also said State Minister for Conflict 
Resolution Merab Antadze had received a strong warning from 
the Abkhaz that if the upcoming decision in the UN on the 
renewal of UNOMIG's mandate was not acceptable to the Abkhaz, 
they would demand the withdrawal of Georgian Ministry of 
Internal Affairs personnel from Kodori.  If they were not 
withdrawn, the Abkhaz told Antadze that they would start "war 
preparations." 
TEFFT

Wikileaks

06TBILISI2708, SUCCESSFUL LAUNCH OF SOUTH OSSETIA ECONOMIC

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If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol).Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #06TBILISI2708.
Reference ID Created Released Classification Origin
06TBILISI2708 2006-10-11 13:25 2011-08-30 01:44 CONFIDENTIAL Embassy Tbilisi

VZCZCXRO5707
OO RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSI #2708/01 2841325
ZNY CCCCC ZZH
O 111325Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4312
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE

C O N F I D E N T I A L SECTION 01 OF 02 TBILISI 002708 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR DAS BRYZA AND EUR/CARC 
 
E.O. 12958: DECL: 10/10/2016 
TAGS: PREL PGOV EAID GG
SUBJECT: SUCCESSFUL LAUNCH OF SOUTH OSSETIA ECONOMIC 
REHABILITATION PROGRAM 
 
 
Classified By: Ambassador John F. Tefft for reasons 1.4(b) & (d). 
 
Summary 
------- 
1. (C) International donors, OSCE, Georgia, and South Ossetia 
kicked off the new economic rehabilitation initiative for 
South Ossetia with the first steering committee meeting in 
Tskhinvali October 6, much of which was open to Georgian and 
 
SIPDIS 
South Ossetian media.  DCM signed a memorandum with OSCE to 
make available USD 2 million of USG funding to support 
implementation this year.  Georgia reiterated its pledge to 
match the total contribution of all other donors, and 
suggested joint police patrols as a step to build trust 
between the sides.  The South Ossetians, despite some 
political comments aimed at the Georgians, expressed strong 
support for the economic program and a willingness to work 
with the Georgians and other donors.  This event was a 
positive change in the climate of increasing tensions between 
the sides, and many of the participants are now aiming to 
continue the dialogue at the Joint Control Commission (JCC) 
meeting scheduled for Vladikavkaz October 13-14.  End Summary. 
 
Helping the People 
------------------ 
2. (U) Representatives of a broad range of donors traveled to 
Tskhinvali for the event, filling the JCC conference room to 
 
SIPDIS 
capacity.  OSCE Acting Head of Mission Veselin Nikolaev 
stressed that donor support was aimed at helping the people 
in the region; he called for Georgian, South Ossetian, and 
international experts to work as a team, and stressed the 
importance of security and freedom of movement.  Frank 
Geerkins of the Belgian MFA stressed the support of the OSCE 
Chairmanship for the program.  Speaking for the USG, DCM said 
our assistance aims to support just and democratic 
governance, at national and region levels, to encourage and 
assist leaders to invest in the needs of the people, and to 
expand opportunities for economic growth.  Following the 
meeting, DCM and Nikolaev signed a memorandum on the USG 
contribution of USD 2 million to support an economic 
development center.  DCM stressed that further USG support 
would depend in large part on the commitment and progress 
demonstrated by the sides to improve conditions for the 
region's inhabitants and to further the peace process. 
 
Civility Breaks Out Between the Sides 
------------------------------------- 
3. (U) Both the Georgian delegation, represented by State 
Minister of Conflict Resolution Merab Antadze, and the South 
Ossetians, represented by JCC deputy co-chair Leonid Tibilov, 
expressed strong support for the program and a willingness to 
work with each other, as well as with OSCE and other donors. 
Antadze stressed that next year's Georgian budget will 
include a sum for the program equal to the amount contributed 
by all the other donors combined, expected to be USD 10 
million.  Ruslan Abashidze, Antadze's deputy, called for the 
revival of an old practice of joint Georgian-South Ossetian 
police patrols in the region.  Tibilov reacted positively to 
the police idea, and suggested further discussions, including 
perhaps at the JCC in Vladikavkaz.  Tibilov took a generally 
supportive, cooperative tone during the meeting, although he 
did veer off onto pointed political comments on occasion, for 
example blaming Georgia for a deadly September shootout in 
the conflict zone.  The Georgians refused to be drawn in, 
arguing that the steering committee meeting was not the right 
format for such exchanges.  The Russians, whose Embassy in 
Tbilisi remains drawn down, were represented at the meeting 
by Murat Tkhvostov, North Ossetian JCC co-chair, who stressed 
that economic success will strengthen work in the political 
sphere. 
 
Comment 
------- 
4. (C) The most significant fact about this meeting was that 
it took place at all, given the deteriorating relations 
between the sides, including the reported October 2 statement 
by South Ossetian "president" Kokoity that he was breaking 
off talks with Georgia.  It now appears that statement was 
not meant to be taken literally.  The Georgians tell us OSCE 
is working to organize the JCC meeting as scheduled in 
Vladikavkaz October 13-14, despite the logistical hurdles 
caused by the Russian flight ban and closure of the Upper 
Lars-Kazbegi land crossing.  The Georgians understand that 
Russia will likely allow a charter flight from Tbilisi to 
Vladikavkaz and back.  The Georgians and South Ossetians 
appear to have found avenues to renew the dialogue, but we 
will need to ensure that the positive remarks in light of a 
10 million dollar donation by the international community 
become real steps forward in the process of finding a 
political solution, including by using the expanded format to 
increase the participation of the international community in 
 
TBILISI 00002708  002 OF 002 
 
 
the political dialogue.  Both sides have now committed 
themselves very publicly to the economic rehabilitation 
program, and we will want to use this success in 
internationalizing the politic
al process so we can move 
forward toward a solution. 
 
TEFFT

Wikileaks

06TBILISI2698, GOG OFFICIALS INTERESTED IN ESTONIAN MODEL FOR

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Reference ID Created Released Classification Origin
06TBILISI2698 2006-10-11 07:17 2011-08-30 01:44 UNCLASSIFIED Embassy Tbilisi

VZCZCXRO5268
PP RUEHAG RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHSI #2698 2840717
ZNR UUUUU ZZH
P 110717Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC PRIORITY 4295
INFO RUEHRA/AMEMBASSY RIGA PRIORITY 0283
RUEHTL/AMEMBASSY TALLINN PRIORITY 0289
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS TBILISI 002698 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EUR/CARC, EB/CBA AND EB/IFD/OIA, INL 
COMMERCE FOR 4231 DANICA STARKS 
TREASURY FOR OIA JEFF BAKER 
 
E.O. 12958: N/A 
TAGS: EINV ECON ETRD PGOV KFIN GG
SUBJECT: GOG OFFICIALS INTERESTED IN ESTONIAN MODEL FOR 
REVENUE SERVICE 
 
 
1. The USAID Georgia Business Climate Reform Project (GBCR) 
sponsored and participated in a very successful visit of key 
GoG officials to Latvia and Estonia September 4-14 as part of 
its technical assistance in the establishment of a new 
revenue service.  The new GoG revenue service will unite the 
activities of the Tax and Customs Departments with the 
Financial Police.  Key counterparts of each country's revenue 
service made presentations, provided tours of their 
headquarters and local facilities, and provided details on 
their experiences in forming their organizations. 
 
2. The Latvian State Revenue Service essentially maintains 
the separate identity of the three services -- tax, customs, 
and financial police -- while combining support activities 
including human, fiscal, and information systems management. 
The Estonian Tax and Customs Board integrates tax, customs, 
and financial police activities with no separate services. 
 
3. The Georgian delegation will recommend that the GoG adopt 
a variation of the Estonian model.  The GBCR is working with 
the Estonian Tax and Customs Board to have them assist in the 
development of the new Georgian revenue service. 
Nevertheless, due to sensitivities among the three agencies' 
staffs, the possibility that the Latvian model may be adopted 
still exists. 
 
4. INL sponsored a two-day conference on September 23-24 with 
GoG Tax, Customs, and Financial Police officials to discuss 
improving their relations with the public and substantive 
issues related to the plan to merge the three agencies. 
 
5. GoG officals participating in the visit to the Baltics 
included: 
 
Lasha Gotsiridze, First Deputy Minister of Finance 
Mikheil Giorgadze, Ministry of Finance Head of Reform 
Coordination TEam 
Kakha Baindurashvili, Tax Department Chairman 
Zurab Antelidze, Customs Department Chairman 
David Tsekvava, Ministry of Finance Head of IT Department 
Malkhaz Bitsadze, Deputy Head of Financial Police 
 
TEFFT

Wikileaks

06TBILISI2680, RUSSIA’S TIGHTENING THE ECONOMIC SCREWS ON GEORGIA

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Reference ID Created Released Classification Origin
06TBILISI2680 2006-10-06 13:32 2011-08-30 01:44 CONFIDENTIAL Embassy Tbilisi

VZCZCXRO2342
RR RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSI #2680/01 2791332
ZNY CCCCC ZZH
R 061332Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC 4275
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHLMC/MILLENNIUM CHALLENGE CORPORATION
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC

C O N F I D E N T I A L SECTION 01 OF 02 TBILISI 002680 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EUR/CARC AND EB/IFD/OIA 
COMMERCE FOR 4231 DANICA STARKS 
TREASURY FOR OIA 
MOSCOW FOR TREASURY ATTACHE 
 
E.O. 12958: DECL: 10/04/2016 
TAGS: EFIN ETRD EWWT ECON PREL GG
SUBJECT: RUSSIA'S TIGHTENING THE ECONOMIC SCREWS ON GEORGIA 
COULD HURT IF PROLONGED 
 
REF: A. TBILISI 2262 
     B. TBILISI 2424 
     C. TBILISI 2616 
     D. MOSCOW 11107 
 
TBILISI 00002680  001.2 OF 002 
 
 
Classified By: Ambassador John F. Tefft, reason 1.4(d). 
 
1.  (U) This is an action request for EB and EUR.  See 
paragraph 8. 
 
2.  (U) Russia has announced that all airline, rail, road, 
sea and postal links to Georgia will be closed after midnight 
Monday, October 2.  On October 3, the Transport department of 
the Georgian Economic Development Ministry confirmed to the 
Embassy that the Russian Civil Aviation Authority (CAA) had 
informed the Georgian CAA that starting October 3, the three 
Georgian carriers, Georgian Airways, Tbilaviamsheni, and 
Georgian National Airlines would not be allowed to land in 
Russia.  The reason given was a lack of certain 
documentation, which the Ministry insists has already been 
presented to the Russian CAA long ago.  The Georgian CAA has 
received formal notification that Aeroflot and Pulkovo 
Airlines are ceasing operations to Tbilisi, but has had no 
official word as yet from other airlines such as Cibir.  We 
expect those flights will be canceled for the time being as 
well. 
 
3.  (U) The announced cutoff of rail links should create no 
real hardship for rail passengers.  Essentially this means 
that two cars on the Moscow-Baku route that are designated 
for onward travel to Tbilisi will no longer be included on 
that train, and passengers will have to change trains in 
Baku.  As for freight, if rail and sea links are interrupted 
for a prolonged period, it will have a deep negative impact 
on the economy and standard of living in Georgia.  Many 
consumer products, raw materials and industrial inputs are 
imported from Russia to the port of Poti and via rail links 
through Azerbaijan.  Georgia's imports from Russia in 2005 
were $384,349,900, 19% of its total imports.  (The EU as a 
whole supplied 33% of imports, or $671,386,900 million.)  Oil 
and gas areQmportant imports from Russia, and we were told 
on October 4 by Deputy Minister of Energy Archil 
Mamatelashvili that gas supplies from Russia are still 
flowing normally.  Georgia's exports to Russia were 17.7% of 
its total exports in 2005.  According to the local director 
of a worldwide food product company we talked to, his 
inventory has been arriving by sea from Novorossisk since 
road connections north via Kazbegi and the Georgian Military 
Highway were cut off in June 2006 (Ref B).  His products will 
now leave Novorossisk invoiced to a subsidiary in 
Switzerland, and once they are at sea, his Swiss subsidiary 
will sell them to the Georgian subsidiary.  Such strategies 
are available to a global company like his, but will not be 
feasible for smaller importers whose traditional connections 
are with Russian wholesalers. 
 
4.  (U) Because the Kazbegi crossing has been closed since 
July 7, any new blockade of road transport to and from Russia 
can only affect the illegal crossings into South Ossetia and 
Abkhazia.  The Georgians have made these illegal border 
crossings the basis of their objections to Russian WTO 
accession.  It is unclear at this point whether Georgian 
trucks will be turned back at the Azerbaijan-Russia border if 
they attempt to enter Russia through Azerbaijan.  Even if 
such traffic is allowed, and Georgian traders can use it as 
an alternative to sea transport, the additional costs will 
impose a serious burden on them. 
 
5.  (U) The head of the Telecommunications Department of the 
Ministry of Economic Development told us on October 3 that 
the Georgian post office has not yet received any official 
notification of interruption of postal services.  He believes 
that express shipments via DHL, UPS, Federal Express and the 
like may be able to be routed through third countries. 
 
6.  (U) According to press reports and ref C, changes to 
Russian legislation are being contemplated to allow 
interruption of financial transfers from Russia, including 
remittances by the estimated 500,000 Georgians living in 
Russia.  The Georgian National Bank estimates that 80% of 
these migrants send money back to relatives in Georgia. 
According to the National Bank, remittances from Russia 
totaled $253,523,000 in 2005, which is 4% of GDP and 63% of 
all remittances to Georgia from the world,  As reported ref 
 
TBILISI 00002680  002.2 OF 002 
 
 
C, all remittances to Georgia from all countries account for 
a total of 6% of GDP in 2005 and totaled $181,633,000 in the 
first seven months of 2006.  Roman Gotsiridze, President of 
the National Bank of Georgia, has to
ld us that he thinks a 
total cutoff of financial transfers is technically impossible 
(ref C).  The General Director of one of the largest 
commercial banks in Tbilisi, TBC Bank, told us that he does 
not believe a cutoff of remittances will have a significant 
effect because so much of the remittances is carried by hand 
in cash over the border.  We are more concerned, because the 
transport restrictions will make such travel much more 
difficult and workers could find it difficult to find 
agencies under Russian jurisdiction that will accept their 
cash for electronic transfer if the Russian government has 
clearly expressed its disapproval. 
 
7.  (U) The Standard and Poor's rating service shares our 
view that a prolonged blockade of transportation by Russia 
against Georgia could have significant negative consequences 
for the Georgian economy.  S&P's London office issued a 
statement on October 3 that the deteriorating relations with 
Russia could threaten the positive ratings outlook on Georgia 
(whose sovereign rating is now B /Positive/B 
(long-term/outlook/short-term)). 
 
8.  (C) Embassy Tbilisi would appreciate EB's opinion as to 
whether an interruption of financial transfers and any of the 
transport bans imposed by Russia on Georgia might violate 
international agreements such as the GATT or international 
transport agreements under organizations such as ICAO or the 
International Postal Union. 
 
 
TEFFT

Wikileaks

06TBILISI2668, GEORGIA TEXTILES AND APPAREL SECTOR:UPDATED

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Reference ID Created Released Classification Origin
06TBILISI2668 2006-10-04 12:50 2011-08-30 01:44 UNCLASSIFIED Embassy Tbilisi

VZCZCXRO9462
RR RUEHAST
DE RUEHSI #2668/01 2771250
ZNR UUUUU ZZH
R 041250Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC 4258
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEHLMC/MILLENNIUM CHALLENGE CORPORATION
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 02 TBILISI 002668 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EUR/CARC AND EB/TPP/ABT:TLERSTEN 
COMMERCE FOR ITA/OTEXA:MDANDREA 
STATE PASS USTR FOR ABIOLA HEYLIGER 
 
E.O. 12958: N/A 
TAGS: EIND ETRD GG
SUBJECT: GEORGIA TEXTILES AND APPAREL SECTOR:UPDATED 
STATISTICS AND PROJECTION OF FUTURE COMPETITIVENESS 
 
REF: A. STATE 138090 
 
     B. TBILISI 2128 
 
TBILISI 00002668  001.3 OF 002 
 
 
1. Pursuant to Ref A Embassy Tbilisi provides the following 
statistics and information regarding the textile sector in 
Georgia. 
 
2.  Statistics (2005 data): 
 
Total industrial production (USD thousands): 1,158,267 
Total textiles and apparel production (USD thousands): 7,745 
Textile/apparel share of Georgian imports: 2.6% 
Textile apparel share of Georgian exports: 1.0% 
Exports in textiles and apparel to the United States 
   (USD thousands): 74 (Georgian Statistics Office figure) 
   (USD thousands): 550 (U.S. Census figure) 
Total industrial employment, including mining 83,497 (2006: 
82598) 
Total textiles and total apparel employment 2,024 (2006: 2420) 
 
3.  Post interviewed Georgian Ministry of Trade officials and 
Davit Jinjaradze, Financial Director of Georgia's largest 
textile manufacturer, Batumitex, to obtain the following 
information. 
 
4.  Q. Are host country producers receiving lower prices due 
to heightened international competition?  Have manufacturers 
received more, less, or the same number of orders as in years 
past?  Have foreign investors, particularly  Asian investors, 
closed factories or otherwise pulled out of local production? 
 
 
A. Textile production in Georgia, like manufacturing of all 
products, was devastated by the economic dislocation caused 
by the dissolution of the Soviet Union in 1991.  The Georgian 
Department of Statistics lists 129 producers of textiles. 
Many of these may not be functioning or do not export from 
Georgia.  One company, Batumitex, was established in 2001 by 
Greenoak, Ltd. the Danish-owned port operator in Batumi. 
Greenoak has since sold part of the business to Low Profile, 
a Turkish company.  Batumitex sews 100,000 garments a month, 
destined for sale in Marks and Spencer stores in Europe.  As 
everywhere, prices of textiles and apparel produced in 
Georgia are probably lower than they would otherwise be 
because of competition from China and other countries of the 
Far East.  However, prospects for the industry in Georgia 
seem to be improving because of political and economic 
changes in Georgia resulting in lower taxes and tariffs, more 
reliable availability of electricity and other utilities, and 
increasing wages in Turkey.  According to Batumitex and the 
Turkish Consul in Batumi, two new textile factories employing 
1000 people each are planned for Adjara, financed by Turkish 
investment (Ref B).  We are not aware of any Asian investors 
in textile production, and have not seen any reports that 
Asian investors have closed factories or pulled out of the 
Georgian market.  Batumitex and other textile producers are 
able to import their inputs duty free so long as they are 
re-exported. 
 
5.  Q. Have U.S. and EU restrictions on certain exports of 
textiles and apparel from China, effective through 2008, 
affected export prospects for host country manufacturers? 
 
A. Exports of textiles from Georgia to the United States are 
negligible, so it is difficult to gauge the effect of 
restrictions on Chinese exports.  More important are EU 
limits on exports from Turkey.  Turkish investors in Batumi 
are seeking to take advantage of unused EU quotas for 
Georgian textile exports. 
 
6.  Q. Has the host government implemented, or is it 
considering implementing, safeguards or other measures to 
reduce growth of imports of Chinese textile and apparel 
products into the host country? 
 
A. The GOG is not contemplating safeguards or other measures 
to reduce growth of imports of Chinese textile and apparel 
products.  In fact, duties on imports of textiles, along with 
many other manufactured products, were reduced by a new 
customs law that took effect on September 1, 2006.  Textile 
tariffs were reduced from 12% to 5%. 
 
7.  Q. Has increased global competition affected local labor 
conditions by causing employers to reduce wages, seek 
flexibility from government required minimum wages, or 
adversely affected union organizing? 
 
TBILISI 00002668  002.3 OF 002 
 
 
 
A. So far as is known, increased global competition has not 
affected local labor conditions by causing Georgian employers 
to reduce wages.  The monthly wage in the private sector in 
Georgia has slowly increased since 2000, but at the end of 
2005 it was only about $100, which according to our research 
is similar to the average wage reported in China.  Batumitex 
pays its workers about $150 per month.  A Tbilisi producer of 
socks for the domestic market told us he pays his workers 
about $235 per month.  There is no minimum wage in Georgia 
for non-government worker
s from which employers might seek 
flexibility.  Unions are not strong anywhere in Georgia. 
 
8. Q. Has the host government or private industry taken 
action to increase the country's competitiveness, such as 
improving infrastructure, reducing bureaucratic requirements, 
developing the textiles (fabric production) industry, moving 
to higher value-added goods, or identifying niche markets? 
Does post think that the host government or private 
industry's strategy will be successful? 
 
A. The GoG has taken dramatic steps to improve the ease of 
doing business generally and improve the competitiveness of 
Georgian industry.  The World Bank has named Georgia the top 
reformer in the world in 2007.  The government is working to 
improve roads, is opening a new airport in Batumi, has 
reduced bureaucratic requirements and licensing, reduced 
taxes, enacted extremely liberal laws regulating employment, 
attacked corruption among customs and immigration officials 
at the borders, and intends to completely eliminate import 
duties by 2008.  None of this has been done specifically to 
benefit textile producers, but it can be expected to increase 
the attractiveness of Georgia as a destination for such 
investment. 
 
9.  Q. If your host government is a partner in a free trade 
agreement or a beneficiary of a preference program such as 
AGOA, CBTPA, CAFTA or ATPDEA, will this be sufficient for the 
country to remain competitive? 
 
A. Georgia has a free trade relationship with the countries 
of the former Soviet Union.  So far, Russia has not imposed 
restrictions on imports of Georgian industrial goods and 
textiles and apparel, as it has on agricultural products, 
wine and mineral waters, but tensions with Russia are always 
a drag on economic development in Georgia.  Georgia has not 
yet been able to capitalize on the free trade relationship to 
benefit its textile industry, but the potential exists. 
Greater opportunities than those in Russia and the CIS 
probably lie in the European Union market.  Factories located 
in Georgia have an advantage over Chinese competitors in that 
shipping times to the European market are less and the lead 
time for production of seasonal styles is therefore reduced. 
According to Batumitex, a truck can complete a trip from 
Batumi to Milan or Frankfurt in 6-8 days. and New York is 25 
days away by ship.  Georgia is one of only two CIS countries 
and 15 countries in the world that have GSP  access to the 
European Union market, under which textiles are not duty free 
but receive a reduced tariff.  The EU has been reluctant to 
enter into negotiations for free trade with Georgia, but 
since the suspension of the Doha round has begun to express 
more interest in such an idea. 
 
10.  In sum, Georgia has some potential, for the most part 
unrealized, for attracting textile manufacturing.  Georgia's 
marketing efforts are fairly rudimentary at this point, but 
the favorable publicity generated by the World Bank's ease of 
doing business survey may prompt some manufacturers to take a 
second look at the idea of locating factories in Georgia, 
despite increasing competition from China. 
TEFFT

Wikileaks

06TBILISI2626, GEORGIA RELEASES RUSSIAN OFFICERS

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Reference ID Created Released Classification Origin
06TBILISI2626 2006-10-02 14:25 2011-08-30 01:44 UNCLASSIFIED Embassy Tbilisi

VZCZCXRO6714
OO RUEHAST
DE RUEHSI #2626 2751425
ZNR UUUUU ZZH
O 021425Z OCT 06
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4234
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE

UNCLAS TBILISI 002626 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR DAS BRYZA AND EUR/CARC 
 
E.O. 12958: N/A 
TAGS: PREL GG
SUBJECT: GEORGIA RELEASES RUSSIAN OFFICERS 
 
REF: TBILISI 2601 
 
Summary 
------- 
1. Georgia released four Russian officers detained for spying 
to OSCE Chair-in-Office Karel de Gucht on October 2 in a 
televised handover ceremony.  The Georgians expect further 
Russian retaliation for the incident, such as the reported 
Russian decision to cut off air travel, mail service, and 
money transfers between the two countries.  The separatist 
leaders of Abkhazia and South Ossetia simultaneously 
announced they were pulling out of talks with Georgia, citing 
alleged violations of the 1994 Moscow Agreement.  End 
Summary. 
 
Releasing the GRU Four 
---------------------- 
2. Georgian officials released the four Russian officers, 
detained since September 27 (reftel), to OSCE in a nationally 
televised ceremony outside the Georgian Prosecutor General's 
Office on October 2.  De Gucht and Georgian FM Bezhuashvili 
witnessed the handover.  Each of the four officers was 
handcuffed, carrying a plastic bag and escorted by two 
uniformed police officers.  The officers entered a van to 
take them to the airport, where a Russian plane was waiting 
to take them to Russia. 
 
3. Prior to the handover, de Gucht and Georgian President 
Saakashvili had met and conducted a joint press conference. 
Speaking in English, Saakashvili stressed that Georgia wants 
Russia to treat it as an independent state.  He said he 
believes the relationship will improve in the future.  He 
said the current pressure from Russia is caused by Georgia's 
success in its reforms and in orienting itself toward 
becoming a member of the "Euro-Atlantic family of democratic 
nations."  Saakashvili added that the criminal case against 
the Russians was well-founded.  He said the decision to 
release them was a gesture to the Western allies, not a 
capitulation to Russian threats.  He said it underlined the 
important role OSCE can play.  In his remarks, de Gucht 
expressed support for Georgia's territorial integrity and for 
continuation of the dialogue in the separatist conflicts.  He 
called on Russia to behave toward Georgia in a neighborly 
manner. 
 
Georgians Take Note of Russian Retaliatory Steps 
--------------------------------------------- --- 
4. Georgian press gave extensive attention October 2 to 
reports that Russia had suspended air, sea, rail, and land 
traffic with Georgia.  Ministry of Transport officials said 
they expect October 3 flights to and from Russia to be 
canceled, but Tbilisi Airport information told us they are 
not sure what would happen.  Georgian press stressed that the 
sanctions would apparently prevent money transfers and mail 
delivery. 
 
Separatists Announce Breakoff of Talks 
-------------------------------------- 
5. Practically at the same time the Russians were being 
released in Tbilisi, the press reported that the de facto 
authorities of Abkhazia and South Ossetia were withdrawing 
from talks with Georgia.  The Abkhaz explained their decision 
by claiming the Georgians were violating the 1994 Moscow 
cease-fire agreement by keeping troops in the Upper Kodori 
Gorge.  South Ossetian "president" Kokoity then personally 
announced that his region would join the Abkhaz decision. 
 
Georgian Opposition Supports Government Actions 
--------------------------------------------- -- 
6. Throughout this controversy with Russia, the Georgian 
opposition has presented a unified front -- with the lone 
exception of Labor Party leader Shalva Natalashvili -- in 
supporting the government's decision to detain the Russian 
officers for spying. 
 
TEFFT

Wikileaks