On October 1st, 2012, it was time. And the show went on. The increasingly-autocratic and dysfunctional government of Mikheil Saakashvili was swept away by the giddy tide of Bidzina Ivanishvili’s cobbled-together coalition, Georgian Dream.
You might say this emphatic rejection of the ruling party, Saakashvili’s United National Movement, and the thrusting into the ring of Georgia’s prodigal son and allegedly-eccentric billionaire – Bidzina Ivanishvili – was greeted in the west with the enthusiastic welcome normally reserved for a turd in the punch bowl, or a cockroach on a wedding cake. The west, not to put too fine a point on it, doted on the Columbia-educated, multilingual Georgian president (which he still is, until this October) as one of its own; a bold reformer and tireless advocate for western-style democracy – a fiction kept breathing by regular infusions of Georgian-taxpayer money to western lobbyists and PR firms, who sang the saccharine praises of Saakashvili the west loved to hear.
So says Lincoln Mitchell, in his punchy “What’s Next For Georgia? The End of the Rose Revolution“. My favourite outtake from this piece is, “Thus, this election did not end the Rose Revolution, because the Rose Revolution was already over. Rather, it defeated a regime that had used the imagery of the Rose Revolution to stay in power.” Amen, Mr. Mitchell. Full disclosure; Lincoln Mitchell was an “informal adviser” to the Georgian Dream party in the last election.
To the great surprise of no one, articles quickly proliferated which suggested Ivanishvili was a Russian stooge. Yulia Latynina – living proof of the chestnut that the wise speak because they have something to say, fools because they have to say something – cast Ivanishvili as “Georgia”s Chavez” (Hugo Chavez had died recently at the time, and our Yulia went on a bit of a Chavez bender for a couple of weeks). According to her, Ivanishvili would “destroy the state machinery that President Mikheil Saakashvili created that had done such a good job of serving peoples’ interests”, and had better get busy thinking up a distraction so Georgians would not remember his “grossly exaggerated campaign promises”. Julia Ioffe, like many western sources, focused on his reclusivness, his outsize home and his zoo of exotic animals to portray him as a kind of semi-political Michael Jackson.
Georgia under Ivanishvili presents the west with a dilemma – it wants Georgia and Georgians to succeed, of course, but it wants that to happen under a leader it controls, or one who by his own proclivities identifies as one with the western reformers. The last thing the west wants for Georgia is for it to drift back into Russia’s orbit. Consequently, Bidzina Ivanishvili is about as popular as a tax hike with most of the west, which paints a picture of him as a bumbling loser whose victory was beginner’s luck on an almost unbelievable scale, an anomaly that would soon be put right once Georgians realized he was just some kind of charming nut, and begged for Saakashvili to restore the normal functioning of government.
Well, let’s drop in on Ivanishvili, shall we? See how he’s really doing.
A good place to start might be with Georgia’s economic indicators. It’s a bit early to expect Ivanishvili to have turned everything around, for better or for worse, but let’s take a look. The currency is stable. GDP is up sharply, as is per-capita GDP – the latter has risen to double the average. GDP adjusted for Purchasing Power Parity (PPP) is also up. Growth is down, which is worrisome, but it’s still early in the year.
Employment and wages are both up steeply, while unemployment is headed back down after a steady climb. The average is a shameful 13.47%, and that’s the rate the previous government would acknowledge; it was likely a good deal higher. Getting people back to work should be a priority, and it looks like it is.
The Consumer Price Index (CPI) looks like it has leveled off, and both the GDP deflator and inflation are down. Interest rates are headed down.
Trade is a little worrying; the trade balance is a bit more negative than the last measurement, and much worse than the average; Georgia imported considerably more than it imported since the last measurement. However, Ivanishvili has made restoration of friendly trading relations with Russia a priority, and for its own part, Russia’s membership in the WTO restricts it from discriminating against Georgia in trade relations. Russia is a major market for Georgian goods, as the economy is heavily agrarian. A return of Georgian wines and mineral water to Russian markets – any time now, it was scheduled to take place this spring – will also be a boost to the economy. Meanwhile, both exports and imports are satisfyingly up by more than double the average.
Government debt to GDP is down, while government spending is up. The government budget is less of GDP than the last measurement, and far less than what has become the average. Industrial production is way down, but it is measured annually, and this is still early in the year. Consumer spending is up sharply.
Unless Saakashvili has completely reversed his previous economic performance and this is all his doing – doubtful – Ivanishvili appears to be doing pretty well, and efforts by outsiders to turn the Georgian people against him appear to have been of little avail.
Encouraging, too, has been his insistence on trimming the President’s expenses, taking away one of the two jets reserved for his use and directing the exterior lights that illuminate the presidential palace at night be turned off to save money. This might seem like mean-spirited squabbling until you consider it costs Georgians nearly $85,000 USD per day to maintain the office of the President in the style to which he has become accustomed, in a country where pensions for ordinary Georgians are $60 USD per month.
Recent polls suggest Ivanishvili and Georgian Dream remain strongly popular, while the best Saakashvili can muster is about 10,000 people to hear him rave about what a great opposition leader he is. Even though the author of the latter piece points out that much of the “crowd” – like the White Ribbon Protests in Russia – is comprised of “chronic protesters” who will come out for anything as long as it’s a protest, he still chides Ivanishvili for revealing that Saakashvili spent public funds to take lavish vacations and buy luxurious gifts. Arresting UNM officials and initiating investigations into Saakashvili’s closest allies is also apparently childish and unseemly in a democratic leader, despite the numerous criminal scandals that erupted in the latter days of Saakashvili’s reign.
Don’t look there for values, Mr. Ivanishvili.