I recently discussed the emerging concept of micropowers, building on a discussion started by Moises Naim and John Robb.

Georgia is a small state of about 4.5 million people of which 84% are Georgian. It’s ethnically homogenous and controls most of its own territory. Being geographically small, independent from the USSR for about 15 years and democratic for three years, Georgia also has little capacity to use hard power in its foreign relations. Although the United States has been training the Georgian military, it is still small and not yet up to NATO standards.

Real Estate Boom

However, Georgia has been benefiting from a type of real estate boom in the region. With the BTC pipeline up and running bringing Azeri oil through Georgia, it’s suddenly found its influence and strategic importance exponentially boosted. On top of that a similar pipeline from Azerbaijan through Georgia transporting natural gas has been built and the BTC pipeline is being extended to bring oil from both Kazakhstan and Turmenistan to Azerbaijan and then through Georgia on route to Turkey. Needless to say, the good is getting better.

But everything is not hunky-dory. The quickly rising value of Georgia’s strategic real estate combined with its Rose Revolution, western orientation and NATO talks have incurred Russia’s wrath which brings us to the question, can Georgia become a micropower? And if so, can it successfully beat back Moscow?

So far, Georgia has played its hand skillfully. It has promoted a democratic image since its revolution in 2003, received a visit by President Bush and enjoyed very good relations with America and later marketed itself (justifiably) as a victim of unprovoked Russian aggression starting with Moscow’s ban of Georgian wine, later mineral water, gas cuts and most recently over the spying row. Following my working formula for micropowers, Georgia has relied on soft power and internationalizing its problems in order to defend itself.

With regard to Abkhazia and South Ossetia, breakaway regions supported and indirectly defended by Russia, Georgia has brought them into the international spotlight by proposing new peace plans at the U.N. through lobbying GUAM .

Advantages and Repercussions

So what does Georgia have going for it? Underdog status. Successful democratic revolution. Bullied by Russia and mostly importantly: real estate! Georgia’s betweenness makes it a key gateway for Azeri, Kazakh and Turkmen oil and gas headed west and we all know alternative pipelines through Iran and Armenia aren’t going to happen anytime soon not to mention that Iraqi oil won’t be coming online anytime soon (which goes through Turkey). Thus Russia is working to keep Kazakhstan from choosing sides. Yet, despite Kazakh investment in Georgia, they too are in a position to apply pressure to Tbilisi should they feel their investments are in danger. On top of that, the ongoing row between Georgia and Russia is set to hit little Armenia hard which could damage relations and push them further into Russia’s arms. But Armenia is another story.

Conclusion

Georgia is in a race against time. Once the regions frozen conflicts and the West-Iran conflict are solved, the “real-estate bubble” will bust. Thus, Saakashvili knows he must get his conflicts on the agenda and secure Georgia a place in the West. To do so requires great skill and not overplaying one’s hand since Russia would love to be given a reason to physically take down Georgia.

John Robb suggests Georgia adopt GG methods to attack Russia’s energy infrastructure which would provide just that. His analysis of Russia’s vulnerability and the ease of attack is spot on, but he misses the bigger picture, namely that Russia would have to know Georgia was behind it but Georgia would have to deny it vehemently. In addition, such an overreaction would surely bring Russian military action with legitimate justification to boot. While provoking what seemed to be an overreaction worked well for Hizballah, that doesn’t translate into a smart move for Tbilisi. Saakashvili’s best move is to keep his conflicts in the spotlight, avoid direct confrontation with Russia and engineer situations which provide cover for forcing the issue and letting Georgia set terms such as the Kodori Gorge Operation and blocking Russia’s admission to the WTO.

I wish them luck and can’t wait to visit!

UPDATE: Just happened to see this. The trend continues. Ukraine stops buying Russian gas, Europeans diversify and now Georgia looks to stop.

• BROWSE / IN TIMELINE
• « Another “special” ad
• » Defending against the Ignominy of Heathenism since 1857