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Russia Raises Pressure on Georgia, Blames U.S. for Protests

Henry Meyer and Helena Bedwell
(Bloomberg) -- Russia targeted Georgia’s wine exports days after banning flights to the Caucasus nation where anti-Kremlin protests are continuing over Moscow’s influence in the former Soviet republic.Russian consumer safety watchdog, Rospotrebnadzor, said Monday it was tightening control over alcoholic drinks produced in Georgia, citing an alleged “deterioration” in the quality of beverages. Russia is Georgia’s largest export market for wine.That followed President Vladimir Putin‘s decision on Friday to suspend flights between Russia and Georgia from July 8 and to press tour operators to stop selling holiday packages to the popular tourist destination visited by 1.4 million Russians last year. Putin’s decision prompted a backlash in Russia, with more than 20,000 signing an online petition demanding the Kremlin cancel the ban because Russians aren’t at risk in Georgia.The surge in tensions came after at least 240 people were hurt in clashes between police and demonstrators in the Georgian capital, Tbilisi, last week. Protesters were angered by pictures of a Russian lawmaker, Sergei Gavrilov, sitting in the speaker’s chair in Georgia’s parliament during a meeting of legislators from Orthodox Christian countries.Relations between the two countries have been tense since Georgia and Russia fought a war in 2008 over the breakaway regions of Abkhazia and South Ossetia, which the Kremlin later recognized as independent. The two territories are considered part of Georgia under international law. Many of the protesters accuse the ruling Georgian Dream government of being too willing to accommodate Russia, which they say occupies 20% of the country.Russian Foreign Minister Sergei Lavrov on Monday pinned the blame for the unrest on what he termed “geopolitical engineering of our Western colleagues.” The U.S. and its allies are “willing to turn a blind eye to ultra-nationalists, Russophobia, in order to cut off ties between the people of Georgia and our country,” Lavrov said in a speech in Moscow.Currency SlidesAmid the tensions, Georgia’s lari currency weakened 1.2% to 2.81 against the dollar at 3:56 p.m. in Tbilisi, close to its all-time low of 2.8150 in December 2016.Protests in Tbilisi extended into a fourth straight day, with demonstrators demanding the resignation of Georgian Interior Minister Giorgi Gakharia over the violence. Drivers of hundreds of cars also joined a protest near the city’s police headquarters.The ban on flights will be reviewed once the anti-Russian mood in Georgia subsides, Kremlin spokesman Dmitry Peskov told reporters on a conference call Monday. “So far, we see that the situation, on the contrary, is getting worse,” he said.The punitive measures are likely to persist because Russia wants to teach Georgia a lesson after Georgian President Salome Zourabichvili described Moscow as an occupier last week, said Fyodor Lukyanov, head of the Council on Foreign and Defense Policy, a research group that advises the Kremlin. "Even if the Georgian government wanted to apologize to Moscow, the domestic situation is such that this would provoke its collapse," he said.The speaker of Georgia’s parliament, Irakli Kobakhidze, submitted his resignation after police fired rubber bullets and tear gas during the clashes that erupted late last Thursday. It was the worst political violence in Georgia since two people died in 2011 protests that targeted then-President Mikheil Saakashvili, an outspoken Putin critic who’s now in exile in Ukraine.Georgian Dream’s billionaire founder, Bidzina Ivanishvili, responded to the protests by announcing changes to the voting system for 2020 parliamentary elections at a briefing with reporters Monday. Prime Minister Mamuka Bakhtadze said the shift to a fully proportional system would expand the number of parties in parliament.(Updates with analyst comment in 10th paragraph)To contact the reporters on this story: Henry Meyer in Moscow at hmeyer4@bloomberg.net;Helena Bedwell in Tbilisi at hbedwell@bloomberg.netTo contact the editors responsible for this story: Gregory L. White at gwhite64@bloomberg.net, Tony Halpin, Paul AbelskyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

(Bloomberg) -- Russia targeted Georgia’s wine exports days after banning flights to the Caucasus nation where anti-Kremlin protests are continuing over Moscow’s influence in the former Soviet republic.

Russian consumer safety watchdog, Rospotrebnadzor, said Monday it was tightening control over alcoholic drinks produced in Georgia, citing an alleged “deterioration” in the quality of beverages. Russia is Georgia’s largest export market for wine.

That followed President Vladimir Putin‘s decision on Friday to suspend flights between Russia and Georgia from July 8 and to press tour operators to stop selling holiday packages to the popular tourist destination visited by 1.4 million Russians last year. Putin’s decision prompted a backlash in Russia, with more than 20,000 signing an online petition demanding the Kremlin cancel the ban because Russians aren’t at risk in Georgia.

The surge in tensions came after at least 240 people were hurt in clashes between police and demonstrators in the Georgian capital, Tbilisi, last week. Protesters were angered by pictures of a Russian lawmaker, Sergei Gavrilov, sitting in the speaker’s chair in Georgia’s parliament during a meeting of legislators from Orthodox Christian countries.

Relations between the two countries have been tense since Georgia and Russia fought a war in 2008 over the breakaway regions of Abkhazia and South Ossetia, which the Kremlin later recognized as independent. The two territories are considered part of Georgia under international law. Many of the protesters accuse the ruling Georgian Dream government of being too willing to accommodate Russia, which they say occupies 20% of the country.

Russian Foreign Minister Sergei Lavrov on Monday pinned the blame for the unrest on what he termed “geopolitical engineering of our Western colleagues.” The U.S. and its allies are “willing to turn a blind eye to ultra-nationalists, Russophobia, in order to cut off ties between the people of Georgia and our country,” Lavrov said in a speech in Moscow.

Currency Slides

Amid the tensions, Georgia’s lari currency weakened 1.2% to 2.81 against the dollar at 3:56 p.m. in Tbilisi, close to its all-time low of 2.8150 in December 2016.

Protests in Tbilisi extended into a fourth straight day, with demonstrators demanding the resignation of Georgian Interior Minister Giorgi Gakharia over the violence. Drivers of hundreds of cars also joined a protest near the city’s police headquarters.

The ban on flights will be reviewed once the anti-Russian mood in Georgia subsides, Kremlin spokesman Dmitry Peskov told reporters on a conference call Monday. “So far, we see that the situation, on the contrary, is getting worse,” he said.

The punitive measures are likely to persist because Russia wants to teach Georgia a lesson after Georgian President Salome Zourabichvili described Moscow as an occupier last week, said Fyodor Lukyanov, head of the Council on Foreign and Defense Policy, a research group that advises the Kremlin. "Even if the Georgian government wanted to apologize to Moscow, the domestic situation is such that this would provoke its collapse," he said.

The speaker of Georgia’s parliament, Irakli Kobakhidze, submitted his resignation after police fired rubber bullets and tear gas during the clashes that erupted late last Thursday. It was the worst political violence in Georgia since two people died in 2011 protests that targeted then-President Mikheil Saakashvili, an outspoken Putin critic who’s now in exile in Ukraine.

Georgian Dream’s billionaire founder, Bidzina Ivanishvili, responded to the protests by announcing changes to the voting system for 2020 parliamentary elections at a briefing with reporters Monday. Prime Minister Mamuka Bakhtadze said the shift to a fully proportional system would expand the number of parties in parliament.

(Updates with analyst comment in 10th paragraph)

To contact the reporters on this story: Henry Meyer in Moscow at hmeyer4@bloomberg.net;Helena Bedwell in Tbilisi at hbedwell@bloomberg.net

To contact the editors responsible for this story: Gregory L. White at gwhite64@bloomberg.net, Tony Halpin, Paul Abelsky

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.