UNRESOLVED CONFLICTS IN THE CAUCASUS ARE "THE MOST LIKELY FLASHPOINTS" IN THE EURASIA REGION

Georgian Business Week
-4feb-96bb-486bc176e329
Feb 8 2010

The newly appointed U.S. director of national intelligence, Dennis
Blair, presented the annual threat assessment report prepared by all of
the 17 national intelligence-gathering agencies to the Senate Select
Intelligence Committee. The conclusion of the American intelligence
agencies is that "Russia has been trying to put sticks in our wheels
at any opportunity," but the economic crisis "is probably causing
Russia to do some reconsidering."

Outlook for Russia

The role Moscow plays regarding issues of interest to the United States
is likely to turn on many factors, including developments on Russia’s
periphery and the degree to which Russia perceives US policies as
threatening to what its leadership sees as vital Russian interests.

There have been encouraging signs in the past year that Russia is
prepared to be more cooperative with the United States, as illustrated
by President Medvedev’s agreement last summer to support air transit
through Russia of lethal military cargo in support of coalition
operations in Afghanistan and Moscow’s willingness to engage
with the United States on constructive ways to reduce the nuclear
threat from Iran. I remain concerned, however, that Russia looks
at relations with its neighbors in the former Soviet space–an area
characterized by President Medvedev as Russia’s "zone of privileged
interests"–largely in zero-sum terms, vis a vis the United States,
potentially undermining the US-Russian bilateral relationship. Moscow,
moreover, has made it clear it expects to be consulted closely on
missile defense plans and other European security issues.

On the domestic front, Moscow faces tough policy choices in the face
of an uptick in violence in the past year in the chronically volatile
North Caucasus, which is fueled in part by a continuing insurgency,
corruption, organized crime, clan competition, endemic poverty,
radical Islamist penetration, and a lagging economy that is just
beginning to recover from the global economic crisis. Some of the
violence elsewhere in Russia, such as a deadly train bombing in late
November 2009, may be related to instability in the North Caucasus.

In addressing nationwide problems, Medvedev talks about Russia’s need
to modernize the economy, fight corruption, and move toward a more
rule-of-law-based and pluralistic political system, but he faces
formidable opposition within the entrenched elite who benefit from
the status quo. Turbulence in global energy markets was a painful
reminder to Moscow of the Russian economy’s overdependence on
energy, dramatizing the need for constructive steps toward economic
modernization and diversification. However, moving forward on issues
such as reforming Russia’s state corporations or creating conditions
more conducive to foreign investors could produce a backlash by those
forces who might lose from competition.

Potential Flashpoints in Eurasia

The unresolved conflicts of the Caucasus provide the most likely
flashpoints in the Eurasia region. Moscow’s expanded military presence
in and political-economic ties to Georgia’s separatist regions of
South Ossetia and sporadic low-level violence increase the risk of
miscalculation or overreaction leading to renewed fighting.

Although there has been progress in the past year toward Turkey-Armenia
rapprochement, this has affected the delicate relationship between
Armenia and Azerbaijan, and increases the risk of a renewed conflict
over Nagorno-Karabakh.

Economic crisis and political competition among top Ukrainian leaders
pose the greatest risk of instability in Ukraine, particularly in
connection with this year’s presidential election.

Competition between President Yushchenko and his primary rivals, Prime
Minister Tymoshenko and Party of Regions leader Yanukovych resulted
in economic reform being put on the back burner and complicated
relations with Russia over gas payments. Moreover, noncompliance with
the conditions set by international financial institutions has put
the country’s economy in further jeopardy.

The regimes of Central Asia–Kazakhstan, Uzbekistan, Kyrgyzstan,
Tajikistan, and Turkmenistan–have been generally stable so far,
but predicting how long this will remain the case is difficult. The
region’s autocratic leadership, highly personalized politics, weak
institutions, and social inequality make predicting succession politics
difficult and increase the possibility that the process could lead to
violence or an increase in anti-US sentiment. There is also concern
about the ability of these states, especially Kyrgyzstan, Tajikistan,
and Turkmenistan, to manage the challenges if Islamic extremism spreads
to the region from Pakistan and Afghanistan. The risks are compounded
by the economic crisis, which has resulted in reduced remittances to
the region, and by perennial food and energy shortages in some parts
of Central Asia. Competition over water, cultivable land, and ethnic
tensions could serve as sparks for conflict.