Georgia eyes payback from Russia for WTO deal

TBILISI Tue Nov 13, 2012 1:14pm EST

TBILISI (Reuters) - Georgia's new government wants Russia to rebuild trade ties and expects Moscow to reward Tbilisi for a deal that allowed its neighbor to join the World Trade Organisation (WTO), its special Russia envoy told Reuters.

"Georgia gave its consent for Russia's entry to the WTO, which was not an easy decision, but there have been no positive steps from Moscow so far," Zurab Abashidze said, referring to Russia's WTO accession in August after 18 years of negotiations.

"We expect such steps," he said on Monday.

Abashidze, appointed this month by Prime Minister Bidzina Ivanishvili, also suggested that Georgia's decision on whether to compete in the 2014 Winter Olympics Russia is hosting in Sochi would depend on whether relations improve.

Abashidze said Ivanishvili's statement last month that Georgia should participate at Sochi, up the Black Sea coast from Georgia, did not amount to a final decision to compete.

"It's a positive signal to Moscow, but it does not mean that Georgia is ready to compete in the Olympics in Russia... We need to clarify the political picture before taking such a decision."

Lawmakers led by Saakashvili, whose final term as president ends next year, had also considered calling on other nations to boycott Sochi, considered the personal project of Russian President Vladimir Putin and which has cost millions of dollars.

Ivanishvili led his coalition to victory in an October 1 election, ending President Mikheil Saakashvili's nine-year political dominance in Georgia, a focus of tensions between Russia and the West and a transit for energy exports to Europe.

The billionaire tycoon has pledged to prioritize relations with the West, following in U.S. ally Saakashvili's footsteps.

He also says he wants to improve ties with Moscow that were badly damaged by a five-day war in 2008 that followed strains over Saakashvili's efforts to bring into NATO a country that was in Moscow's thrall for nearly two centuries before the 1991 Soviet collapse.

At the same time, he wants to avoid appearing to accept Moscow's control over Abkhazia and South Ossetia, two breakaway Georgian regions that Russia recognized as independent states after routing Georgian forces in the war in August 2008.

"I think we can start talking and solving problems which are not behind so-called 'red lines' such as recognition of Abkhazia and South Ossetia," Abashidze told Reuters.

He cited as an issue for discussion: Georgian wine, mineral water and other products Moscow barred in 2006. Wine and mineral water exports to Russia, popular in the region since the Soviet era, make up almost a third of total Georgian exports.

REGIONAL SECURITY

Abashidze said cooperation on regional security, particularly the fight against drugs and weapons smuggling, as well as cultural and humanitarian cooperation between the former Soviet republics, were also up for discussion.

With Russian forces based in Abkhazia and South Ossetia and Moscow saying the Georgian government should treat the regions as nations, security is fraught.

Abashidze said that restoration of diplomatic relations, severed after the war, was not on the agenda for now.

"If Georgia restores diplomatic ties unilaterally, it would mean that we are legalizing a reality that has been created after the war," he said. "But if our dialogue produces some real and tangible results, this issue may get onto our agenda."

Abashidze said Ivanishvili's visit this week to Brussels, his first foreign trip as prime minister, underscored that relations with the West were the priority.

"We also have our own "red lines" such as our sovereignty, territorial integrity and freedom in our foreign relations," Abashidze said.

He said Georgia would be "consistent but principled" in any talks with Moscow. "We are not going to give up on fundamental issues. At the same time we don't want to imitate cooperation and to create an illusion of progress," he said.

Ivanishvili is keen to be seen as forceful in his dealings with Russia, where he made much of his estimated $6.4 billion fortune. He worked hard during the election campaign to deflect accusations that he is a Kremlin stooge.

Abashidze, 61, was ambassador to Russia in 2000-2004, a period that coincided with Putin's first term and came mostly before Saakashvili came to power in Georgia in the wake of the 2003 Rose Revolution.

(Editing by Steve Gutterman and Louise Ireland)