|Republic of South Ossetia
Республикæ Хуссар Ирыстон / Respublikæ Khussar Iryston ( Ossetic)
სამხრეთი ოსეთი / Samkhret Oseti ( Georgian)
Республика Южная Осетия / Respublika Yuzhnaya Osetiya (Russian)
|Anthem: National Anthem of South Ossetia|
Map of South Ossetia
South Ossetia (in green) and Georgia proper (in grey)
|Official languages||Ossetic, Georgian, Russian1|
|Recognised regional languages||Georgian|
|-||Prime Minister||Vadim Brovtsev|
|Independence from Georgia|
|-||Declared||28 November 1991|
|-||Recognized2||26 August 2008|
1,506 sq mi
|Currency|| Russian ruble (
|Time zone||( UTC+3)|
|Drives on the||right|
|1.||Russian language is "official language of government authorities, public administration and local self-government".|
|2.||Independence has only been partially recognised internationally.|
South Ossetia (pronounced /əˈsɛdiə/ ə-SED-ee-ə or /ɒˈsiːʃə/ o-SEE-shə; Ossetic: Хуссар Ирыстон, Khussar Iryston; Georgian: სამხრეთ ოსეთი, Samxret Oseti; Russian: Южная Осетия, Yuzhnaya Osetiya) or Tskhinvali Region ( Georgian: ცხინვალის რეგიონი, Tsxinvalis regioni; Russian: Цхинвальский регион, Tskhinvalskiy region) is a disputed region and partly recognized state in the South Caucasus, located in the territory of the South Ossetian Autonomous Oblast within the former Georgian Soviet Socialist Republic.
South Ossetians declared independence from Georgia in 1990, calling themselves the "Republic of South Ossetia". The Georgian government responded by abolishing South Ossetia's autonomy and trying to retake the region by force. This led to the 1991–1992 South Ossetia War. Georgian fighting against those controlling South Ossetia occurred on two other occasions, in 2004 and 2008. The last conflict led to the 2008 South Ossetia war, during which Ossetian separatists and Russian troops gained full, de-facto, control of the territory of the former South Ossetian Autonomous Oblast.
In the wake of the 2008 South Ossetia War, Russia, Nicaragua, Venezuela and Nauru recognized South Ossetia as an independent republic. Georgia does not recognize South Ossetia's existence as a political entity, and considers most of its territory a part of the Shida Kartli region within Georgian sovereign territory occupied by the Russian army.
Medieval and early modern period
The Ossetians are originally descendants of the Alans, a Sarmatian tribe. They became Christians during the early Middle Ages, under the Byzantine and Georgian influences. Under Mongol rule, they were pushed out of their medieval homeland south of the Don River in present-day Russia and part migrated towards and over the Caucasus mountains (into the kingdom of Georgia and into the lands of present-day North Ossetia-Alania), where they formed three distinct territorial entities. Digor in the west came under the influence of the neighboring Kabard people, who introduced Islam. Kudar in the south became what is now South Ossetia, part of the historical Georgian principality of Samachablo where Ossetians found refuge from Mongol invaders. Iron in the north became what is now North Ossetia, under Russian rule from 1767. The vast majority of the Ossetians are Orthodox Christians; there is also a significant Muslim minority.
South Ossetia as a part of the Soviet Union
The territory that is now modern-day South Ossetia joined Russia in 1801, along with Georgia proper, and absorbed into the Russian Empire. Following the Russian Revolution, South Ossetia became a part of the Menshevik Georgian Democratic Republic, while the North Ossetia became a part of the Terek Soviet Republic. "The Georgian Menshevik government accused Ossetians of cooperating with Russian Bolsheviks. A series of Ossetian rebellions took place between 1918 and 1920 during which claims were made to an independent territory. Violence broke out in 1920 when Georgian Mensheviks sent National Guards and regular army units to Tskhinvali to crush the uprisings. Ossetian sources claim that about 5,000 Ossetians were killed and more than 13,000 subsequently died from hunger and epidemics"
The Soviet Georgian government established after the Red Army invasion of Georgia in 1921 created the South Ossetian Autonomous Oblast in April 1922. Although the Ossetians had their own language ( Ossetian), Russian and Georgian were administrative/state languages. Under the rule of Georgia's government during Soviet times, it enjoyed partial autonomy, including speaking the Ossetian language and teaching it in schools.
The tensions in the region began to rise amid the rising nationalism among both Georgians and Ossetians in 1989. Before this, the two communities of the South Ossetian Autonomous Oblast of Georgian SSR had been living in peace with each other except for the 1918-1920 events. Both ethnicities have had a high level of interaction and high rates of intermarriages.
The influential South Ossetian Popular Front (Ademon Nykhas) was created in 1988. On 10 November 1989, the South Ossetian regional council asked the Georgian Supreme Council (in Russian: Верховный Совет Грузии) for the region to be upgraded to that of " autonomous republic". In 1989, the Georgian Supreme Council established Georgian as the principal language countrywide.
The Georgian Supreme Council adopted a law barring regional parties in summer 1990. This was interpreted by Ossetians as a move against Ademon Nykhas and led to Ossetians proclaiming South Ossetia as the South Ossetian Democratic Republic on September 20, 1990, fully sovereign within the Union of Soviet Socialist Republics (USSR). Ossetians boycotted subsequent Georgian parliamentary elections and held their own contest in December. The Georgian government headed by Zviad Gamsakhurdia declared this election illegitimate and abolished South Ossetia's autonomous status altogether on 11 December 1990.
Violent conflict broke out towards the end of 1990. Russian and Georgian interior ministry troops were dispatched to South Ossetia in December, with war starting on January 5, 1991, when Georgian troops entered Tskhinvali. The fighting was characterised by general disregard for international humanitarian law by uncontrollable militias, with both sides reporting atrocities. During the war, many South Ossetian villages were attacked and burned, as were Georgian houses and schools in Tskhinvali, the capital of South Ossetia. As a result, approximately 1,000 died and about 100,000 ethnic Ossetians fled the territory and Georgia proper, most across the border into North Ossetia. A further 23,000 ethnic Georgians fled South Ossetia and settled in other parts of Georgia. Many South Ossetians were resettled in uninhabited areas of North Ossetia from which the Ingush had been expelled by Stalin in 1944, leading to conflicts between Ossetians and Ingush over the right of residence in former Ingush territory.
The western part of South Ossetia was affected by the 1991 Racha-Java earthquake, which killed 200 and left 300 families homeless.
In 1992, Georgia accepted a ceasefire to avoid a large scale confrontation with Russia. The government of Georgia and South Ossetian separatists reached an agreement to avoid the use of force against one another, and Georgia pledged not to impose sanctions against South Ossetia. However, the Georgian government still retained control over substantial portions of South Ossetia, including the town of Akhalgori. A peacekeeping force of Ossetians, Russians and Georgians was established. On 6 November 1992, the Organization for Security and Cooperation in Europe (OSCE) set up a mission in Georgia to monitor the peacekeeping operation. From then until mid-2004 South Ossetia was generally peaceful. In June 2004, serious tensions began to rise as the Georgian authorities strengthened their efforts to bring the region back under Tbilisi rule, by establishing an alternative pro-Georgian government for South Ossetia in Tbilisi. Georgia also sent police to close down a vast black market complex, which was one of the region's chief sources of revenue, leading to fighting by Georgian troops and peacekeepers against South Ossetian militiamen and freelance fighters from Russia. Hostage takings, shootouts and occasional bombings left dozens dead and wounded. A ceasefire deal was reached on 13 August though it was repeatedly violated.
The Georgian government protested against the continually increasing Russian economic and political presence in the region and against the uncontrolled military of the South Ossetian side. It also considered the peacekeeping force (consisting in equal parts of South Ossetians, North Ossetians, Russians and Georgians) to be non-neutral and demanded its replacement. This criticism was supported by the U.S. senator Richard Lugar. EU South Caucasus envoy Peter Semneby said later that "Russia's actions in the Georgia spy row have damaged its credibility as a neutral peacekeeper in the EU's Black Sea neighbourhood." Later, Joseph Biden (Chairman, U.S. Senate Foreign Relations Committee), Richard Lugar, and Mel Martinez sponsored a resolution accusing Russia of attempting to undermine Georgia's territorial integrity and called for replacing the Russian-manned peacekeeping force operating under CIS mandate.
The prelude to the conflict began with violent clashes on Wednesday, 6 August 2008 with both sides claiming having been fired upon by the other. Separatist authorities in South Ossetia said that Georgia shelled South Ossetian villages, killing six Ossetians. The Georgian interior ministry claimed Georgian forces had returned fire only after South Ossetian positions shelled Georgian-controlled villages injuring six civilians and one Georgian policeman. The Georgian interior ministry accused the South Ossetian side of "trying to create an illusion of serious escalation, an illusion of war." In addition, the commander of the Georgian peacekeeping unit, General Kurashvili, accused the Russian peacekeepers of participating in the shelling of the Georgian villages. South Ossetia denied provoking the conflict.
According to Moscow Defense Brief, over the course of several days in early August, the Georgians concentrated a significant number of troops and equipment, including the full 2nd, 3rd and 4th Infantry Brigades, the Artillery Brigade, the elements of the 1st Infantry Brigade, the separate Gori Tank Battalion, among others — all in all, up to 16,000 men — in the Georgian enclaves in the South Ossetian conflict zone, under cover of providing support for the exchange of fire with Ossetian formations." International Institute for Strategic Studies and Western intelligence experts give a lower estimate, saying that the Georgians had amassed about 12,000 troops and 75 tanks on the South Ossetian border by 7 August.
On 7 August, Georgian and Ossetian forces agreed on a ceasefire. However, in the first hours of 8 August 2008, Georgia launched a massive attack. According to a report prepared by the Georgian government, the Georgian army acted after a large number of Russian troops and around 150 armored vehicles and trucks entering the South Ossetia territory through the Roki tunnel on the night of August 7. Allegedly the Russian military and Ossetian militia started a heavy artillery bombardment of the Georgian populated village Tamarasheni located on the outskirts of Tskhinvali at 9pm on August 7. However, an OSCE monitoring group in Tskhinvali did not record outgoing artillery fire from the South Ossetian side in the hours before the start of Georgian bombardment, and NATO officials attest to minor skirmishes but nothing that amounted to a provocation, according to Der Spiegel. Georgia's claim that it responded to a large-scale Russian invasion has received little support from Georgia's allies, the US and NATO.
The accounts of who started the war remains contradictory. Erosi Kitsmarishvili, Georgia's former ambassador to Moscow and a confidant of President Mikheil Saakashvili, in his testimony to the Parliament of Georgia said that Georgian government was preparing to start the war in South Ossetia.
After a prolonged artillery attack, Georgian troops with tanks and air support entered South Ossetian-controlled territory. On the same day, twelve Russian peacekeepers were killed and nearly 150 injured. Heavy fighting was reported in Tskhinvali for most of 8 August, with Georgian forces attempting to push Ossetians slowly from the city. The following day, Russia deployed forces into South Ossetia to remove Georgian forces from South Ossetia. Additionally, Russia targeted Georgia's military infrastructure to reduce Georgia's ability to conduct another incursion. Russian troops and the South Ossetians pushed the Georgian army out of South Ossetia and moved farther, occupying Gori, Kareli, Kaspi and Igoeti in Georgia proper. Parallel to these events Russian forces also entered western Georgia from another breakaway region of Abkhazia occupying Zugdidi, Senaki and the major Georgian port of Poti.
Following an EU sponsored cease-fire between Georgia and Russia, Russia pulled its forces back to Russia and South Ossetia, finishing the withdrawal by 8 October. The war left mostly Ossetian city Tskhinvali in ruins, ethnic Georgian villages burnt and razed to the ground, leaving 24,000 Ossetians and 15,000 ethnic Georgians displaced, according to an Amnesty International report.
South Ossetia covers an area of about 3,900 km2 (1,506 sq mi) on the southern side of the Caucasus, separated by the mountains from the more populous North Ossetia (part of Russia) and extending southwards almost to the Mtkvari river in Georgia. It is extremely mountainous, with most of the region lying over 1,000 m (3,281 ft) above sea level, and its highest point is the Mount Khalatsa, at 3,938 m (12,920 ft) above sea level. Its economy is primarily agricultural, although less than 10% of South Ossetia's land area is cultivated. Cereals, fruit and vines are the major produce. Forestry and cattle industries are also maintained. A number of industrial facilities also exist, particularly around the capital, Tskhinvali.
The European Union, Council of Europe, North Atlantic Treaty Organization (NATO) and most UN member countries do not recognize South Ossetia as an independent state. The de facto republic governed by the secessionist government held a second independence referendum on 12 November 2006, after its first referendum in 1992 was not recognized by most governments as valid. According to the Tskhinvali election authorities, the referendum turned out a majority for independence from Georgia where 99% of South Ossetian voters supported independence and the turnout for the vote was 95%. The referendum was monitored by a team of 34 international observers from Germany, Austria, Poland, Sweden and other countries at 78 polling stations. However, it was not recognized internationally by the UN, European Union, OSCE, NATO and the Russian Federation, given the lack of ethnic Georgian participation and the legality of such a referendum without recognition from the Georgian government in Tbilisi. The European Union, OSCE and NATO condemned the referendum.
Parallel to the secessionist held referendum and elections, the Ossetian opposition movement ( People of South Ossetia for Peace) to Eduard Kokoity, the current President of South Ossetia, organized their own elections in contemporaneously Georgian-controlled areas within South Ossetia, in which Georgian and some Ossetian inhabitants of the region voted in favour of Dmitry Sanakoyev as the alternative President of South Ossetia. The alternative elections of Sanakoyev claimed full support of the ethnic Georgian population.
In April 2007, Georgia created the Provisional Administrative Entity of South Ossetia and staffed by ethnic Ossetian members of the separatist movement. Dmitry Sanakoyev was assigned as the leader of the Entity. It was intended that this provisional administration would negotiate with central Georgian authorities regarding its final status and conflict resolution. On 10 May 2007, Sanakoyev was appointed by the President of Georgia as the Head of South Ossetian Provisional Administrative Entity.
On July 13, 2007, Georgia set up a state commission, chaired by the Prime Minister Zurab Noghaideli, to develop South Ossetia's autonomous status within the Georgian state. According to the Georgian officials, the status was to be elaborated within the framework of "an all-inclusive dialogue" with all the forces and communities within the Ossetian society.
Following the 2008 South Ossetia war, Russia recognized South Ossetia as independent. This unilateral recognition by Russia was met by condemnation from Western Blocs, such as NATO, OSCE and the European Council due to the violation of Georgia's territorial integrity. The EU's diplomatic response to the news was delayed by disagreements between Eastern European states and the UK wanting a harsher response and Germany, France, and other states' desire not to isolate Russia. Former US envoy Richard Holbrooke said the conflict could encourage separatist movements in other former Soviet states along Russia's western border. Several days later, Nicaragua became the second country to recognize South Ossetia. Venezuela recognised South Ossetia on September 10, 2009, becoming the third UN member state to do so.
On August 30, 2008, Tarzan Kokoity, the Deputy Speaker of South Ossetia's parliament, announced that the region would soon be absorbed into Russia, so that South and North Ossetians could live together in one united Russian state. Russian and South Ossetian forces began giving residents in Akhalgori, the biggest town in the predominantly ethnic Georgian eastern part of South Ossetia, the choice of accepting Russian citizenship or leaving. However, Eduard Kokoity, the current president of South Ossetia, later stated that South Ossetia would not forgo its independence by joining Russia: “We are not going to say no to our independence, which has been achieved at the expense of many lives; South Ossetia has no plans to join Russia." Civil Georgia has said that this statement contradicts previous ones made by Kokoity earlier that day, when he indicated that South Ossetia would join North Ossetia in the Russian Federation.
During the opening ceremony of a new building of the Georgian Embassy in Kiev (Ukraine) in November 2009 Georgian President Mikheil Saakashvili stated that residents of South Ossetia and Abkhazia could also use its facilities "I would like to assure you, my dear friends, that this is your home, as well, and here you will always be able to find support and understanding".
Law on Occupied Territories of Georgia
31 Oct. 2008 President Saakashvili has signed into law a document on the occupied territories passed by Parliament last week. The law covers breakaway Abkhazia and the Tskhinvali region (territories of former South Ossetian Autonomous Oblast).
The law envisages restrictions on free movement and economic activities in the territories. In particular, according to the law, foreign citizens should only enter the two breakaway regions through Georgia proper.
The law specifies that in case of Abkhazia the entry should be carried out from the Zugdidi District and in case of South Ossetia - from the Gori District. The major road leading to South Ossetia from the rest of Georgia passes through the Gori District.
The document, however, also lists those “special cases” in which entry into the breakaway regions will not be regarded as illegal. It says that “a special permit” on entry into the breakaway regions can be issued, if this trip there “serves Georgia’s state interests; peaceful resolution of the conflict; de-occupation or humanitarian purposes.”
The law also bans “any type of economic activity – entrepreneurial or non- entrepreneurial,” if such activities require permits, licenses or registration in accordance with Georgian legislation. It also bans air, sea and railway communications and international transit via the regions; and mineral exploration and money transfers. The provision covering economic activities is retroactive, going back to 1990.
The law says that the Russian Federation – the state, “which has carried out military occupation” – is fully responsible for the violation of human rights in Abkhazia and South Ossetia. The Russian Federation, according to the document, is also responsible for compensation of “material and moral damage inflicted on Georgian citizens, stateless persons and foreign citizens, who are in Georgia and enter the occupied territories with appropriate permits.” The law also says that de facto state agencies and officials operating in the occupied territories are regarded as “illegal.”
The law will remain in force until “the full restoration” of Georgian jurisdiction over the breakaway regions is realised.
Until the armed conflict of August 2008, South Ossetia consisted of a checkerboard of Georgian-inhabited and Ossetian-inhabited towns and villages. The largely Ossetian capital city of Tskhinvali and most of the other Ossetian-inhabited communities were governed by the separatist government, while the Georgian-inhabited villages and towns were administered by the Georgian government. This close proximity and the intermixing of the two communities has made the Georgian–Ossetian conflict particularly dangerous, since any attempt to create an ethnically pure territory would involve population transfers on a large scale.
The political dispute has yet to be resolved and the South Ossetian separatist authorities govern the region with effective independence from Tbilisi. Although talks have been held periodically between the two sides, little progress was made under the government of Eduard Shevardnadze (1993–2003). His successor Mikheil Saakashvili (elected 2004) made the reassertion of Georgian governmental authority a political priority. Having successfully put an end to the de facto independence of the southwestern province of Ajaria in May 2004, he pledged to seek a similar solution in South Ossetia. After the 2004 clashes, the Georgian government has intensified its efforts to bring the problem to international attention. On 25 January 2005, President Saakashvili presented a Georgian vision for resolving the South Ossetian conflict at the PACE session in Strasbourg. Late in October, the U.S. Government and the OSCE expressed their support to the Georgian action plan presented by Prime Minister Zurab Noghaideli at the OSCE Permanent Council at Vienna on 27 October 2005. On 6 December, the OSCE Ministerial Council in Ljubljana adopted a resolution supporting the Georgian peace plan which was subsequently rejected by the South Ossetian de facto authorities.
Republic of South Ossetia
On September 11, 2006, the South Ossetian Information and Press Committee announced that the republic would hold an independence referendum (the first referendum had not been recognized by the international community as valid in 1992) on 12 November 2006. The voters would decide on whether or not South Ossetia "should preserve its present de facto status of an independent state". Georgia denounced the move as a "political absurdity". However, on 13 September 2006, the Council of Europe (CoE) Secretary General Terry Davis commented on the problem, stating that it would be unlikely that anyone would accept the results of this referendum and instead urged South Ossetian government to engage in the negotiations with Georgia. On 13 September 2006 European Union Special Representative to the South Caucasus, Peter Semneby, while visiting Moscow, said: "results of the South Ossetian independence referendum will have no meaning for the European Union". Peter Semneby also added that this referendum would not contribute to the peaceful conflict resolution process in South Ossetia.
Ethnic Ossetians and Russians living in South Ossetia nearly unanimously approved a referendum on 12 November 2006 opting for independence from Georgia. The referendum was hugely popular, winning between 98 and 99 percent of the ballots, flag waving and celebration marked were seen across South Ossetia, but elsewhere observers were less enthusiastic. Ethnic Georgians living in South Ossetia boycotted the referendum. International critics claimed that the move could worsen regional tensions, and the Tbilisi government thoroughly discounted the results. "Everybody needs to understand, once and for all, that no amount of referenda or elections will move Georgia to give up that which belongs to the Georgian people by God's will," declared Georgi Tsagareishvili, leader of the Industrialist’s bloc in Georgia's parliament.
The People of South Ossetia for Peace was founded in October 2006 by the ethnic Ossetians who were outspoken critics and presented a serious opposition to secessionist authorities of Eduard Kokoity.
The group headed by the former defence minister and then prime minister of secessionist government Dmitry Sanakoyev organized the so-called alternative presidential election, on 12 November 2006– parallel to those held by the secessionist authorities in Tskhinvali. High voter turnout was reported by the alternative electoral commission, which estimated over 42,000 voters from both Ossetian (Java district and Tskhinvali) and Georgian (Eredvi, Tamarasheni, etc.) communities of South Ossetia and Sanakoyev reportedly received 96% of the votes. Another referendum was organized shortly after asking for the start of negotiations with Georgia on a federal arrangement for South Ossetia received 94% support. However, People of South Ossetia for Peace turned down a request from a Georgian NGO, “Multinational Georgia”, to monitor it and the released results were very likely to be inflated.
According to the International Crisis Group, "Georgian government’s steps are non-violent and development-oriented but their implementation is unilateral and so assertive that they are contributing to a perceptible and dangerous rise in tensions".
Initially the entity of Sanakoyev was known as "the Alternative Government of South Ossetia", but during the course of 2007 the central authorities of Georgia decided to give it official status and on 13 April the formation of "Provisional Administration of South Ossetia" was announced. On 10 May 2007 Dmitry Sanakoyev was appointed head of the provisional administrative entity in South Ossetia.
An EU fact finding team visited the region in January 2007. Per Eklund, Head of the Delegation of the European Community to Georgia said that “None of the two alternatives do we consider legitimate [in South Ossetia].”
Before the Georgian-Ossetian conflict roughly two-thirds of the population of South Ossetia was Ossetian and 25-30% was Georgian. The eastern quarter of the country, around the town and district of Akhalgori, is predominantly Georgian, while the centre and west are predominantly Ossete. Much of the mountainous north is scarcely inhabited. (See map at Languages of the Caucasus.)
Because the statistical office of Georgia was not able to conduct the 2002 Georgian census in South Ossetia, the present composition of the population of South Ossetia is unknown, although according to some estimates there were 47,000 ethnic Ossetians and 17,500 ethnic Georgians in South Ossetia in 2007.
2009 Population Estimate: During the war, HRW stated that 15,000 Georgians fled and a total of 500 citizens of South Ossetia were killed. This left the estimated population at 54,500. However Russia's reconstruction plan involving 600 million dollars in aid to South Ossetia may have spurred immigration into the De Facto independent Republic, especially with Russia's movement of 3,700 soldiers into South Ossetia, in order to prevent further incursions. RIA Novosti places the population of South Ossetia at 80,000 although, this figure is probably too optimistic.
|Ethnicity||1926 census||1939 census||1959 census||1970 census||1979 census||1989 census||2007 estimate|
|Ossetians||60,351 (69.1%)||72,266 (68.1%)||63,698 (65.8%)||66,073 (66.5%)||65,077 (66.4%)||65,200 (65.9%)||47,000 (67.1%)|
|Georgians||23,538 (26.9%)||27,525 (25.9%)||26,584 (27.5%)||28,125 (28.3%)||28,187 (28.8%)||28,700 (29.0%)||17,500 (25.0%)|
|Russians||157 (0.2%)||2,111 (2.0%)||2,380 (2.5%)||1,574 (1.6%)||2,046 (2.1%)||2,128 (2.1%)||2,100 (3.0%)|
|Armenians||1,374 (1.6%)||1,537 (1.4%)||1,555 (1.6%)||1,254 (1.3%)||953 (1.0%)||871 (0.9%)||900 (1.3%)|
|Jews||1,739 (2.0%)||1,979 (1.9%)||1,723 (1.8%)||1,485 (1.5%)||654 (0.7%)||648 (0.7%)||650 (0.9%)|
|Others||216 (0.2%)||700 (0.7%)||867 (0.9%)||910 (0.9%)||1,071 (1.1%)||1,453 (1.5%)||1,850 (2.6%)|
Following a war with Georgia in the 1990s, South Ossetia struggled economically. South Ossetian GDP was estimated at US$ 15 million (US$ 250 per capita) in a work published in 2002. Employment and supplies are scarce. Additionally, Georgia cut off supplies of electricity to the region, which forced the South Ossetian government to run an electric cable through North Ossetia. The majority of the population survives on subsistence farming. Virtually the only significant economic asset that South Ossetia possesses is control of the Roki Tunnel that used to link Russia and Georgia, from which the South Ossetian government reportedly obtains as much as a third of its budget by levying customs duties on freight traffic.
President Eduard Kokoity has admitted that his country is seriously dependent on Russian economic assistance.
South Ossetia's poverty threshold stood at 3,062 rubles a month in the fourth quarter of 2007, or 23.5 percent below Russia’s average, while South Ossetians have incomparably smaller incomes.
Before the 2008 South Ossetia war, South Ossetia's industry consisted of 22 small factories, with a total production of 61.6 million rubles in 2006. In 2007, only 7 factories were functioning. In March, 2009, it was reported that most of the production facilities were standing idle and were in need of repairs. Even successful factories have a shortage of workers, are in debt and have a shortage of working capital. One of the largest local enterprises is the Emalprovod factory, which has 130 employees.
The South Ossetian authorities are planning to improve finances by boosting the local production of flour and thus reducing the need for flour imports. For this purpose, the area planted with wheat was increased tenfold in 2008 from 130 hectares to 1,500 hectares. The wheat harvest in 2008 was expected to be 2,500 tons of grain. The South Ossetian Agriculture ministry also imported some tractors in 2008, and was expecting delivery of more farm machinery in 2009.
Russia planned to spend 10 billion rubles in the restoration of South Ossetia in 2009.
Much of the economy is based around the presence of Russian military forces.
- Kosta Khetagurov