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Moscow will not leave Sukhum and Tskhinval alone in crisis2009-03-04 13:09
The Russian Ministry of Finance is urgently preparing draft agreements with Abkhazia and South Ossetia on provision of financial aid. In spite of the crisis Moscow does not abandon new friendly states.
Recently the government published an order to the Ministry of Finance on elaboration of an agreement between Abkhazia and South Ossetia. Aid to Sukhum will help keeping further economic development of the region and sustaining budget equilibrium. Tskhinval will spend the appropriated funds primarily on restoration of the republic following the Georgian assault in August.
The government's order apparently will help implementation of the investment projects in Abkhazia. As GeorgiaTimes already wrote the republic expected that at the time of preparation for the Olympic Games its economy would rely on the Russian capital for its rapid development. However the crisis made certain changes in these plans.
On February 23 a delegation arrived in Moscow from Sukhum in order to discuss specific investment projects and the next day Russian Prime Minister signed the document mentioned above. As saminvestor.ru is reporting today experts associate the order to the Ministry of Finance with the Russian businessmen's slump in investments to Abkhazia's sanatorium-resort area and production of construction materials. In particular, the project of concrete factories was rejected by BasEL, Oleg Deripaska's holding company now going through hard times.
South Ossetia took Russian government's order with little enthusiasm. As Kommersant newspaper is writing today Tskhinval is not happy about the scheme of transfer of sums Moscow proposes. Hasan Pliev, acting Prime Minister of the republic, complained that the repair works were not paid and contractors were standing idle. Out of 10 billion rubles only one and a half have been appropriated and transferred not directly to Tskhinval but to a special account with the Russian Treasury Administration for South Ossetia.
Moscow wants to keep financial flows directed to the Southern neighbors out of charitable motives under strict control. It is a natural intention. Russia's Accounts Chamber proposed to form a special federal department for reconstruction of South Ossetia that would inter alia deal with selection of contractors. Such a mechanism was used at the time of Chechnya restoration.