Orbeli Analitical Research

Georgia in Iran’s South Caucasus Policy Domain

15 m. | 2019-11-27

Tehran-Tbilisi dynamics

T he South Caucasus has been of strategic importance to Iran in the different stages of its history. The role of the Caucasus region increased especially after the collapse of the USSR, when each of the South Caucasus republics began to pursue independent policies. The new dreams forged in the South Caucasus created opportunities and placed Iranian diplomacy with unprecedented challenges.

Despite the fact that during the post-Soviet period, Russia viewed the South Caucasus as its zone of influence, Turkey still found ways to increase its influence in the region. During this time, the United States and the European countries were in the process of establishing diplomatic relations with the newly independent republics, with Iran also eyeing the region to establish relations.

The foreign policy priorities of Iran has undergone changes, because of foreign policy transformations in respective countries in the region, Armenia, Azerbaijan and Georgia, and also because of the shifting interests of the superpowers. Recently, the concept of Iran’s neighborhood policy has been developed by Iran’s leading think tanks on the initiative of retired ambassadors. Although about 3 decades have passed after the collapse of the USSR, when assessing Iran’s regional policy, experts often consider the below factors with which Iran has been influenced with the post-Soviet era.

When observing the relationships between Iran and its neighboring countries we should take into account two circumstances:

Iran has issues on demarcation, security, water resources, environmental protection, cultural heritage, religion with almost all its neighbors.
Some of the neighbors of Iran are under pressure from the US, because of expanding relations with Tehran

These realities contain additional risks for Iran, which can create undesirable conditions. Hence, the neighborhood policy concept used by Iran is meant to manage the following risks and to show new approaches in foreign policy strategy. For properly assessing the dynamics of Iran-Georgia relations, it’s necessary to assess the factors influencing the bilateral relations.

Iran has always prioritized economic cooperation with the South Caucasus countries, regardless of Georgia’s foreign policy and ties with the US, the transit opportunities of Georgia are very important for Iran’s economy hence the Iranian government's persistence in maintaining relations.

Dynamics between Georgia and Iran

T he relations between Iran and Georgia can be divided into 3 stages in the post-Soviet era:

The first stage starts from the establishment of diplomatic relations to the “Rose Revolution”,

The second stage starts from the “Rose Revolution” to the nuclear deal,

The third stage includes the period after the nuclear deal signed between Iran and the “5+1 group” in 2005, when the unprecedented activity in bilateral relations gradually declined.

First stage

Taking into account the Georgian-Ossetian, Georgian-Abkhazian conflicts in the 1990s, as well as the ongoing political instability in Georgia, the period between 1990-2000 hasn’t been marked by any other significant events in the relations between Iran and Georgia, except for the official reciprocal visits.

The diplomatic relations between Iran and Georgia were established in 1992. The embassy of Iran in Tbilisi was opened in 1993, and a year later, the embassy of Georgia in Tehran was opened. On January 19, 1993, the Chairman of the Supreme Council of Georgia Eduard Shevardnadze visited Iran and during his meeting with the Iranian President Hashemi Rafsanjani they discussed various issues, including the issue of Artsakh, stressing the importance of official Tehran’s efforts towards the conflict’s resolution [2].

Eduard Shevardnadze’s and Hashemi Rafsanjani’s meeting

On April 20, 1995, the Iranian President Hashemi Rafsanjani paid a return visit to Georgia. During the Rafsanjani-Shevardnadze meeting the parties discussed economic cooperation issues. Particularly, the Georgian side expected Iran’s support in overcoming Georgia’s energy crisis.

During his visit to Georgia, the President of Iran also visited Batumi and Poti, where he met with local Muslim communities [3]. In the first stage, the presidents of both parliaments and ministers of Foreign affairs visited reciprocally.

Meeting of the USSR Foreign Minister Eduard Shevardnadze with the leader of Iran’s Islamic Revolution Imam Khomeini. Tehran, 1989.

Shevardnadze, as a foreign minister of the USSR, visited Iran in 1989, so as to convey M. Gorbachev’s message to Imam Khomeini, leader of the Islamic revolution. [4] Studying the legal-contractual field of Iran and Georgia in that period, we see that the mutual cooperation mostly related to tourism, education and agriculture [5].

The first stage was the most significant in terms of high level mutual visits, whereas political relations gradually decreased within the other two stages., Mikhail Saakashvili was the first Georgian leader since 1993, who in 2004 visited Iran and after this visit no meeting of presidents took place. Of course, meetings between the two countries were held within other frameworks such as the United Nations General Assembly and other international organizations.

Second stage

Since the end of the 2000’s the US impact on the dynamics of Iran-Georgia relations had gradually increased. Though officially Tehran was cautious in its relations with Tbilisi because of the foreign policy Georgia adopted after the “Roses Revolution”, Georgian-Iranian relations were quite active in the economic field.

After a long break, Iran-Georgia Intergovernmental Economic Commission resumes its work. The 2^nd session of the commission took place in 1993, the 4^th in 2005 and the 5^th in 2015, which shows the problems of uncoordinated work in bilateral relations.

During the years of Saakashvili’s presidency in Georgia, there was also activity in bilateral political relations. On July 7, 2004, the president of Georgia left for Iran on an official visit. During the meeting with the Iranian President Mohammad Khatami, Saakashvili discussed the issues on the South Caucasus security, as well as the possibility of exporting Iranian gas to Europe [6].

Mikhail Saakashvili’s and Mohammad Khatami’s meeting. Tehran, 2004.

The visa regime cancellation between Iran and Georgia in 2011 contributed to the revival of economic ties between Iran and Georgia. The number of Iranian companies registered in Georgia increased significantly in just two years, reaching 1500 in 2013.

The Consulate General of Iran opened in Batumi, in 2011, which also resulted in economic activity. Though during the sanctions against Iran, Tehran mostly emphasized the importance of the ports in Georgia.

Under the Presidency of Mahmoud Ahmadinejad (2005-2013), after the toughening sanctions on Iran by the United States, and despite the tremendous economic benefits, the Georgian side restricted its cooperation with Iran because of the external pressure. Georgia restored visa regime for the citizens of Iran unilaterally in July 1, 2013, which the official Tbilisi explanation was that the Georgian government was worried that in case of the trade relations’ expansion, Iran may bypass the economic sanctions by using Georgia’s financial system.

Generally, by studying the economic relations between Iran and Georgia, we note that they mostly have had development based on current short term objectives rather than a long-term strategy.

Current Relations between Iran and Georgia

A fter Hasan Rouhani’s being elected as the president of the Islamic Republic of Iran in 2013, the normalization of relations with neighbors was announced to be a foreign policy priority. At the 1^st stage of Rouhani’s presidency, within a context of positive change in Iran-West relations, a tangible activity was noticed in the relations between Iran and Georgia. Tehran emphasized the importance of Iran-Georgia cooperation in regional economic projects. Stressing the necessity to intensify Iran-Azerbaijan-Georgia relations at the meeting with the new ambassador of Georgia Ioseb Chakhvashvili on April 22, 2014, Hassan Rouhani noted: “It’s very important for Iran to connect to the Black Sea, as well as to the ports of Batumi. We want to connect our railway line to Georgia through the territory of Azerbaijan” [7].

After the nuclear deal signed between Iran and the “5+1 Group” in 2015, there was an unprecedented activity in the relations between Iran and Georgia and the two countries were especially interested in cooperating with gas transit. Georgia’s objective was to diversify their energy flows, and the Iranian gas export to Georgia could substantially reduce Iran’s dependence on Turkey. Today Turkey is the only buyer of the Iranian gas and given the unfavorable conditions in Iranian geopolitics, Turkey tries to extract concessions from Iran on the gas price.

On February 16, 2016 Georgian Deputy Prime Minister Kakha Kaladzeh left for Iran to discuss gas and electricity import issues with Iran, during which an agreement was reached to export 200 mil cubic meters of gas to Georgia in 7 months [8]. On April 22, 2017, Georgia’s Prime Minister Giorgi Kvirikashvili paid a visit to Iran. During the meeting with Georgia’s Prime Minister, the first Vice President of Iran, Eshaq Jahangiri referring to the possibility of exporting Iranian gas to Georgia, mentioned: “Iran is ready to supply gas to Georgia. We can deliver gas through the border with Azerbaijan or Armenia. Recently they agreed to ship 4 mil cubic meters for four months. Some banking issues should be resolved to implement it” [9].

Meeting of Iranian President Hassan Rouhani and Georgia’s Prime Minister Giorgi Kvirikashvili. Tehran, 2017.

Of course, this cooperation wasn’t the first attempt in the field of gas: in the early 1990s an agreement was reached between Iran and Georgia to implement a “gas-ore” transaction. In 2006, during the suspension of Russian gas exports to Georgia, Iran transported 4 million cubic meters of gas daily through the territory of Azerbaijan to Georgia for a short period of time [10]. Iran calls this step as a manifestation of good will towards the Georgian people.

After the nuclear deal, the gas exchange between Tbilisi and Tehran had ceased because of a number of factors. As for economic cooperation, according to Iran’s official data, the bilateral trade volumes actually increased after the nuclear deal, which ultimately offset the ceasing of the gas exchange which deteriorated relations. [11]. Trade turnover between Iran and Georgia was $50 mil in 2010, and $100 mil in 2015, it was $157 mil in 2017 and grew to $210 mil in 2018.

Certainly, Georgia is in a favorable position in terms of economic activity with Iran. While Armenia and Azerbaijan’s economic cooperation with the Islamic Republic of Iran mainly develops with the participation of state organizations in the case of Georgia, the bilateral economic ties are mainly deepened through the Iranian private sector.

Many Iranians have bought apartments in Georgia in recent years due to their belief that Georgia will soon enter the EU. The Deputies of the Iranian Parliament expressed their concern over the issue, calling on the Government to take appropriate steps to prevent the Iranian capital’s outflow. According to unofficial statistics, currently 40,000 Iranians reside in Georgia 10,000 of whom have received a residency permit [12].

In recent years Georgia has attracted many Iranians within the tourism sector as well as the Iranians who have been purchasing property in Georgia. This ultimately gives them a sigh of hope to permanently reside in that country with their motive conditioned by the Georgia-EU relations. There is a belief among Iranians that by 2020 Georgia will join the EU.

According to the Georgian law purchasing an apartment worth at least $35,000 allows you to receive a residency permit for a period of one year, and after renewing it for 6 years a permanent residency permit is then issued. The Iranians who have settled Georgia hope that after Georgia joining the EU, they will be able to move freely in Europe.

If after the nuclear deal Tbilisi was developing a seamless economic cooperation with Iran and was attracting Iranian investors to Georgia with various privileges, after the US withdrawal from the Iran nuclear deal in May 2018, Tbilisi began to be cautious in its economic partnership with Iran. In May of 2018, immediately after the US decision on withdrawing from the nuclear deal, Georgian banks froze accounts of Iranians living in Georgia. This caused concerns among many Iranians living and doing business in Georgia. In response, the Ambassador of Georgia to Iran Ioseb Chakhvashvili gave a remarkable explanation: “If Europe continues economic cooperation with Iran, Georgia will continue as well” [13] giving plight to the ongoing relations between the two nations which had seen a rough ride due to US sanctions on Iran and the undue pressure on Georgia to commit to those international obligations.

In a short period of time, Georgia’s attitude towards Iranian citizens residing in Georgia gradually changed. At the end of 2018 and in early 2019, Georgia deported more than two hundred Iranian citizens. According to the Iranian side, tourists who traveled to Georgia via travel companies and who had legitimate visas were also deported. Some of them were deported for drug trafficking others were Iranians studying in Georgia. Although the Georgian side didn’t provide any clarification on the reasons for deportation, the Iranian media stated that it was implemented under an anti-immigration policy of the newly elected President of Georgia Salome Zurabishvili [14].

The official reaction from Tehran, Bahram Ghasemi, the Iranian Foreign Ministry Spokesperson, expressed his concern about Georgia’s actions [15]. The Iranian Embassy in Georgia also made a statement [16], and on December 5, 2018, Georgia’s Ambassador to Iran was invited to the Foreign Ministry to receive clarification on “the unfriendly attitude of Georgian border guards towards Iranians”.

During that period, the relations between Iran and Georgia became tense, both parties were even discussing about restoring the visa regime. Finally, as a result of talks between the two countries, Tbilisi and Tehran solve the immediate tensions that were apparent, but Iranian’s business activity in Georgia gradually became more restricted. [17]

Georgian authorities reviewed their cooperation plans with Iran as a result of both domestic political processes, the US and EU positions and Georgia’s commitments to the European Union [18].

Occupying a strategically important position in the region, Georgia is very important for Iran from a political, economic and security viewpoint [19]. Iran has taken into account the transformations of Georgia-Russia relations, the steps taken to weaken Georgia’s dependence on Turkey and Azerbaijan as well as on EU integration while developing its policy towards Georgia. From the security viewpoint, Iran certainly keeps in focus (particularly during the period of unfavorable security environment around Iran) Georgia-NATO relations, military exercises in Georgia, Turkey and Azerbaijan and Georgia’s military cooperation with the United States, as well as Israel-Georgia relations.

Ultimately, Iran doesn’t have serious expectations from Georgia both from bilateral and regional cooperation’s viewpoint. Iran is interested in using the Georgian banking system and Georgia’s transit opportunities. In recent years, Iran has made serious efforts in launching the Persian Gulf – Black Sea corridor along with transit routes with Turkey and Azerbaijan, which will connect Iran to Georgia through Armenia.

In the coming years it will be possible to activate Iran-Armenia-Georgia trilateral cooperation within the frameworks of the Persian Gulf-Black Sea corridor. In 2020, Armenia will continue reconstruction of roads connecting Georgia and Iran, it should be added that the construction of the Tavriz-Armenia highway are also being taken in consideration in Iran. According to the agreement reached between the province of East Atrpatakan of Iran and the Ministry of Roads and Urban Development of Iran, part of the payment of taxes of “Mess Sungun” copper company (120-130 bil tomans) will be directed to the Tavriz-Armenia highway’s construction [20]. This will ultimately provide the link to Georgia for Iran to have the access it needs to the Black Sea ports and to Georgian in general.

[1] http://irdiplomacy.ir/fa/news/1971125/

[2] “Alik” daily, January 20, 1993, N 15980, p. 1

[3] “Alik” daily, April 22, 1995, N 16604, p. 1

[4] https://www.mashreghnews.ir/news

[5] http://www.tbilisi.mfa.ir/index.aspx

[6] “Alik” daily, July 8, 2004, N 19199, p. 1

[7] http://www.president.ir/fa/76820

[8] https://bit.ly/31IjaOJ

[9] http://www.fvpresident.ir/fa/news/5263/

[10] http://www.iras.ir/fa/doc/note/1440/

[11] http://www.tpo.ir/uploads/europe

[12] https://www.farsnews.com/news