x Abu Dhabi, UAEFriday 28 July 2017

Newsmaker: Bidzina Ivanishvili and the battle for Georgia

The success of the billionaire businessman Bidzina Ivanishvili in Georgia's elections is likely to have an international impact. But how much? Alasdair Soussi reports.

Illustration of Bidzina Ivanishvili by Kagan McLeod for The National
Illustration of Bidzina Ivanishvili by Kagan McLeod for The National

Looking a little like a modern-day Count Dracula and with the lifestyle of Batman's wealthy, philanthropic alter-ego, Bruce Wayne, the man who looks set to become Georgia's next prime minister has shaken the very foundations of his native land to its core. The political shock waves he has caused seem certain to reverberate far beyond the borders of this small but restive former Soviet republic lying off the Black Sea coast.

Bidzina Ivanishvili, 56, a billionaire businessman and leader of the Georgian Dream coalition, not only roundly defeated the incumbent president, Mikheil Saakashvili, in a bitterly fought parliamentary election contest this week, but did so after ending years of self-imposed internal exile. Until he announced his ambition to overthrow Saakashvili's party in October last year, he had been locked away in a James Bond-style modernist glass house-cum-fortress, with obligatory helipad, on a hillside looking out over the Georgian capital, Tbilisi.

There, this self-made man, who made his billions in industries such as banking and mining, whiled away the hours supporting Georgia's art scene, adding to his own collection of Picassos, Moores and Lichtensteins, and doting on the animals at his private zoo in his native village in the west of the country. He never gave interviews and was rarely seen in public.

But today, standing on the cusp of power, Ivanishvili's emergence from the shadows looks to have paid off - handsomely. Indeed, for a man who, for years, was so successful at staying out of the public eye, his decision to run for office and his victory at the polls - which forced Saakashvili to concede an early defeat on Tuesday to ensure a peaceful transition of power - has capped an incredible year for this caped crusader of Georgian politics, during which more mud was slung than you would find in a hippo's bathhouse.

It is to Georgia's credit that for the first time in its young, tumultuous history as an independent nation, a change in government has been the result of peaceful democratic elections rather than revolution or armed insurrection. However, the political showdown between Saakashvili and his United National Movement Party - which, despite becoming deeply unpopular across the country, won plaudits for modernising Georgia and eliminating police corruption - and Ivanishvili and his disparate six-party coalition has not been for the faint-hearted.

"I have come into politics to save my country, not to challenge Saakashvili," Ivanishvili told the BBC last year after announcing his decision to throw his hat into the ring for the right to govern this country of 4.3 million people.

The authorities led by Saakashvili, a US-educated, pro-Western champion of the free market, were not amused and promptly stripped the tycoon of his Georgian citizenship and raided a bank under his ownership.

The government insisted this was in keeping with Georgian law, but Ivanishvili used this aggressive response to his advantage - highlighting the dictatorial methods under which the president was operating, which had inspired his challenge in the first place.

This somewhat counterproductive approach by Saakashvili's campaign team was followed by a more nuanced attack on Ivanishvili and his links to Russia.

It attempted to paint the challenger to the throne, who is worth an estimated US$6.4-billion (Dh23.5bn), as a Russian stooge in a Moscow-backed plot to destabilise the Georgian regime and overthrow President Saakashvili, an enemy of the Russian president, Vladimir Putin.

But, just weeks before the election, harrowing footage of prisoners being abused and sexually assaulted in a Tbilisi prison - which shocked and appalled the country's deeply conservative society - added more fuel to the claims by Ivanishvili that the president and his ruling majority were demonstrating totalitarian tendencies.

Saakashvili has said that, despite the result of the parliamentary election, he intends to remain president until the presidential elections due next year. But from his extraordinary throwing in of the towel - an act not widely practised by political leaders in post-Soviet republics - it was clear that, ugly election or not, Ivanishvili had presided over one of the most extraordinary political developments in the two decades since the collapse of the Soviet Union. Observers from the Organization for Security and Cooperation in Europe said that "despite a very polarising campaign, the Georgian people have freely expressed their will".

Ivanishvili's rise to billionaire powerhouse and now, it seems, Georgian prime minister, is a story that only his most harshest of critics could not readily admire.

Born in the mountains of rural western Georgia in the 1950s, where poverty was rife, he was the youngest of five children. His father was a miner and his mother a housewife.

"Sometimes we could buy shoes, but we weren't always lucky," he told Forbes of his formative years. "We got electricity when I was 7 or 8. Radio when I was 14 or 15. Then television. So we spent most of our time outside but we worked a lot. Everyone had to work."

Sweeping metal shavings in a steel mill helped Ivanishvili pay for night school and, armed with an aptitude for self-improvement and a keen desire to learn, he climbed the factory ladder like a man in a hurry, only to turn down the chance to become head of economic development. His factory had become involved in a precious-metal smuggling ring, and this unsettled him.

"It scared me," he told Forbes. "If you were to move forward, you become a quasi-criminal. I didn't really want this."

In the early 1980s, he took his chance at forging a new path in life by heading for Moscow. There, he learnt the Russian language, gained a PhD and met a group of like-minded men who sensed an opportunity to make money by selling computers and other electronic equipment. This smart enterprise netted the four-strong group a cool $100,000 as the Soviet Union was beginning to founder.

Following this, in an astute move that more than aptly explains how he attained his billionaire credentials, he and one of the other members of the group bought out the other two and formed a bank. They called it Rossiisskii Kredit which, after gaining some important depositors and developing a stranglehold on the retail sector, very quickly grew in stature and in wealth.

In 2002, Ivanishvili left Russia for France, where his family was living. The next year, he returned to Georgia and was present when Saakashvili came to power in the so-called Rose Revolution of November 2003. Initially, he welcomed the development and saw Saakashvili as the answer to Georgia's ills - not least years of corruption that had stifled the nation's political and economic institutions.

But before long, his dismay at the president's aggressive stance on Russia, and what he deemed underhand tactics in securing victory in the 2008 elections, tainted his opinion of Saakashvili and his party. With his views of the president now ones of bitterness and betrayal, Ivanishvili, now claiming to have been on the receiving end of harassment from the authorities, almost took flight to France. Instead, he decided on a more direct course of action, one that now looks to have taken him to the very top of the Georgian political tree.

Georgian politics have shifted somewhat dramatically over the last week - Saakashvili's party will today find itself in the unfamiliar position of playing second fiddle to the Georgian Dream coalition. And a change in government by democratic means rather than by revolution is a welcome change. But Ivanishvili's victory raises many questions that may yet prove problematic for the victors - and for the billionaire himself.

One is whether a six-party coalition can hold together and collectively govern in a way that benefits a country in which more than half of the population has no proper job and where many older people are hankering after the old ways of the USSR.

Another is Ivanishvili's suggestion that he would serve only two years as prime minister - a role that looks set to increase in power under already agreed reforms.

A more pressing concern, however, is Georgia's propensity for political instability, which could provide for some rocky weeks - if not months - to come.

"Assuming Georgia does not erupt into civil war, an initial turn to Russia with Ivanishvili would bring a more immediate economic benefit than a re-engagement with the non-committal West under any Saakashvili-inspired system," wrote James Nixey, a manager and research fellow of the Russia and Eurasia programme at the London-based think tank, Chatham House.

"Though that equation is far more suspect in the medium-to-long term ... [Georgia] remains the country in the former Soviet Union with the most charm, and the most potential (Baltic states apart) to take steps forward. The irony is that Mikheil Saakashvili will have to lose power to prove it."

Another irony, perhaps, is now that this power seems to have fallen upon Ivanishvili, the married father-of-four will, for the very first time, be judged on his ability to govern - not, as he has so often relied, on the size of his personal bank account.

 

THE BIOG

February 1956 Born in Chorvila, Georgia

1982 Moves to Moscow to study for PhD

1991 Marries Eka, an 18-year-old daughter
of a doctor

2002 Leaves Russia for France

2003 Returns to Georgia

October 2011 Decides to challenge President Mikheil Saakashvili and his ruling party for power

October 2012 Defeats President Saakashvili and his ruling party, which loses its majority in parliament