A leaked conversation between Georgian and Russian oligarchs raises further suspicions of Russia sidestepping sanctions through Georgia.

09 May, 2022

Water-proof cases that the Georgian government is indeed helping Russia to evade sanctions are still to emerge; however, allegations coming from the Ukrainian side and Georgian politicians are gathering cloud over the Georgian Dream(GD) government. Georgian leadership's political decision not to join sanctions against Russia, verbally attack President Zelenskyy and his entourage, and dub internal political opposition as a "war party" while arguing that peace is more important than freedom has raised eyebrows not only internally in Georgia, but among some of Georgia’s friends in Western capitals.

Two phone call recordings between Bidzina Ivanishvili, the GD party founder, and Vladimir Yevtushenkov, a recently sanctioned Russian oligarch, were published by an anonymous Youtube channel - "Cyber Kmara" on April 25. The alleged phone calls took place on March 10 and March 12. The audio recordings are yet to be proven authentic; however, they still raise questions as to whether Yevtushenkov was asking Ivanishvili to circumvent the sanctions.

Vladimir Yevtushenkov was sanctioned by the UK government on April 13 and earlier by Australia. As a result, Yevtushenkov had to give up formal shareholder control of the "Sistema" conglomerate, which he founded three decades ago.

Three weeks after the start of Russia's invasion of Ukraine, two billionaires seem to be encouraging each other. During the first call, Ivanishvili tells Vladimir Yevtushenko that the situation is not joyful, but they have to stay strong. Yevtushenkov informs Ivanishvili that his deputy, Ali Uzdenov, and a man named Davit would visit Georgia to discuss "crops." Davit is likely to be Davit Khidasheli, a former vice-president of Yevtushenkov's "Sistema" group. Khidasheli was involved in the "cartographers' case," a scandal that erupted before the 2020 elections and was used by the GD to blame the former government for "selling out the land" to Azerbaijan. Two civil servants were arrested at that time but were later released following a public outcry. Prime Minister Gharibashvili praised Khidasheli for acquiring important maps, which uncovered the foul play by the previous Georgian government.

Davit Khidasheli later shared a letter in which he confirmed that he did indeed meet with Ali Uzdenov to discuss wheat import from Russia. In the letter, he outlined that any connection with a sanctioned Russian oligarch had nothing to do with politics in Georgia.

In the second recording, Ivanishvili tells Yevtushenkov that Ali Uzdenov should meet with the Prime Minister, his former personal assistant – Irakli Garibashvili. While GD members denied that the meetings took place, in an exclusive interview with Formula TV, Vladimir Yevtushenkov confirmed that Ali Uzdenov did indeed meet with Irakli Gharibashvili in Tbilisi.

After the phone recordings were released, Davit Arakhamia, chairman of the People's Rada faction in Ukraine, called on the EU and the United States to consider imposing sanctions on Bidzina Ivanishvili and his business associates. This call comes after a series of critical statements from high-level Ukrainian officials, including President Zelenskyy.

Georgia's opposition leaders immediately reacted to the released audio recording. Petre Tsiskarishvili, United National Movement's (UNM) Secretary-General, said that Yevtushenkov could be working with Ivanishvili on a scheme to evade sanctions. Another opposition party - "Lelo," issued a statement, claiming that, if the conversations are authentic, "PM Garibashvili and his informal superior Bidzina Ivanishvili could be considered guilty of aiding Russia to evade sanctions."

GD leaders first denied that the meetings took place but then downplayed their significance. Irakli Kobakhidze, the chairman of the GD, said that since Georgia has not joined sanctions against Russia, having trade relations with Russia was natural. Shalva Papuashvili, Speaker of the Parliament, claimed that the conversation between Ivanishvili and Yevtushenkov was falsified. He also argued that the disinformation campaign was carried out against Georgia to "involve the country in the war." This rhetoric is characteristic of the GD in recent weeks - every pretext is used to blame UNM and opposition for trying to "drag the country into the war." GD members have labelled UNM as a "war party." US Ambassador to Georgia Kelly Degnan, when asked about the exchange of accusations between Georgia's Government and opposition, responded that she had not heard "any political leaders try to drag Georgia into this war" and that she had heard "people be very careful and very sensitive to the fact that Georgia has Russian forces already" on its territory.

Several MEPs responded to the leaked phone conversation. Michael Gahler (Germany, EPP) tweeted that the GD needs to clarify "whether such behaviour is considered helpful for Georgia's European stance," while Miriam Lexmann (Slovakia, EPP) stated that "if indeed true, and political & business leaders in countries who are aspiring to join the EU are dealing with individuals on EU sanctions list, this raises both serious questions about possible sanctions avoidance & also about their commitment to their countries' European future."

Other cases of Russia potentially evading sanctions through Georgia have been brought to the public attention by opposition politicians. Elene Khoshtaria from "Droa" spoke of a specific mechanism, how the Russian Authors' Society (RAO) was using Georgian partner organization "Gera" (Georgian Rightholders' Association) to make monetary transactions in circumvention of international sanctions. A letter quoted by Khoshtaria read: "due to the situation in Ukraine and the sanctions imposed on Russian banks and the financial system, Rao had a problem with the conversion of royalties into foreign currency. The largest Russian banks have been subject to sanctions. The way to exchange royalties lies through our partner "Gera" in Georgia." This allegation was denied by Gera and the GD representatives as groundless and a slander.

Another allegation came from the opposition party Lelo leaders, who claimed that as of April 27, 130 cisterns containing 7800 tons of oil belonging to the sanctioned Russian oil giant Lukoil were stationed in the Kulevi oil terminal in Western Georgia. Lelo leaders uncovered a scheme - transportation of the Lukoil's oil from the Caspian Sea through Azerbaijan to Georgia and into the Black Sea international waters to deliver it to the importers through a neutral company not linked with Lukoil. The government also dismissed these allegations as groundless.

The questions about the Georgian government's decision not to join anti-Russian sanctions are amplified by an on-and-off discussion about rhetorical and symbolic support towards Ukraine. During the recent two months, a debate ensued in Georgia over whether the Georgian delegation should visit Ukraine. Finally, on April 16, the Parliamentary delegation, consisting of various political parties, visited Bucha and Irpen. Main opposition party UNM, however, did not participate in the delegation and went on a separate visit together with the ex-president Giorgi Margvelashvili, formerly a GD affiliate, who became critical of the Government and Bidzina Ivanishvili.