Trade as a confidence-building measure in protracted conflicts: the cases of Georgia and Moldova compared

Abstract

Academic and policy literature on the post-Soviet region's protracted conflicts frequently assumes that trade is an effective confidence-building measure (CBM) and as such also has the potential to facilitate progress toward conflict settlement. We probe these assertions through a detailed empirical comparison of the effects that regulated and unregulated forms of trade have had in the cases of Abkhazia, South Ossetia, and Transnistria. Relying on a wealth of primary and secondary sources, including 29 semi-structured interviews, as well as direct and participant observation, we find that, absent political will by authorities on the ground and their respective international partners, trade remains by-and-large unregulated and has limited and generally not sustainable confidence-building and stabilizing effects, as evidenced by the cases of Abkhazia and South Ossetia. Where local and geopolitical conditions are more conducive, trade becomes more regulated and significantly contributes to confidence building and stabilization and has some positive spill-over effects into non-economic areas of confidence building, as is evident from Transnistria. This finding has potentially important implications for other cases in which governments and relevant regional and international actors are faced with difficult choices over whether and how to engage with unrecognized entities, such as in Ukraine. ARTICLE HISTORY

Navigating de facto statehood: trade, trust, and agency in Abkhazia’s external economic relations

“…This dependency is usually exacerbated by the actions of the parent state -the state from which the de facto state seeks to break away -which often responds to the secessionist bid by imposing sanctions or economic blockades (Ker-Lindsay 2012). In light of continued nonrecognition, economic interaction with the world beyond patron and parent remains severely restricted, with the de facto states barred from joining international trade regimes or engaging in formalized trade (Kemoklidze and Wolff 2020). However, we argue, treating de facto states as hapless pawns in the patron's power-play detracts from our understanding of conflict dynamics: de facto states do enjoy (bounded) agency.…”

“…How to re-build trust where there is little or none? The conflict transformation literature has highlighted the role of trade in fostering trust/confidence-building (see Kelman 2005;Hegre, Oneal, and Russett 2010;Rohner, Thoenig, and Zilibotti 2013;Kemoklidze and Wolff 2020). Increased trust will in turn facilitate further trade by lowering the transaction costs.…”

Navigating in-between the EU and Russia

“…In the case of post-Euromaidan Ukraine, Wolczuk remarks that the EU "offred [Kyiv] an unprecedented 'reform stimulus'" by supporting its capacity building even though Ukraine is not an EU candidate state (2019,737). The EU participates in conflict resolution forums in the case of the Eurasian "frozen conflicts" and pursues seduction strategies of "engagement without recognition" toward de facto states (Cooley and Mitchell 2010) or "trade as a confidence-building measure in protracted conflits" (Kemoklidze and Wolff 2020). Conditionality, cooperation and (norm) socialization are the three fundamentals of the EU's strategy for exerting influence (Delcour 2017, 62).…”

China’s Belt and Road Initiative in the Contested Eastern Neighborhood: A Case Study of Ukraine

“…Today, the system of factors and actors that impacts the regional security complex in the Eastern Partnership generally and Ukraine particularly has transformed from a bipolar geopolitical competition between the West and Russia to a more complex multipolarity model where at least four great powers (the USA, the EU, Russia, and China) are implementing their competitive influence seeking strategies (Kemoklidze and Wolff, 2020). In 2014, the competition of great powers triggered the Russian-Ukrainian undeclared war.…”