Georgian President Mikheil Saakashvili on Tuesday admitted his ruling coalition had suffered an unexpected defeat in parliamentary elections.
“As leader of the United National Movement, I declare that our party is going into opposition” Saakashvili announced on state television on Tuesday, accepting opposition coalition Georgian Dream’s landmark victory.
“I fundamentally disagreed with the views put forward by the Georgian Dream.,” Saakashvili said, adding “However, democracy works by the majority of the Georgian people making the decision – and we respect that choice.”
Georgian Dream’s leader, billionaire Bidzina Ivanishvili, 56, gave a triumphant speech on opposition TV on Monday night, as his supporters took to the streets of the mountain-ringed capital, Tbilisi, to celebrate. “We have won! The Georgian people have won!” he said, as thousands of his supporters waved flags bearing the blue and gold symbol of his opposition movement.
Speaking later on Tuesday, Ivanishvili pledged there would be “no persecution” of his political rivals.
The vote represents a humiliating defeat for Saakashvili, 44, who had labeled Monday’s polls a choice between his pro-West policies and a return to the “dark days” of the 1990s, when a crime-ridden Georgia lay within Moscow’s sphere of influence.
But a peaceful handover of power would also prove an almost unique example of democracy in action in the former Soviet republic. Georgia’s last two presidents both resigned early to quell rising civil unrest.
US ambassador to Georgia Richard Norland told journalists on Tuesday the elections were “remarkable.”
With just over 53 percent of ballots counted as of 3.30pm (11.30am GMT), Saakashvili’s UNM had received 41.5 percent of the vote against 53 percent for Georgian Dream in the proportional electoral system. UNM have said they expect a solid showing in single-mandate constituencies. The early results were broadly in line with four exit polls, which all predicted victory for Georgian Dream.
Saakashvili’s announcement eased fears of post-poll violence in Georgia, a country of 4.5 million that is an important transit route for oil and gas to the West.
The prospect of widespread disorder had appeared very real early on Tuesday as opposition media alleged police had fired plastic bullets at opposition activists as they forcibly removed ballot papers from a polling station in central Georgia. The Interior Ministry denied the accusations.
International observers from OSCE/ODIHR, the European Parliament, the Council of Europe and the NATO Parliament Assembly said on Tuesday said that Georgia had taken an “important step” forward in the conduct of democratic elections. They warned, however, that key issues such as “intimidation” and “violence” remained.
Milan Cabrnoch from the European Parliament said that progress was “visible” but noted the opposition had only “limited” access to the media.
Amnesty International on Tuesday condemned “human rights abuses” during the elections.
The elections took on particular importance in the light of a law passed in 2010 transferring the majority of the president’s executive powers to the prime minister. The law comes into force from 2013 when Saakashvili’s second term ends. Georgian Dream will therefore be able to appoint the prime minister.
Saakashvili’s UNM enjoyed a healthy lead in opinion polls until last month, when opposition channels aired explicit footage of male inmates at a Tbilisi jail being sexually assaulted with broom handles. The videos sparked protests across Georgia and widespread anger at Saakashvili and the UNM, triggering an apparent groundswell of support for the opposition.
The opposition accused Saakashvili of running a dictatorship and said his policies had brought Georgia to the brink of disaster, not least by leading it into the 2008 war with its vast neighbor, Russia.
Staunch US-ally Georgia earned plaudits from the World Bank for its far-reaching business reforms. But the opposition said nothing had been done to alleviate poverty, and argued that the true number of unemployed is far above the official figure, which hovers around 15 percent.
“Apart from those people close to Saakashvili, no one else is living well in Georgia,” said Levan Chochua, a middle-aged Georgian Dream supporter, as euphoric crowds waved flags on central Tbilisi’s Freedom Square on Monday night.
“He has built a façade of European democracy in the center of Tbilisi, but most people never see all this" he added, gesturing at the impressive buildings around the square. A short distance away, Georgian and EU flags flew side-by-side outside the parliament building, in a vivid display of Saakashvili’s ambition to take Georgia into both Europe and NATO.
Critics wrote the Georgian Dream coalition off as little more than a rag-tag alliance of parties with very little in common, pointing out that, once in power, Ivanishvili will be hard-pressed to suppress the more nationalist and xenophobic elements of his coalition.
“People see Ivanishvili as some kind of savior, just as they did Saakashvili in 2003,” said Irakli Urashadze, 31, an artist, early on Tuesday. “But I’m afraid that they will be disappointed – again. And, you know, Saakashvili did a lot of good for the country in cleaning up corruption and red tape.”
US-educated lawyer Saakashvili has seen his fair share of political rivals, but has not faced such a serious challenge at the ballot box since taking office in 2003 after a popular revolt against a regime led by former Soviet foreign minister Eduard Shevardnadze.
All this changed last October, when former ally Ivanishvili announced he would use just some of his personal fortune of $6.4 billion – equal to half of the country’s GDP – to create a viable political alternative to the UNM, which had been in power for the last eight years.
But Saakashvili painted his ultra-wealthy rival, who made much of his money in Russia in the 1990s, as a Kremlin stooge seeking to "return Georgia to Russia's imperial space."
Ivanishvili dismissed these allegations as "laughable" adding on Tuesday that his government would attempt to maintain healthy ties with both the West and Russia, although he admitted the task would not be simple.
“It is very difficult to have many strategic partners, but we have to try and do this,” he told journalists. “If we can build a democratic state, I believe we will have a genuine opportunity to build good relations with NATO and Russia.”
Georgia has had no diplomatic relations with Russia since 2008, when it fought and lost a five-day war with its powerful neighbor over the breakaway republic of South Ossetia. Russia subsequently recognized the sovereignty of South Ossetia and another breakaway republic, Abkhazia. But a mere handful of countries have so far followed suit.
While Russia did not back either side at the polls, there is great personal antipathy between Saakashvili and Russian President Vladimir Putin, who reportedly said in the aftermath of the South Ossetia conflict that he would like to “hang him [Saakashvili] by the balls.”
Saakashvili is due to step down as president in October 2013, meaning he will be forced to work with Ivanishvili for around a year, a prospect that – given the level of mutual animosity during the election campaign – could prove unworkable.