A precarious peace is back in place between Georgia and South Ossetia after the long-frozen conflict nearly became a hot war again and drew in Russia when dozens were killed in August 2004 fighting. President Saakashvili tried to break a twelve-year deadlock and take another step to restore Georgia's territorial integrity by undermining the regime in Tskhinvali, but seriously miscalculated. A more comprehensive approach is needed to resolve this conflict peacefully. The onus is on Georgia, with help from its international partners, to increase the security and confidence of people living in the zone of conflict, promote economic rehabilitation and development, ensure the right of Ossetians to return to South Ossetia and Georgia proper, and create arrangements guaranteeing South Ossetia effective autonomy. South Ossetia must enter a real dialogue with Georgia on its status and not use the winter to force Georgian villagers still in South Ossetia to leave their homes.

After peacefully resolving its decade-old conflict with Ajara earlier this year, the Georgian decision-makers turned their attention to South Ossetia. In May 2004 they believed their Ajarian success could easily be repeated. They considered that South Ossetia's de facto president, Eduard Kokoity, had little democratic legitimacy or popular support and that, as in Ajara, the people would rapidly switch loyalty from Tskhinvali to Tbilisi.

The initial strategy aimed to address the political-economic causes of the conflict through an anti-smuggling operation, aimed primarily at closing the sprawling Ergneti market on the outskirts of Tskhinvali, in the Georgian-South Ossetia zone of conflict. The theory was that Kokoity and a small circle of officials around him were maintaining control over South Ossetia through their involvement in black market trade. In parallel, the Georgian side organised a humanitarian "offensive" to provide people in the region with the benefits of economic and cultural projects.

The strategy backfired. Rather then capitalising on real popular discontent, it caused many average citizens who depended on illegal trade for their economic survival to regroup around Kokoity. Ossetian de facto authorities successfully portrayed Georgian moves as aggressive first steps towards a remilitarisation of the conflict that had enjoyed a ceasefire since 1992. Kokoity's popular support rose as he described himself as the only leader capable of guaranteeing Ossetians' security, as well as their political, economic and cultural interests. Assistance sent by Tbilisi was portrayed as a cheap attempt to buy support.

The Georgian approach failed in large part because it was based on a limited analysis of the causes of the conflict. Since 1992 little progress has been made to bring Ossetians and Georgians closer together. Many of the grievances and ambitions developed during the war that broke out as the Soviet Union was dying remain tough obstacles to peace. Unless they are addressed, efforts to re-integrate South Ossetia into Georgia are almost certain to lead again to violence.

In the past few months Georgia has shifted gears and begun to emphasise the geopolitical nature of the conflict, terming it "a problem between Georgia and Russia". Russia does play a special role. But it is unlikely that Georgia can successfully persuade the U.S. or European Union to duel with Moscow over South Ossetia.

A new ceasefire holds since 19 August 2004. At a high level meeting between Georgian Prime Minister Zurab Zhvania and South Ossetian leader Eduard Kokoity on 5 November in Sochi, an agreement on demilitarisation of the zone of conflict was signed. Some exchange of fire continues in the zone of conflict, apparently primarily initiated by the Ossetian side, but there is still cause for optimism that the conflict will be resolved non-violently since all sides seem to be reconsidering their policies. Georgia's legitimate insistence on the preservation of its territorial integrity needs to be balanced with the Ossetians' concerns for the protection of their national minority rights.

For the negotiations that are needed with Russia, South and North Ossetia to succeed, Georgia must show it is putting in place political, economic, legal, and social conditions to guarantee Ossetians equal rights in a multi-national and democratic state. The greatest lesson from the May-August period is that attempts to resolve the conflict swiftly will lead to war. President Saakashvili seemed to recognise this when, at the UN General Assembly, he pledged to engage in a "stage-by-stage settlement plan". To avoid further casualties and displacement, Georgia, together with its international partners, must implement a comprehensive strategy to resolve the root causes of the conflict and make non-violent re-integration possible.

Tbilisi/Brussels, 26 November 2004