Rebel Abkhazia's tourist dreams hampered by crisis

By Amie Ferris-Rotman
SUKHUMI, Georgia (Reuters) - Burned-out Soviet tower blocks loom over the Black Sea coast of Georgian breakaway region Abkhazia, whose ambitions to become a tourist hotspot are shattering as the global crisis cripples Russia's economy.
Though pockmarked from the separatist war with Georgia in 1992-93, this sub-tropical strip of land attracts tens of thousands of Russian tourists drawn by prices long gone in the motherland and a longing for Soviet nostalgia.
Russian-backed shiny hotels and restaurants have sprung up along the winding promenade in the region's capital Sukhumi.
Filling such places, though, is getting difficult.
"I fear this crisis, and it's making it hard to say if people will come or not," said Nikolai Chekhalin, a 26-year old hotel manager from Nizhny Novgorod in western Russia.
He runs the Inter-Sukhum in the capital, which charges 1,200 roubles ($38.47) for a single room and was revamped from a crumbling Soviet eyesore last August.
New buildings clash with bombed out health resorts across the 8,000-square km (3,088 sq miles) strip that was once the playground of the Soviet elite.
Rates at the hotel will be slashed by a fifth beginning next month if demand slumps as expected, Chekhalin added.
Fifty-one year-old Ashot, who sells arable plots for vineyards inland and south of Sukhumi, blames the drop in custom on Russia: "They have a crisis in Russia, so now we have one. They are Abkhazia's lifeline."
While it is difficult to gauge the health of the economy -- the government will not start calculating its Gross Domestic Product (GDP) until 2010 -- total trade more than doubled in the past four years to 7.1 billion roubles ($228.7 million) in 2008, Abkhazia's Economy Minister Kristina Ozgan told Reuters.
Citrus fruits, persimmons and hazelnuts are sent to Russia, while Turkey, home to half a million ethnic Abkhaz who fled before and during the separatist war, buys up timber.
"We are a small republic without our own currency and dependent on the Russian rouble," Ozgan said.
This means fewer tourists, she said, but more worryingly: "Prices have shot up on building materials, making it difficult to construct and putting off investors."
This year, the government expects to make 1.55 billion roubles ($49.92 million) in revenue from tourism and trade with Russia and Turkey.
Russia and Georgia's war last August over second breakaway region South Ossetia have also scared off investors who fear violence could also befall Abkhazia, hotel manager Chekhalin said. Continued...
Source: Reuters