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The Influence Industry: Georgian power struggle becomes D.C. lobbying battle

Georgian tycoon and politician Bidzina Ivanishvili speaks to the media in April outside the first congress of his newly established political party in Tbilisi. (DAVID MDZINARISHVILI/REUTERS)

Opposition candidate Bidzina Ivanishvili has run into difficulties in the republic of Georgia, where the government has stripped him of his citizenship and questioned his allies about their political spending.

So Ivanishvili and his supporters are pressing their case in Washington, spending more than $1 million in recent months on a U.S. lobbying campaign ahead of pivotal parliamentary elections in Georgia this fall, U.S. disclosure records show.

Deputy Editor, National Politics View Archive

The Washington lobbying effort is aimed at raising doubts about the pace of democratic reforms under Georgian President Mikheil Saakashvili, who has forged a close relationship with the United States. The lobbying is unusually aggressive for a foreign opposition movement and would likely be impossible without Ivanishvili, an investor and philanthropist estimated by Forbes to be worth $6.4 billion — or about half the annual gross domestic product of the country he’s seeking to lead.

The Georgian government is funding its own U.S. lobbying campaign, portraying Ivanishvili as a Russian pawn attempting to use his foreign-derived wealth to seize control in Tbilisi. Saakashvili has nurtured close ties with Washington since gaining power during the 2003 “Rose Revolution” and after the 2008 clash with Russia over South Ossetia.

“It’s a battle for legitimacy in Washington,” said Thomas de Waal, a senior associate in the Russia and Eurasia Program at the Carnegie Endowment for International Peace. “You have two election campaigns — one in Georgia for the Georgian vote and one in the U.S. for the leadership in Washington.”

The once-reclusive Ivanishvili, who made much of his fortune through post-Soviet investments, created his Georgian Dream coalition party last year with hopes of gaining control in October parliamentary elections. He and a key ally, the Free Democrats party, have hired a half dozen U.S. lobbying firms to represent them in Washington, records show.

The largest firms include Patton Boggs, which reported spending $510,000 on Ivanishvili’s behalf in the first quarter of 2012; National Strategies, spending $160,000 in the same period; and BGR Group and its affiliates, which reported about $180,000 in contracts with either Ivanishvili or the Free Democrats from January to March, according to congressional and Justice Department records.

On the other side, the Podesta Group and Orion Strategies spent about $375,000 on lobbying and public relations for the Georgian government in the first quarter, according to records and officials.

Ivanishvili’s U.S. team has placed full-page newspaper ads, lobbied the Obama administration and arranged a blizzard of meetings on Capitol Hill seeking attention for their cause. A House resolution introduced last month by Rep. Jim McDermott (D-Wash.) would halt U.S. assistance to Georgia if the October elections are not “free, fair and competitive.”

The Tbilisi government stripped Ivanishvili of his Georgian citizenship last year because he also holds citizenship in France and would need a presidential waiver for dual nationality. The government also rounded up more than 100 opposition leaders for questioning this year, part of an investigation that Amnesty International said was “politically motivated and aimed at intimidating current and potential opposition party sympathizers.”

“America has chosen Georgia as a junior partner,” Ivanishvili said in a recent interview with Der Spiegel, explaining his U.S. lobbying push. “The United States believes that Saakashvili is creating a democratic Georgia, but these are merely facades. I want to show the Americans his true face.”

Cory Welt, a Caucasus expert at George Washington University, said Ivanishvili is “trying to change the narrative here on Georgia,” which has a mostly positive reputation in Washington.

A McDermott aide said the House resolution was in part due to trips that the congressman took to Georgia in 2008 and 2010. McDermott said after introducing the bill that “political freedom and fair competition between political parties has been under assault” in the country.

Saakashvili and his aides dismiss Ivanishvili as a Russian-backed tycoon who has struggled to garner broad support among Georgia’s citizenry. Temur Yakobashvili, Georgia’s ambassador to the United States, said in an interview that he does not see Ivanishvili or the Free Democrats as “an impediment” to his country’s Washington agenda.

“This is a free country — anybody can hire whoever they want,” Yakobashvili said, referring to Ivanishvili’s U.S. lobbying campaign. “But I don’t see them doing anything but demonizing the current government. We have a positive agenda, which is the interests of Georgia, but they seem to have only a negative agenda.”

For previous Influence Industry columns, go to

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