North Caucasus Resort Company and Kabardino-Balkarian Leadership in Power Struggle

Publication: North Caucasus Weekly Volume: 13 Issue: 24

On November 30, the deputy director of OJSC Northern Caucasus Resorts, Vladimir Yevdokimov, upbraided the Kabardino-Balkarian authorities for obstructing the company’s expansion plans in the republic. Earlier, several members of the republican legislature stated they would veto allocation of land to OJSC Northern Caucasus Resorts. “The land does not belong to the deputies,” Yevdokimov said in response. “Moreover, it does not have any lawful owners currently. We have not started construction work in Kabardino-Balkaria yet, and we will not be able to start before legal questions are settled in the republic.” The Northern Caucasus Resorts official alleged that the same people who had lobbied their own interests at the company now were making hostile statements. Yevdokimov said that in those regions where local officials wanted to attract investments and create jobs, such as Karachaevo-Cherkessia, Ingushetia and North Ossetia, there were no political problems as in Kabardino-Balkaria (

Material published on the company’s website on November 29, however, said the borders of the Special Economic Zone where the company would operate in Kabardino-Balkaria had been defined. The Special Economic Zone will stretch across four districts in the republic—Cherek, Chegem, Zol and Elbrus—its overall area coming to 40,000 hectares, or about 150 square miles (

For the first time, North Caucasian officials attacked Moscow’s plans to build ski resorts in the region. Even though the criticism was practically anonymous, it is clear that given the political regime in Kabardino-Balkaria, the top leadership of the republic is not satisfied with the Northern Caucasus Resorts’ plans for one reason or another. There are several possible explanations for the unexpected resistance to the Kremlin’s plans in Kabardino-Balkaria. One is that the tourism sector in the republics has developed to some extent already, so the existing tourist facilities may be endangered by big-money enterprises like OJSC Northern Caucasus Resorts. The problem is even more acute because the republican minority, the ethnic Balkars, tend to occupy the mountainous areas where the resorts are to be built. The redistribution of land in the mountains and arrival of big players in the republic, therefore, could significantly alter the rules of the game and the power balance between the Balkars and the Kabardins (a.k.a. Circassians).

The idea of building word-class ski resorts in the North Caucasus was first announced by Moscow’s envoy to the North Caucasus, Alexander Khloponin, in 2010, within several months of his appointment. The plan was portrayed as the long-term solution to the problems of the region, including the high unemployment rate, which would presumably help the government solve the insurgency problem in the region. However, critics said the development of tourism in the North Caucasus would be impossible before political stability was achieved in the region. The less pronounced danger for the project comes from the regional elites, whose power may be undermined if a big business player becomes the primary provider of employment and tax revenues. Moscow’s whole aim may precisely be an economic “takeover” of the North Caucasian republics, with the crux of the issue being about control rather than development.

On December 3, ITAR-TASS reported that the residents of the villages located near the future tourist facilities supported the tourism development project and were indignant about opposition to it. According to the news agency, local residents hoped to start their own small businesses and receive other benefits from the expanding tourist sector in Kabardino-Balkaria (ITAR-TASS, December 3). It is plausible that hotel owners resist the arrival of big players in the tourism market of Kabardino-Balkaria while ordinary residents find it beneficial. The republican leaders probably have their own plans for exploiting the tourist areas around Mt. Elbrus, the highest mountain in Europe. OJSC Northern Caucasus Resorts arguably has very strong political backing from Moscow, which gives it an advantage in talks with the head of Kabardino-Balkaria, Arsen Kanokov. Control over the Special Economic Zone in Kabardino-Balkaria is likely to be taken away from the republican government in Nalchik. Naturally, republican officials will not like that.

Meanwhile, the unrest in Kabardino-Balkaria took a new turn on December 5, when unidentified attackers gunned down a Russian TV anchor there, 28-year-old Kazbek Gekkiev. The assailants reportedly asked Gekkiev to confirm whether he was a TV news producer and when he nodded affirmatively, they killed him. So the attack appeared to target him specifically. However, while it is widely assumed that the militants carried out the attack, it is unclear why Gekkiev was singled out, since he had not made any controversial reports that could have offended anyone. The Russian Investigative Committee said in a special statement that Gekkiev’s killing was “a threat to other journalists who tell the public about results of the struggle with the bandit [groups] active in the republic” ( Unlike other murders of journalists, both President Vladimir Putin and Prime Minister Dmitry Medvedev conveyed their condolences and vowed the journalist’s killers would be prosecuted (,

With the scramble for ski resorts underway in Kabardino-Balkaria, political violence in the republic is not abating. If Moscow, in pushing the ski resorts project, does so in an adversarial way that alienates the republican leadership, an already precarious security situation may further be complicated.