Georgia is on the edge of a new, uncertain political era after president Mikhail Saakashvili conceded defeat in parliamentary elections, and said the opposition billionaire Bidzina Ivanishvili would form a new government.
In a TV address on Tuesday Saakashvili said his ruling United National Movement (UNM) had lost to Ivanishvili's Georgian Dream coalition. He urged Georgians to respect the result. "We believe that their views are extremely wrong. But democracy works in a way that Georgian people make decisions by majority," he said.
The election marks an extraordinary moment in Georgia's post-Soviet history, with power transferred for the first time democratically and thus-far peacefully between rival political forces.
It is also a blow to the mercurial Saakashvili, who led the country's pro-western rose revolution in 2003. He has been an outsize, polarising figure ever since, at home and abroad.
The man who defeated him is a 56-year-old billionaire with a stupendous private fortune, a large modern art collection and a zoo including penguins and a zebra. Ivanishvili entered politics just a year ago, turning a disunited opposition into a formidable electoral coalition. His democratic credentials are unproven.
In a press conference on Tuesday Ivanishvili said Saakashvili should now resign. This is unlikely. Instead, Georgia is entering a potentially volatile political period. The new parliament is set to nominate Ivanishvili as prime minister. Saakashvili has to approve the nomination and could, theoretically, reject it, triggering a constitutional crisis.
But Raphaël Glucksmann, a senior presidential adviser, said on Tuesday that Saakashvili would not seek to thwart Ivanishvili.
"Saakashvili is very disappointed [with the result]. But one thing he is certain about is that leaders don't cheat in elections, and don't govern against the popular will," he told the Guardian, adding that the "political dynamics" were with the opposition.
The big political question is whether Saakashvili and Ivanishvili can co-operate, in the wake of an election campaign characterised by mutual vitriol. The early signs of co-operation were not encouraging. Ivanishvili called Saakashvili's widely praised reforms a joke, and said his rule was "based on lies". Government sources dismiss Ivanishvili as a Russian stooge.
Under Georgia's constitution the president will carry on until the end of his term next October. After that Georgia shifts from a presidential to a parliamentary system. Over the next 12 months Saakashvili and Ivanishvilithe two men will have to work closely together, and consult on foreign policy and the budget.
Ghia Nodia, a former education minister who now runs a Tbilisi thinktank, said: "You have Saakashvili's emotionality and Ivanishvili's bizarre character. But it's in both their interests to co-operate.
"If Ivanishvili accepts this power-sharing arrangement, he will see it as a transitory stage towards acquiring full power," he said.
Nodia said the president deserved credit for allowing the democratic process to take its course: "Whatever happens next, Saakashvili has vindicated himself to an extent. He is not a perfect democrat. But he is more democrat than autocrat. In autocracies, oppositions can't win elections."Some feared Ivanishvili might be tempted to emulate Ukraine's president Viktor Yanukovych and mete out judicial punishment to his defeated political enemies. "The deep divisions in the country are slightly threatening. I sense vengeance, not just among people in the street but among [Georgian Dream] politicians who will be in the new parliament," Nodia said. Ivanishvili, however, said that government officials would not be prosecuted unless they had broken the law.
Another unanswered question is Ivanishvili's policy towards Russia. The tycoon's international priorities are similar to Saakashvili's, and include European integration and Nato. But he has also pledged to improve relations with Vladimir Putin's Russia. Ivanishvili said he would try to convince Russia that Georgia's strategic aspirations were not a threat.
Russia welcomed the result, saying ties that had been frozen in the wake of the 2008 Russian-Georgia war could be renewed.
"We are definitely looking forward for a fresh, new non-hostile, sober leadership in Georgia," said Dmitry Peskov, Putin's spokesman.
A new leadership would be "very good, very positive for us", he continued. "If they have more political wisdom under a new leadership, then lots and lots of new roads can be opened for the country." Russia cut ties with Georgia in the wake of the 2008 war over South Ossetia.
Putin and Dmitry Medvedev, the current prime minister who was president at the time of the war, have refused to speak to Saakashvili. Ivanishvili has raised the prospect that some of Georgia's key exports – such as wine and mineral water – banned by Moscow in 2006 could now resume.
Relations are expected to improve under Ivanishvili, who made his fortune in Russia in the 1990s. Peskov said the Kremlin had had no contact with Ivanishvili in the run-up to the vote. "We don't know him," he said. "We'll continue to watch very closely the preliminary results in Georgia, where the people are not in favour of the acting authorities so they should be changed."
Georgian government sources, meanwhile, said they had not been expecting to lose Monday's election. Opinion polls had put Saakashvili's party in front.
They conceded that a video broadcast on 19 September showing prison officers beating and raping inmates with broom handles had turned public opinion against the authorities. Voters in the Georgian Orthodox church – unhappy with the government's socially liberal policies – had also supported the opposition in huge numbers, they said.
Official figures have yet to be confirmed but government sources said the coalition would have 84 parliamentary seats and the UNM 66. Ivanishvili's six-party coalition appears to have won about 51% of the popular vote, with 41% for UNM and 9% for other parties.
Thousands of Georgian Dream supporters gathered on Monday night, celebrating in the capital Tbilisi and flooding Freedom Square. They included several nuns in black habits, waving blue Ivanishvili flags.
"The reality is that the majority of people in this country support Ivanishvili," Tarel Peradze, an engineer, said. He added: "The problem is that Saakashvili didn't do dialogue. He only did monologue."
