KEY POINTS:
The prospect of a war in the Caucasus is looming closer. Last week four Russian military jets crossed into Georgian airspace - flying over the breakaway republic of South Ossetia. This prompted a furious reaction from Georgian officials. They have vowed to shoot down the next Russian warplane.
Temperatures in both Tbilisi and Moscow are rising. The ostensible area of conflict is South Ossetia and Abkhazia - separatist regions of Georgia that have enjoyed de facto independence since the early 1990s. In May, Vladimir Putin, then Russian President, recognised Abkhazia as a legal entity. Georgia accuses Russia of trying to annex its restive Black Sea territory.
In reality, the conflict between Russia and Georgia is not just about Abkhazia but about Russia's lingering resentment at what it regards as Western encirclement. Following the end of the Cold War and demise of the Warsaw Pact, Russia believed it had an assurance from Nato and the West that there would be no expansion into Russia's backyard. The opposite happened. Former Warsaw Pact countries rushed to join Nato. Georgia and Ukraine are the latest to seek entry. Russia's political leadership and military establishment regard this as the final straw. If Georgia joins Nato's membership action plan - possibly in 2009 - expect Moscow's response to be nasty.
The recent change of leadership in the Kremlin makes a conflict more rather than less likely. Widely regarded as a weak leader, Dmitry Medvedev needs to demonstrate to the powerful clans inside the Kremlin that he, too, can be tough.
Last week, Medvedev attacked America's plans to site its missile defence shield in Poland and the Czech Republic. He also denounced Kosovo's independence, and lambasted Russia's northern Baltic neighbours, accusing them of rewriting the history of World War II. Russia's relations with the EU Balts remain poor. (Moscow believes it liberated the Baltics from Nazism; Estonia, Latvia and Lithuania see the Soviet Union as a second occupier).
Stylistically, Medvedev is no Putin - his manner is that of a friendly and helpful bureaucrat - but his message is the same. Putin, meanwhile, continues to oversee foreign policy from his new office in Russia's prime ministerial White House.
From a Western perspective, Russia is guilty of both bullying and bribing its neighbours. As sovereign countries, both Georgia and Ukraine surely have a right to decide what direction to choose. Russia's political elite, its views forged during the Cold War, has apparently not yet come to terms with the death of the Soviet Union and Russia's diminished post-imperial role. Restoring Russia's lost greatness has been Putin's key ideological task.
Faced with a powerful and much larger neighbour, Georgia's pro-Western President, Mikhail Saakashvili, needs to tread carefully.
He has staked his political credibility on joining Nato and finding a successful outcome to the Abkhazia and South Ossetia problem. A small war in Abkhazia's Kodori gorge - where Russian "peacekeepers" and Georgian troops face off against the backdrop of an enthralling mountain range - is not a solution.
- OBSERVER
