That visit, however, did not take place. Instead, South Ossetian President Eduard Kokoity travelled to Moscow on August 26 to sign an intergovernmental agreement with Putin, who observed pointedly that "inertia" has hindered postconflict reconstruction in South Ossetia. "Much has still to be done, and much has to be started from scratch," Putin added.
Two Russian commentators have construed Putin's comments, in conjunction with the failure of North Ossetian President Taymuraz Mamsurov to attend the anniversary celebrations in Tskhinvali, as reflecting Moscow's annoyance and possibly disillusion with Kokoity, who is widely regarded as incompetent and corrupt. The Russian daily "Vremya novostei" on August 27 quoted Kokoity as having told his closest associates before his departure for Moscow that he plans to take "extended leave."
The most obvious source of friction between Kokoity and the Russian leadership is the ongoing harassment of Stroiprogress, a subsidiary company of Russia's Gazprom that has just completed construction of a gas pipeline that will supply Tskhinvali with Russian gas. (The formal commissioning of the pipeline coincided with Kokoity's meeting with Putin.)
The owner of Stroiprogress, businessman Albert Dzhussoyev, is one of Kokoity's main political rivals. A recent investigation into the operations of Dzhussoyev's First Republican Bank reportedly uncovered numerous financial violations, and the South Ossetian authorities threatened to rescind the bank's license on the grounds that it was issued in violation of existing legislation.
During the night of August 23-24, all Stroiprogress's construction machinery and equipment on South Ossetian territory was impounded without prior notice. Meeting with Russian State Duma deputies on August 26, Kokoity accused Dzhussoyev of tax evasion; but Stroiprogress is registered in Russia and therefore pays taxes there, rather than in South Ossetia. Other companies owned by Dzhussoyev have invested considerable sums in infrastructure projects in South Ossetia over the past few years, in light of which Kokoity's accusations look both petty and politically motivated.