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. Last Updated: 07/27/2016

Caucasus Skiing Idyll the Olympics Forgot

MTSkiers waiting halfway up a mountain at the Dombai resort for a new ski lift to open to take them to the top. "Half an hour ago they said they would open in half an hour," a skier said. "Now they are saying they will open in another half an hour."
DOMBAI, Karachayevo-Cherkessia -- High up on the slopes of this idyllic mountain retreat, it is easy to forget that the ski resort of Dombai lies at the heart of the volatile North Caucasus.

The resort is struggling to throw off the association with the troubles of neighboring republics, and foreign and Moscow-based investors are still wary of committing to the predominantly Muslim Caucasus republic.

Much of the investment now coming into Dombai, therefore, comes from local investors, local residents and analysts say. Last fall, the village was engulfed by construction, as investors sought to get new hotels ready for the approaching ski season.

Yet Dombai is still a long way away from a modern ski resort, as was shown during a recent visit to its slopes when construction cranes stood silently in the center of the village.

At the bottom of the slopes, the new gondola lift -- the centerpiece of the resort's facelift -- shuddered to a halt. Ten minutes later, it started again, and a few more skiers boarded. Again, it ground to a halt.

By 10:30 a.m., the gondola lift had ferried people to the next stage, but the new six-seater chairlift that takes skiers to the top of the mountain stood idle.

"Half an hour ago, they said they would open in half an hour," one skier muttered. "And now they are saying they will open in another half an hour."

By 11 a.m., the lift had still not opened.

"When are you opening?" one skier asked.

Today," came the nonchalant reply from one of the lift attendants.

This is skiing, Dombai-style. The slopes are largely unpisted, run markers nonexistent, yet skiers from all over Russia flock to the resort year after year.

Catrina Stewart / MT
Dombai's main street. The town emerged as a draw for tourists in the 1970s.
"This place is like a magnet. It draws you back time after time," said Zhenya, a Muscovite in his 40s who is a regular visitor to Dombai.

Dombai, which attracts about 5,000 skiers per day during peak season, first emerged as a draw for Soviet tourists in the early 1970s. It has since staked its claim as the country's top ski resort.

Tucked in a valley just a few miles from the border with the Georgian breakaway republic of Abkhazia, Dombai is framed by the towering peaks of the Caucasus range. These are some of the highest mountains in Europe, with Mount Elbrus over the valley to the east standing at 5,642 meters, while more than 10 other peaks in this range outstrip Mont Blanc, Western Europe's highest mountain.

The local residents, who call themselves gortsy, or mountain people, are charming and hospitable. This is a community where shopkeepers will give customers too much change rather than too little, where tourists and locals will exchange tall tales over cognac on the slopes, and cafe proprietors will serve up drinks on the house after a brief exchange of pleasantries.

But it is also an area on which Moscow trains a watchful eye, thanks in part to its proximity to Abkhazia, and the North Caucasus republics of Kabardino-Balkaria, Chechnya and North Ossetia to the east. In the summer, hikers are required to obtain border permits to walk in the mountains beyond the village, while Federal Security Service officials are overtly suspicious of foreigners who make the trip.

By North Caucasus standards, Karachayevo-Cherkessia is considered relatively stable, but it has not always been so. It is home to the so-called Karachai jamaat, members of which were implicated by the Russian courts in the 1999 apartment bombings in Moscow and Volgodonsk.

The republic has also seen major riots. The first outbreak of protests came in 1999 after a disputed local election. Then, in 2004 protesters ransacked the headquarters of the republic's president, Mustafa Batdiyev, over allegations that his son-in-law had murdered seven business rivals. A year later, more protests erupted over a controversial land transfer away from the republic's tiny Abazin minority.

Catrina Stewart / MT
Gondolas take skiers halfway up, and a ski lift takes them the rest of the way.
Given the clan allegiances that still dominate all walks of life here, it is the regional elite who pour in the bulk of investment, residents and analysts said.

"There is a certain instability connected with the [republic's] ruling political elites," said Nikolai Petrov, a scholar-in-residence at the Carnegie Moscow Center. "The whole republic is a concern, because all of these ethnic groups are related."

Added to the mix is the potential for the instability in neighboring Abkhazia to spill over the border, where many of the republic's citizens have family.

"Compared with three years ago, of course the business climate has changed," said Natalya Borisova, deputy head of the National Agency for Direct Investment, which works closely with government and business to attract investment into the North Caucasus.

"There is the feeling now that you can travel here without danger, and that you can work more effectively. There is a real feeling that a lot has changed in this republic," Borisova said Friday by telephone from Cherkessk, the republic's capital, where a meeting of senior officials and business leaders was taking place to discuss projects in the Southern Federal District.

"It's absolutely safe, in my view, and particularly so in Dombai," she added.

President Vladimir Putin's envoy to the Southern Federal District, Grigory Rapota, said at Friday's meeting that there was "a serious lack of investment" in the area and called for efforts to tackle poor infrastructure, transport links and energy supply as the government gears up for the 2014 Sochi Olympics, Interfax reported.

Putin, a skiing enthusiast, is often photographed on Russian ski slopes, but it rankles with some Dombai residents that he has not visited the resort during his time in office.

"You know how many times Putin has been here to visit in eight years? Not once!" said Hassan, a ski instructor in his 60s, who declined to give his last name.

Instead, Moscow has chosen the greenfield site of Krasnaya Polyana nearer Sochi to host the 2014 Winter Olympics, a development which will see billions of dollars of investment. The government has earmarked 8.5 billion rubles ($356 million) for investment into transportation infrastructure in the Sochi area this year alone.

Catrina Stewart / MT
About 5,000 skiers per day hit the slopes of Dombai during peak season.
Some Dombai residents feel passed over, arguing that the village could host some of the Olympic events as it already has some of the ski facilities in place.

But it is not only a question of pride. By choosing the Krasnaya Polyana site, the government has denied the North Caucasus resort a chunk of the huge investment expected to flood into the area around Sochi.

Some residents are sanguine about the decision, however.

"Dombai is great for mountain skiing," said Hassan, as he sipped a cognac at the Snow White cafe, situated halfway up the slopes. "but it doesn't have the space for the other events, such as a marathon and biathlon."

Three years ago, Paul Mathews, president of Canadian mountain resort planning firm Ecosign, helped to work out an ambitious redevelopment for Dombai. That plan envisioned a village area with 6,200 beds, a pedestrian street and underground parking.

According to Mathews, the republic's government was able to obtain supplemental federal funds to upgrade the resort's aging ski lifts. He proposed at the time that the local authorities give developers an ultimatum over unfinished projects -- complete them within a year, or give up on them, he said.

While hotels here have sprung up at alarming speed, the development plan has barely gone further, and the village is a long way from its more established European and Western ski areas.

"[President Batdiyev] said that's what they [were] going to do, but the republic really needed to take control of what was going on," Mathews said by telephone from Canada. "Nobody owns any land, they can build wherever they want."

Some villagers resent the rapid development, arguing that it has affected the feel of the place, particularly with the influx of outside laborers. Some Dombai residents have accused the migrant workers of petty thefts, alcoholism and a slovenly approach to work.

Foreign investors are starting to arrive, however.

Exim Development Corporation, a company headed by Florida-based businessman Miroslav Aleksic that has invested extensively in Russia and Eastern Europe, is to pump $200 million to $240 million into the development of a five-star hotel complex in the village.

The planners behind the grandiose schemes in Sochi hope that it will put Russia on the ski map, and Putin has already made clear his intentions to introduce an array of initiatives to attract overseas skiers, not least the move to ease visa restrictions by 2014.

"We're on the cusp of a ski boom," said James Brooke, who coordinates Sochi Olympics consulting work for real estate firm Jones Lang LaSalle. "From time to time, skiing really sweeps a country. In Russia, you have the combination of a nation with a long tradition of winter sports and now they have money."

The hope is some of this investment will spill over into Russia's other ski resorts, which are scattered over the Caucasus and the Ural mountains.

The development of Sochi will "be a shot in the arm for Dombai," Brooke said.

But regardless of how much Olympic cash it receives, Hassan, the local ski instructor, has no doubts that the village will continue to thrive.

"Dombai needs no advertisement," said Hassan, "The wealthy will go to Krasnaya Polyana, the middle class will continue to come here."