Few people have heard of Kosta Khetagurov (1859-1906) but the citizens of Iryston are used to it-few people have heard of them either. Khetagurov is Iryston’s national poet, and his statue graces the central square in the national capital, where he stands against a striking backdrop of rolling hills and snow-covered mountains. Flowers cover the plinth at the base of Khetagurov’s memorial during the national independence-day celebrations each September, when representatives of Iryston’s allies-heads of state and plenipotentiaries from the republics of Apsny, Artsakh, and Pridnestrove-present wreaths and hearty congratulations to the president and his ministers on another year of hard-won independence.

This array of republics might sound like a page from a fantasy novel, but they are real, and their existence is one of the major challenges to the political transformation and regional security of significant parts of the postcommunist world. More familiar to scholars and journalists under the names South Ossetia (Iryston), Abkhazia (Apsny), Nagorno-Karabakh (Artsakh), and Transnistria (Pridnestrove), these unrecognized states were the result of the wars of the Soviet succession, a congeries of ethnic and separatist conflicts that accompanied the dissolution of the Soviet state. Although the fighting in each of these wars ground to a halt in the mid-1990s, the basic question at the heart of each-Who should govern the particular piece of territory over which the wars were waged?-has not been resolved. The internationally recognized governments that play host to these unrecognized entities-Georgia (South Ossetia and Abkhazia), Azerbaijan (Nagorno-Karabakh), and Moldova (Transnistria)-have continually called for outside help in settling disputes, and representatives of the United Nations and the Organization for Security and Cooperation in Europe (OSCE) have been on the ground for years attempting to do just that.

In this limbo between war and peace, Eurasia’s unrecognized states have spent the better part of a decade building real institutions that function, in some cases, about as well as those of the legitimate countries of which these republics are still, supposedly, constituent parts. All have the basic structures of governance and the symbols of sovereignty. All have military forces and poor but working economies. All have held elections for political offices. All have set up currency structures, border regimes, and educational systems separate from those of the recognized states. The four entities even cooperate with each other, sending representatives to regular summits and ministerial meetings. Although the disputes that prompted the emergence of these unrecognized regimes are usually labeled as “frozen” or “stalled,” they scarcely look that way to the people who live in the former conflict zones. Over the last decade, “frozen conflicts” have given way to de facto states.

On its own, the unrecognized statehood of these entities would not present a large-scale problem. States all over the world have worked out a variety of complex constitutional schemes to recognize substantial sovereignty for peripheral regions. And other unrecognized entities, such as Taiwan or the Turkish Republic of Northern Cyprus, have existed for decades in relative peace, going about the business of acting like states even if few governments have recognized them as such. But across Eurasia, the current situation is highly problematic. The unrecognized entities have had a cancerous effect on the local economy, state security, and democracy in Georgia, Azerbaijan, and Moldova. They have undermined public order and have become havens for corruption and crime. They have also come to play a role in international criminal networks-and, reportedly, networks that supply money and weapons to transnational terrorist organizations. The unrecognized states exist in more than name only and finding some way of making policy toward them will be an essential component of ensuring security and promoting democratization across eastern Europe and Eurasia.

The wars that produced the current state of affairs were part and parcel of the dissolution of the Soviet state. Three of the four wars-in Nagorno-Karabakh, Abkhazia, and South Ossetia-were associated with the demands of ethnic-minority populations against a central government; even in the Transnistrian region of Moldova, which did not have a distinct ethnic minority as such, the war came about because of a regional elite’s dissatisfaction with the cultural policies of the center. On a global scale of human misery, the wars were relatively insignificant: the number of people killed in all the postcommunist wars of the 1990s (these four, plus Yugoslavia, Chechnya, and others) is still less than the number killed in Rwanda alone in the same period. Nevertheless, the people who made the wars, many of whom are still in office in both the central governments and the unrecognized states, point back to the original grievances and the experience of war as explanations for the lack of a final settlement.

But the complex root causes of the conflicts have little to do with what has sustained them. Today, the disputes remain unresolved for a rather simpler reason: the status quo-no war but no real solution-hurts no single party enough to cause them to press for resolution. Or to put it even more plainly, plenty of folks on all sides of these disputes benefit from the continued existence of Eurasia’s nonstate states.

The Russian Federation has clearly played a role in creating and sustaining the unrecognized entities, and local observers argue that their existence allows Russia a degree of influence in three countries with generally pro-Western foreign policy orientations. In the early 1990s, the Russian military provided weapons to the nascent separatist armies, and Russian officers even defected in order to staff the security organs of the unrecognized republics. Although Moscow would later tout the pacifying role of its troops and peacekeepers deployed in three of the separatist regions, had it not been for those troops it is unlikely that the disputes would have descended into violence in the first place.

Since the end of the fighting, Russian policy has been schizophrenic. There has, in fact, been a set of policies, rather than a single policy, in each of the disputes, depending on which portion of the Russian establishment one is considering. The Russian presidents, both Boris Yeltsin and Vladimir Putin, have repeatedly affirmed that Russia respects the territorial integrity of its neighbors. At the same time, the State Duma has passed resolutions calling for Russia to support the interests of the separatist elites and their populations against what is perceived as the march of nationalism in Georgia, Azerbaijan, and Moldova. Individual ministers and ministries have also issued statements and inaugurated new policies regarding these struggles that at times conflict with those of both the president and the Duma. Last spring, the government announced that it would withdraw from the visa-free regime in place across the Commonwealth of Independent States (CIS). The policy did not apply, however, to citizens of Abkhazia and South Ossetia, who can still travel to Russia as easily as before. As the Georgian government has pointed out, that new policy was a clear affront to Georgian territorial integrity, Russian protestations to the contrary notwithstanding.

The Russian factor is indisputable, and officials in Georgia, Azerbaijan, and Moldova frequently point to Russia as the key source of support for the unrecognized states. But Russia has not been the most serious obstacle to resolution. Today, the most vexing reasons for the disputes’ intractability have very little to do with what happens outside the states afflicted by territorial separatism and a great deal to do with the interests within them-in two crucial senses.

First, there is a political economy to Eurasia’s unrecognized states that benefits almost all sides. Georgia, Azerbaijan, and Moldova are extraordinarily weak states, with state revenues too low even to ensure many of the most basic state functions. In the lives of average citizens, the state is often conspicuous by its absence. Where it does intrude, it is usually in the form of a corrupt police officer soliciting a “fine” for an obscure traffic violation. That very weakness, though, is of untold benefit both to the unrecognized regimes as well as to the legitimate state institutions that are supposed to be looking out for the states’ interests. Exports can be channeled abroad through the separatist regions, thereby avoiding state tax inspectors. Imports can be brought in through the regions and distributed on the wider national market. Untaxed agriculture and industry-hazelnuts in Abkhazia, steel in Transnistria-can likewise be sources of profit, both for the unrecognized governments as well as for their collaborators in central institutions. Smuggling of illicit goods, from Afghan heroin to Russian vodka to prostitutes and illegal migrants from as far afield as Southeast Asia, have also become sources of profit.

Second, the process of informal state building has gone on for so long that distinct societies have begun to emerge in the rebel areas. Children who were not born when the conflicts began are now almost teenagers, and thanks to the creation of educational systems separate from those run by the legitimate governments, they have been schooled in the idea that their homeland is a place called Pridnestrove or Artsakh-not Moldova or Azerbaijan. The same may be said of other members of the cultural elite, such as the writers, artists, and poets who have spent the last ten years creating panegyrics to the real but unappreciated statehood achieved through the sacrifice of the best sons of the fatherland. What looks to the outside world and the central governments like a separatist conflict looks to many inside the conflict zones like a heroic war of independence, a war that has, moreover, become mythologized in the consciousness of the average citizen.

Of course, all that might change if Georgia, Azerbaijan, and Moldova were strong, wealthy states that could offer citizens of the separatist zones something in return for relinquishing the sovereignty that they won through violence in the early 1990s. But for most people, life in an unrecognized state is not significantly different from life in a recognized one. In some cases, it is better. Citizens of Sukhumi, the capital of Abkhazia, have better access to electricity than those of most provincial Georgian cities. Citizens of South Ossetia have easier access to consumer goods, imported via the highway to the Russian Federation and controlled by the local administration, than many other Georgians. A similar situation exists for the citizens of Transnistria, especially those who work in the region’s large steel-producing plant, one of the few heavy industries in all of Moldova still functioning (and at a considerable profit, by dumping its products onto the Canadian and US markets).

The status quo is of benefit to most players in the short term, including overburdened foreign governments, which are generally satisfied so long as no shooting wars are going on. But over the longer term, the existence of these republics, no-man’s-lands on the periphery of already frail existing states, presents a major problem. In a region of feeble states and uncertain democracies, they are perpetual threats to order, stability, and governance. They have become conduits through which illegal goods, including drugs, enter the European Union. They have been stopping-off points for migration into Europe and farther afield. They have become vast weapons bazaars, where everything from small arms to heavy military equipment can be purchased by foreign governments and criminals. One of the states, Transnistria, now manufactures arms, an achievement praised on more than one occasion by its president.

And they cooperate with one another in each of these areas. Last autumn, the unrecognized presidents held a summit meeting in the Transnistrian capital, Tiraspol. Last summer, the foreign ministers met in the Karabakh capital, Stepanakert. What has emerged from these meetings is a commitment to coordinate negotiating positions in talks with the three central governments, as well as to deepening contacts among their own governments, militaries, and businesses. Eastern Europe and Eurasia have witnessed the proliferation of international conventions and organizations, creating a confusing array of acronyms and abbreviations, from the CIS, to the multilateral forum of Georgia, Ukraine, Uzbekistan, Azerbaijan, and Moldova (GUUAM), to the Black Sea Economic Cooperation organization (BSEC). A new one can now be added to the list. We might call it TAKO, for Transnistria, Abkhazia, Karabakh, and South Ossetia-an international organization that, like its members, is not formally recognized but that exists in a far more real sense than many of the other organizations declared across the postcommunist lands.

Since September 11, governments across the region have found a new label to apply to the unrecognized regimes: “terrorists.” The Azerbaijani press has come to describe the Nagorno-Karabakh administration not as “aggressors” or “separatists,” as in the past, but as “terrorists,” who should be dealt with by force. The Azerbaijani government has also stepped up efforts to have the army of Nagorno-Karabakh placed on the US list of terrorist organizations and Armenia placed on the list of state sponsors of terrorism. (Similarly, the Russian government has long referred to guerrilla fighters in Chechnya as terrorists, but the label has received even wider currency since September. It is clear that Chechen fighters have fled to, and perhaps trained in, areas of Georgia adjacent to Chechnya, and Russian officials, including President Putin, have hinted that Georgia may therefore be a state that knowingly harbors terrorists.) Commentators in Georgia, Azerbaijan, Moldova, and Russia have suggested that the US attack on Afghanistan provides a precedent for relaunching a military campaign against the unrecognized entities and their supporters abroad. The flare-up of violence in Abkhazia in early October may be linked to precisely such calculations.

In fact, the “terrorist” label may be more than mere rhetoric. The Moldovan government has reported that Hezbollah and other international terrorist organizations have sought to acquire arms from the Transnistrians. Of course, the government has an interest in painting the Transnistrians in the worst possible light. But it would not be surprising to find that Hezbollah, al-Qaeda, and other forces had established contacts with arms manufacturers and drug traffickers in Transnistria and elsewhere. The real surprise would be if they had not. The borders of these unrecognized states are notoriously porous; governance is weak; and the lines between local militias, the local economy, and the self-proclaimed governments are often blurry. If one were looking for places to acquire arms, off-load heroin, and launder money, Eurasia’s archipelago of nonstate states would be a good place to start.

In the middle of all this stand the representatives of international organizations, especially the UN and the OSCE, which have provided good offices to the various parties since final-status negotiations began in the mid-1990s. So far, mediators have taken a strong position affirming the territorial integrity of Georgia, Azerbaijan, and Moldova; denouncing separatism; and encouraging negotiations in which the devolution of autonomy to the separatist regimes is the model for conflict resolution. That model, however, is now exhausted. Despite the committed efforts of fine diplomats and negotiators in the field, none of these disputes is really any closer to being resolved than it was when the fighting stopped several years ago. In some ways, the situation is worse, because over that period the separatist regions have consolidated their statehood.

At the heart of this issue lie a dilemma and a tragedy. The dilemma is this: so long as these statelets remain unrecognized, it is very difficult for the international community to make policy regarding them-except to continue with “negotiations” that are often postponed, cancelled, or manipulated by all the parties to ensure that they achieve little. Yet recognizing them will do violence to the principle of the territorial integrity of the existing states.

The tragedy is this: even in the best-case scenario (a peace agreement that would allow for the separatist regions to be formally reintegrated with the existing state but would also provide for considerable local autonomy), Georgia, Azerbaijan, and Moldova will still end up as the losers. They are, at the moment, states that do not control significant portions of their own territory (from about 12 percent in Moldova’s case to around 25 percent in Azerbaijan’s), and in which the general trend in terms of democratization, economic performance, and reform in recent years has been negative. That situation would be unlikely to change were the unrecognized entities simply granted the status de jure that they already enjoy de facto. At the same time, however, the status quo-stalled negotiations, the constant threat of renewed violence, and unrecognized states that exist outside anyone’s purview-is one of the postcommunist world’s most acute challenges. If the alleged links between international terrorist groups and the unrecognized governments turn out to be real, the problem of Eurasia’s obscure statelets may at last get the attention it deserves.