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Will Georgia see a peaceful transfer of power? (+video)

As Georgia's President Mikheil Saakashvili conceded defeat Tuesday, Russia's Dmitry Medvedev expressed hopes for improved relations between the two countries. The U.S. State Department also views Saakashvili's concession in a positive light.

Georgian President Mikheil Saakashvili concedes defeat and announces his party will now become the opposition.
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Georgia's President Mikheil Saakashvili on Tuesday conceded defeat in parliamentary elections to a coalition led by a tycoon promising to ease tensions with Moscow, four years after the staunch U.S. ally lost a war with Russia.

Russian Prime Minister Dmitry Medvedev, who has long been openly hostile to Saakashvili, welcomed the opposition victory as opening the way for "more constructive and responsible forces" to enter the Georgian parliament.

Saakashvili's acceptance that his ruling party will go into opposition to Bidzina Ivanishvili's Georgian Dream increased the chances of the country's first peaceful transfer of power between rival parties since the Soviet Union collapsed in 1991.

Although it strengthens Georgia's democratic credentials, it could lead to an uneasy cohabitation between Ivanishvili, who is likely to become prime minister, and Saakashvili, who does not step down as president until next year.

Instability in the country would worry the West because it is a conduit for Caspian Sea energy supplies to Europe and has a strategic location on the Black Sea between former Soviet master Russia and Iran, Turkey and central Asia.

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