South Ossetia Georgian government severed diplomatic relations with Russia. Russian forces left the buffer areas bordering Abkhazia and South Ossetia on 8 October and the European Union Monitoring Mission in Georgia assumed authority over the buffer areas. Since the war, Georgia has maintained that Abkhazia and South Ossetia are Russian-occupied Georgian territories. South Ossetia is in the very heart of the Caucasus at the juncture of Asia and Europe, and it occupies the southern slopes of the Greater Caucasus Mountain Range and the foothills' part of the Kartalin Valley. South Ossetia is a very mountainous region. The Likhi Range is roughly in
South Ossetia third of its budget by levying customs duties on freight traffic before the war President Eduard Kokoity has admitted that his country is seriously dependent on Russian economic assistance. South Ossetia's poverty threshold stood at 3,062 rubles a month in the fourth quarter of 2007, or 23.5 percent below Russia's average, while South Ossetians have incomparably smaller incomes. Before the 2008 South Ossetia war, South Ossetia's industry consisted of 22 small factories, with a total production of 61.6 million rubles in 2006. In 2007, only 7 factories were functioning. In March, 2009, it was reported that most of the production