Nauru Economy and History


Phosphate – a stroke of luck and bad luck at the same time!

Nauru has an important raw material that has shaped the fate of the island and its inhabitants for many years and continues to do so. This raw material is phosphate (see everyday life). The export of this raw material is very important for Nauru, as three quarters of the gross national product (GDP) are generated through it.

But a large part of the phosphate has now been broken down. Although new deposits have recently been discovered and have started to mine them, the supplies are now finite.

There are no ideas on how to make money on Nauru

The problem is that the Naurus economy has not yet looked for alternatives. There is almost no agricultural production. Virtually nothing is produced on the island, everything has to be imported. Imported products are more expensive and the now impoverished population can often not afford them.

In the meantime, some Nauru people are working as fishermen again in order to at least be able to provide for their families. The fishing grounds are very rich on the coasts of Nauru.

Australia pays for a camp for asylum seekers

Because of the bad economic situation, people in Nauru tried to get some money. Nauru became a tax haven, you didn’t have to pay taxes here. They also sold passports – a criminal business, it turned out. Another source of money was the establishment of a camp for asylum seekers from Afghanistan. Australia paid for it and the people gathered in Nauru. It was only when it became known that many inmates were badly treated there and that crime was the order of the day that the camp was closed. In the meantime a new warehouse has probably been built.

There is hardly any tourism on Nauru, although the island has beautiful beaches. But the island is difficult to get to and there are few things to see.

Nauru, once one of the richest countries in the world is now a very poor country economically.

Nauru Economy

History and Politics

Early history

We do not know where the inhabitants of Naurus originally came from. It is believed that shipwrecked people settled the island. They came from Polynesia, Melanesia or New Guinea. There was probably no original population. So today’s residents probably descend from Micronesians and Melanesians.

The Europeans are coming

The Europeans discovered the island relatively late in 1798. A British captain named John Fearn was the first to see the island and named it Pleasant Island, which means “pleasant island”.

Originally, twelve indigenous tribes lived on Nauru. Each tribe had its own head. These tribes are still immortalized in the state flag. Today there are no longer any tribes, but the administrative units are called districts. Two tribes are now extinct.

German colony

From 1830, it was mainly the British who immigrated. At the same time, they brought diseases with them, against which the inhabitants of the island had no power of resistance. Fighting between immigrants and residents took place at the end of the 19th century. In 1888 Nauru came to the German protectorate of the Marshall Islands. From 1906 to 1920 Nauru was part of the German colony of German New Guinea.

Also towards the end of the 19th century the rich phosphate deposits were discovered on the island. This phosphate was created due to the bird droppings of the birds that often nest on the island (see economy, everyday life). In 1908 they began to mine the valuable raw material on Nauru. British and Germans joined forces for this.

First World War

After the beginning of the First World War, Australian troops occupied the island. After the German Reich had been defeated in World War I, Nauru was jointly administered by Australia, Great Britain and New Zealand in 1920 under a mandate from the League of Nations. All three states controlled the mining of phosphate. The inhabitants of the island went almost empty-handed. The nations that mined the phosphate also secured the income and thus exploited the inhabitants and actual owners of the phosphate.

Second World War

In 1942 the Japanese occupied Nauru during World War II until the Allies recaptured the island. In 1947, Nauru was placed under the administration of Australia in trust. The country received internal independence on January 31, 1966. In 1968, Nauru became an independent republic and at the same time a member of the Commonwealth of Nations. The former chief Hammer de Roburt became president. He held the office of president for a long time. Bernard Dowiyogo took over from him.

It was not until 1970 that Nauru was able to benefit from the phosphate deposits. The Naurian Phosphate Society was founded. The money was put into expanding the infrastructuresuch as the main road that circles the whole island. Nauru became the second richest country on earth after Saudi Arabia. This assessment was based on GDP.

In the meantime, Naurus has even brought a lawsuit against Australia, which exploited the country before independence without paying any compensation to the residents. The attempt to rebuild the nature destroyed by the phosphate degradation was given up again. The area that had been destroyed was too big.

From 2000 onwards, Nauru made negative headlines again and again. As a tax havenit aided criminals. Drug dealers could launder money and the Mafia moved in there. This damaged the reputation of the small country tremendously. The government had lost all control over the financial transactions that were being carried out in the country. However, the money was also an important source of income, there was no other income. Still, attempts were made to enact laws to stop this criminal activity. For a long time, the country was on the so-called “black list” of the OECD.

The country’s presidents changed frequently and the situation was not stable.

In 2001 a new source of income was found when the government established the Nauru Detention Centerset up. These were refugee camps in which mainly refugees from Afghanistan, but also from other Asian countries and Iran were accommodated. For this, the Australian government, whose duty it would have been to look after the refugees themselves, paid Nauru money. The camps were closed due to mistreatment of refugees, but reopened in 2012. Little information about the conditions in these camps reaches the outside world, so that it is difficult to assess what the conditions are really like on site today.