The British came to the island in 1798 as the first Europeans. In 1888, Nauru was annexed by Germany, and in 1914 occupied by Australian forces. In 1919 Nauru became a joint British, Australian and New Zealand mandate.
From 1942 to 1945 the island was occupied by Japan, from 1947 it was the Australian mandate area. On January 31, 1968, Nauru became an independent republic.
The economy of Nauru has been entirely based on the extraction of phosphate. In 1993 Australia agreed to pay Nauru $ 90 million in compensation for the Australian utilization of phosphate leases 1919-67. New Zealand and the UK contributed $ 10 million each.
Phosphate production dropped sharply from the early 1990s, and the nation sought to launch itself as a tax haven for foreign businessmen. See abbreviationfinder for geography, history, society, politics, and economy of Nauru. Thanks to the phosphate rents, Nauru citizens in the 1970s were able to enjoy an average income that was among the highest in the world. At the turn of the millennium, phosphate rents were virtually depleted and the economy so miserable that the government had no money to pay government employees.
The situation in the 1990s led to frequent government crises and a shift in the presidential post; a condition that continued after the turn of the millennium.
In this bundle, in 2002, Nauru received about 1,000 asylum seekers who had landed in Australia, including 300 Afghans who had been rescued by the Norwegian ship Tampa the year before. Australia paid financial compensation. The asylum seekers protested during hunger strikes against alleged miserable conditions in the detention camp and thus triggered yet another government crisis in 2003.
The detention camp had been introduced in 2001 as a fence against illegal immigration: Asylum seekers at sea were taken up by Australian naval vessels before they could land in Australia, and were then interned in camps at Nauru and Papua New Guinea.
However, the operation of a large detention camp has been an important source of income for Nauru. The newly elected Australian Labor government under Kevin Rudd put an end to the so-called Pasific Solution policy and closed the camp in 2008; it reopened in 2012. The Nauru camp houses mostly 1,300 asylum seekers, and employs about 10 percent of the island’s workforce. Hunger strikes and self-harm are widespread among asylum seekers, and a riot in 2013 led to extensive damage. 200 asylum seekers fled and the health center was burned down.
In 1999, Nauru joined the UN. Following strong international pressure, Nauru agreed in 2003 to discontinue its “offshore” banking business, which had allegedly been used by criminal syndicates to extensively launder money. In recent years, much of the state revenue had come from this activity, which was condemned by the International Anti-Money Laundering Organization (FATF).
From April 2004, Nauru was no longer able to pay interest and loan repayments, and was declared a technical bankruptcy. Australia assumed the role of interim administrator and took control of Naurus financial activities.
Ludwig Scotty was elected President for the third time in October in a year and a half; last time without a counter candidate. Just before he had dissolved parliament, which had not been able to adopt a reform budget. The Scotty government announced in May 2005 that it would restore diplomatic relations with Taiwan, following a 2003 breach. This was condemned by China, which claimed that Nauru was only aiming for “short-term economic benefits”. The connection with Beijing was thus broken.
In 2008, Australia increased its assistance to Nauru to a total of NOK 150 million. In part, this was a compensation following the closure of the detention camp. Over the years Australia had paid over NOK 300 million to keep the camp operating. In 2008, the Naurus economy was in acute crisis after the previously valuable phosphate rents were virtually depleted. Up to around 1990, about 14,000 inhabitants had an average income that was at the top of the world, but great value was wasted due to poor investment choices and corruption.
Veteran politician Rene Harris died in July 2008, aged 61. He was Naurus president for four terms, the last time 2003-04. He has been criticized for wasting the phosphate mines revenue and for allowing local banks to be used to launder money for Russian mafia and other criminal syndicates. Nauru was long on the International Monetary Fund’s blacklist not to cooperate in the fight against financial crimes, but was deleted from the list in 2005.
During the 2008 financial crisis, Naurus’s remaining assets in Australia were sold to cover debt obligations abroad. The island state was again declared bankrupt. International assistance, mainly from Australia, Taiwan and New Zealand, kept Naurus’ economy afloat.
Former weightlifter Marcus Stephens was elected president in 2007, having previously been finance minister. Among his sporting merits were 7 gold and 5 silver in the Commonwealth Games, as well as silver in the 1999 World Championships in Athens. His music is often played on the outdoor scene in Aiue Boulevard, in the country’s unofficial capital of Orro, but is not known outside Nauru.