Nauru
Nauru's phosphate deposits began to be mined early in the 20th century by a German-British consortium; the island was occupied by Australian forces in World War I. Upon achieving independence in 1968, Nauru became the smallest independent republic in the world; it joined the UN in 1999.
There are currently no known threats to visitors or expatriate personnel in Nauru, the world's smallest republic.
President Rene Harris was appointed as president by the parliament at the end of March 2001 for a three-year term. He was also president for 12 months from 1999-2000. The former President Dowiyogo, had been elected by Parliament on 19 April 2000, following general elections in Nauru on 8 April 2000.
Nauru's main source of revenue has come from exports of phosphates, but mining is slowing as reserves run down and is expected to become uneconomic soon. As few other resources exist, the country imports most of its necessities. The rehabilitation of mined land and the replacement of income from phosphates are serious long-term problems for Nauru. Nauru's economy is based on the phosphate industry, the life expectancy of which is roughly estimated at five to 10 years. Phosphate production has declined since 1989, as demand has fallen in traditional markets and as the marginal cost of extracting the remaining phosphate increases.
Anticipating that Nauru's phosphate deposits will eventually be exhausted, a proportion of revenue from phosphate sales has been invested in long-term trust funds to provide for Nauru's economic future. As a result of investment and fiscal deficit problems, the unencumbered value of those assets has now reportedly declined to between $200-300 million.
Nauru's other main foreign policy interests are twofold. As a low-lying island, whose very existence may be threatened by a rise in sea levels, Nauru has an urgent interest in the global environment, especially the issue of global warming. Secondly, in common with other South Pacific nations, Nauru objected fiercely to French nuclear Pacific tests although, since the end of the most recent series of tests, diplomatic relations (suspended in 1995) have been resumed.
Finally, an international task force has imposed sanctions on Nauru in December 2001 for missing a deadline to strengthen laws against money laundering. The Organization on Economic Cooperation and Development (OECD) task force will warn international banks, businesses and investors that transactions in Nauru - the world’s smallest independent republic - could be tainted by money laundering operations. Russia's central bank has said that as much as $70 billion in the ill-gotten gains of Russian criminal groups has been laundered through Nauru’s financial systems.
