Nauru: History

Pre-20th-Century History

Not much is known of traditional Nauruan life, and even less of the island's history before Captain John Fearn came across it in 1798 as he sailed from New Zealand to China. He must have thought it was all right, naming it Pleasant Island and noticing quite a few dwellings from his offshore vantage point. The usual European roués - whalers, blackbirders, loggers and buccaneers - started dropping in over the next 30 or 40 years.

The introduction of firearms and alcohol destroyed a relatively peaceful co-existence of the 12 tribes living on the island, leading to a ten-year war. By the 1870s so many guns had been traded to Nauruans that the German traders who found themselves based there asked their government to protect them. Warfare and introduced disease reduced the population by a third in little over 40 years, and a rough census showed that women outnumbered men by 30% by the time Germany invaded in 1888. Nauru was incorporated into the German Marshall Islands until 1914.

Modern History

In 1899 a British prospecting company discovered Nauru's immense wealth of phosphate. Mining began, and Australia's first action of WWI was to wrest Nauru from Germany. After the war, the island became a British-mandated territory administered by Australia, and exploitation continued. In December 1940, Germany exacted revenge, shelling and sinking several Australian and British vessels. The Japanese invaded in 1942 and deported about half the population for forced labour. By 1946, when the survivors returned, the population had shrunk to less than 1000. After the war, Nauru remained under Australian administration as a United Nations Trust Territory.

By 1951, the Local Government Council was established, granting a small measure of self determination to islanders. Nauru won independence in 1968, when it was accorded special member status of the Commonwealth. In 1970, Australia, New Zealand and Britain handed over their joint control of the phosphate operations to the Nauru Phosphate Corporation.

In the early days of mining the company paid Nauruans holding land in mined areas. While the royalties continued, Nauru lodged a claim against Australia in 1989 for compensation for damage caused before independence. Australia signed an out-of-court settlement, and New Zealand and Britain each agreed to contribute nominal sums.

The Nauru Phosphate Royalties Trust was supposed to invest these royalties as insurance for the day when the phosphate mining ground to a halt but the investments became a case study in financial mismanagement and most of the Nauruan people's savings evaporated. An attempt to create an offshore banking tax haven brought accusations of money-laundering and an international ban was placed on financial transactions involving Nauru.

The Trust should also have paid a percentage of royalties into a fund to finance rehabilitation of the landscape. The most recent estimate is US$230000000.00 million over more than 20 years.

Recent History

With their accessible resources exhausted, mining stopped and their nation edging towards economic ruin, the government was plagued with instability and accusations of poor financial management. In the years following 1995 Nauru had six rulers, with changes often brought about by votes of no confidence.

Some of the large-scale losses were recouped in 1996 when the government successfully sued its legal advisors. However, the country's finances continued to deteriorate and, in 2001, the government signed up to the Australian government's 'Pacific Solution', receiving payment for hosting (in poor conditions, and at Australia's expense) the would-be refugees Australia did not deign to accept.

The axe finally swung in 2004, when the country defaulted on loan payments and saw its Australian holdings placed into receivership. Australia sent officials to assume control of finances and the president declared a state of emergency.

By 2005 the country was on its knees. The one remaining aircraft of the Air Nauru fleet was in financial crisis, the bank had no money, lack of fuel for the generators saw electricity limited to just a few hours a day, drinking water was contaminated and the health system was barely functioning. Many of the long-standing Chinese stores were closing, and restored diplomatic relations with Taiwan included an agreement by Taiwan to repatriate the long-term resident I-Kiribati and Tuvaluan workers who wanted to return home.

Australian payments for the 'Pacific Solution' detention centres provided almost all cash income, and as part of the package Australians held key positions in the police and finance departments. Tourism, unsurprisingly, has been non-existent for some years.

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