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Photo by Jocelyn Carlin
Photo by Jocelyn Carlin
Photo by Jocelyn Carlin

 

Economic Profile

MOST OF NAURU is like a lunar landscape. Large and deep craters I alternate with smaller holes; vegetation is scarce; rocks and rubble are scattered everywhere. But, in this case, humans are to blame for all of this. The quest for phosphate - the valuable mineral used as fertiliser for food - led the western powers to devastate a tiny Pacific island, and its inhabitants to trade their paradise in the sea for a heap of ruins.

Humankind has tilled tine soil for centuries and has always tried to improve its quality to grow better food. Bones were initially found to be good fertilisers, leading in the early 19th century to a ghoulish trade from the battle fields that ended after a public outcry. Then people discovered that phosphate was the key ingredient in bones that fertilised the soil and that it could be found in certain rocks. So a furious worldwide search for deposits began, dispelling a foreboding belief among western intellectuals that Overpopulation would lead to a struggle for existence ending with extinction through starvation. In 1900, with already over three million tons of phosphate being produced each year, a New Zealander named Albert Ellis recognised a rock used as a door-stop on the floor of a Sydney laboratory. He made a discreet trip to Nauru, where the rock had come from, and estimated that the island contained 41 million tons of extremely high quality phosphate deposits, the produce of thousands of years of bird droppings accumulating in the sea. In fact, there was closer to twice that amount.



Ellis was working for the Pacific Islands Company - later the Pacific Phosphate Company - which floated on the London Stock exchange with British, Australian and New Zealand shareholders in 1902. In 1906, with Nauru under the German protectorate decreed in the late 19th century, mining began.

Nauruans were paid half a penny per ton as royalty for owning the land. Since their economy was still based on bartering for goods with fish and copra, it's easy to see how such an agreement was formed. Ifs only from 1921, after head chief Detudamu complained, that royalties were increased regularly.

Colonial power

Most of the phosphate was shipped to Australia and New Zealand, who lacked sufficient quantities of the mineral for their soil. Up to two million tons of phosphate a year were exported there. Between 1923 and 1955, the value of the exports was UKŁ23 million, although Nauruans received less than three per cent. For Carl N McDaniel and John M Gowdy, authors of Paradise for Sale, "The colonial imperialists who occupied Nauru and mined it for its lucrative phosphate devastated the island, which forever changed its native people.

In 1968, Nauruans regained control of their island and immediately faced a dilemma: to pursue a sustainable future that would protect their valuable natural resources -the physical integrity of the island - or to mine the remaining 40-year supply of the phosphate and in the process make most of their home useless. They did the latter."

Actually it was already too late to regain the fine balance of a traditional culture and sustainability of land. The people were already forced into a capitalist system by 1968. To not continue mining was never seen as an option. So today, in 2001, phosphate resources are nearly gone. Some of the money from sales was — invested in long-term trust funds to provide for Nauru's economic future. But bad management of bad investments means the assets are now worth less than US$200 million - hardly enough for the nation to survive on for long. According to some statistics, gross domestic product per head reached US$40,000 at one point - one of the highest levels in the world. Today, it's less than US$2,000. This has led to great political instability. President Bernard Dowiyogo was elected by parliament on 19 April 2000. It was the eighth change of government since the fall of Lagumont Harris's government in a vote of no- confidence in early November 1996. Dowiyogo fell in March 2001 and was replaced by Rene Harris.

A first economic summit in March 1999 tried to produce a development strategy for the next century, but it was successful only as a first step of consultation between the government and the people. When phosphate revenues were high, and government subsidies too, there was no need for people to question policy. Now, they have a close eye on what happens and an urgent requirement to participate in ways to turn the economy around.

Searching for more

Trials are taking place to determine whether secondary phosphate mining is feasible. It's certain that there is a lower grade of phosphate deeper down, but extraction could be too costly. The existing infrastructure needs replacing and it's difficult to dig between the hard limestone pinnacles. A sensible solution would be to contract the extraction to a foreign mining corporate for a percentage fee of the profits. Limestone could be sold as a byproduct of this operation.

If secondary mining is not an option, it's crucial to rehabilitate the mined-out land: over 80 per cent of the island. Nauru's the most densely populated island in the Pacific, with an average of 10 people per household. But only the coastal area is available for housing, or for any use at all. This means housing competes for space with all the building and infrastructure requirements of the nation.

One saving grace is that land ownership has always been restricted to Nauruan nationals. But rehabilitation is one of the most sensitive issues today. In 1993, the then government signed a settlement for 107 million Australian dollars over 20 years with Australia following a claim for compensation lodged with the International Court of Justice in the Hague. Nauru's estimated rehabilitation will cost three times that amount and will take 30 years to complete.

What a vague dream that the eerie, barren, inhospitable landscape could.have roads, residential areas, agricultural and forestry sites, waste disposal, cemeteries, conservation areas and a water reservoir. This is the dream that Nauru most wants, and most deserves. It's not much to ask that years of abuse be put right by the conglomerate abusers. Yet, even if more compensation is awarded, it may be too late to salvage what's left of a once beautiful nation.

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