Nauru: The first failed Pacific State?

Abstract

In recent years supposedly ‘failed states’ have been recognized in the Pacific. Nauru, once rich, has acquired most of the characteristics of a failed state, in large part because of the consequences of an extreme ‘resource curse’ scenario, where other economic sectors fail. Mining of phosphate is now almost over. Wasteful expenditure, especially on a national airline and the panoply of a ‘welfare state’, and inadequate health services and education systems created budget deficits but not the skills required to develop an alternative economy to mining. The collapse of a corrupt offshore banking and passport system emphasized this failure. Political systems have been too inexperienced, short-term and divided to stabilize the political economy. Regional external intervention has occurred and may lead to extensive emigration from Nauru and to a new political status.

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