Nauru goes bankrupt

Remember Nauru? That small Pacific island that got rich off phosphates? The BBC narrates:

Nauru’s rich reserves of phosphates – an ingredient for high-grade fertiliser – created enormous wealth during the 1970s and 1980s.

The island’s 10,000 inhabitants enjoyed one of the world’s highest standards of living, as well as exemption from tax and immigrant labour to perform all menial jobs.

But the phosphates have run out and things have turned sour. Amanda Butler tells us that the government faces foreclosure on 5 May if it does not pay a debt of 230m Australian dollars (US$169m; £94m).

What does it mean for a government to face foreclosure? Well, this government owns the Mercure Hotel in Sydney, a shopping center in the suburbs, and a “derelict” Melbourne tavern. But heck, why not close up the country altogether?

There have been reports that the island’s inhabitants could be given Australian citizenship as a reward for their help with asylum [seekers].

Alternatively, there have occasionally been proposals to move Nauru’s population to another unoccupied Pacific island.

The politically incorrect question: Why do these very small countries exist in the first place? Before answering that question, check out some photos and a short travelogue of Nauru. Or look elsewhere. New Zealanders claim that there are more Tongans in New Zealand than on the mainland of Tonga. Does either the world, or the islanders, still reap a positive cultural externality from maintaining these small groups? If all these islanders simply moved to Australasia, wouldn’t everyone be much better off within a generation? Those are questions, not answers. But I, for one, would not mourn the disappearance of Nauru. Or as the philosophers would say “Nauru as we know it.”

Addendum: Here is some radio narrative. Thanks to Nathan Fong for the pointer.