Nauru is one of the world’s smallest and most remote sovereign states and was one of the many Pacific islands first settled centuries ago by the dauntless seafaring Polynesian and Melanesian explorers. It was allocated to Germany under the 1887 Anglo-German Convention shortly before phosphate, the island’s principal raw material, was discovered at the turn of the century. Nauru was captured by Australian forces in 1914 and continued under Australian rule (other than a period of Japanese occupation from 1942 to 1945) until independence was granted in 1968.

A plan to evacuate the islanders in order to develop Nauru’s remaining phosphate deposits precipitated the protest movement that eventually led to independence. Nauru sought compensation from the British, Australian and New Zealand governments, and after lengthy and heated negotiations a Compact of Settlement was signed in August 1993; Australia, New Zealand and the United Kingdom all proffered contributions. Revenue from phosphate sales was invested in a long-term trust fund, but the trust’s subsequent history has been a shadowy one whose main beneficiaries appear to be the lawyers charged with investigating bogus claims and fraudulent investments.

Nauru’s first head of state was the Head Chief, Hammer DeRoburt, who held power for most of the time between independence and 1989 (in 1976, Parliament unseated DeRoburt after some members objected to his autocratic style, but he was re-elected two years later, winning further elections in 1980, 1983 and 1986). Finally, in December 1989, DeRoburt was defeated by Bernard Dowiyogo who went on to win a second term in 1992. However, the 1995 poll resulted in Dowiyogo’s removal, defeated nine votes to eight by René Harris. Henceforth, until Dowiyogo’s death after heart surgery in March 2003, Nauruan politics was dominated by the struggle – punctuated by occasional truces – between these two men and their supporters. This concluded in 2004, when Ludwig Scotty gained presidency.

In common with other small island states, Nauru has attempted to develop an ‘offshore’ financial services industry to diversify its otherwise limited economy. This has led to problems with the Organisation for Economic Cooperation and Development, which has been leading a campaign against international money-laundering. Nauru is one of seven nations which, in April 2002, were ‘named and shamed’ by the OECD because of their failure to tackle the problem. In early 2003, the Nauru government agreed to wind up the sector. A more unusual means of collecting revenue emerged in 2001 when Australia paid the Nauru government to take on 1000 refugees, mostly from the Middle East, who had tried to enter Australia, in return for a significant amount of money. Another pressing issue for Nauru is the global environment, and especially global warming: as a low-lying island, its very existence may be threatened by a rise in sea levels.

The president of Nauru is elected by the 18-member unicameral parliament, itself elected by universal adult suffrage every three years. The President wields executive power assisted by an appointed cabinet of ministers.