Nauru, one of the world’s smallest countries with a population hardly surpassing 10,000 people, has experienced what people, having gained enough of its history, would obviously dub a ‘wheel of fortune’. Once when its phosphate reserves were among the largest on the planet, the nation could easily afford all the affinities provided. Investment was made globally, in numerous businesses, real estate projects, and even a huge musical production in United States (which later ended up in a similarly huge flop as well).
Then came the reversal of fortune, near the closing end of 20th century.
At the moment, with the reserves almost completely used up, and with very little savings, excluding their gone-wrong businesses’ bad debts, the tiny Pacific nation is hopelessly putting its final hope on Australia, one of its largest, and most influential, foreign donors. The country, as part of an agreement with the latter to accommodate illegal migrants detained in Australia, has for years received, in turn, over hundred million dollars in terms of foreign aid, mostly used for their annual expenditure. With things going upside down, in less than a generation, the whole nation has suffered from financial difficulties.
A former Australian financial adviser for Nauruan government described his half-year experience dealing with the people, and in particular, how he helped them reforming the country’s already dilapidated financial and budgetary sectors.
Read his full article on Australian Financial Review.
One of my responsibilities was signing every spending receipt in the whole government. This was a big reform that had stopped money leaking out of the Nauru budget. Every cent of expenditure was confirmed by the Budget Adviser. It made sense, but it was an enormous pain.
Hundreds of complex spending receipts came over my desk every week. And then there was public sector pay.
Nauru had thousands of public servants, and every pay cheque had to be signed, by me or the head of the department. The Secretary of Finance did exactly what I would have done in his shoes, and delegated.
I saw and signed everyone’s pay cheque, from the president down to the gardeners who controlled weeds near the airstrip. The lowest pay was $180 a fortnight; the highest only about $350 – even for the president.