Freedom in the World
After President Marcus Stephen survived a no-confidence vote in February, parliamentary elections were held twice, in April and June, but both failed to produce a majority. A state of emergency was declared on June 11, and Stephen continued to govern as acting president until he was reelected in November. Separately, voters rejected proposed amendments to the constitution in February.
Nauru, an eight-square-mile island in the South Pacific, is the world’s smallest republic. It was a German protectorate from 1888 until Australian troops seized it during World War I. The League of Nations granted a joint mandate to Australia, Britain, and New Zealand to govern the island in 1919. Japan occupied Nauru during World War II, and in 1947, the United Nations designated it as a trust territory under Australia. Nauru gained independence in 1968, became an associate Commonwealth member in 1969, and joined the United Nations in 1999.
Nauru’s once-plentiful supplies of phosphate, mined by Australia for use as fertilizer, have been almost entirely exhausted. Mining has made more than 80 percent of the island uninhabitable, and the government has squandered much of its accumulated wealth through financial mismanagement. The country currently carries a large foreign debt, and rising sea levels threaten its survival.
Recent governments have tried different ways to generate income, with limited success. With few viable economic alternatives, foreign development assistance became a major source of government income. However, money laundering tied to Nauru’s offshore banking operations landed the country on international blacklists, restricting its access to international loans. Despite such restrictions, Nauru has received considerable aid from China and Taiwan by switching diplomatic recognition between the two rivals. Between 2001 and 2008, Nauru served as a refugee-processing and detention center for Australia in exchange for rent and aid. International groups criticized the center for detaining refugees—including children—for years while awaiting processing, adjudication, and settlement. Its closure cost Nauru approximately one-fifth of the country’s gross domestic product.
Intense political rivalry and the use of no-confidence votes have been a source of political instability. The election of Ludwig Scotty as president in 2004 and his reelection in August 2007 provided hope for a stable government and implementation of much-needed economic reforms. However, following a no-confidence vote in December 2007, Scotty was replaced by Marcus Stephen, who pledged good governance and transparency. Stephen secured a second term as president in a snap election in April 2008.
In February 2010, Stephen’s opponents tried to unseat him with a no-confidence vote, but he survived the challenge and called for a snap election in April to secure his position. Parliament remained equally split between supporters and opponents of Stephen, and a deadlock ensued. As acting president, Stephen declared a state of emergency on June 11 and dissolved Parliament. A second election on June 19 failed to resolve the stalemate. Political maneuvering continued until November 1, when Stephen was reelected in an 11 to 6 vote as part of a deal that returned Scotty as parliamentary speaker.
To improve political stability and government accountability, the Scotty administration launched a constitutional review in 2005. Proposals included a directly elected president, making the state auditor an independent officer of Parliament, and requiring strict accounting for all public revenue and expenditures. In February 2010, 78 percent of all voters participated in the referendum to amend the constitution. The results fell far short of the required two-thirds majority, as nearly 70 percent of participating voters opposed the 34 proposed changes.
Nauru is an electoral democracy. The 2010 elections were deemed free and fair by international observers. The 18-member unicameral Parliament is popularly elected from 14 constituencies for three-year terms. Parliament chooses the president and vice president from among its members. Political parties include the Nauru First Party and the Democratic Party, but many politicians are independents.