What Happened When a Tiny Nation Got Filthy Rich Overnight

Nauru - An Island Country in South Pacific is in news for the bad living conditions in its Refugee Detention centers. The Island is also known for its high rate of poverty and unemployment. Only a few decades ago, the island was listed among world's richest countries while it was a major phosphate exporter but as the resources exhausted, the national systems started to fail. At some point in its history, the country became a hub of money laundering in order to generate income.
The transition of this country from rags to riches and back to rags again is something you might never have heard before.

This video is narrated by Clundor. Check out his channel here - https://www.youtube.com/channel/UCq0zANl2rZi7MK8UjTadw_Q

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With only 21 square kilometers of land area - somewhat the size of LA international airport, Nauru is the smallest state in South Pacific and third smallest state in the world after Vatican City and Monaco. It's a home to some 11,000 people but long before humans discovered the island, local bird species used this island as their restroom and excreted their poop here for millions of years.
Nauru was sitting on top of excrement gold and Germans were the first to find out. They started mining in this resource in 1906 under the name of "Pacific Phosphate Company". Following the world war 1, mining continued under the "British Phosphate Commission" when Nauru fell in the hands of Britain, Australia, and New Zealand. Things remained more or less the same until world war 2 and this is where the things started to change.

Nauru got independence in 1968, bought the "British Phosphate Commission" and instead of fixing the damage done, it went on a full-on crazy mining streak under the locally owned "Nauru Phosphate Corporation". The people of Nauru mined A LOT, so much so that Nauru became one of the richest countries in mere a decade

In 1975, the country earned the equivalent of $2.5 billion for a population of mere 7000 - more than enough to keep them satisfied for generations to come. Per capita income of Nauru reached second highest in the world, only after the oil-heaven Kuwait.

Time took a turn, Island's phosphate resources depleted but countries expenditure remained the same, Nauru started borrowing money from other countries. One of the advisers convinced the president to invest in a London based musical pop band named Unit 4+2. The show closed only a few weeks after its debut costing Nauruans more than 7 million dollars in today's money.
With no source of income to pay off its debts, international creditors seized Nauru's entire real estate portfolio together with its sole aircraft of Air Nauru. Nauru trust went bankrupt, virtually bankrupting entire nation.

As a desperate attempt to generate income, Nauru published ads on the internet offering anyone with $20,000 the opportunity to open a bank on the island. Russian mafia saw an opportunity to seize and used Nauru’s liberal banking policies to launder over $70 billion from the former Soviet Union.
At one point, Nauru used its position as a member of the United Nations to recognize independent countries like Kosovo and Abkhazia allegedly for money. Russia was reported to give Nauru US$50 million in humanitarian aid for this act. Nauru Government, however, claimed that these two things were not linked.
In 2001, Nauru became a refugee detention center when the Australian government agreed to pay Nauru for temporarily housing refugees that were reaching Australia for Asylum.
The Nauru camp shut down in 2008 and reopened again in 2012 with minor additions but the conditions did not improve. This time the Australian and Nauruan governments tried to keep things secret by limiting access to the Island and punishing those who would speak about the conditions inside the camps. An Iranian refugee, in 2016, lit himself on fire after he learned that he would be expected to live on the island for the next ten years.

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