YAREN, Nauru — President David Adeang backed a call from New Zealand Foreign Affairs Minister Winston Peters for Pacific leaders to shift their focus from aid to strengthening their own economies, pointing to an Australian National University analysis of Nauru’s decade-long boom as the region prepares for the Pacific Islands Forum Leaders Meeting in Palau.
Peters told Pacific Mornings that stronger economies are vital if island countries are to have more control over their future. “I go to ASEAN, and it’s all about the economy, the economy, economy, economy. I go to the Pacific, it’s all about aid,” he said.
Adeang said in a release Thursday that his government has pursued that approach since he was elected in 2023. “From the outset we said that our future will not be defined by the UN’s ranking of Naoero as the world’s fifth most vulnerable nation to economic and climate shock,” he said.
The analysis the release cites, published July 17 by Development Policy Centre director and ANU economics professor Stephen Howes, found Nauru recorded average annual growth in national income of 4.9 percent per person between 2009 and 2024 and was reclassified as a high-income country in 2020. Between the 2011 and 2021 censuses, the economy created 36 percent more jobs for men and 74 percent more for women, employment rose from 47 percent to 64 percent of the population and unemployment fell from 23 percent to 5 percent. Howes wrote he is not aware of any other boom worldwide that has “delivered similarly stunning results in such a short period.”
Howes attributed the boom to a surge in foreign income, driven mainly by Australia’s Regional Processing Centre, other aid and fishing license revenue, with foreign income rising from about 30 percent of GDP in the late 2000s to more than 60 percent now. He also flagged risks the release does not mention: there is no guarantee the boom continues, population growth is spreading the foreign revenue across more people and Nauru has the lowest life expectancy of all Pacific Island countries despite its new wealth.
Adeang credited the progress to bold thinking, innovation, close friendships with Australia, China and the Asian Development Bank, and long-term planning. He pointed to the Intergenerational Trust Fund, advances in crypto, the country’s citizenship program, new fishing initiatives and third-party resettlement arrangements with Australia. Howes’ analysis found the trust fund, Nauru’s second sovereign wealth fund after the first was bankrupted, has grown from 20 percent of the size of the economy in 2016 to 100 percent now.
“We are succeeding because we were transparent, because we spoke directly with our people, and because they trust that the sacrifices were for Naoero’s future,” Adeang said.
