Politics of Nauru

Politics of Nauru takes place in a framework of a parliamentary representative democratic republic, whereby the President of Nauru is the head of government of the executive branch. Legislative power is vested in both the government and the parliament. The Judiciary is independent of the executive and the legislature.

Nauru's economic viability has historically rested on its phosphate reserves. Phosphate — in actuality a resource derived from a 1,000-year cycle of bird droppings—has been mined on the island since 1906. In the 20th century, the small Pacific nation generated healthy revenues from this lucrative—but finite—resource.

The phosphate supply has virtually all been exhausted in recent years and as such, the future of the people of Nauru is uncertain, and the challenge for the country's policy makers will be to determine a path of continued economic prosperity, without the benefits of this resource.

In this regard, the government has tried to develop the island into an offshore financial centre, imitating the success of the Bahamas and other island nations around the world that have emerged as major offshore banking centres. The government has also invested in property on other islands and the United States through its Nauru Phosphate Royalties Trust.

Over the course of recent years, however, offshore banking institutions and instruments have come under increasing scrunity by international bodies seeking to make international finance a more transparent system. Nauru, as a result, has been a casualty of this movement.

...
Wikipedia