However, Nauru is very bad at managing its money: it has no domestic taxes, and only taxes on imports are levied on tobacco, alcoholic beverages, and automobiles and motorcycles; health care and education are free; in June 2000, the G7 anti-money laundering agency, the Financial Services Task Force (FATF), placed Nauru on a money laundering blacklist, and a number of Nauru's banks that had opened outside the country were forced to shut down in 2003 for engaging in money laundering; and a number of commercial buildings purchased in the U.S. and commercial buildings purchased in the United States and the 52-storey "Nauru Tower" in Melbourne, Australia, which was built at great expense, have not operated well; began depositing a significant portion of the proceeds from the sale of phosphates more than 30 years ago in order to allow future generations to live off the interest - but the financial crisis of the late 1990s caused its deposits to shrink dramatically. But the financial crisis of the late 1990s caused their deposits to shrink dramatically.
Meanwhile, Nauru was struggling more and more to generate income. The economy was too monolithic, the phosphate mines had been virtually exhausted, and it was even considering demolishing the presidential palace to make way for the minerals; agriculture, which sustained the nation, was not a priority for the state; and the fishing industry, which was uniquely suited to the task, had not taken hold.
Nonetheless, enjoyment has always been the first priority in the lives of Nauruans. The Nauru government reportedly ships meat from Australia, thousands of kilometers away, at a cheaper domestic price than in Australia; it is surrounded by the sea, but relies on imports of fish; and it is even "sharing" the world's prosperity with China, which exported all of the 26,000 U.S. dollars of bilateral trade between China and Nauru in 2000, according to the General Administration of Customs of the People's Republic of China. ......
Things went from bad to worse when, in early 2004, General Electric Capital Corporation came to the door demanding $230 million in debt due, and when the Speaker of the Nauru Parliament resigned, but no one succeeded him, resulting in a "shutdown" of Parliament.
As a last resort, Nauru signed a Memorandum of Understanding (MOU) with Australia in April: Australia would provide Nauru with a team of financial officers to reorganize Nauru's finances, and a police force led by a superintendent to help maintain law and order. Interestingly, Ms. Bogdan, a Nauru government spokesperson, said she did not yet know the number of police officers who would be coming, but told reporters: "The issue of police, law and order is not very pressing. We need more training of our own police and a reserve of police officers." Nauru's president, René Harris, also expressed his "deepest appreciation" for Australia's help in a statement - after he had dismissed Australia's proposal to set up a "Pan-Pacific Police College" at the Pacific Islands Forum in 2003.
In 2003, he also dismissed Australia's proposal for a "Pan-Pacific Police College" at the Pacific Islands Forum, and has repeatedly been "uncomfortable" with Australia's big-brother stance in the region.
But what else could Nauru do?
But what else could Nauru do?