Friday, September 15, 2006

Cake or no cake?


This is going to be difficult to write without sounding like a teacher, or a lecturer but I will try to do my best not to. Something which did not grab the headlines here in the UK nor in Sweden, well we do have political turmoil at the moment in both places, UK with Mr. Blair and the question, ”Will he or won’t he?” and in Sweden this Saturday is the general election, and the left will probably make way to the right, something which only happened twice before, in 1976 when the Social Democrats had to give way to the Centre Alliance, nothing to do with Star Wars, saying that, the Alliance in Star Wars would possibly done a better job. The other time the left had to give to the right was in 1967 when the Swedes had to park their cars for two hours at 2 am in November, whilst the traffic scheme changed from driving on the left to driving on the right...

No the reason why the headlines had not been filled with the financial ruin of Nauru is because no one cares. They didn’t have it, then they did...they lost it got it back and lost it again…make sense doesn’t it?

Nauru is the world’s smallest republic, situated at 0°31’41.86”S and 166° 56’ 04.27”E in the South Pacific. It has a population of only 9,600 large citizens. Why is it that no-one cares I hear you ask…well you see once upon a time, not too long a go, they were one of the richest countries in the world per capita, and all of this because of Guano…or birdshit to you and me…

Lets do a bit of history, Captain John Feam, a British navigator sailed past Nauru in 1798 and names it Pleasant Island, take it he did not get ashore then with all those bird droppings…

In 1888 the Germans took control of the Island and believe it or not, a British firm discovered phosphate on the island so they start to mine it, sharing the profits with the Germans, have to be one of the first. Phosphate is a valuable resource used as fertilizer, among other things.

The Australians get a wind of this so they arrive and take control, until WW2 when…you guessed it…the Japanese turn up and want a bit of the action. Now the Japanese were not very nice to the Nauruans, they shipped a third of the population to Micronesia to work in labour camps and then an additional 500 died from starvation or bombings.

War ends, Australia is back but this time only as a keeper under a UN legislation. So life plodders on in Nauru and in 1968 they have had enough of the Aussies so they gain independence and elects their first president, Mr. Hammer DeRoburt.

Now, for the first time since 1798, the Nauruans have control over their country and more importantly their birdshit. They continue to mine the guano and sue the Aussies, New Zealand and Great Britain for lost royalties and compensation for mining damage, don’t ask me how the Germans missed out on that lawsuit…and they win, $73,000,000 from Australia and $16,400,000 from the UK and NZ combined.

Happy, rich and prosperous, life for the 10,000 inhabitants of Nauru is great. So during the 1970’s and 1980’s they splash out, having one of the highest standards of living in the world. So far so good…they have had a bit of turmoil with ownership of the birdpoo, but now hard working and successful Nauruans work away…well not really…they are rich and successful but working? No they hire immigrant workers to do all the jobs, whilst they spend most of their time watching television, living on a diet of junk food, quite common for us in the Western world, or go for spin in their car on the islands only road, which is about 7.5km long. Then one day in the mid 90’s disaster strikes.

Their birdshit is running out!!!

Not having invested their money in other sustainable businesses Nauru is facing financial ruin, as most of their money has been put away in daft financial schemes, been lost or stolen, so what to do…?

They have the financial wizardry and know-how so they decide…against better judgement, to set up offshore banking. Before long Nauru becomes a haven for dodgy financial deals and money laundering. In 1998 it is estimated that $70,000,000,000 was transferred from Russian to Nauruan banks, which is 700 times more than Nauru’s entire gross national product.

Needless to say that it could not last…you cannot run a business laundering money for the Russian mafia and Colombian drug cartels, it just doesn’t work, no one in the banking world wants to be your friend if you do that, so subsequently the banks were shut down. So now with no guano, no drug money things start to get tough on the island, the infrastructure is collapsing and they are starting to have serious payment problems. Supplies are cut off frequently, including the supply of fresh food.

Tough when you import 100% of all that you use. The population is now one of the unhealthiest populations in the world due to years of sitting down doing nothing. Australia got fed up by bailing them out and even cancelled their subsidised medial care. The Australians did do a deal with them…the Aussies said “We will pay you to set up a detention centre for asylum seekers.”

This has been a lucrative deal, but they still needed aid as they had run up debts of some $169,000,000.

So what next, well they are trying to make some inroads with Taiwan which of course angers the Chinese. Air Nauru’s only aircraft was repossessed by a US bank in December last year, which now makes it difficult for anyone wanting to get out of there, so…I don’t have any answers…more than… You cant have your cake and eat it…unless of course you are Nauruan then you will eat all the cakes and still want more…What is that all about?

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