Limestone pinnacles remain after phosphate mining.
Nauru House in Melbourne (middle). Once owned by the Nauru Phosphate Royalties Trust, the floorspace of the building is 0.24% of the area the entire terrority of Nauru.
Nauru's economy depends almost entirely on declining phosphate deposits; there are few other resources, and most necessities are imported.[26] Small-scale mining is still conducted by the NPC. The government places a percentage of the NPC's earnings in the Nauru Phosphate Royalties Trust. The Trust manages long-term investments, intended to support the citizens once the phosphate reserves have been exhausted. However, a history of bad investments, financial mismanagement, overspending and corruption has reduced the Trust's fixed and current assets. For example, Nauru House in Melbourne was sold in 2004 to finance debts and Air Nauru's only Boeing 737-400 was repossessed in December 2005 - though the aircraft was replaced in June of the next year with a Boeing 737-300 model, and normal service was resumed by the company.[27][28] The value of the Trust is estimated to have shrunk from A$1,300 million in 1991 to A$138 million in 2002.[29] Nauru currently lacks money to perform many of the basic functions of government, the national Bank of Nauru is insolvent, and GDP per capita has fallen to US$5,000 per annum. In the early 1980's Nauru had the highest GDP per capita in the world.
There are no personal taxes in Nauru, and the government employs 95% of those Nauruans who work; unemployment is estimated to be 90%.[30][20] The Asian Development Bank notes that although the administration has a strong public mandate to implement economic reforms, in the absence of an alternative to phosphate mining, the medium-term outlook is for continued dependence on external assistance.[29] The sale of deep-sea fishing rights may generate some revenue. Tourism is not a major contributor to the economy, because there are few facilities for tourists; the Menen Hotel and OD-N-Aiwo Hotel are the only hotels on the island.
In the 1990s, Nauru became a tax haven and offered passports to foreign nationals for a fee. The inter-governmental Financial Action Task Force on Money Laundering (FATF) then identified Nauru as one of 15 "non-cooperative" countries in its fight against money laundering. Under pressure from FATF, Nauru introduced anti-avoidance legislation in 2003, following which foreign hot money flowed out of the country. In October 2005, this legislation—and its effective enforcement—led the FATF to lift the non-cooperative designation.[33]
