[Opinion] Oh!! Nauru

Located in the South Pacific Ocean, Nauru is a small, lonely island surrounded by reefs. The British, who arrived at this island in the late 18th Century, called it “the jolly island” because of its mild weather and delightful scenery. Although the island’s size amounts only to a mere 21 square kilometers, its soil is rich in phosphate ore. Nauru’s phosphate ore, the creation of a mixture of marine creature fossils and guano, is prized as the world’s best quality ore of its kind. Thanks to the exports of guano, Nauru’s per capita GDP amounts to 5,000 Australian dollars. Thirty years ago, it amounted to 30,000 Australian dollars. Half of the money earned by phosphate exports goes to the central government and the other half is allocated to the regional government and landlords. With this money, sufficient social welfare benefits were offered to the people of Nauru.

▷The problem, however, was in the government’s mismanagement of the money. Investment in real estate around the world, including in Sydney, did not meet expectations, and the government was suspected of corruption. The Nauru government became so short in money that once it ran a financial institute to help Russian Mafia money laundering, which it was forced to shut down after fierce international pressure. Recently, the 12,000 inhabitants of Nauru were struck with the fact that their country is in the verge of bankruptcy. Creditors seized even the jumbo jets owned by the government airline.

▷Now the only cash line that they can rely on is the annual $7 million provided by the Australian government (payment for Nauru housing refugees), compensation from the U.K., Australia and New Zealand (for environmental damages caused in the past), and fishing. Nevertheless, politics in Nauru are still lamentable. The parliament, composed of 18 members, is divided into ruling party and opposition party, with nine members each. The phosphate ores that were once considered infinite are now running low due to indiscriminate mining, and the only thing left is a 150-300m crater in the center of the island.

▷The Korean Peninsula is 10,000 times larger than Nauru, with 4,000 times the population, but it lacks natural resources. Korea, however, has a large pool of human resources and managed to become the 13th largest economy in the world. Once, in the past, the Korean people held the record for most labor hours. Nonetheless, in the present, labor intensity is decreasing and labor hours are shortening. People seem to focus on depleting, rather than filling the labor force, which is Korea’s only resource. In fact, the equalization of education, reducing working days, and the government’s distribution first policy are all being promoted under the name of “reforms.” I am worried that once we run out of resources, we might become like poor Nauru, which has no one to rely on.

Kim Byung Joo, guest editorialist, honorary Economic Professor at Sogang University,

pjKim@ccs.ac.kr

Hyong-Nam Bhang hnbhang@donga.com