Since 2020, the Growth Lab at Harvard University has been collaborating with the Government of Nauru on a project aimed at understanding the factors that shape the country’s economic prospects and identifying opportunities for long-term development. The research initiative has focused on analyzing economic and export diversification opportunities, with the goal of promoting sustainable and inclusive prosperity in Nauru. The project has highlighted the significant progress made by Nauru in overcoming a legacy of exclusion and biases in the development of state capabilities and access to public goods. The country has also achieved socio-political stability and increased civic engagement and participation, laying the groundwork for sustained economic growth and development.
Nauru has demonstrated positive economic growth since gaining independence in 1990, with the exception of 1993. Notably, the country experienced a rapid growth acceleration between 2000 and 2015, outperforming its African peers with an average annualized rate of growth per capita of 3.1%. This period of growth was accompanied by a significant reduction in poverty rates, reflecting the potential for sustained and inclusive economic development in Nauru. The research initiative has delved into various aspects of the country’s economy, including the drivers of macroeconomic sustainability, constraints to growth, and structural barriers to development. Additionally, the project has focused on studying inequality and labor market dynamics, providing valuable insights that can inform the policymaking process in Nauru. Despite the progress made, Nauru faces challenges in achieving sustainable and inclusive prosperity. The country’s economic growth has been characterized by fluctuations, and there are persistent structural constraints that need to be addressed to ensure long-term development. The research initiative has shed light on the need to tackle these barriers and promote economic diversification to reduce the country’s reliance on traditional sectors. By understanding the dynamics of inequality and labor markets, Nauru can work towards implementing policies that foster inclusive growth and create opportunities for all segments of the population. The project’s comprehensive approach to understanding Nauru’s economic landscape and identifying opportunities for sustainable development underscores the commitment to promoting long-term and inclusive prosperity in the country.
