The tiny Pacific island nation of Nauru is celebrating the 45th anniversary of its independence from Britain, New Zealand and Australia this week.
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31 Jan 2013 - 9:37 AM  UPDATED 26 Aug 2013 - 10:48 AM

(Transcript from World News Australia Radio)

The tiny Pacific island nation of Nauru is celebrating the 45th anniversary of its independence from Britain, New Zealand and Australia this week.

Heavily reliant on its local phosphate industry, Nauru is one of the smallest nations in the world with only ten thousand residents spread across 21 square kilometres.

But how independent is this Pacific nation which receives millions of dollars in foreign aid, particularly from Australia?

And after agreeing to Australian government calls to re-open an asylum seeker processing centre on the island, has Nauru compromised its independence in foreign policy?

Nauru gained its independence in 1968 after Australia, Britain and New Zealand ended their joint administration of the country after the Second World War, under a United Nations trusteeship.

It came after a turbulent war-time period on Nauru in which two-thirds of the population were forced off the island by Japanese forces.

Many of the exiles died from starvation and disease.

The Nauruans left behind on the island during Japanese occupation were subjected to brutal conditions as slave labourers.

The 31st of January celebrates Nauru's tenacity in overcoming war-time occupation as well as its independence on that day in 1968.

Nauruan government spokeswoman Joanna Olsson says a new memorial will be unveiled this year, celebrating the courage shown by Nauruans during the Second World War.

"The significance of independence runs deep and Nauruans are very passionate about it and devoted to it. Independence effectively means freedom from the colonial powers, it's also about keeping our own national identity and it's about freedom to mine our own phosphate and have our own money because the mining was mainly done by foreign powers and most of that went to them."

Ms Olsson says there will be a range of community events across the island on Independence Day, including flag-raising ceremonies and beauty pageants.

Pacific politics expert, Professor Stewart Firth from the Australian National University in Canberra, says the significance of Independence Day has been passed on to generations of Nauruans.

"They (the Nauruans) were very badly treated by the Japanese. In fact what happened was they were moved around from Nauru to all sorts of different places where the Japanese wanted to take them. So that was a big problem. The other big point is that it wasn't until the 1960s after they gained independence that they began to make real returns from the phosphate. So there was a feeling that Australia had exploited them over all those years as well and I think that contributed to that sense of independence."

Professor Firth says Nauru's bid for independence had to overcome initial opposition from Australia.

A plan had been proposed to resettle the Nauruans on Queensland's Curtis Island, leaving their island free for Australia to mine.

But even after gaining independence, Nauru still struggled to manage its phosphate resources to compete on the world stage.

After initially generating massive wealth, phosphate exports suffered a marked decline in the 1990s and since then Nauru has become heavily reliant upon foreign aid and imports.

In 2012-13 alone, Australia is forecast to provide 31 million dollars in aid to Nauru.

The funding goes towards sustaining key infrastructure on Nauru like electricity, hospitals, schools and water desalination plants.

Professor Firth says Nauruans generally accept that as a very small nation, they need support from foreign governments to provide basic services.

"If you talk to the Nauruan leaders, they're pretty close to Australia and they realise that they couldn't survive without Australia. So in fact when the Howard Government proposed the refugee processing centre, they welcomed it and they welcomed it again under the Gillard Government. So it's a question of survival really and even ordinary people in Nauru don't really oppose the presence of that centre."

The offshore immigration processing centre is currently home to over 300 asylum-seekers.

But critics of the centre, including some Nauruan MPs, fear the numbers are likely to continue increasing, placing added pressure on Nauru's limited resources.

They also point to it as a clear case where Nauru has failed to assert its independence from Australia and has merely given in to Australia's demands.

But supporters argue that Nauru's economy is in such a weak position that the country has little choice but to agree to Australia's plans.

At the time the agreement with the Gillard Government was reached on the asylum-seeker processing centre, Nauru's Foreign Minister Kieran Keke claimed it would greatly benefit the Pacific nation.

He says the centre generated economic wealth for Nauru when it was last open during the Howard Government.

"The asylum seekers in Nauru were actually treated very well. They had excellent facilities. They did have excellent facilities. They were well looked after. They had freedom on Nauru to move about. They went swimming, bike-riding and got involved in community activities."

Nauruan government spokeswoman Joanna Olsson believes Nauru's independence has never been compromised because political and community leaders have consistently backed Australia's plans.

"We always could have backed out of it. It was just a matter of Australia asking us and then whether we agreed or not. Australia has been a long time development partner of Nauru and its biggest aid donor. We're happy to support Australia. Mind you, most of the financial back-up for this is all funded by Australia. So it doesn't really weigh on our financial system."

However Pacific politics expert Professor Stewart Firth believes the asylum-seeker processing centre is only having a minimal economic benefit for Nauru.

He says current restrictions mean asylum-seekers can only move around the centre itself and are not permitted to buy goods and services across the island, which would benefit local businesses.

United Nations data shows the average Nauruan earns around 4,800 Australian dollars per year compared with 40-thousand dollars per year for the average Australian.

Professor Firth believes Nauru needs to expand economic growth in areas like fishing to lift the nation's standard of living and shift away from the island's reliance on phosphate exports.

Nauruan government spokeswoman Joanna Olsson agrees.

She believes the independence anniversary is a good chance to re-assess the direction the nation is taking to try and maximise economic growth and employment in the years ahead.

"Fishing is always an avenue. We've already started a fishing vessel scheme where we allow foreign fishing vessels to fish in Nauru and they pay us for certain fishing hours on the island in our waters. So fishing is one avenue. We haven't shipped our own fish out, but we are allowing foreign fishing vessels to fish in our waters and they pay a fee to do that."