Nauru close to US default

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The country of 12,500 people owes the US General Electric Capital Corporation, which has a mortgage over Nauru’s Australian property investments, about $230 million.

But with a political crisis hampering efforts to revive economic fortunes, a Nauru opposition political newsletter published this week warned the country faced foreclosure by May 5 after failing to meet several payment deadlines.

The 21sq km island’s economic woes are in sharp contrast to the days following independence in 1968 when Nauruans were among the world’s richest people, with global air, shipping and building investments.

Nauru, between New Zealand and Hawaii, was formerly a UN territory under joint control of Australia, Britain and New Zealand, which began strip mining much of the island’s phosphate-rich topsoils for export as fertiliser.