Nauru, a small island nation in the south-west Pacific Ocean, has rolled out a controversial new program—selling citizenship at a minimum cost of $105,000 (Rs 91.38 lakh). The administration aims to collect funds to tackle the increasing menace of rising sea levels, storm surges, and coastal erosion, which threaten the island nation's very survival.

One of the world's most climate-exposed nations, Nauru does not have the means to safeguard itself against a crisis created in large part by richer countries. The amount from the sale of citizenship will finance the relocation of 90% of the island's 12,500 population to higher ground and the creation of a new settlement.

“While the world debates climate action, we must take proactive steps to secure our nation’s future,” Nauru’s President David Adeang told CNN.

The impacts of climate change are already wreaking havoc on Nauru. Numerous residents along the coast have lost their property, with some even having their entire houses engulfed by strong king tides. “A lot of people residing on the coast have already lost land—some have had their entire houses engulfed by king tides, and they have lost everything,” said Tyrone Deiye, a Nauruan national and researcher at Monash Business School in Australia.

The advantages and disadvantages of 'golden passports'

Citizenship-by-investment schemes, commonly referred to as "golden passports," have been employed by various countries in order to stimulate their economies. On the other hand, they have been accused of facilitating financial crimes and security threats. For small developing nations like Nauru, these programs can be an economic lifeline.

As per Kirstin Surak, an associate professor at the London School of Economics, such schemes provide global mobility, especially to individuals who hold passports of restricted countries. A Nauru passport facilitates visa-free entry into 89 countries, including the UK, Hong Kong, Singapore, and the UAE.

The economic gain will be substantial. The government anticipates making $5.6 million in the first year of the program, with a long-term goal of $42 million per year. If it succeeds, it will bring 19% of the nation's entire revenue.

Past controversies of Nauru

Nauru has tried selling citizenship in the past, but it caused huge scandals. During the 1990s, the nation sold passports with little verification, creating serious security issues. In 2003, two Al Qaeda terrorist suspects were detained in Malaysia with Nauruan passports, which created concern over the dangers of the program.

To prevent a repeat of past errors, the government has assured rigorous vetting. “The program’s vetting will be stringent and exclude those from countries designated as high risk by the United Nations, including Russia and North Korea,” President Adeang stated. The initiative will also be monitored by international organizations like the World Bank to ensure transparency and accountability.

A model for other nations?

Nauru is not alone in its climate resilience and use of citizenship sales. The Caribbean island nation of Dominica has been running a similar scheme since 1993 and recently announced that part of the money is going towards the construction of climate-resilient infrastructure.

Edward Clark, Nauru Economic and Climate Resilience Citizenship Program CEO, said that the program will be rolled out with caution. “As we assess for any unintended consequences or negative impact,” he noted, highlighting the country’s commitment to ensuring responsible execution.

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