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Republic of Nauru: 2025 Article IV Consultation-Press Release; Staff Report; and Statement by the Alternate Executive Director for the Republic of Nauru
Constrained by structural challenges stemming from its remote location and small landmass, Nauru‘s economy has registered low and volatile growth and is heavily reliant on imports and foreign support, making it susceptible to external shocks, particularly in a global environment with heightened trade policy uncertainty. The growth outlook has improved, supported by the anticipated pickup of regional processing center (RPC) operations and sustained donor support. Risks to the growth outlook are tilted to the downside, driven by a global slowdown and potential decline in donor support induced by deepening geoeconomic fragmentation and policy uncertainty. Inflation is expected to moderate, though it could stay protractedly high owing to rising wage growth in the public sector.
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