In 1989, Nauru appealed against Australia to the International Court of Justice, due to the environmental devastation inflicted by phosphate mining during the colonial period.

Nauru agreed to host a detention centre for refugee applicants seeking asylum in Australia, in exchange for economic aid.

This agreement came to an end in 2007, following the election of Kevin Rudd as Prime Minister of Australia, prompting Nauruan concerns about the future of the island's revenue.

Nauruan Foreign and Finance Minister Dr Kieren Keke stated that his country did not want aid handouts.

One possible solution currently being explored would be for Australia to assist Nauru in setting up a "boat repair industry" for regional fishing vessels.