Receivers appointed to Nauru House and other properties
from AAP

The financial crisis facing Nauru has deepened with receivers moving into Melbourne's Nauru House and other Australian properties owned by the Pacific island's administration.

American financial giant General Electric Capital Corporation (GE) is seeking to recover debts after the tiny republic failed to pay back more than $230 million borrowed in relation to its offshore properties.

Nauru's Australian spokeswoman Helen Bogden said receivers were appointed to the Nauru House Property Trust at 4pm yesterday (AEST).

She said the trust included Melbourne's Collins Street high rise Nauru House, Sydney's Mercure Hotel and Royal Randwick Shopping Centre and the Downtowner and Savoy Park Plaza hotels in Melbourne.

She said GE had lent money to the trust in relation to the properties and was seeking to have it recovered.

"There are still negotiations going on between the Nauru government and the receivers; until Monday we won't have any further details," Ms Bogden said.

More

She said Nauru's President Rene Harris was in Australia to deal with the
issue and was scheduled to meet with Foreign Minister Alexander Downer on
Monday.

She would not say whether Mr Harris would use the meeting to ask the
Australian government for financial assistance.

Australia has an understanding with Nauru which allows asylum seekers to be
processed on the Pacific Island and last month Mr Downer said Australia would
provide Nauru with $22.5 million to help stabilise the country's economy and
strengthen law and order.

But a Department of Foreign Affairs and Trade spokeswoman yesterday said the
GE issue was a commercial one and not for the Australian government to resolve.

"The Australian government has consistently told Nauru that sound economic
management and good governance is essential," she said.

"Our agreement to provide a finance secretary and Australian officials with a
new memorandum of understanding is geared to addressing precisely these sort of
financial management issues.

"Australia has no role to play in GE's commercial decisions.

"We provide a substantial amount of development assistance through the
memorandum of understanding governing cooperation on the offshore processing
centre with $22.5 million provided up to June 2005."

LOAD-DATE: April 18, 2004

posted by prof_booty | 09:33 AM