Formerly part of the Gilbert and Ellice Islands, the Gilberts became independent from Britain in 1979 and took the name Kiribati (pronounced "Kir-ee-bahs"). British interest in the Gilbert Islands rested solely on the exploitation of the phosphate deposits on Banaba; these ran out in 1980. In 1981, Kiribati won damages (but not the costs of litigation) from the British for decades of phosphate exploitation.

Locals still refer to themselves as Gilbertese. Almost all Gilbertese are Micronesian, although the inhabitants of Banaba employed anthropologists to establish their racial distinctness. Tension with the Banabans is intense, mostly fueled by the historic value of Banaba's phosphate deposits. Most Gilbertese are poor. Many go to Nauru as guest workers, living in barrack-room conditions, or work as merchant shipping crew. Those who stay at home go through a circular migration from the outlying islands to Tarawa, returning to see relatives. Women play a prominent role, especially on outlying islands, where they run most of the farms.

Strengths

Subsistence economy; little need to import food. Coconuts provide some export income: the EU is the biggest market. Fisheries have limited potential. Upgraded port facilities at Betio.

Weaknesses

Lack of resources. High levels of poverty. Isolation, and large distances between islands. Heavy dependence on international aid. Almost no economic potential.

The traditional chiefs still effectively rule Kiribati, through a party system on the British model. Victory for the MTM in the 1994 elections ended 15 years of rule by the NPP. The main concern is the economy, which is extremely vulnerable to any fluctuations in world demand for coconuts. The overpopulation of Tarawa is the other major issue. Possible restrictions on travel to the island have been discussed. In part, the problem of migration is caused by the poverty and lack of opportunity on the outer islands. A resettlement program, aiming to move people out of Tarawa, began in 1998.

Kiribati has little international significance because of its tiny size and remote location, but is able to make its voice heard regionally through the Pacific Islands Forum. In 1986, Kiribati was a signatory to a deal between the USA and a number of Pacific Island states that resulted in the USA paying $60 million in return for access to Pacific fishing grounds. In the Cold War era Kiribati played the USSR off against the USA, extracting a high price for fishing leases, which allowed boats to spy on US nuclear testing on the neighboring Kwajalein atoll in the Marshall Islands.

Australia and New Zealand provide de facto protection, with regular antisubmarine patrols.

Phosphate deposits on Banaba ran out in 1980. All energy supplies have to be imported. Underwater agriculture is being developed.

Rising sea levels cause coastal erosion and ultimately threaten Kiribati's existence. Global warming is a critical issue both for this reason, and because of its damaging effects on the coral reef which protects Tarawa from the sea and holds important inshore fish stocks in the lagoon. The coral has also suffered from pollution by untreated effluent.

Kiribati has a limited air link with Fiji. Transportation around and between the atolls is provided mostly by small canoes.

Most Gilbertese are healthy, thanks to a home-grown diet and free medical care. Those on Tarawa import tinned food because of a lack of agricultural land, and nutrition is becoming a problem.

Education is British-inspired and compulsory from six to 15. The best students go on to university in Fiji.

Crime, apart from brawls resulting from drunkenness, is minimal. The judicial system is based on the British model.

Life in Kiribati is modest. Most Gilbertese live by subsistence farming and fishing. Civil servants in Bairiki form the wealthiest group. The cost of living in Tarawa is higher than in the outlying islands due to the need to import food, although fish is abundant and cheap everywhere.

Kiritimati (Christmas Island) has a weekly air service to Honolulu and attracts a small but steady stream of visitors.

The British established the phosphate-producing colony of the Gilbert and Ellice Islands in 1892.

• 1957 First British nuclear tests take place near Kiritimati.
• 1979 Independence as two states, Kiribati and Tuvalu. NPP in power.
• 1981 Kiribati wins damages for phosphate mining from UK.
• 1986 Kiribati–US fishing deal.
• 1994 NPP loses election to MTM. Teburoro Tito elected president.
• 1999 National drought emergency.