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The main aim of this guiding manual is to improve climate finance flows to Nauru. It can be used as a reference document by the government of Nauru and all the other relevant stakeholders to access international climate funds and different types of funding options available for climate adaptation and mitigation projects globally.

Following the resumption of normal activity post-COVID, small states have been on a path to economic recovery, largely sustained by a rebound in tourism, which in many small states has reached pre-pandemic levels. However, ongoing shocks – ranging from geopolitical to climatic – have marred this recovery. As such, small states are projected to grow at 3.3 per cent in 2025, a contraction from the 3.7 per cent growth in 2024, as a result of persistent economic challenges.

The combination of socio-economic shocks over the past few years has also affected socio-economic progress in small states. Geopolitical tensions in Europe and supply chain disruptions have had impacts on food security, given the reliance of small states on food imports. This has worsened progress on poverty indicators.

Climate change shocks continue to affect socio-economic progress in the health and education sectors, by damaging social infrastructure, affecting school attendance and promoting the spread of communicable diseases.