The eceonomy of the Republic of Kiribati’s is one of the poorest in the world. In one form or another, Kiribati gets a large portion of its income from abroad. Fishing fleets from South Korea, Japan, Taiwan, and the United States pay a licensing fee in order to operate in Kiribati’s territorial waters.
South Tarawa is the official capital of the Republic of Kiribati. Bairiki is a village and an islet now part of South Tarawa, and at one time itself the center of government (and therefore, capital) of Kiribati.
South Tarawa has an overall cost of living index which equates it with high cost of living locations. The overall cost of living index is comprised of the prices for defined quantities of the same goods and services across all 13 Basket Groups.
The latest cost of living rank for each of the 13 Basket Groups is now available.
Expatriate International Cost of Living 
I read a bit about how the government controls weather people can open their own businesses or not. Do you think it would affect the economy if people had the option to start their own businesses?
If people could start their own businesses the economy would
definitely be boosted. However, every economy needs Government
approval depending on the type of business you would like to open for
reasons such as tax returns, business registration, stats, etc.
I have included a small extract from a website re the economy in
Kiribata, perhaps you would find this interesting :
Kiribati’s per capita GDP, which is below U.S. $700, is one of the
lowest in the world. Only 16% of the workforce participates in the
formal wage economy and over 60% of all formal jobs are in South
Tarawa. The monetary economy of Kiribati is dominated by the services
sector, representing a GDP share of over 73%, and the public sector which provides 80% of monetary remuneration.
Go here to read more: http://www.traveldocs.com/ki/economy.htm