Kiribati’s copra subsidy is a major element of the government’s economic strategy that simultaneously accomplishes three key goals. First, it reduces poverty. Second, it incentivizes living on the outer islands rather than migrating to South Tarawa. Third, it provides employment in a historically and culturally significant industry. However, it does not meet these goals efficiently and effectively, which is creating fiscal issues for Kiribati. All three goals can be achieved more cheaply and sustainably by lowering the copra subsidy and supplementing it with targeted cash transfers. Reducing the copra subsidy would also create opportunities to achieve other goals, like restoring the profitability of the copra industry. This would require additional reforms. Reducing the copra subsidy would also allow for agricultural diversification, which would create new markets and encourage economic activities on the outer islands. The government can support this by expanding farmer services, training staff, and promoting knowledge exchange. Developing alternative exports like seaweed, solar salt, and tourism, especially on Kiritimati Island, could boost the economy. Agricultural diversification could improve nutrition and health. It would encourage local production of vegetables and root crops, make them cheaper and more available, and reduce dependence on imported food. Moving away from imported, highly processed foods would improve nutrition and overall health.