U.S. Still Hasn't Paid Overdue UN Dues

by Thalif Deen

According to the latest figures released here, unpaid UN assessments totalled a hefty $2.2 billion at the end of last year, about $500 million more than the previous year. One member state -- the United States -- is responsible for more than half those arrears, says Gerard Ho of Singapore.

Accusing Washington of falling back on its pledge to pay its arrears, Ho told the UN's Administrative and Budgetary Committee that the 189-member General Assembly "bent over backwards" to accommodate U.S. concerns during negotiations to change the scale of assessments about three months ago.

As a result, the U.S. assessment to the UN's regular budget was reduced from 25 to 22 percent, with the shortfall being absorbed mostly by developing nations.

As an incentive, he said, the United States "dangled a $900 million carrot in front of us...We were told that this money (mostly U.S. arrears) was already approved and held in escrow," he added.

When the assessment rate of that member state was reduced, the United Nations was told that the money would be released. "We kept our end of the bargain. But there is no sign of any money. Instead we are offered more excuses," he added.

Ambassador Don MacKay of New Zealand told delegates that what little progress made in 1999 to mitigate the UN's financial crisis was undermined last year. The UN's cash reserves were down and unpaid assessments of over $2.2 billion exceeded the levels of the previous four years.

Additionally, he said, debts owed to member states for their participation in the most crucial of the UN's activities, namely peacekeeping, increased to $917 million, also exceeding previous years.

"The great bulk of arrears is attributable to a single member state," he said. Nevertheless he welcomed the efforts of the United States to pay down its substantial arrears.

Speaking on behalf of 133 developing nations and China, the chairman of the Group of 77, Ambassador Bagher Asadi of Iran, said that whilst the year 1999 had raised hopes that the organization might at last move a step forward from the bleak financial situation of the past years, the year 2000 was potentially a step backward.

The organization began the year 2001 with a financial picture no different from the previous years, and in fact with collections lower than expected.

Asadi recalled the "difficult process of negotiations" that preceded the change in the new scale of assessment permitting a reduction in the U.S. contribution to the United Nations.

"It was particularly difficult for our Group. Despite these difficulties, the Group made a lot of sacrifices in the spirit of collective responsibility of all member states to ensure the financial health of the organization," he noted.

But the Group of 77, he said, regrets that to date the organization has not received the payment expected from the United States.

"Based on the understanding that made the adoption of the new scale possible, we once again urge the major contributor to also heed its responsibility and demonstrate, through concrete action, commitment to make the necessary payment in full, on time and without conditions," he added.

Anne Merchant of Norway said the resolutions adopted last fall regarding the scale of assessments gave reason to hope that the UN's financial situation would improve somewhat.

"We hoped that the largest contributor would pay a substantial part of its arrears, and that future assessments would be paid in full. We are now eagerly awaiting the adoption of (U.S.) legislation that will release some of the money owed to this organization, and we also hope that future legislation will prevent the accumulation of debt," she said.

U.S. Ambassador Donald S. Hays, told delegates that the United States, as the UN's largest single contributor, recognizes its duty to do everything it can, as fast as it can, to help alleviate the present difficulty.

In December last year, he said, UN members entered into an explicit compact -- reform of the scales of assessment in return for U.S. payment of a sizeable portion of its arrears.

The negotiations, he pointed out, resulted in a compromise, "one that we all felt was fair and reflected an even-handed balance of competing interests, both political and financial, around the table."

The result of this compact, he said, was short of the steps required by U.S. legislation to enable Washington to pay the $582 million in arrears.

"Therefore it is necessary for our government to take steps to amend our laws in order to free up these funds. We wish to assure delegations and the Secretariat that the U.S. government is moving quickly to pass necessary legislation, and that this action has the full support of our government."

The U.S. delegation, he said, wished to ensure the membership that any further delay in payment is not a reflection of political opposition, but rather a function of a legislative process.