Debtor US in danger of losing vote

PUBLISHED : Thursday, 07 October, 1999, 12:00am
UPDATED : Thursday, 07 October, 1999, 12:00am

The United States must pay the United Nations US$350 million (HK$2.7 billion) more than the US$200 million already appropriated by Congress for back dues to avoid being stripped of its vote in the UN General Assembly, the organisation's chief financial officer said.

The UN's under secretary-general for management, Joseph Connor, made the announcement after briefing the General Assembly administrative and budgetary committee on the UN's precarious financial situation.

'The UN is running on empty, with many miles to travel,' Mr Connor said.

Without cash reserves due by December 30, the UN would lose its financial flexibility, jeopardising its existence, he said.

'The magnitude of the unpaid assessments eliminates any financial base of the organisation.' As of September 30, Mr Connor said, the US accounted for 65 per cent of all unpaid assessments owed by members and 81 per cent of unpaid dues for the organisation's regular budget.

The next biggest debtors, Brazil and Argentina, together accounted for nine per cent of the arrears on the regular budget. The US owed US$1.7 billion, Mr Connor said. Congress has passed legislation to pay US$200 million.

But even with that payment, Mr Connor said, Washington would need to pay US$350 million to save its General Assembly vote.

The US acknowledges owing $1.025 billion. Washington and the UN differ over the share of peacekeeping costs, assessments that Washington will not pay for policy reasons and a dispute over taxing Americans who work for the UN.

The UN Charter states that a member whose arrears total more than its assessed dues for the previous two years forfeits its right to vote in the General Assembly. That could happen automatically to the US on January 1.

US representative Richard Holbrooke said the US remained committed to paying its fair share.

But in a statement to the committee, Mr Holbrooke called on the UN to 'observe budget discipline' and 'reduce its over-reliance on a single member, or handful of members, for financial support'.

Mr Holbrooke described the US as still the biggest contributor to the UN.

He said its share should be reduced, from 25 to 22 per cent of the regular budget and from 31 to 25 per cent of peacekeeping assessments.

But the British representative, Sir Jeremy Greenstock, contended that Britain was the largest 'net creditor', taking into account what it was owed for peacekeeping missions.

'Yes, the US is the largest creditor,' Sir Jeremy said. 'But the US has muffled its voice and stained its reputation by also being the largest debtor, persistently and perennially.

'I welcome ambassador Holbrooke's commitment to changing all that. He has not got much time.' Mr Connor said if Washington paid US$250 million towards the regular budget and US$100 million towards peacekeeping to avoid losing its vote, the UN could show a modest surplus.