UN, with eye on US cuts, says it is financially 'sound'

A street sign in New York, where the United Nations’ headquarters are located. Photo by: monette lyan / CC BY-ND

The United Nations overall has a “generally sound financial situation,” even as it faces the risks of losing a lot of funding support from the United States, its largest donor, Yukio Takasu, under-secretary-general for management said on Tuesday.

The U.N. expects its regular budget — standing at more than $2.6 billion as of this month — to tighten by the end of the year, Takasu told reporters during a press briefing at U.N. headquarters. So far, the U.N. has received more than half of its regular budget from member states, leaving $1.39 billion unpaid. That marks a slight improvement from this time last year, when $1.4 billion was unpaid.

The U.N. is now operating with $632 million in cash on hand, an increase from the $471 million it had in April 2016.

UN calls for continued engagement as Trump budget aims to slash funding

Secretary-General António Guterres has called the proposed budget "complex and lengthy." It aims to cut U.S. support to U.N. agencies and peacekeeping operations, fulfilling a pledge of President Donald Trump to decrease foreign aid.

While the U.N.’s overall cash situation is currently positive, the end of 2017 could prove more difficult, as the U.N. found that it had to draw on cash reserves during the final months of the year in 2016. While many countries make their payments during the spring and up until the summer, the U.S. normally pays its annual dues by October or November. Australia, Germany, India, Japan, China, Sweden, Switzerland, South Africa, Austria and Canada are among the 39 member states that have already paid the U.N. this year.

“The timing of this [payment schedule] is very important,” Takasu said. “We will continue to monitor the cash flow very closely.”

Takasu declined to speculate how U.N. work would specifically be impacted if the U.S. does not pay its annual dues to the U.N.

“We have not been formally informed about their level of contribution this year,” he said. “We have received no notification about the position of the U.S. and its assessed contributions.”

The U.S. contributes a maximum of 22 percent to the U.N.’s operating budget, and is expected to pay the organization more than $610 million this year, in addition to contributing about 28 percent of the peacekeeping operations’ nearly $8 billion budget. Overall, the peacekeeping units’ budget is equivalent to 1 percent of U.S. defense spending.

Country support of the U.N. — proportional to gross national product — is mandated by the U.N. charter. If the Trump administration makes good on its promise to cut funding to the U.N. as part of its reduced commitments to foreign aid, it could stand to temporarily lose voting rights at the General Assembly, Takasu said. Five member states presently have their voting rights suspended due to lack of payment.

Trump administration cuts all future US funding to UNFPA

The U.N. Population Fund has attributed the loss of funding from its second largest donor to the false claim that it supports work in coercive abortions and forced sterilizations in China.

The U.S. has already cut all funding, worth about $69 million, to the U.N. Population Fund.

The U.N. operating fund is not able to supplement the UNFPA and other U.N. agencies, which look to member states for voluntary contributions for their work.

While the U.N.’s overall finances are in good shape, the organization still owes $777 million to troop- and police-contributing countries — chiefly, Ethiopia, India, Bangladesh, Pakistan, Egypt, Rwanda, China, Burundi, Nigeria and Cameroon.

“This is the highest priority for all of us,” Takasu said. “They deserved to be paid. We are making every effort to give the money that we owe to troop-contributing countries.”

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About the author

  • Amy Lieberman

    Amy Lieberman is the U.N. Correspondent for Devex. She covers the United Nations and reports on global development and politics. Amy previously worked as a freelance reporter, covering the environment, human rights, immigration, and health across the U.S. and in more than 10 countries, including Colombia, Mexico, Nepal, and Cambodia. Her coverage has appeared in the Guardian, the Atlantic, Slate, and the Los Angeles Times. A native New Yorker, Amy received her master’s degree in politics and government from Columbia’s School of Journalism.