UN on the verge of bankruptcy

By Yuri O. Thamrin

JAKARTA (JP): The magnitude of the financial crisis facing the United Nations is distressing. Unless its member countries, particularly the major contributors, pay their contributions, the UN will have to declare bankruptcy by the end of this year.

The world body is so strapped for cash that on April 30, 1996 it ran out of regular budget money to pay its bills. The shortfall was the result of the failure of the United States, Japan and Germany to settle a portion of their debts as promised.

As of May 1996, member states owed the organization a total of US$ 2.8 billion -- $ 1.6 million for peace-keeping and $1.2 billion for the regular budget. This is $ 300 million more than the entire UN operating budget for the next two years.

Of this total, the U.S. owes more than half: $ 1.5 billion in current and back debts for the regular budget and peace-keeping operations. The Russian Federation is the next largest debtor with $400 million, followed by the Ukraine which owes $250 million.

In late April, the U.S. approved a budget that includes $ 256 million for the UN. This money will settle the U.S. debt for the regular 1995 budget -- a mere 15 months late. But the UN is still on a slippery slope towards bankruptcy by the end of the year, when it is set to go bankrupt by $200 million, double the initial forecast.

What conclusions can be derived from the above statistics? Perhaps some countries are withholding payment as a pressure tactic or to make a political point. Or perhaps we are ignorant of what the UN really does and therefore don't quite appreciate the work of the UN. Or we ostensibly feel that we could do better without the UN.

In this regard, we often hear that the UN should do more in the post-Cold War era to help solve various international problems. However, it is quite unfair if this expectation is not accompanied by a readiness on our part to honor our financial obligations to the organization. The UN can only go as far as its members allow it to. The UN is helpless without our financial support.

What does the UN really do? Is the UN worth our support?

The purposes set for the UN are to maintain international peace and security; to achieve international cooperation in solving economic, social, cultural, and humanitarian problems, and in promoting respect for human rights and fundamental freedoms; and to coordinate the nations in attaining these ends.

Eighty percent of the work of the UN system is devoted to helping developing countries to help themselves. This includes promoting and protecting democracy and human rights; saving children from starvation and disease; providing relief assistance to refugees and disaster victims; countering global crime, drugs and disease; and assisting countries devastated by war and the long-term threat of land-mines.

Efforts for disarmament and arms control, including the prevention of proliferation of weapons of mass-destruction are vigorously pursued within the UN framework.

The UN has launched 20 peace-keeping operations between 1988 to 1994, compared to 18 operations from 1945 to 1987, thus indicating a new-found activism and the will to help restore peace around the world, in the favorable atmosphere of the post- Cold War era.

The above facts will hopefully underline the importance of the UN for the community of nations. We need the UN.

However, we can not ignore the fact that the UN needs to be reformed to pare down its inefficient bureaucracy and more reliable for tackling down various international problems.

What is important is that reform should not be made a pretext for not fulfilling one's financial obligation. Indeed, reform and back payments are equally important and have to be pursued hand in hand at the same time.

The UN financial crisis is now being addressed at the UN High Level Working Group on Finance which sits in New York. Various proposals have been put forward. One of them is to employ a new method to determine which country pays what percentage of the UN budget.

This is like prescribing the wrong drug for a disease. The UN's current financial difficulty is simply due to the failure by some member states to fulfill their financial obligations in full and on time.

The way payments are calculated is not the problem. A readjustment of payments can only result in a shifting of the burden to countries which pay their contributions.

The right approach must be to induce countries in arrears to fulfill their obligations more responsibly. Perhaps article 19 in the UN charter on the suspension of voting right of the countries which are in arrears should be more enforced more strictly.

The writer is an observer of international politics, particularly the UN affairs.

Window: The above facts will hopefully underline the importance of the UN for the community of nations. We need the UN.