UN Facing “Worst Cash Crisis” in Years— U.S., Others Owe

  • "As of Oct. 9, 2019, the regular budget cash deficit reached its deepest in the year at $386 million."
  • Some 60 countries are in arrears to the UN, with seven of them accounting for 90% of the deficit.
  • Two-thirds of аll UN mеmbеrѕ, 129 соuntrіеѕ, have раіd thіѕ year's duеѕ, whісh collectively tоtаl nеаrlу $2 bіllіоn.

The United Nations on Friday announced a series of measures to tackle its worst financial crisis in nearly a decade. The United Nations reported a deficit of $1.4 billion in its operational budget this year and blamed the funding gap on some 60 countries in arrears, seven of which caused 90% of the deficit, such as the United States, Brazil, Israel, and Iran.

António Guterres is a Portuguese politician and diplomat who is serving as the ninth Secretary-General of the United Nations. Previously, he was the United Nations High Commissioner for Refugees between 2005 and 2015.

The cash crisis can be felt through the stalled staircases at its headquarters, the absence of central heating, and even the restaurant for diplomats being closed. “As of Oct. 9, 2019, the regular budget cash deficit reached its deepest in the year at $386 million, thereby exhausting the $150 million from the Working Capital Fund as well as the $203 million from the Special Account, and borrowing $33 million from the closed peacekeeping missions,” said Catherine Pollard, UN undersecretary-general for management strategy, policy and compliance.

In a letter to staff, Secretary-General Antonio Guterres outlined looming austerity measures, which he said would mean fewer flights, receptions, documents, reports, translations and even water refrigerators, as well as restricting employment. Guterres described the current crisis as “the worst monetary crisis facing the United Nations in almost a decade.” He warned that the organization “is at risk of depleting its reserves of liquidity by the end of this month and default on payments of staff.”

The United Nations has reported a deficit of $1.4 billion in its operational budget for the year. Some 60 countries are in arrears to the UN, with seven of them— Argentina, Brazil, Iran, Israel, Mexico, the United States, and Venezuela— accounting for 90% of the deficit. The United States, in particular, owes more than $1 billion.

“We had started borrowing from the Working Capital Fund in July, and we had to borrow from the Special Account as well in August. By late September, we had to borrow from closed peacekeeping missions, as regular budget cash reserves were so severely depleted that we risked problems with payroll payments or defaults in vendor payments,” Pollard said.

The UN is financed from assessed and voluntary contributions from member states. This is broadly based on the relative capacity of each country to pay, as measured by its gross national income (GNI), with adjustments for external debt and low per capita income.

The fund for peacekeeping operations suffers from the same problem, and in 2019 France, for example, owed $103 million. According to UN documents, the United States owes $ 2.3 billion to the peacekeeping budget. “When the rich refuse to pay, it is the poor who bear the burden,” said a UN official, who asked not to be named. The United Nations does not impose fines or interest on arrears owed by the Member States.

Two-thirds of аll UN mеmbеrѕ, 129 соuntrіеѕ, have раіd thіѕ year’s duеѕ, ассоrdіng tо UN spokesperson Stephane Dujarric. Collectively, this totals nearly $2 billion. Thе ѕроkеѕреrѕоn tоld USA Today thаt thе оutѕtаndіng bаlаnсе for thе 64 соuntrіеѕ that haven’t yet раіd thеіr rеgulаr budgеt assessments іn full іѕ $1.3 billion.

An unnаmеd U.S. mission оffісіаl tоld USA Tоdау thаt Wаѕhіngtоn hаѕ handed оvеr $600 mіllіоn tо реасеkееріng еffоrtѕ in 2019.  Thе Trumр administration hаѕ been strongly critical of glоbаl соореrаtіоn, аnd promoted sizeable cuts in U.S. funding fоr thе U.N., аlоng with thе оrgаnіzаtіоn’ѕ programs аnd реасеkееріng activities. Durіng a ѕреесh tо thе UN Gеnеrаl Aѕѕеmblу lаѕt month, Trumр rеіtеrаtеd hіѕ соmрlаіntѕ аbоut “globalism.”

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Doris Mkwaya

I am a journalist, with more than 12 years of experience as a reporter, author, editor, and journalism lecturer." I've worked as a reporter, editor and journalism lecturer, and am very enthusiastic about bringing what I've learned to this site. 

 


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