By Gary Wilson
The United Nations might run out of cash to meet its commitments by November. The organisation is facing a US$1.7 billion shortfall because a third of its member states are in arrears with their annual contributions to the UN budget.
As a consequence, it has been unable to fill some of its vacant positions. It faces the prospect of having to make cuts to its expenditure and scale back on the activities it is currently involved in.
These financial problems are not new. The challenge of adequately funding the UN has been a long-running saga which can be traced back to its early years. The term ‘financial crisis’ has been applied to the UN in discussions dating back to the 1960s.
But the financial crisis became particularly dire in the 1990s. This period coincided with a huge expansion in UN peacekeeping activities, necessitated by the explosion of internal conflicts around the world at that time. The activities were made possible by new-found cooperation between the major powers. This saw a decline in their use of vetoes within the Security Council. The increase in peacekeeping placed a greater financial strain on the UN.
Its debts reached US$2.3 billion as America’s arrears mounted. At the time, the United States (US) was the biggest budget contributor to the UN despite the fact that its contribution was a tiny share of its federal domestic spending. While the situation improved somewhat into the millennium, the financial well-being of the organisation has remained heavily contingent upon the US’ compliance with its budgetary obligations.
The US has remained the biggest contributor to the UN, currently carrying 22% of the general budget, and has continuously sought to use that as leverage to extract concessions from the world body. It has managed to negotiate a reduction in its contribution, while at the same time pushing for efficiency reforms and cost-cutting measures within the organisation.