Press Releases

    18 March 2002


    Citing Absence of Other Sources of Interim Financing, Under-Secretary-General
    For Management Says Cross-Borrowing Likely to Continue

    NEW YORK, 15 March (UN Headquarters) -- In a short meeting this morning, the Fifth Committee (Administrative and Budgetary) concluded its discussion of the financial situation of the United Nations, which was presented to its members last Wednesday by Under-Secretary-General for Management Joseph E. Connor. [For background information, see Press Release GA/AB/3500 of 13 March.]

    While welcoming the improved financial situation of the Organization in 2001, the representative of Cuba (on behalf of the Group of 77 developing nations and China) expressed concern that next year might be different. Reaffirming the legal obligation of all Member States to pay their assessed contributions in full, on time and without conditions, the Group also recognized the need to be sympathetic towards States temporarily unable to meet their financial obligations due to genuine economic difficulties. The Group was concerned with the recurring cash-flow problem faced by the Organization in the second half of each year, resulting in cross-borrowing from peacekeeping and the Tribunals’ budgets. All Member States must align their payment schedules in order to provide the Organization with the needed financial resources early in the year.

    Regarding the projected debt of some $748 million at the end of 2002, she said that all Member States should clear their arrears at the earliest, especially the major contributor. The Group hoped that improvements in reimbursing developing countries for troops and equipment for peacekeeping operations would continue. It was concerned that "write-offs" of some liquidated peacekeeping missions had not been certified and the problem not highlighted for Member States. The Claims Section should honour all commitments to troop-contributing countries for their reimbursement in such cases. The Group urgently requested information on measures by the Department of Peacekeeping Operations to resolve the issue.

    Speaking on behalf of the European Union, the representative of Spain also welcomed the improvement in the United Nations financial situation -– an objective towards which the Union had worked consistently over the years. The key element needed to sustain that improvement was prompt payment of financial contributions by all States. In that connection, he noted with regret that the number of countries which had made their payments in full had declined last year. Conversely, he commended the efforts of the Russian Federation to honour its commitment to pay its peacekeeping arrears in full, in accordance with its five-year plan. The high level of unpaid peacekeeping assessments and a very small margin of regular budget cash at the end of the year underlined the continuing precariousness of the United Nations financial situation.

    The European Union had hoped that the Organization had left the days of cross-borrowing behind, he said, renewing the Union’s call to all Member States to respect their legal obligations to the United Nations. All countries, and above all the largest contributor, should also take all measures to address an alarming level of arrears owed to the Organization. All troop-contributing countries expecting reimbursement had the right to receive payment without any further delay.

    The challenges ahead included the need to pay for increased security and take forward options for structural improvement of the United Nations buildings, whose financing must ultimately be the obligation of the host country. The Union unreservedly supported United Nations peacekeeping, but would continue its work to improve its efficiency and cost-effectiveness.

    Responding to the delegates’ comments, Mr. Connor said he was afraid that cross-borrowing would continue, for there was no other source of interim financing. He was also concerned that funds available to cross-borrow were being circumscribed.

    Also this morning, the representative of Cuba introduced a draft decision (document A/C.5/56/L.49), which had been submitted by Venezuela on behalf of the Group of 77 and China, on the programme budget implications of draft resolution A/C.3/56/L.84/Rev.1 on the implementation of the World Conference against Racism, Racial Discrimination, Xenophobia and Related Intolerance.

    By the text, the Committee would inform the Assembly that adoption of the draft would lead to expenditures not exceeding $1.074 million under section 22, Human Rights, and $103,900 under section 32, Staff assessment (to be offset by an equivalent amount under income section 1, Income from staff assessment) of the regular budget. The Committee would recommend that the Assembly authorize the Secretary-General to enter into corresponding commitments, on the understanding that he would report on the actual requirements to the Assembly’s fifty-seventh session, so that they could be dealt with during the same session.

    At the end of the meeting, the representative of Cuba reiterated the request of the Group of 77 developing nations and China that the Committee be provided with written responses regarding the cutbacks in services to Permanent Missions.

    The Committee is expected to conclude its first resumed session and act on all remaining texts at 3 p.m. today.

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