United Nations Cuts U.S. Dues

ByEdith M. Lederer

U N I T E D   N A T I O N S -- The United Nations adopted the first majoroverhaul of its financing in more than two decades today,cutting U.S. payments to the world body and shifting most of thefinancial burden to developing countries that have experiencedeconomic improvement.

Bleary eyed delegates from 189 countries—many now hoping tomake it home for holidays—wrapped up agreement on the budgetreform package after South Korea dropped last-minute demands.

The General Assembly promptly approved the new system, passingresolutions for separate budgets for the United Nations’ day-to-dayoperations and its far-flung peacekeeping operations. When assemblypresident Hari Holkkeri of Finland gaveled the session to a close,there was loud applause—and a race to the doors.

U.S. Lobbied For Redistribution

“Buried in this complex financial package is the firstfinancial reform of the U.N. regular budget in 28 years and thefirst time ever for peacekeeping,” said Richard Holbrooke, theexhausted but jubilant U.S. ambassador. Many credited his personallobbying of reluctant and often hostile delegates for thegroundbreaking accord.

The last time the U.S. portion of the regular budget was reducedwas in 1972, when the ambassador was George Bush, Holbrooke noted.

With a debt to the United Nations now totaling $1.3 billion, theUnited States has been repeatedly attacked by other countries,including its allies, for not paying its dues. The U.S. Congress,demanding reform of the bloated U.N. bureaucracy, has passedlegislation requiring that the U.S. share of the budget besubstantially reduced before a substantial chunk of the arrears canbe paid.

Ted Turner Covers Shortfall

On Friday, the United States won the battle to reduce its shareof the U.N. budget—the centerpiece of the U.N. financing overhaul- after media tycoon Ted Turner offered a $34 million one-timegift. Turner’s donation would cover the shortfall the U.S cutcreates in the main U.N. budget in 2001.

Under the deal, the U.S. share of the administrative budgetwould drop from 25 percent to 22 percent. Its share of thepeacekeeping budget would be reduced from 31 percent to around 27percent—still more than the 25 percent the U.S. Congressdemanded.

“We were given a mission nearly impossible by legislativemandate,” Holbrooke said. “We end this administration reportingmission substantially accomplished. Now it’s up to the newadministration and Congress to decide how to proceed.”

It’s a ‘Win’

Sen. Joseph Biden of Delaware, the top Democrat on the SenateForeign Relations Committee, said last week he might be able topersuade lawmakers to amend the legislation and send a check for a$582 million installment on the arrears even without the fullpeacekeeping reduction. Biden co-authored the legislation withcommittee chair Republican Jesse Helms.

“Hopefully it won’t be a fight,” a delighted Biden told TheAssociated Press after today’s consensus was reached. “It’s a great deal. America wins. ... Our standing in the United Nations is improving because of this and our financial obligation isdecreasing. That’s a win.”

Secretary-General Kofi Annan called the agreement “the bestpossible seasonal gift” for the United Nations, saying it shouldremove a major source of tension in the world body. “Inparticular, we can now look forward to a normal and constructiverelationship with the United States administration,” he said in astatement.

“The United Nations now can begin the new century on a firmerfinancial footing, and we can focus our energies on our truetask,” he said. “We must now concentrate on responding to theneeds and expectations of our peoples.”

Addressing South Korea’s Concerns

The possibility that the lengthy negotiations might fail at thelast minute led to a series of pre-dawn high-level calls around theglobe—and indicated the difficulties especially for the countriesthat will swallow most of the U.S. cuts: 18 developing countriesthat have seen their economies grow in recent years, particularlySouth Korea, Singapore and Brazil.

At the last minute, South Korea—whose payments will see thegreatest increase, according to Holbrooke—insisted on a lowerpercentage and on having its payments reviewed after three yearsrather than five, demands that could have scuttled a deal.

Before dawn, Annan and U.S. Secretary of State MadeleineAlbright telephoned South Korean leaders. Also working the phonesin search of a solution were Holbrooke, the U.S. ambassador toSouth Korea, Stephen Bosworth, and European leaders, U.S. and U.N.officials said.

Because of the time difference between New York and Seoul,hundreds of diplomats spent more than seven hours sitting in aconference room during the night doing nothing while high-levelgovernment officials addressed the South Korean concerns. Holbrookesaid he was very sympathetic to South Korea’s concerns, many ofwhich were the result of misunderstandings.

Other issues raised by the Czech Republic, Britain, China andthe United States were also resolved.

‘Winners’ and ‘Losers’

The U.N. budgets—based mainly on the capacity to pay—hadother “winners” and “losers” in terms of who will now pay more or less.

Japan received a 1 percent cut in its regular budget payment, tobelow 20 percent, but still second to the United States. The15-member European Union, which insisted it would not pick up theU.S. reduction because it already pays more than its share ofglobal GNP, received a very modest increase.

In addition to the oil-rich and newly industrializing countrieswho will face higher U.N. bills, China will be paying over 50percent more to both the regular and peacekeeping budgets,admittedly from a very low base. Because of its low economicgrowth, Russia’s regular budget contribution would have been cutthis year—but Moscow chose to increase its contribution.

South Africa’s U.N. Ambassador Shadrack Kumalo, whose countryheads the Non-Aligned Movement of developing nations, said thegroup was pleased with the result even if some members were payingmore—because it was helping the United Nations.

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