- The Washington Times - Tuesday, December 19, 2000

NEW YORK American diplomats at the United Nations are working against a Thursday deadline to complete a long-sought deal that would reduce U.S. financial contributions to the organization in exchange for payment of more than $500 million in arrears.

If U.S. negotiators can persuade the other 188 member states to lower Washington's assessment to the international organization by a total of 8 percent, the Clinton administration will be free to turn over some $572 million the second of three payments that could total $926 million and nearly wipe out the debt.

A deal must be concluded by dawn Thursday if the General Assembly is to vote on it before adjourning Friday for the Christmas holiday. Under U.N. rules, the scale of assessments cannot be reconsidered again until 2003.

Although officials remain cautious about winning a revision of the regular budget, they are increasingly optimistic about reducing the U.S. assessment for peacekeeping.

"We believe this package has a reasonable chance of being accepted," said Ambassador Donald Hays, who oversees the budget negotiations for the U.S. Mission.

"The net result is an institutional solution which embeds economic performance of countries in determining … their assessment," he said.

Discussions on apportioning the organization's annual $1.2 billion operating budget have been proceeding slowly and often rancorously.

The European Union and Japan which along with the United States account for the largest share of U.N. financing have said they will not increase their contributions, which are based on a formula that considers gross national product, foreign debt and population.

The United States pays 25 percent of the regular budget but accounts for roughly 27 percent of the world's wealth. It is asking for a ceiling of 22 percent for any single nation, although only Japan comes close.

There is more sympathy for an overhaul of the peacekeeping scale, which initially was cobbled together in 1973 to pay for a single observer mission in the Sinai Peninsula. The U.S. assessment for peacekeeping now is 30.4 percent, with total costs expected to hit $3 billion next year.

Many of the poorest nations that got discounts in 1973 have since become prosperous and should pay more, the Americans say. Israel, Hungary, South Korea and several others have announced they will forfeit discounts worth millions of dollars each year.

But other governments complain that a sudden rise in their peacekeeping assessments would throw their budgets into havoc.

A proposal crafted by Mexico and approved by most of Latin America is to be introduced formally today and will peg the peacekeeping discount more closely to a nation's wealth.

Under the Mexican proposal, nations will be divided into nine groups instead of the current four, with discounts ranging from 90 percent of the regular budget assessment for the poorest nations, to 20 percent for the wealthier ones. Dozens of nations will not receive any discount.

In both scales, the five permanent members of the U.N. Security Council the United States, Britain, France, China and Russia pay premiums on top of their regular budget assessments.

The Japanese, Australians, Canadians, South Koreans and some of the European nations most likely to have their shares increased have agreed informally to the Mexican proposal, delegates say.

However, it is a not clear whether that proposal would reduce the U.S. contribution for peacekeeping to 25 percent, as Washington demands.

Although U.S. negotiators continue to pursue the 25 percent ceiling, Mr. Hays said, "There is no doubt that if this goes through, we will be closer to 25 than the current 30.4 percent."

Variables include how much the United States ultimately is assessed on the regular budget and how big a premium they pay as a permanent Security Council member.

The United States has been angling for a lower assessment rate since 1995, when President Clinton signed a law capping the American U.N. contribution at 20 percent of the regular budget and 25 percent of peacekeeping. The organization continues to bill Washington at 25 percent and 30.4 percent, respectively, accounting for most of the $1.6 billion the organization claims it is owed.

U.S. Ambassador Richard C. Holbrooke, who has lobbied other governments intensively on this issue, says it is unhealthy for the United Nations to rely so heavily on only one contributor.

Other nations have begun to agree if only, in the words of allies and enemies alike because that nation does not pay reliably or without attaching conditions.

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