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"Worst cash crisis in a decade," says UN Secretary-General Guterres

By Zeeshan Mohd. . 12th October 2019 12:49pm

In a shocking turn of events, the United Nations is facing a serious financial crunch. In a letter to his staff, a copy of which was seen by AFP, Secretary Antonio Guterres said that United Nations are facing its "Worst cash crisis" in nearly a decade. 

The problem arose because of the non-payment or gap in funding of around 60 states that have been late in paying their dues. Of those, just seven countries made up 90 per cent of the deficit: the United States, whose outstanding payments top a billion dollars, Brazil, Argentina, Mexico, Iran, Israel and Venezuela.

Adding further to his statement, Guterres said, "the organisation runs the risk of depleting its liquidity reserves by the end of the month and defaulting on payments to staff and vendors”. The UN announced a $1.4 billion shortfall in its operating budget this year. 

One of the top officials in the UN's management department, Catherine Pollard said, "We really have no choice". She further added that the main priority now is ensuring the salary for the UN's 37,000 employees. 

'Peacekeeping is a costly affair'

The peacekeeping operations' has a separate budget which also has suffered. Big nations like the US and France contribute to the peacekeeping budget. The Donald Trump-led country owes $2.3 Billion as per the official UN document and Macron's country owes $103 Million.  

The UN has always faced budget struggles, but these days they are getting bigger, surfacing earlier and lasting for longer, the UN said. The UN budget runs according to the calendar year, while the US fiscal year is from October 1 to September 30, and the UN hopes Congress will free up the funds by the end of the year.

The UN budgetary rules do not include any penalty or interest on late payments.