APPENDIX 14 U.S. contributions to United Nations operations in the Congo through June 30, 1962 1 1 This table deals with Congo operations conducted multilaterally through the United Nations. In addition to contributing to the programs shown on this table, the United States conducts the following programs for the Congo outside the framework of the United Nations: 2 Appropriation request pending. 3 From July 1, 1962, the U.N. proposes to fund Congo military costs from the proceeds of its $200,000,000 bond issue. 4 Estimated total through June 30, 1962. Reimbursed to Department of Defense by Department of State. • Of which $101,144 has been reimbursed to Department of Defense by Department of State. APPENDIX 16 THE UNITED NATIONS FINANCIAL POSITION AND PROSPECTS STATEMENT BY THE ACTING SECRETARY-GENERAL AT THE 899TH MEETING OF THE FIFTH COMMITTEE, DECEMBER 11, 1961 Mr. Chairman, 1. I hope the Committee will bear with me a few minutes before it proceeds with its consideration of today's agenda, in order that I might present by way of background, as it were, to the discussion on which you are about to embark, some brief but relevant observations on the state of the United Nations finances. 2. It is not my intention at this time to deal specifically with the question of ONUC and UNEF cost estimates and their financing or to seek to prejudge the General Assembly's decision in this respect. The documentation already issued, including the reports of the Advisory Committee on Administrative and Budgetary Questions, will, I hope, provide a sufficient basis for necessary action. 3. The purpose of this intervention is rather to underline once again the fact that the steadily increasing financial difficulties which have confronted the United Nations during the past several years have become so serious as to now threaten the ability of the Organization to carry out its primary responsibilities and approved programmes.. 4. The progressive deterioration in the financial position of the Organization may be seen in the widening gap between the Organization's total unpaid obligations and its total net cash resources to cover such obligations. 5. In referring to the financial position I am, of course, speaking only to the situation that obtains in respect of activities financed in whole, or primarily, by assessments levied on Members by the General Assembly. These activities relate to (a) the Working Capital Fund, (b) the regular budget of the United Nations, (c) the UNEF special account and (d) the ad hoc account for the expenses of ONUC. 6. Moreover, in referring to the Organization's unpaid obligations I mean the sum represented by the unliquidated obligations entered on the United Nations books of account plus the amounts that should be in various surplus accounts plus the amounts borrowed from the Working Capital Fund and other special or trust funds and accounts in the custody of the Secretary-General. I exclude, however, the Organization's residual liabilities relating to the unpaid balance of the United Nations Headquarters loan or the balance of credits due Members in respect of the transfer of the League of Nations assets. 7. At the end of 1956 the gap to which I have referred-which may be called our cash deficit amounted to $9.3 million. This increased to $21.2 million at the end of 1957 and again to approximately $29 million at the end of the following two years 8. At the end of 1960 the gap had become $86.9 million and it is now estimated that, at the end of this year some twenty days from now-it will have reached the amount of $107.5 million.1 1 The total unpaid obligations, net cash resources, and deficit as at the end of each year from 1956 through 1961 were as follows: 9. On the assumption that the Organization's expenses will continue during the first half of 1962 at the rate of approximately $17 million per month and that the collection of contributions during that period will total approximately $40 million, the gap between the debts of the Organization and its available net cash resources will have increased to approximately $170 million by 30 June 1962. 10. In view of the present situation and the prospects for the immediate future, I consider it imperative that the General Assembly take appropriate action during the present session to re-establish the financial solvency of the Organization and to provide it with the financial resources necessary to carry out its continuing responsibilities. In the absence of adequate and assured long-term arrangements looking to the Organization's immediate as well as prospective financial needs the consequence of insolvency will have to be faced seriously and soon. 11. It is estimated that by 31 December 1961, the United Nations will have unpaid bills of approximately $82.5 million. In addition, depletion of the Working Capital Fund (plus temporary loans from other United Nations accounts) is likely to account, as of that date, for a further $26.0 million. Thus financial arrangements must be made at this session of the General Assembly which will not only ensure the provision of some $107.5 million for meeting these obligations and needed fund restorations but will provide also for payment of ongoing costs of other authorized activities. 12. Against total current liabilities as indicated above (i.e. unliquidated obligations plus advances from the Working Capital Fund and other special or trust accounts) it is calculated that year-end financial statements will show some $86 million in unpaid assessments. 13. Despite some relative improvement in the course of 1961, the Organization's cash position can be said to be equally critical, with the virtual certainty of its rapidly and progressively deteriorating through the first half of 1962, and the prospect that all reserves will shortly be exhausted. It is also clear that exclusive reliance on the short-term borrowing expedients so far used would no longer be possible or desirable. 14. In short, Mr. Chairman, the United Nations will be facing imminent bankruptcy, if, in addition to earliest possible payment of current and, particularly, of arrear assessments, effective action is not promptly taken for the purpose of (i) enabling outstanding obligations to be settled; (ii) improving the cash position; and (iii) providing needed financing for approved continuing activities. 15. I therefore venture to express the hope that, before it concludes its present session, the General Assembly will devote thought and attention to this continuing financial crisis, and agree upon ways and means by which it could be resolved. 16. The situation requires that all Member States assist us, not only by alleviating the present crisis, but also by providing sound and longer-range financing. This applies to activities for which provision is made under the regular United Nations budget, as also to separately financed operations specifically approved. It was in anticipation of such a spirit of co-operation, and in the confident expectation that all Members share a common interest in preserving the Organization they have built up as a going concern, that I undertook my present responsibilities. The tasks that have been entrusted to me, however, can be successfully accomplished only if pledges of goodwill are accompanied by a readiness to provide the financial support and resources essential for their fulfilment. APPENDIX 17 STATEMENT BY AMBASSADOR PHILIP M. KLUTZNICK, UNITED STATES REPRESENTATIVE IN COMMITTEE FIVE, ON UNITED NATIONS EMERGENCY FORCE AND CONGO FINANCING, DECEMBER 15, 1961 Mr. Chairman, we are faced with a great task. The operation in the Congo goes on. Neither the General Assembly nor the Security Council has spoken to stay it. In August I was in the Congo for a brief visit. There, as in this Committee room, I found many differing opinions on many aspects of what was done or what should be done by the United Nations in the Congo. On one thing there was unanimous agreement in mid-August among the people to whom I spoke. These included old settlers and new, Congolese and Europeans, Americans and members of other missions. Without exception and in the hope that some of the aggravating issues would be solved quickly, these people expressed the hope that a United Nations military force would continue for some time as a symbol of the interest of the international community in the realization of a viable Congo. I have no doubt that many of these people were moved to this conclusion by the recognition that some time was needed by the new Congolese Government to gain firm control of the situation at hand. Since my visit tragedy and division have stalked the Congo. As we sit here, the African atmosphere is tense with alternate hope and despair; the undertaking begun many months ago is not finished. A Secretary General and his aides were martyred by the cause of Congo unity and independence. An Acting Secretary General equipped with a most recent mandate of the Security Council has shown quiet courage and enheartening determination to make good the promise of this Organization. In these circumstances, what alternatives are available to the United Nations? Of course, it can sacrifice with finality the investment of men, money, and material by many members by bringing its operation to an abrupt end. Or it can bring to final consumption what could prove to be one of the most meaningful chapters in its history by completing the task which it undertook. All of us have heard the challenging report of U Thant. More resources are needed if this operation is to conform to the political mandates of this Organization. Here again the report of the Working Group of Fifteen is enlightening. Even though there was a difference of opinion about the legal significance of an assessment by the General Assembly of the cost of the Congo operation, there was substantial agreement that in any appropriate peace or security action the principle of collective responsibility of the membership should prevail. Therefore, while we await with confidence an advisory opinion from the International Court of Justice (ICJ), we should without regard thereto reaffirm the doctrine of mutuality and of collective responsibility which is the hallmark of these United Nations. We have before us an appropriate resolution to authorize the expenditure of required funds for the Congo operation and another for the UNEF, and to assess appropriately the cost among the members of this Organization. Appropriation and assessment resolutions are not enough. This knowledgeable group understands full well that the cash flow into the coffers of the United Nations is the key question that confronts us. For a variety of reasons which, in large part, have nothing to do with ability to pay, some of our members are just not paying. The mere size of the Congo costs made it clear some time ago that the persistence of some in this unorthodox posture would precipitate a crisis of immeasurable proportions. We have arrived at that point now! wish to venture to more dangerous exposures, but the stakes are much too high to risk the precipice on which this Organization rests today. Some may The adoption of the resolutions of authorization and assessment, assuming that paying habits remain the same, will not provide sufficient cash when added to all authorized borrowings to avert a bare treasury in the spring of 1962. If, for whatever reason, members do not change their paying habits, then the Organization will be bankrupt and unable to pay its bills next spring. This unhappy fact cannot be brushed under the carpet any longer. Now is the time for those who speak of their great concern for world peace, peaceful co-existence, cooperation, and all the sugary words of seduction to show their true colors. My Government throughout this whole exercise has demonstrated its willingness to meet the problem more than half-way. So have others. We who have paid our bills have no more voting strength than those who have elected to ignore the mandates of this Organization. It is for the many who may suffer from the padlocking of these doors to assert themselves now. My Government would deeply regret the indecent demise through default of the moving ideal embodied in this Organization, but there are limits to our patience and an end to our indulgence. If these resolutions are not the best answer, let another better response be presented. It will have our serious interest. But one answer whether it be rumored or not is unacceptable. In the discharge of mutuality one state should not be called upon to carry the major burden. This is bad for the United Nations and for that state as well. If the United States is someone's candidate for that role, it should be made clear that it has gone as far as it can and will go. It is unthinkable that the United States pay so much of this bill and its own act will help destroy the United Nations. Neither our government nor our people will play such a foolish role. We regret the necessity at this critical stage (even for a moment) of leaving the field of facts and figures to consider certain proposals that have been suggested here. For example, it has been seriously urged against the assessment and apportionment resolutions that the state or states responsible should pay all or |