Explainer: Why is UN warning of 'imminent financial collapse'?

GENEVA/WASHINGTON, Feb 4 (Reuters) - U.N. Secretary-General Antonio Guterres is sounding the alarm on U.N. finances, warning that the world body is at risk of "imminent financial collapse" due to unpaid fees and a budget rule that forces it to return unspent funds.Guterres has repeatedly spoken about the U.N.'s worsening liquidity crisis but this was his starkest warning yet, and it came as the United States, its main contributor - and debtor - is retreating from multilateralism on numerous fronts.The Week in Breakingviews newsletter offers insights and ideas from Reuters' global financial commentary team. Sign up here.Here are some questions and answers about U.N. finances:HOW MUCH IS OWED TO THE UNITED NATIONS AND BY WHOM?In a letter to member states last week, Guterres said there was a record $1.57 billion in outstanding dues for the U.N.'s regular budget, without naming the nations that owed them.U.N. officials say more than 95 percent of what is owed to the regular U.N. budget is owed by the United States - $2.19 billion by the start of February. The U.S. also owes another $2.4 billion for current and past peace-keeping missions and $43.6 million for U.N. tribunals.
On December 30, the U.N. General Assembly approved $3.45 billion for the regular U.N. budget for 2026, following weeks of negotiations. This covers costs of running U.N. offices around the world, including the headquarters in New York, staff salaries, meetings and development and human rights work.U.N. officials say the U.S. did not pay into the regular budget last year and owes $827 million for that, as well as $767 million for 2026. Next in line were Venezuela and Mexico, owing $38 million and $20 million respectively.Contributions depend on economy size. The U.S. accounts for 22% of the regular budget, followed by China with 20%. Fees are officially due by Feb. 8 and so far 41 states have paid for 2026, a U.N. document showed, opens new tab.WHAT IS GUTERRES ASKING MEMBER STATES TO DO?Without naming the United States, U.N. spokesperson Stephane Dujarric said this week the U.N's "cash-flow problem" could be solved "if member states, who have an obligation to pay, pay."The crunch comes at a time when U.S. President Donald Trump has launched a Board of Peace with himself as lifetime chair, which some fear could undermine the United Nations, a body with 193 member states formed in the ashes of World War Two that works to maintain international peace and security.Under Trump, as well as refusing to make mandatory payments to the U.N.'s regular and peacekeeping budgets, the U.S. has slashed voluntary funding to U.N. agencies with their own budgets, and moved to exit U.N. organizations including the World Health Organization. In December, the U.N. appealed for a 2026 aid budget only half the size of what it had hoped for in 2025, acknowledging a plunge in donor funding at a time when humanitarian needs have never been greater.Guterres launched a reform task force last year, UN80, seeking to cut costs and improve efficiency. The approved 2026 regular budget is roughly $200 million higher than he proposed, but about 7 per cent lower than the approved 2025 budget.Guterres warned in his letter that the U.N. could run out of cash by July and cited a "Kafkaesque" requirement for it to credit back hundreds of millions of dollars in unspent dues to states each year even if it never received the money. U.N. officials hope to overhaul this "bizarre" rule, which Guterres has called "a race to bankruptcy."WHAT HAS THE TRUMP ADMINISTRATION SAID?Speaking to Politico on Sunday, Trump, opens new tab cast himself as the savior of the U.N. but declined to say if the U.S. would pay up.According to Politico, Trump said he was unaware the U.S. was behind in its commitments but was sure he could "solve the problem very easily" and get other countries to pay — if only the U.N. would ask.The White House and State Department did not respond when asked if the U.S. will pay, or if Trump meant that other countries should put up the money instead.A senior State Department official did though say that "the U.N. needs to get back to basics" and accused it of wasting money."We have no interest in continuing to spend American tax dollars on such waste, fraud and abuse," the official said."The U.N. continues to pay its staff far more than for comparable U.S. government positions, provide unacceptable benefits and pensions, and increase the number of high-level bureaucrats in New York - up over 30% - in the last two years alone. The U.N. also spent $340 million just on meetings and conferences last year."It showed just two of 58 department head posts in the layer of under-secretaries-general beneath Guterres, or 3%, would go, compared to around 19% across the board and up to 28% for one lower-ranking category, according to Reuters calculations.A U.N. official said Guterres aimed to deliver on reform while limiting the impact of cutbacks. If the U.S. did not pay, "at the end of the day, meetings can't be organized, work's not done, staff is not being paid," the official said."Unlike a government, we can't borrow money and we can't print money."Reporting by David Brunnstrom in Washington and Emma Farge in Geneva, Editing by William MacleanOur Standards: The Thomson Reuters Trust Principles., opens new tab

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