.1994 The Future Role of the Global Multilateral Organisations in English                        TOC2.jpg (2545 ???)


Report on the Conclusions and Recommendations
by a High-level Expert Group on

THE FUTURE ROLE OF THE GLOBAL MULTILATERAL ORGANISATIONS

Chaired by Andries van Agt

7th - 8th May 1994

The Hague, Netherlands

MULTILATERALISM IN THE POST-COLD WAR SETTING

1. In the post-cold war era, the international community finds itelf in the midst of tremendous flux undergoing unprecedented adjustment in a quest for a new order. The question is pertinent, whether nations and people are indeed more secure now than before. The hopes for a multipolar world have not materialised. For their part, multilateral organisations have proved themselves neither ready nor capable of assuming broader responsibilities. Expectations about the capacity and power of international organizations have been dashed, especially in the face of insufficient and shaky levels of finance. With Russia mired in crisis and groping for a new identity, the United States continues to shoulder a broad range of global responsibilities alone. And yet, against the backdrop of a more confused political framework, the direction in the economic sphere is much clearer than it has been for a long time, reflected in the global consensus that the market economy - no matter what form or mix it may take - is the only practical way forward.

2. Clearly, opportunities exist to move towards a unified global system with stronger multilateral organisations in a way which has not been possible at any time before. But what can be the future role of global multilateral organisations while the overall direction of the international community remains uncertain? In the former Yugoslavia, Somalia or Rwanda, it has become clear that if the big powers are not interested in a particular conflict or problem, there is virtually no chance that multilateral organisations can tackle it effectively. The recent policy shift by the United States Government from assertive multilateralism to a more sober, pragmatic approach (towards more selectivity and more effectiveness) is mirrored by the cooling attitudes and expectations of other Governments - in both industrialised and developing countries - concerning their willingness to participate in international organisations and cooperation. Developing countries, for one, are reexamining their options out of frustration with the defunct North-South dialogue - there is a real danger that international cooperation will founder on the rock of ill feeling between industrialised and developing counties. Moreover, given the positive experience of many countries with privatization as a stimulus to economic development - with at best marginal involvement by international organizations -, these countries have begun to assess the financial burden of their membership in more than 20 organisations of the United Nations system alone, quite apart from that of regional and other organisations. The frustration at the imbalance between the financial obligations and the tangible benefits from the multilateral system is thus pervasive throughout the world.

3. Recent years have revealed deepening differences among the membership as regards priorities for action by international organisations with many countries wanting to devote increasing attention and resources to peace-making and peace-keeping activities, while many others, especially from the developing world, would rather focus more on economic development programmes. Moreover, governments may well state their preference for stronger and more effective multilateral tools, yet in reality they are not willing to surrender part of their sovereignty and they do not want to create institutions with power vis-a-vis the nation-state. In many instances, sovereign nation-states even fail to implement decisions they themselves have taken in multilateral forums.

4. The lingering and intensifying dissatisfaction among governments with international organisations does not augur well for the future. Not only is there worldwide no perceptible change in the attitude of most nation-states regarding sovereignty, but on the contrary in all continents the expression of national or individual interests by states is on the upsurge. In the absence of a common enemy or ideological opponent, unbridled national interest is becoming the main driving force for action by states.

5. And in a further twist, groups within states or societies are ever more forcefully expressing their aspirations, leading to a fragmentation which impinges on state authority, reduces state control over events within its realm and often triggers internal conflicts and tensions.

6. The key issue surely remains whether governments are really poised, in general, to use international organizations and, specifically, which ones for which purposes. The decreasing propensity and habit of governments to resort to international cooperation is ominous and is the weak link in the cooperation equation. The adoption of more meaningful and effective decision-making mechanisms and other organisational incentives may help to reinstil the commitment of some countries to multilateral solutions. This overall sceptical attitude notwithstanding, governments cannot but recognize that a number of daunting global problems - with long-term implications - will not wither away. They can only be resolved through global cooperative efforts.

MULTILATERAL ORGANISATIONS AND THE NEW GLOBAL AGENDA

7. Multilateral organisations - most of which were substantially affected by the Cold War conditions - were designed to serve specific purposes. The multilateral system as it appears today represents an assortment of intergovernmental structures and institutions, comprising the United Nations and its system, financial institutions - including the Bretton Woods institutions World Bank and International Monetary Fund (IMF) -, regional organisations and a host of other international organisations. While some multilateral organisations are not universal in terms of membership, they may nevertheless be global in terms of their interests, outreach and ramifications of action.

8. The institutional underbrush of international cooperation is littered with organizations, making it impossible for governments to deal with them, much less so in a creative manner. It is not only a matter of overlap or duplication or efficiency or corruption - all of which may play a role. The present organizational overload in the international global system needs to be pruned so as to enable leaders committed to global cooperation to focus on the truly important issues and to choose the most suitable organisation for action. Under no circumstances should henceforth new organisations be created without abolishing existing ones. By its very nature, this process of reform will be incremental.

9. The United Nations and its system of specialized organisations and agencies - which includes the World Bank and IMF - represents the core of today's multilateral arrangements. One of its major shortcomings is that it really does not operate as a system with common guidance, supervision or central direction. The main reason for this state of affairs is the system's polycentric nature, which by itself is due to a decentralisation of institutional competence on functional or technical grounds dating back in some instances more than 50 years. Thus, a plethora of more or less independent organizations pursues largely uncoordinated economic and social policies and programmes. In spite of an abundance of coordination devices, which remain largely ineffective, the activities of the UN system lack coherence. While the international problems at hand are cross-sectoral and cross-organisational, they are being dealt with more often than not in isolation and generate hefty competition for mandates and resources. A proliferation of unheeded and unimplemented resolutions has undermined the authority, effectiveness and impact of the various organisations; without supranational powers, they cannot enforce their decisions. The case can be made to unify a number of agencies. Non-governmental organisations and multinational corporations should also be involved more systematically in the decision-making and programming processes as well as in financing.

10. The mission of the United Nations was to foster international cooperation, to prevent new wars and stimulate economic development and well-being. Peace and security was meant to be maintained through a small collegial group of allies. However, during the cold war, the United Nations, and especially its Security Council, was unable to function as conceived and its potential only began to be realised following the end of the Cold War. The years since then may have been a little deceptive for the United Nations in the sense that unusually favourable conditions prevailed where the Soviet Union and the United States more or less agreed on all issues at hand. The proposals in the "Agenda for Peace" by the United Nations Secretary-General may point to new directions with respect to peace-keeping, peace-making and peace-building. In the economic area, the United Nations has never been able to assume a lead role and consequently its Economic and Social Council (ECOSOC) has languished - and this was not a consequence of cold war stalemate.

11. The state or performance of the international organizations in general and the United Nations in particular has always been a direct reflection of the political and psychological mood and constellation of the international community. Overall, the UN seems to have been able to achieve the almost impossible feat of not meeting the needs of most of its members. Part of the reason may be that the Organization was conceived at a different time for a slightly different purpose and is now serving the world in a changed situation and environment. While many governments and politicians pay lipservice to the central role of the United Nations, decisions and multilateral action on an increasing number of issues are shifted to forums outside the United Nations. As a minimum, the United Nations, and in particular the General Assembly, should revive one of its important functions, namely to serve as a forum for deliberative debate among governments in which all points of view can be ventilated, but where no effort would be made to reach agreement on issues which are beyond the genuine scope of a non-governmental entity.

12. If the United Nations was made impotent through disagreements among the superpowers during the cold war, it now seems to have been overburdened and overwhelmed with an enormous agenda in the face of too weak an administrative and financial infrastructure. The end of the East-West conflict, the demise of the Soviet Union as a sovereign state and strategic superpower, the emergence of new and competing political units, and the proliferation of acute global problems which jeopardize the very survival of the planet, pose new challenges and give rise to conflicts of new types in a unipolar world. Long overshadowed by the Cold War or even hardly imaginable in the mid-1980s they are today more and more understood as menaces to mankind: environmental degradation and biospheric depletion, climate change, the emission of greenhouse gases, the demographic explosion and transborder population movements, jobless growth, rampant poverty, AIDS, drug trafficking, international corruption which compromises development efforts, ethnic and regional conflicts, the calluous disregard of human rights, the specter of the proliferation of nuclear and other weapons of mass destruction, terrorism, and a destabilising globalisation of financial markets. The international community is groping for a new vision and appropriate institutional mechanisms for the 1990s and beyond to respond to these challenges and threats to global and human security. Clearly, the United Nations will not be able to do everything and should not attempt to do so. As a general guidance, the issues selected for international cooperation should be vital, global in nature and implications, urgent and long-term in character and require impartiality. For any action, proper sequencing is crucial: decision about a course of action - choice of most suitable organisation or mechanism - securing the financing for the implementation of the decision - implementation and enforcement of political decision.

TAPPING THE POTENTIAL OF NON-STATE ACTORS

13. While the world should be moving towards multi-centricism, the general thinking is still very much state-centric. But the course of events is no longer determined by governments alone, there are many more and significant players, especially non-governmental organisations (NGOs) and multinational organisations. Worldwide there are today some 18,000 non-governmental organisations and many more national and local ethnic, racial, religious, professional and other groups operating, each with a specific know-how and competence extending over the entire range of human concerns. The flow of finance from NGOs in the North to NGOs in the South alone amounts at present to some US$9 billion. Whereas official development assistance (ODA) has stagnated or has been declining in real terms for many years, the NGO flow is expanding since several years at a rate of 5-8% per year in real terms. The private sector and multinational corporations are a major force in the field of investment flows and they wield considerable financial and political power.

14. The multilateral system should seek to integrate, collaborate and make constructive use of this enormous potential of non-state actors. Recent United Nations conferences, including the Rio Earth Summit and the World Conference on Human Rights, demonstrated the benefits for their creative and active participation.

15. Multilateral organisations should also make more frequent use of blue ribbon commissions, which - like at the national level - could help both forge consensus on contentious issues and jumpstart processes and the implementation of decisions.

16. Equally, the feasibility of a parliamentary chamber or assembly complementing the present intergovernmental structure should be seriously explored, as it might enhance the political legitimacy of the organisations and strengthen accountability of organisations and governments.

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17. The multilateral system and especially the United Nations should be oriented towards a holistic approach whereby peace and security issues are not mechanically separated from development issues. At the same time, the new concept of security should not be diluted beyond recognition by loading it with all types of problems. In the process, one should arrive at a redefinition of the interrelationship between national and global interests, the definition of commonly accepted multilateral structures, mechanisms and rules of operation. Ultimately, it will be inevitable that nations yield some of their sovereignty to multilateral organisations. Yet, we should be realistic enough to accept that any transfer of sovereignty and a deepening voluntary cooperation among states may also harbour the seeds of conflict. Many new states may take an even narrower view of international requirements. Confrontation and tensions may be nurtured by diverging interests, disagreements, and clashes of ideologies or religions.

18. In the age of global interdependence, the principal areas for multilateral global action fall into three main categories:

a) the maintenance of peace and global security;

b) the management of economic interdependence;

c) the management of the new global challenges: coping with the population explosion and promoting sustainable human development.

THE MAINTENANCE OF PEACE AND GLOBAL SECURITY

19. Collective military defence is no longer an overriding priority of national policy. Other risks and instabilities have emerged which are difficult to quantify in military terms and which have led to a redefinition of security. Stability, which is easy to recognize but difficult to define, does not depend on the military dimension alone. Although the United States is now dominating the unipolar world, it is trying to reduce its commitments. Yet, global security and stability will not be achieved without strong American participation and all efforts should be made to persuade the United States to continue playing such a role.

20. A collective security system would need to be organised and structured in such a way to enable it to monitor developments continuously and to preempt, prevent and contain conflicts, mediate disputes, assure the protection of small and weak states and deal authoritatively with aggressors. This will require mechanisms for peace-keeping, peace-making, peace-building and conflict resolution. The effectiveness of action by the Security Council has encountered limitations inasmuch as certain resolutions remain unimplemented because the Council has no independent means of implementation and enforcement. Instead, it needs to rely on the goodwill and cooperation of important member states and other international organisations. This discrepancy between authority and power ought to be reduced, yet there are doubts that members are really ready to give the Council full enforcement power and the attendant means.

21. The growing demands and diversified assignments for the United Nations in conflict and crisis situations (e.g. preventive deployment of monitoring troops in Macedonia) require an increasing number of troops hitherto provided by national governments. Even if an operation is under United Nations control and command, in reality not a single important decision can be taken without the involvement of troop-contributing governments. Articles 43 and 45 of the United Nations Charter envisage that the Security Council can call on stand-by international military or police forces and deploy them quickly in order to break cycles of violence and the destruction of human societies through firm intervention. Initial discussions on the possible activation of these provisions have begun, but have already pointed to reservations and reluctance of a number of governments to join this scheme.

22. The sobering experience in Somalia holds many lessons for future operations. In the first stage, the United States operation in Somalia was nothing but a purely humanitarian operation undertaken by a country that was ready to send its troops to a faraway continent without having any direct interest in doing so, apart from its general leadership obligations as the only global power. That was a widely praised and unprecedented act of generosity. However, once efforts were made to tackle the underlying causes of the Somali disaster, the whole operation began to flounder as the mandate and the resulting orders became confused and blurred. Thus, the operation was transformed mid-way into a different mission. Any military operation must always have a priori a clear objective and mandate. A real dilemma arises when force will be used to restore stability in strife-torn areas. How can legitimacy be conferred upon the use of force outside a nation's own borders or alliances? Does the use of force conflict with other objectives, such as humanitarian programmes? Similar questions pertain to peace-building and the reconstruction of war-torn societies, when a wide range of humanitarian aid, economic development, financial assistance, rebuilding and resettlement of refugees must be coordinated.

23. In general, many governments feel that their public will not tolerate the loss of lives of their own citizens on any significant scale in areas that may be perceived of peripheral interest. Given the reluctance of Governments to place their own soldiers in harm's way and to neutralise vagaries of the political process in many countries, the creation of a modest-size standing force of volunteers under UN auspices would be a compelling proposition. The creation of such a standing volunteer force would endow the Secretary-General and the Security Council with a rapid means of pre-empting conflicts or intervening to head off humanitarian tragedies (e.g. in Rwanda), subject, of course, to a satisfactory resolution of issues of finance, recruitment, command and control. Once established, it could conceivably be combined with, and backed up by, regional or sub-regional peace-keeping forces.

24. Worldwide ethnic conflicts and conflicts between ideologies persist. The re-emergence of ideological conflicts disguised as religious conflicts might be a prime source of future tensions and conflicts. In situations where governments lose effective control within their borders, the non-violability of the borders of sovereign states may be put aside under certain conditions which may justify intervention by the international community (see annex I containing pertinent proposals by Lord Callaghan contained in his report on the conclusions and recommendations of a High-level Group by the InterAction Council on "Bringing Africa Back to the Mainstream of the International System", Cape Town, January 1993). Security Council resolution 688 provides a general legitimation for such interventions, as it determined that repression by governments of its own people which results in urgent humanitarian needs constitutes a threat to international peace and security. However, the Somalia experience suggests that any such intervention in a failed state under conditions of political bankruptcy and ongoing civil strife is exceedingly complicated and fraught with risks. This lesson is already being reflected in the widespread reluctance of Governments to get involved in Rwanda.

Early warning and policy planning

25. For the moment, the United Nations is called upon to act in the security area somewhat akin to an emergency team when Governments by themselves cannot cope. Long-term or medium-term policy planning might thus be useful but could give rise to misleading expectations since one is often taken by surprise. Although preventive measures might be the most economic and effective way to deal with problems, they often depend on intelligence available to individual Governments and rarely shared with the Secretary General. Hence, such measures are rarely put in motion or, with doubtful effectiveness, only when a conflict is about to erupt. Governments more often than not might be wary in setting up an early warning mechanism as it might trigger a spiral of events leading to a - not necessarily desired - intervention. The Yugoslav crisis may serve as an example for a situation where ample warning existed about what was likely to happen, which however was not met by a commensurate readiness to take preventive action. Preventive action will only be credible if it is genuinely believed that there is a willingness to take serious action if a conflict does arise.

26. In the context of a broad concept of security, i.e. including the new global challenges, multilateral policy planning would make considerable sense. It could draw on the enormous amount of information collected by, and the institutional memory available in the agencies of the United Nations system and would thus give wider access to this largely unknown wealth of global data.

Globalism versus regionalism: towards a new burden-sharing?

27. Increasingly, the case is being made for a stronger involvement and role by regional organizations, in line with Article 52 of the UN Charter, in situations requiring peacekeeping and conflict resolution. Recent moves in the Security Council to delegate responsibilities in peace-keeping matters to regional organizations are a reflection of a general mood towards more decentralisation of the international system. Driven by a motivation to strike a balance between the abstraction, complexities and burden of globalism and the shortcomings of unilateral approaches, the proponents of regionalism point to advantages of proximity and neigborhood which might permit more leeway, leaner decision-making and, hence, better responsiveness and reaction. Such an application of the principle of subsidiarity in global decision-making must be carefully weighed against the tasks at hand. While the subsidiarity concept stipulates that decisions should be taken as close as possible to a problem, this shall not be interpreted to mean that internationally decisions should be taken at the lowest possible level. This would run counter to the concept and perceived necessity of global leadership. Rather, decisions should be taken at a level where all pertinent interests are taken into account and where they will lead to maximum international effect. Hence, an appropriate burden-sharing between regional and global institutions will have to be determined in each case. But even if a regional organisation will take on a particular mandate, approval by the Security Council should be sought as this would confer international legitimacy.

28. However, the global system will not by necessity become more effective through a broader involvement of regional organizations. Paradoxically, such organizations are frequently weaker in performance and decision-making capabilities than the United Nations and are on even shakier grounds as regards their financial basis. Hence, skepticism may abound as to the real effectiveness and capacity of regional organisations. If there is however a widespread feeling favoring increased recourse to regional organisations in crisis situations, then it is an imperative that countries take urgent measures to strengthen the regional organisations concerned so that they may perform their new missions.

29. In Europe, a well-established structure exists through NATO (and its recent Partnership for Peace arrangement), the European Union, the Western European Union and the Conference on Security and Cooperation in Europe (CSCE). But seemingly, Europe cannot deal effectively with its own security challenges. Enlargement in the membership of these organs is widely viewed as compromising cohesion and efficiency. In Africa, the Organisation for African Unity (OAU) is evolving, but it will not be capable of carrying out any large-scale peace-keeping operation without assistance from outside. The OAU recently adopted a conflict management mechanism, but it is not working yet as it should. Many more tragedies like those in Somalia, Liberia, Rwanda are looming and to ward them off, some preventive, low-key and non-military intervention should be initiated as long as conflicts are still smoldering and when they can be contained before degenerating into violence. In Asia and the Pacific, no regional organization exists which could assume a role in peace-keeping or conflict resolution. This reflects to some extent a historically greater reliance on global multilateral institutions. The Middle East poses a particular problem with the danger of Islamic fundamentalism, which is unlikely to be solved by any regional organisation. In Latin America, the experience of the last decades was disappointing. The Organisation of American States (OAS) has been irrelevant with respect to important issues. As a result, informal and ad hoc groupings were formed, such as the Contadora Group, the Group of Eight later transformed into the Rio group, as well as the countries of the Consensus of Cartagena on debt restructuring.

30. Regionalism might be useful for specific circumstances but can never serve as a general recipe for pursuing world governance and order. It might lead to a fragmentation of the world into rather inward-looking regions and give rise to the emergence of spheres of influence, running counter to the very concept and potential of international cooperation at the global levels. Instead, all efforts should be undertaken to enhance cohesion and the efficiency of global cooperation and to avoid a splitting up into regional groupings.

Reform of the United Nations Security Council

31. The need for a reform and expansion in membership of the Security Council is widely acknowledged so that it may acquire the legitimacy, authority and political and financial support necessary for the discharge of its expanding responsibilities. When the present permanent members were determined in 1945, they accounted for over 60% of total world GNP, while today this share has dropped to less than 40%. Widespread agreement seems to prevail that Germany and Japan should become permament members; other powers will also have claims and demand inclusion. Any enlargement in the composition of the Council, however, should not jeopardize its efficiency. Yet, there is also fear in some quarters that any amendment to the Charter might open a Pandora's box so that the necessary Charter revision might also bring other proposals to the fore.

32. Another practical, yet fundamental adjustment may be required to improve the crucial relationship between the Secretary-General and the Security Council. This relationship has been in essence determined by the cold war. If during that period the Secretary-General spoke in the Security Council or in one of its informal meetings, he was sure to offend either the United States or the Soviet Union. Therefore he did not speak either in the Security Council or in informal meetings. As a result, the incumbent Secretary-General does not attend informal meetings of the Security Council. It would appear that such informal meetings would offer a valuable opportunity for the Secretary-General to discuss openly information available to him, to outline possibilities for action and to highlight practical difficulties with respect to options under consideration. This would make governments feel involved in the actual running of operations and would increase the confidence of governments.

Arms control and arms trade

33. Arms control, in particular measures to control the proliferation of weapons of mass destruction and the arms trade, should receive priority attention in multilateral forums. At present, most, if not all of the conventions and treaties on subjects of military security (including the Nuclear Non-proliferation Treaty/NPT, the Strategic Arms Limitation Talks/SALT and the Strategic Arms Reduction Talks/START) were conceived and negotiated outside the United Nations. As a consequence, the UN cannot deal with violations of these treaties nor can it authoritatively intervene against a country which has not acceded to a particular treaty. Urgent steps should be taken to make the world's ever more complex assortment of arms control and disarmament treaties and conventions more transparent and manageable. Preferably, it should be placed under the authority of one single organisation, the United Nations. Efforts should also be accelerated to prevent the leakage and proliferation of nuclear weapons, hardware and technologies. Equally, chemical, biological weapons and ballistic missiles should be brought under strict multilateral control to avoid further spread.

34. Adherence to the Nuclear Non-Proliferation Treaty (NPT) should be broadened towards universality and greater authority should be conferred upon the International Atomic Energy Agency (IAEA). In 1995, the NPT will be reviewed and there is considerable merit in extending it for a substantial period of time. At that time, the IAEA should also be empowered to carry out challenge inspections of all nuclear facilities on the territory of signatory states.

35. However, the five proclaimed nuclear powers must show evidence that they are serious about their NPT obligations to seek a reduction of nuclear arms - that, in short, the NPT is not a treaty aimed at codifying inequality. Multilateral negotiations should begin to reach agreement on the elimination of all nuclear weapons.

36. The arms trade is a particularly costly and destabilizing feature of international life. It remains unregulated and beyond effective governmental or international control. The now defunct Coordinating Committee for East West Trade (COCOM) should be restructured and converted into an effective export control system for weapons of mass destruction, ballistic missiles and the arms trade (including the setting of global norms, regulations and limits for both arms suppliers and purchasers). Information thus gathered should be matched and integrated with data provided by Governments to the voluntary arms register opened at the United Nations. The publication and dissemination of information about arms sales will be a first step in terms of making it clear where arms sales are going. The weapons trade with developing countries should be substantially reduced and curbed. To that end, international organisations and bilateral donors should impose conditionality in the sense that countries where military expenditures exceed 2% of GNP should no longer be eligible for development assistance and funds.

MANAGING ECONOMIC INTERDEPENDENCE

37. The collapse of the centrally planned economies, the global embrace of the market economy and the freedom of capital flows have brought about a truly global economy. There seems to be broad agreement as to the future direction of the world economy. With the whole world moving away from managed and planned economies, any notion that the world economy would lend itself to collective economic leadership is antithetical. There nevertheless remains scope for an institutional multilateralism to support the rules-based multilateral framework determined by the principles of the market economy, non-discrimination, free trade and payments and optimal competition. As the market economy does not exist in a vacuum, it can only have beneficial results if internationally the rule of law and an open system prevail. Treaties have designated international organizations with independent secretariats as custodians of the multilateral system to ensure observance of the rules of the game and, thus, to manage the interdependence of national economies.

38. At the national level, it is the responsibility of the government to provide the right institutional framework and environment to enable the market economy to operate. The countries in East Asia and Latin America have shown how economic progress and substantial growth can be attained in a framework that only a few years ago seemed quite impossible.

39. The disappearance of the cold war also makes itself felt in the economic arena. One of the prime reasons for the cooperation pursued by the Western countries was the existence of a common enemy. This no longer being the case, the habit of cooperation weakens coinciding with a period where the interests of states in the economic and trade fields are becoming more and more egoistic. This presages new types of conflicts. As a result, both the economic as well as the institutional sides of the multilateral system are being eroded. The economic side is under duress owing to a growing tendency - particularly by the big countries - towards bilateralism, regionalism and regional trade blocs. These countries try to escape from the discipline of the rules-based global cooperation by seeking to address problems within a more limited framework, ignoring the external trade-diverting effects on the world as a whole and thus running counter to the principle of multilateral non-discrimination.

40. Notwithstanding any positive effects regional trade blocs might yield, the countries involved leave the multilateral fold. Protectionist pressures are growing in different parts of the world. As it has never been possible to organize international economic cooperation without the whole-hearted involvement of the United States - either in a leadership or in a strong supportive role - much will depend on the attitude of the United States, where protectionist sentiments are on the rise. It is troubling also that the European Union is heavily preoccupied with protecting its frontiers by tariff or quasi tariff barriers. And Japan always had a strong protectionist tendency, particularly in the agricultural field.

41. With the world's open trading system under serious threat - despite the conclusion of the Uruguay Round-, international institutions must now redouble their efforts to reinvigorate and nurture a continuation of the cooperative habit of past decades.

42. The tremendous development of the international economy in recent years was due in large measure to the way in which the multilateral system had been developed and had performed. The leading institutions in the economic field include the International Monetary Fund (IMF), the World Bank, the International Finance Corporation (IFC), the General Agreement on Tariffs and Trade (GATT) - which is to be replaced by the new World Trade Organisation (WTO) -, the Organisation for Economic Coperation and Development (OECD) and the Group of Seven (G-7). The G-7, however, is a most confusing term because it really refers to two different groups: the Summit of the Heads of State and Government of the G-7 countries -which has largely lost its economic orientation -and the G-7 finance ministers (which also includes the central bank governors).

43. With respect to coordination of financial policies, the creation at first of a G-4, then a G-5, which later evolved into the G-7, was a reflection of the disillusionment with the too institutionalized process of international macroeconomic policy coordination. Helmut Schmidt and Valery Giscard d'Estaing were both members of the original group, which they found extremely useful. When they became leaders of their countries, they decided to replicate it at the heads of state or government level. That was how the G-7 economic summits were born. Today, these summits have degenerated into a meaningless public relations routine at which no effective decisions are taken and no economic coordination accomplished. They increasingly serve political purposes leading to the adoption of often meaningless political declarations, but do not further economic cooperation, recent initiatives on jobs and the environment notwithstanding. Nevertheless, these summits may have some value in that the leaders get to know each other better at the working level than would otherwise be the case. Of real importance is the fact that during the preparatory process bureaucracies are forced to address jointly a variety of issues pertaining to international cooperation. However, the G-7 summit should revert from its semi-institutionalisation to the original concept providing for a private, confidential exchange of views between a few key leaders of the world. It is only through such a mechanism that the President of the United States can be regularly exposed in such detail to the views of other leaders.

44. The G-7 process, at the level of finance ministers and central bank governors, enables financial and monetary authorities to engage in policy coordination without any permanent institutional underpinning. At the advisory and informal level, it serves as a useful mechanism, prior to ministerial meetings, for soliciting understanding of each other's positions, identifying possible short-term trade-offs and devising possible long-term policy options. The record of G-7 action reveals maybe too great an emphasis on balance of payments adjustment as compared to measures stabilising the macroeconomic framework. Sometimes, the G-7 process has led to a situation where government intervention has become too excessive, e.g. in the aftermath of the stock market crash of October 1987.

45. Indeed, prior to ministerial meetings, an entire chain of consultation and cooperation is set in motion, e.g. within the EC and other informal groups. G-7 (finance ministers) decisions play a key role in action by the Group of Ten governors (G-10) at the Bank for International Settlements (BIS) and the IMF and its Interim Committee - composed of developed and developing countries -, which engages in consultations more often than not of uncertain impact. It is the Interim Committee which formally ratifies - or rubberstamps - decisions. This last stage of the process suffers from the absence of a real dialogue, despite the presence of finance ministers and central bank governors.

46. In practice, the G-7 has marginalised other multilateral organisations in the economic field - the Bretton Woods organisations and the OECD -, relegating them to the position of "think tanks". Increasingly the legitimacy, performance and credibility of the G-7 is being criticised: the Western world's share of population, wealth and trade is shrinking, while new economic powers are entering the stage unable to participate in the world's premier economic decision-making club. Given the weight of their economies and their political importance, Russia and China will need to be brought into the G-7 framework. One of the dangers of enlargement, however, may be that although some key countries may formally participate, on truly important issues they may resort to bilateralism or other new, strictly limited groupings.

47. The present challenge is how a more meaningful and satisfying link can be established between the G-7 and the multilateral economic institutions. Small groups may be useful for efficiency purposes, but they are rarely useful for fostering the rules-based system. As a minimum, G-7 (finance ministers and summit) meetings should allow heads of the key international economic and financial institutions to be present as observers.

48. However incomplete the Uruguay Round agreement may be, it represents a significant achievement with an average reduction of tariffs by over 30% (although the regimes for anti-dumping and counterveiling duties are insufficient). The most remarkable merit of the new World Trade Organisation (WTO), for all its apparent shortcomings, is a completely revised dispute settlement system, which will result in faster proceedings and binding solutions. While this might be interpreted by some as an encroachment on sovereignty, its rejection would set the world back to 1947. The paramount challenge is to get the WTO successfully off the ground and to make it an effective mechanism which can combat protectionism and unilateralism.

49. In the wake of the non-establishment of the International Trade Organisation (ITO) in 1947, the United Nations Conference on Trade and Development (UNCTAD) was created to fill the vacuum. With the agreement on WTO, there is no more justification for UNCTAD and it needs to be wound up.

50. The development of global financial markets has to some extent privatized work that used to be done by the IMF and the World Bank, both as regards the provision of finance to cover balance of payment deficits and to provide development finance for countries that can attract funds from international markets. This has slightly diminished the roles of the Bretton Woods institutions, which are called upon to refine their mission, particularly in the light of mounting criticism about the record of the World Bank in the environmental field.

51. As regards OECD, it serves a forum for macroeconomic and other policy dialogue, analysis and research for its member countries. But its dialogue with non-member countries has gained importance. As structural and distributional problems - such as the phenomenon of jobless economic growth - take center stage in the international and national policy debates, OECD - with its analytical capacity and expertise in global structural issues - will be called to play a prominent role. OECD is also well-equipped to address the interrelationship between macroeconomic and structural policies and the interaction between social policy, education policy, and labor market policies. OECD, in cooperation with GATT (and later with the new WTO) will have a crucial role in securing an open trading system.

52. Given the dissatisfaction and the sense of exclusion, especially on the part of the smaller countries in both the developed and the developing world, several options for global economic cooperation are being floated, aimed at group decision-making that is more representative of the diverse global picture and interests, but at the same time not too unwieldy. One proposal is to create (within the framework of the Bretton Woods institutions) a forum consisting of the finance ministers and central bank governors of the G-5 and a representative group of the non- G-5 countries of no more than 10 or 7 persons. This might result in a body of not more than 15 countries. Another suggestion envisages the establishment of an economic and development security council within the United Nations of between 12 and 15 members, with the proviso that participants should be drawn from among finance ministers and central bank governors. Overall, economic policy-making is bound to benefit if finance ministers - who now only attend the meetings of the Bretton Woods institutions - could be brought closer to the discussions in United Nations bodies and if ministers charged with other aspects of economic policy could become more involved in the work of the Bretton Woods institutions.

53. The systemic instability of financial markets as a result of the globalisation of financial markets and the absence of any global regulatory or supervisory authority poses a new, widely underrated danger to the stability of the world economy. Speculative activities are threatening widespread global financial collapse and are endangering the required flow of credit and funds. Instability resulting from the globalisation of financial markets needs to be tackled at the international level. Primarily there is a need for global coordination of macroeconomic policies to minimize turbulences resulting from inconsistent policies. This may, however, not be sufficient in addressing vulnerabilities owing to speculative capital inflows and outflows triggered by accidental circumstances in some countries.

54. While the supervision of financial behaviour is at present inadequate in many countries, international supervision is entirely absent - notwithstanding initiatives taken at the level of the G-7, IMF, BIS and OECD. To guard against financial breakdowns, a set of rules in the form of prudential guidelines for financial institutions in markets has been adopted under the auspices of the Bank for International Settlements (BIS). Recently, its Committee on Banking Supervision has proposed a new set of capital requirements to address market risks. In the absence of a single global regulatory and supervisory authority for the rapidly expanding globalised financial markets, an urgent study should be undertaken regarding the feasibility of establishing sound regulatory and supervisory arrangements and the practical steps required towards that end.

55. Neither the United Nations and its Economic and Social Council (ECOSOC) nor the UN's specialised agencies have ever played any significant role in economic policy-making and it seems unlikely that they ever will. Governments direct their energies only to institutions where cooperation is likely to be most fruitful. The real problem is that the United Nations system was never able to cope with the multidisciplinary character of interdependence. The organisation of the system along functional lines led to a situation where international cooperation was approached only from a sectoral perspective (which in turn would have the effect of strengthening sectoral lobbies nationally). Instead, it should have tried to balance the various sectoral interests for the sake of global progress and cooperation. This would require a determined and sustained coordination exercise at the highest level, which cannot be resolved by the executive heads of the agencies meeting from time to time under the chairmanship of the Secretary General. One of the irritations encountered in the past was that the various agencies were operating at cross-purposes, engaging as they did in normative activities and in issuing policy directives which were at variance. Sovereign governments had adopted in different -sectoral - forums contradictory decisions of a global nature.

56. For its part, ECOSOC has ceased to have any meaningful mission. There is no issue on the agenda of ECOSOC that is not also being discussed by the General Assembly. ECOSOC has never coordinated anything, as opposed to simply rewriting resolutions with very little value added.

57. In future, in the economic field the United Nations should concentrate primarily on questions of sustainable development, population and matters related to the provision of statistical information. Regarding the latter, there is a need for centralisation and computerisation of the staggering amount of data collected within the UN system. However, the question must be asked what practical purpose many reports and statistics serve if competing reports by private institutes and companies take precedence in debates and policy-making.

58. The perennial quest for coordination has by itself given rise to some inefficiency in the multilateral system. If coordination and coherence of action are considered desirable for the UN system, it might be more effective to create a coordination body akin to a holding in the corporate world, providing a unified umbrella for the plethora of United Nations organisms in the economic and social area. It would be governed by a board that would guide, issue instructions, exercise control and seek to realise synergies.

59. As regards a comprehensive reform of the United Nations system, careful consensus building is unlikely to yield tangible results, as evidenced by the experience gained with the Nordic United Nations project. One way out of the deadlock could be the appointment of a representative reform commission which would be charged with producing within a specific time-frame a package that can only be accepted or rejected, but not amended and diluted. This group should draw up its package on the basis of certain parameters, such as a percentage reduction in the number of organisations, the number of intergovernmental committees and the volume of paper, reports and documents.

MANAGING THE NEW GLOBAL CHALLENGES: COPING WITH THE POPULATION EXPLOSION AND PROMOTING SUSTAINABLE HUMAN DEVELOPMENT

60. The global population explosion may end up suffocating one national economy after another, gradually forcing an ecological burnout on a global scale, accelerating the greenhouse effect with devastating sea level rise and loss of agricultural lands, and triggering considerable population movements intensifying the spiral of ever more poverty, disease and conflicts. Cities will have living conditions fostering increased migration and apocalyptic health epidemics. In 1990, world population stood at 5.7 billion. Over each of the next two decades 1 billion people will be added. World population is estimated to reach 10.2 billion by the year 2100.

61. Different scenarios estimate that in the second half of the next century the world population may reach anywhere between 8 and 14 billion. To achieve a stable global population at the end of the next century, the total fertility rate, i.e. the average number of children per woman, must decrease to 2.1 as soon as possible. If this is achieved by 2025, the population might stabilise below 11 billion. If it is reached 25 years later, another 6 billion might be added. Whether the low or the high estimates materialize will depend on policies and measures taken in the next few years. The frightening reality and prospect of rapid population growth and its implications must therefore become the prime focus of multilateral attention. Managing that extraordinary population increase is the most daunting challenge confronting the world.

62. The overall decrease in the fertility rate can be achieved through a variety of measures:

a) Enhanced access to and utilisation of contraceptives: an extraordinary revolution has taken place in terms of worldwide contraceptive prevalence (to prevent unplanned and unwanted fertility). In the developing world, access by fertile couples to contraception has moved from under 10% some 3 decades ago to now well over 55%. As a result, the family size has shrunk appreciably from a historic average of 6 children per family (in virtually all societies) to about 3.8 in the developing world today. Globally, the total fertility rate is about 3.4 as opposed to the target of 2.1 children per family. No developing country has however reached that level yet.

b) Extended education of girls and school attainment, preferably until the age of 14-16 years: without any education girls tend to marry at 17; with secondary education they marry well beyond the age of 21. The requisite education could be attained over a period of 10 years for a sum equivalent to 0.25% of the collective GDP of the low income countries.

c) Enhancement of women's rights, their status, employment opportunities and access to productive resources and credit.

d) Improvement and expansion of basic health services, including clinics, especially for women and children.

d) A better definition of men's responsibilities to children will also contribute to a decrease in the demand for children.

63. The figure adduced for programmes and policy initiatives to be carried out under the draft Cairo Population Action Plan (to be adopted at the September 1994 United Nations Conference on Population and Development) - providing for an expansion of contraceptive services up to the year 2000 - is estimated at US$11 billion. Currently, the amount of ODA devoted to population activities stands at a mere 1% of all ODA. If the rich nations were to pick up their usual share for the proposed increased contraceptive services, the cost to every tax payer would be about 1 penny per day. However, expansion of health services and educational facilities for girls will require a much more significant amount of resources. Developing countries are certainly called upon to contribute a substantial portion of the needed funds for these measures themselves by shifting priorities in their budgets so as to allow an implementation of the programmes and measures proposed.

64. The challenge for the multilateral system is not how better to coordinate or how better to execute programmes. Rather, countries that are ready and anxious for certain kinds of help should be assisted, with resources, expertise and technical advice. Each country may require a different set of calculations and a specific set of policy prescriptions. At the national level, laws should also be reviewed to increase the age of first marriage in order to bolster efforts aimed at spacing of children.

65. More than four decades of foreign aid has done little to improve the prospects of most developing countries or to create a global social safety net. Poverty, unemployment, disease and violence are rampant. In its present form, development assistance resembles charity, failing to address the real issues such as trade, foreign investment, debt and transfer of technology. The multilateral agencies, mired in the management of narrow needs for each country, are not devising the necessary global strategies for key parameters.

66. It is evident that social development must be accelerated in the next decade, especially if the above population goals are to be realised and if poverty is to be eradicated. The Social Summit convened by the United Nations for 1995 in Copenhagen will need to come up with coherent policy guidance on how to face up to this challenge, which is likely to require a significant increase in resource flows - yet the agreed and often repeated target of 0.7% of GNP for development assistance by industrialised countries has been met (and exceeded) by only a few. If every country were to give 0.7%, this would raise US$145 billion, a sum adequate, for example, to implement the entire Agenda 21 adopted by the Rio Earth summit. What may be required in future is a sizable UN fund for poverty alleviation. Will such a massive, Marshall Plan-type programme with a critical mass of resources be feasible and how best could it be financed, managed and administered? The chapter on financing below discusses some approaches in that respect.

67. Efforts to identify ways and means to raise the necessary levels of finance must be complemented by an urgent reform of the multilateral structure, decision-making and management of development assistance programmes. In its current form, the system may not be able to carry out what has to be done. It is suggested to merge all individual United Nations funds and programmes dealing with sustainable human development into a single entity, which would result at present in a fund of about US$5 billion, only about the size of the International Development Agency (IDA) operating within the Bretton Woods framework. Such an authority should certainly be designed to be capable of managing much larger resources. The creation of a unified United Nations authority for development would also obviate the need for separate governing bodies, each administering a small amount of funds, and for competing bureaucracies.

68. National policies in most countries drive unsustainable forms of development and encourages global warming, acid rain, air pollution and related syndromes, mainly as a result of the use of fossil fuels and hydrocarbon energy sources. These policies can be reversed and modified in ways that would not only encourage more sustainable forms of development but also improve economic productivity, industrial efficiency and international competitiveness. The stability of political systems in all societies will depend on the underpinning of their natural systems.

69. Each year in the 1990s the world will take on board another 95 million people of whom 90 will be in the developing and only 5 in the developed countries. Those 5 million people added each year to the developed nations during the 1990s will, because of our lifestyles, generate more greenhouse gases for global warming than all the 90 million additional people in the developing world each year. Multilateral organizations must begin by raising the level of international awareness of these problems and devising approaches to change consumption and industrialisation patterns.

70. The focus of economic policy at the national and the international levels has been almost invariably growth. Yet, the industrialized nations of Western Europe and North America are losing 4 to 5% of GDP due to environmental problems. The nations of Eastern Europe are losing between 6 and 10% and some of the developing nations are losing as much as 10 to 18%. Those percentages have been going up slowly but steadily for some years. There is a need to shift the focus of economic policy to sustainable growth.

71. 25 million environmental refugees already outnumber all forms of traditional refugees by at least 50%. These are people who can no longer gain a basic fundamental livelihood in their traditional homelands. Within our lifetime, the total may surpass 100 million. And within another few decades, the total might exceed several hundred million. This trend is further driven by a job famine, especially in the developing world. If the developing countries are to integrate the already born new entrants into the workforce, they will have to generate 40 million jobs per year on average for the foreseeable future against a total workforce of almost 2 billion at present and 3 billion by the year 2025. Unemployment is already running at some 25% of the workforce or about 750 million unemployed. This slightly exceeds the entire workforce in the developed world. Even during the boom years of the early- and mid-1980s, the United States economy had difficulty generating 2 million jobs per year. In 25 years the number of unemployed in the developing world - 1.1 billion - will equal the population of the industrialized world. Jobs in this magnitude will simply not be available. The likelihood is that the number of environmental refugees will double by the end of this decade. The world will have to deal with an entirely new phenomenon in the global arena which is disruptive politically, socially, ethnically and culturally.

72. Given the enormous number of jobs required in the developing world alone, new and different types of technology are called for. As the environmental problems are closely tied up with unemployment, labour-intensive technologies must take precedence.

73. In the wake of the Rio summit, a Commission for Sustainable Development (CSD) was created within the United Nations and implanted as a subsidiary body to ECOSOC in the intergovernmental web. The mandate of CSD - covering virtually everything dealing with sustainable development - may turn out in practice to be a considerable bottleneck. Rather than speeding up, it may retard the adoption and implementation of meaningful measures. CSD also lacks the involvement of finance ministers who ultimately will have a significant influence on national and international policy making, including a determination of priorities for growth and development.

74. Instead of relying on national reports, CSD should request the preparation of independent, factual reports on issues under consideration and thus focus on realities outside the country context. CSD would then have an independent basis on which to pass judgement on how national policies have adjusted, contributed or failed to contribute to improving the environmental fortunes of the world.

75. Consideration should also be given to whether there is really a need for CSD to report to other intergovernmental bodies, such as ECOSOC or the General Assembly, inducing a proliferation of meaningless debates. Would it not be sufficient for CSD to directly report to governments and to the Secretary-General, suggesting particular areas for attention or initiatives?

76. Given deficiencies resulting from its genesis, mandate, composition and operating modalities, doubts have arisen whether CSD will be able to become the desired, effective forum to discuss, coordinate and cope with the cluster of global issues of environmental degradation, poverty and overpopulation. The suggestion has been made that it would be desirable to have in this area a body as powerful and efficient as the Security Council is in its field. Such a body should be empowered to pass binding resolutions and to seek enforcement of decisions (although, to be sure, the Security Council itself is lacking this very power to impose policies on national governments).

77. In that context, it may be recalled that in April 1989, an agreement was reached by 24 heads of state from all continents meeting in The Hague that a High Authority should be established to set an internationally binding policy framework for behaviour by governments and the private sector in the field of environment, which should be accorded regulatory and enforcement powers, subject to control by the International Court of Justice. This agreement, reached in a top-down approach, is yet to be implemented - and certainly the mandate of CSD falls far short in that respect.

78. In order to mitigate global warming, measures will be required on two multilateral fronts. One will be to strengthen agreements already reached by incorporating binding and enforcable agreements. The other is a massive international research programme for the development and introduction of renewable energy sources - in particular nuclear fusion, solar energy (photovoltaics) and geothermal energy -, to develop CO2-reducing technologies and to promote energy-efficient technologies. The appropriate multilateral framework for such a mega-programme, however, would still need to be designed involving as it will Governments, the scientific community, the private sector, non-governmental and intergovernmental organisations.

79. Multilateral efforts should also be intensified, co-ordinated by the International Atomic Energy Agency (IAEA), to find solutions for safe and stable nuclear waste disposal and safe procedures for the decommissioning of nuclear reactors. Moreover, civilian nuclear programmes to improve the safety standards of nuclear plants should be expanded.

THE IMPERATIVE OF LEADERSHIP

80. International organizations neither are nor should be passive actors waiting to receive instructions or requests from governments. If the secretary-general of an organization were to go to the government to ask what he or she should do, nothing would happen. It is up to the secretariat to see that the right issues are placed on the agenda of intergovernmental meetings, that the discussions take place and that they lead to positive results through the widest possible participation. Hence, bureaucratic leadership is indispensable. Organizations must position themselves in such a way that they can take the lead in introducing reforms that are needed in order to engage governments constructively.

81. To ensure constructive bureaucratic leadership, much more attention must be paid to the selection process for the leadership positions of the major multilateral organizations. The profile of an executive head predetermines in many respects the fortunes and impact of the organisation concerned.

FINANCING THE UNITED NATIONS AND MULTILATERAL ACTIVITIES

82. The failure of many international development efforts over the past 30 years might well be linked to mismanagement, corruption, lack of capacity and institutions - and lack of political will. But, most importantly, it may well have failed for an absence of a critical mass of finance to jumpstart development and finance peace-keeping activities. This problem - and its symptoms - cannot be resolved by organising or reorganising the United Nations and its economic and social sectors.

83. Paradoxically, the United Nations and its agencies struggle with a seemingly permanent financial crisis at a time when more and increasingly complex tasks are being thrust on them, entailing substantially growing resource needs. Ad hoc improvements to the existing funding mechanisms, such as charging interest on overdue contributions, may no longer do the trick. The recurrent financial crisis of the United Nations and of many of its agencies is in the main caused by the failure of a number of governments to pay their assessed - and obligatory - contributions in full and on time. Member governments should be continuously reminded and urged to pay their full dues to the regular budget on time.

84. Unfortunately, everybody agrees with the principle, but in reality the arrears worsen. Under the present financing structure for the United Nations, it has paid off not to pay. Paradoxically, if a country does not pay up its contributions, it finds itself in a better negotiation situation. Financing cannot be viewed as a contest, as this fosters a morale which no national system would tolerate. And no national government would ever run operations under the conditions which the United Nations has faced in Somalia or the former Yugoslavia. To overcome the present predicament, Governments must begin to see themselves not merely as members with certain rights only, but rather as clients taking on both rights and obligations. This might help impart a sense of ownership and would secure the timely payment of assessed contributions for the regular budget of the organisation - which in any case serves to finance only the institutional backbone of the United Nations. In that context, the present rules regarding ceilings and floors for maximum and minimum contributions may also have to be adjusted.

85. The financial fortunes of the organisation are likely to become even more precarious as governments begin to look hard at their budget deficits. This will affect the ability of expenditures for multilateral purposes to compete with domestic expenditure.

86. Beyond the obligatory costs for maintaining the institutional infrastructure, activities promoting sustainable human development - i.e. most of the developmental and humanitarian work (operational activities) by the United Nations system (e.g. UNDP, UNICEF, UNFPA, WFP and programmes by the specialized agencies) - are at present financed from voluntary contributions by Governments, pledged on an annual basis without legal obligations, but driven by the concept of burden-sharing especially among the major donors. Efforts over several decades to bring about a system on a broader, more stable and more predictable basis have yet to be successful. The Nordic countries have suggested the adoption of a financing system combining assessed, negotiated and voluntary contributions. Altogether, there is a chronic lack of sufficent resources and the present state of burden-sharing is considered inadequate. Also, the focus on peace-keeping operations has in many countries diverted resources from international development.

87. As a first step towards a new system, criteria should be agreed upon for involvement and intervention by the United Nations with regard to sustainable development and other new global challenges. This will help to determine whether and how much additional financial resources will be required. Money may not be the only constraining factor. One principle must guide future decision-making: whenever a decision is taken to launch a global programme, full financing must be ensured. If that is not the case, the programmes concerned should either be delayed or alternative mechanisms should be sought.

88. Over the past decades, virtually every United Nations conference dealing with development or social issues has produced a separate financing proposal, unrelated to other schemes. Governments must put a stop to this confusing and counterproductive proliferation of uncoordinated financial estimates, proposals and financing mechanisms.

89. Given the global needs, which some estimates place at some US$ 125 billion annually for activities related to sustainable development alone, the question arises whether such volume could be obtained through levies on certain international activities. Some new and imaginative financing devices tied directly to services (such as international air travel/departure fees to be added to ticket prices; an arms sale tax; international telecommunications and postal services; certain transactions in globalized financial markets such as a levy on speculative capital transactions) could conceivably generate a steady flow of substantial revenue to finance such programme activities. But all such innovations will need full public support and care should be taken to avoid an erosion of the present level of general support for the United Nations. Eventually, a specific facility with appropriate decision-making and voting procedures might need to be established to administer and apportion the funds thus raised to the various programmes - and not financing everything the United Nations is doing today or intends to do.

90. However, there are drawbacks worth careful consideration. If these taxes and levies were "painless", then governments with deficit problems would raise them for their own purposes. Hence, they may not be nearly as painless as they seem at first sight. Levying taxes on the public is unpopular. If the UN were to impose levies, one other critical argument could be that an undemocratic, unelected authority imposes taxes instead of a democratically elected authority.

91. UN peacekeeping operations are currently financed through separate budgets based on obligatory contributions. The total peacekeeping budget has grown from US$ 600 million in 1991 to US$ 2.8 billion in 1992 and in 1993 they reached some US$ 4.3 billion. By now it substantially exceeds the regular budget, but it suffers from the same late- and non-payment syndrome as the regular budget. Entrusting certain responsibilities in this field to regional organisations might not yield the necessary effects as most of the organisations concerned suffer from an even more serious dearth of financial resources than the United Nations. This may prevent any action from happening. Thought could therefore be given to the feasibility of granting the United Nations access to monetary and currency-related instruments, especially Special Drawing Rights (SDR), for peace-related activities only.

92. There is an clear and urgent need that an international group of independent financial and administrative experts be set up to examine the feasibility of various alternative and innovative funding arrangements proposed and identify tie-ups and governance arrangements within the multilateral system for introducing automaticity in future funding arrangements.


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