The UN has to pay back money it never received
At the United Nations office in Nairobi, General Assembly President Annalena Baerbock delivered a sobering warning: the institution charged with keeping global peace is itself imperiled by a financial crisis of its own members' making. As major contributor nations withhold assessed dues and the UN's own budget rules force it to refund money it never received, the peacekeeping missions and humanitarian programs serving the world's most vulnerable populations face an uncertain future. The paradox is as old as collective governance — those who most loudly invoke the ideals of international order are often the first to abandon the obligations that sustain it.
- The UN is caught in a liquidity trap so severe that it must return credits to member states that never paid their contributions in the first place — a bureaucratic absurdity draining the organization from within.
- The $5.6 billion peacekeeping budget, already less than half a percent of global military spending, has shrunk by 8.2 percent from the prior year, squeezing nine active missions that depend on it for personnel, technology, and logistics.
- The United States, the single largest contributor at nearly 27 percent of assessed costs, has begun withdrawing from certain UN bodies, a retreat Baerbock warned will accelerate the funding collapse.
- Beyond peacekeeping, the UN development system faces its steepest cuts among all development partners, with the resident coordinator network carrying a $46 million shortfall and most arriving funds tied to short-term, earmarked conditions that strip the organization of flexibility.
- Baerbock is pushing a committee proposal to reform the counterproductive redistribution rule and is calling on member states to honor their Charter obligations — but the 30 percent core funding target set by the Funding Compact remains a distant aspiration.
Standing before reporters at the UN's Nairobi office, General Assembly President Annalena Baerbock delivered a frank diagnosis: the United Nations is in the grip of a deep liquidity crisis that threatens its most essential functions. Peacekeeping missions, humanitarian assistance, and development programs all hang in the balance as member states fail to meet their legal financial obligations.
The crisis is made worse by a structural absurdity embedded in the UN's own budget rules. When unspent allocations exist, the organization is required to return those funds to member states as credits — even when the recipient nation never paid its share to begin with. "At the moment, the UN has to pay back money it never received," Baerbock said, capturing the self-defeating logic of a system that undermines the very operations it is meant to finance.
The approved peacekeeping budget for 2024–2025 stands at $5.6 billion — less than half a percent of the $2.4 trillion spent globally on military forces in 2023. That sum funds nine of eleven active missions and supports logistics hubs in Brindisi and Entebbe, yet it represents an 8.2 percent drop from the previous year's allocation. The United States, contributing nearly 27 percent of assessed peacekeeping costs, has begun withdrawing from certain UN bodies — a move Baerbock warned will deepen the shortfall further.
The damage reaches beyond peacekeeping. UN development programs have absorbed the steepest cuts of any development partner, and the resident coordinator system — which manages UN operations in countries worldwide — faced a $46 million gap in 2025. Most funding that does arrive comes with strings: short-term commitments and earmarks that limit the organization's ability to respond to collective priorities. The Funding Compact's target of 30 percent core funding remains far out of reach.
Baerbock's visit to Nairobi also carried a broader message. Meeting with senior UN leadership including the heads of the UN Environment Programme and the UN Office in Nairobi, she highlighted Africa's role in multilateralism and called the continent's absence from a permanent Security Council seat "one of the injustices of the past within the international system." Her proposed budget reform and her appeal for stable, predictable funding are, at their core, a plea for member states to match their rhetoric about peace with the resources required to pursue it.
Annalena Baerbock, president of the United Nations General Assembly, stood before reporters at the UN's Nairobi office and delivered a stark assessment: the organization is drowning in a liquidity crisis that threatens to cripple its most essential work. Peacekeeping missions, humanitarian assistance, development programs—all of it hangs in the balance as member states fail to meet their financial obligations.
The crisis is not simply a matter of insufficient donations. It is compounded by a rule so counterproductive that it forces the UN to send money back to countries that never paid their share in the first place. Here is how it works: when the UN has unspent budget allocations, it must return those funds to member states as credits. The absurdity is complete when a major donor nation has failed to contribute at all, yet the organization still owes it a refund. "At the moment, the UN has to pay back money it never received," Baerbock said, describing a system that undermines the very peace and security operations member states claim to support.
The numbers tell part of the story. The approved budget for UN peacekeeping operations in the 2024-2025 fiscal year is $5.6 billion—a figure that sounds substantial until you consider it represents less than half of one percent of global military spending, estimated at $2.4 trillion in 2023. That $5.6 billion finances nine of the UN's eleven peacekeeping missions and provides support, technology, and logistics through service centers in Brindisi, Italy, and Entebbe, Uganda. The remaining two missions are funded through the regular budget. Even this modest sum has shrunk: the current budget represents an 8.2 percent decrease from the previous year's $6.1 billion allocation.
The burden falls unevenly. The United States contributes 26.95 percent of assessed peacekeeping costs, followed by China at 18.69 percent, Japan at 8.03 percent, and Germany at 6.11 percent. The five permanent Security Council members pay larger shares by design, reflecting their special responsibility for international peace and security. Yet some of these major contributors have begun to withdraw. The US, the largest donor, has pulled out of certain UN bodies, a move Baerbock warned will worsen the funding shortfall.
The problem extends beyond peacekeeping. UN Secretary-General António Guterres raised the alarm earlier this year about the development system's funding gap. Contributions to UN development programs have suffered the highest cuts among all development partners and are projected to decline further. Core funding remains well below agreed targets. Most money that does arrive comes with strings attached—short-term commitments and earmarks that limit flexibility and undermine collective priorities. The resident coordinator system, which oversees UN operations on the ground in countries worldwide, faced a $46 million shortfall in 2025 and remains dependent on voluntary contributions. While the regular budget provided $53 million for this system, Guterres emphasized it falls short of what is needed.
Barebock's proposal, to be discussed in committee, would reform the counterproductive redistribution rule. She called on member states to honor their legal obligations under Article 17 of the UN Charter and to increase stable, predictable, flexible funding. "If you call for a stronger role for peace and security of the UN, you cannot sacrifice the so important part, especially of peacekeeping, by not paying your contribution," she said. The Funding Compact calls for member states to reach a 30 percent core funding target—a goal that remains distant.
During her Nairobi visit, Baerbock also met with senior UN leadership, including Zainab Bangura, director-general of the UN Office in Nairobi, and Inger Andersen, executive director of the UN Environment Programme. She emphasized Africa's role as a leader in multilateralism and raised the question of African representation in the Security Council, calling the continent's under-representation "one of the injustices of the past within the international system." The crisis is not abstract. It is felt in the field, where underfunded programs struggle to deliver aid, where peacekeeping operations lack resources, where the machinery of international cooperation grinds slower each year.
Notable Quotes
We should not sugarcoat things. The UN is in a deep liquidity crisis.— Annalena Baerbock, UN General Assembly President
If you call for a stronger role for peace and security of the UN, you cannot sacrifice the so important part, especially of peacekeeping, by not paying your contribution.— Annalena Baerbock
The Hearth Conversation Another angle on the story
Why does the UN have to return money it never received? That seems designed to fail.
It's a budget rule meant to prevent waste—if you don't spend your allocation, you lose it next year. But it backfires when member states don't pay their share in the first place. The UN ends up owing refunds to countries that haven't contributed, which is absurd.
So the organization is being punished for countries not paying?
Exactly. It's a perverse incentive. The rule was meant to encourage efficiency, but it creates a situation where the UN is forced to operate with less money than it's legally owed.
How much are we talking about? Hundreds of millions?
Yes. And when you consider the peacekeeping budget is only $5.6 billion—less than half a percent of global military spending—even small shortfalls matter enormously. Nine entire peacekeeping missions depend on that money.
What happens if the funding doesn't improve?
Peacekeeping operations slow down, humanitarian programs get cut, development work suffers. The people on the ground—in conflict zones, in countries facing crises—feel it first.
Is there a realistic path to fixing this?
Baerbock is proposing to change the redistribution rule, but it requires member states to agree. That means the countries that benefit from the current system have to vote against their own interests. It's a test of whether nations actually prioritize peace and security or just say they do.