Exchange rate, inflation cause UN to spend $28 million more in 2000-01 - report

The United Nations will spend about $28 million more than originally anticipated during the current two-year period, mostly due to fluctuations in the exchange rate and inflation, according to a new report by Secretary-General Kofi Annan released today at UN Headquarters in New York.

The second performance report on the UN’s programme budget for the biennium 2000-01 estimates that the Organization’s expenses will be $2.56 billion, up $27.8 million from the $2.53 billion appropriated last year by the General Assembly.

At the same time, income for the two-year period will drop $1.1 million, making the total budget difference around $28.9 million.

The report attributes $10.4 million of the extra expenditures to the “generally unfavourable rate of exchange” of the US dollar in relation to a number of major currencies in countries where the UN maintains headquarters: the Swiss franc; the Austrian schilling and the Netherlands guilder.

On the other hand, a number of other duty stations – Bangkok, Santiago, Addis Ababa and Nairobi – saw more favourable rates of exchange and partially offset the additional requirements, the report says.

Meanwhile, inflation accounted for another $9.1 million in extra expenses.