Withdrawing but Not Paying: How U.S. Arrears Are Reshaping Global Institutions

The United States is simultaneously withdrawing from some UN agencies and refusing to pay billions in assessed and voluntary contributions, creating cash shortfalls and prompting institutional adjustments across the UN system. Officials say arrears must be settled before formal exits take effect, while agencies relocate staff and curtail services in response to tighter finances.

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Key Takeaways

  • 1The U.S. has announced withdrawals from WHO and UNESCO while owing significant past dues; WHO says the U.S. must pay roughly $260 million in assessed dues for 2024–25 before exit is effective.
  • 2U.S. arrears across the UN system have been reported in the billions, with different UN statements citing cumulative unpaid amounts exceeding $3 billion and UNESCO arrears over $600 million.
  • 3Financial strain has forced the UNDP to move nearly 400 posts from New York to Europe and prompted operational cutbacks at UN headquarters.
  • 4Withholding dues functions as a political instrument to influence agency behaviour but risks eroding U.S. soft power and prompting institutional rebalancing away from Washington.
  • 5The UN Charter allows for the loss of General Assembly voting rights for persistent arrears, but practical enforcement is politically complicated.

Editor's
Desk

Strategic Analysis

This is more than a budgetary spat: it is a strategic gambit with systemic consequences. By turning dues into a policy lever, the United States is attempting to coerce, reshape or delegitimise multilateral bodies without necessarily providing an alternative framework that can match their remit. The immediate fiscal effects—project delays, staff relocations and administrative belt‑tightening—are concrete and reversible, but the reputational and structural shifts are not. Agencies will increasingly diversify funding, deepen engagement with other states and donors, and relocate functions to places that offer stable hosting and financing. Over time, that diminishes U.S. influence inside institutions it once dominated, and opens space for other powers to lead agenda setting. Policymakers in Washington should weigh the short‑term leverage of withholding funds against the long‑term costs of hollowing out the very institutions that manage transnational risks the U.S. cannot solve alone.

China Daily Brief Editorial
Strategic Insight
China Daily Brief

The United States’ recent pattern of withdrawing from and withholding funds to international organisations has forced a reckoning over the practical costs of politicising multilateralism. Washington announced a formal withdrawal from the World Health Organization in an executive order signed on 20 January 2025, and later declared it would again leave UNESCO; yet U.S. non‑payment of assessed and voluntary contributions has continued, prompting blunt public reminders from agency officials that exit is conditional on settling arrears.

World Health Organization spokespeople have been blunt: the WHO’s rules permit a member to withdraw, but outstanding assessed contributions must be paid before the exit becomes effective. The organisation says the United States has not paid its assessed dues for 2024 and 2025, amounting to roughly $260 million, on top of regular voluntary funding that typically totals $200–$400 million a year for targeted programmes such as vaccination and disease surveillance.

Across the United Nations system, the numbers are larger and more consequential. Washington is the single largest assessed contributor to the UN regular and peacekeeping budgets, yet its unpaid balances have fluctuated into the billions. UN officials have repeatedly publicised arrears that range from more than $1 billion in a single year to cumulative shortfalls exceeding $3 billion, with separate figures cited for the regular budget, peacekeeping and specialised agencies such as UNESCO, where U.S. arrears have been reported at over $600 million.

The immediate impacts are tangible: agencies report cash shortfalls, curtailed services and the relocation of posts away from New York. The UN Development Programme has announced a reconfiguration that will move nearly 400 posts from its New York headquarters to Germany and Spain as part of a broader push to be closer to project sites and to adapt to constrained budgets. Smaller entrances and operational cutbacks at UN headquarters this year have been explained publicly by the secretary‑general as consequences of late or missing payments by member states.

Beyond balance‑sheet pains, the political signal is sharp. Analysts inside and outside China interpret U.S. withholding as a deliberate use of financial leverage to compel agencies to follow Washington’s priorities—or to step aside entirely. Chinese scholars and officials quoted by state outlets argue that the behaviour undermines the United States’ soft power and legitimacy as a “responsible great power,” while many Western diplomats privately worry that the approach is pushing multilateral institutions to rebalance governance and funding away from Washington.

The legal consequences are limited but symbolic: the UN Charter allows a member that is years in arrears to lose its vote in the General Assembly, though the bar is high and enforcement politically fraught. Practically, repeated non‑payment risks accelerating a long‑term shift in where institutions locate authority and staff, how they budget, and which donor coalitions call the shots—effectively weakening agencies at a time when global governance faces mounting collective challenges from pandemics to climate change.

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