186. Telegram From the Department of State to Certain Posts 1

165200. Subject: Reduction of U.S. Assessment Rate in UN. Ref: State A–8349, State 148408.2

1.
Replies to refair have raised questions how US assessment rate can be reduced without an offsetting increase in rates of other members. Following background information may be utilized in discussions with host governments on this subject.
2.
The language of our General Assembly resolution will be explicit on the point that no present UN member’s assessment rate is to be increased as a result of the US proposal. The offsetting 6.52 percentage points needed to bring our assessment rate down to 25 percent could come from two sources: percentage points brought in by new members and percentage points derived from the relative economic growth of present members.
3.

Regarding new members, only the admission of the FRG and the GDR could substantially offset the reduction in the US assessment. The estimated assessment rates for each would be 6.80 percent and 2.00 percent respectively. However, USG does not intend to alter its position that entry of the GDR into UN cannot take place unless and until two conditions outlined in para VI of reftel have been met satisfactorily and the FRG is in a position, through authorization of the Bundestag, to apply for UN membership. We cannot predict when West and East Germany might enter UN since these complex issues must still be satisfactorily resolved within a sensitive political framework. (FYI—hopefully during 1973—end FYI.)

Regarding assessment rate increases due to relative economic growth, this point refers to increases that some members would receive in any event as a consequence of their economic progress in comparison with other members. It is an established procedure for Committee on Contributions to calculate such increases (which would occur with or without a reduction in the US assessment rate), and redistribute offsetting reductions.

5.
What is implied in the above two methods of obtaining offsetting percentage points is that, while no member’s rate will be increased as a consequence of our proposal, some countries will forego a pro rata reduction that they might have otherwise received. The United States position is that the first 6.52 offsetting percentage points that become available from either source be applied toward reducing our assessment rate to 25 percent; any additional available points may be redistributed among membership according to present procedures. Note that almost 70 countries paying the minimum assessment rate of 0.04 percent will not be affected at all, in that they would not receive any reductions from their minimum assessment rate in any case.
6.
If the General Assembly adopts our resolution lowering maximum assessment rate to 25 percent, Committee on Contributions will follow GA instructions in computing a new scale of assessments to go into effect in 1974. If significant new members are not admitted before new scale goes into effect, then obviously we will not be able to receive needed percentage points. Then, if Congress does not appropriate contributions above 25 percent level the US will fall into arrears in its legal obligation to the UN.
7.
A favorable UNGA response to US proposal will be extremely helpful in seeking appropriations for both assessed and voluntary contributions. If our proposal is rejected, and if Congress decides not to appropriate sufficient funds to meet our assessment, we will have to expect that Congress might also act to reduce our voluntary contributions, which we would like to maintain at a generous level.
Rogers
  1. Source: National Archives, RG 59, Central Files 1970–73, UN 10–4. Limited Official Use. Drafted by Bailey; cleared by Hennes, Walker, Bennett, von Peterffy, Chase, Kimball, Monsma, Daniel Goott, and Sutterlin; and approved by Assistant Secretary De Palma. Sent to Abu Dhabi, Cairo, Manama, Muscat, Nouakchott, Sanaa, and Suva and repeated to USUN, Bern, Berlin, Bonn, Saigon, and Seoul.
  2. Regarding A–8349, see footnote 2, Document 183. Telegram 148408 is not printed. (National Archives, RG 59, Central Files 1970–73, UN 3 GA)