Global Trends by Martin Khor

Monday 3 April 2006

UN agencies face closure threat

Under the guise of effecting greater efficiency, the developed countries propose to close down most United Nations agencies and re-group them into three giant organizations.  Threatened are many development arms of the UN which serve the needs of developing countries.


These are perilous times for agencies of the United Nations that are undergoing scrutiny as to whether they should continue to exist.

This week, a panel co-chaired by the Prime Ministers of Pakistan, Norway and Mozambique are meeting in New York to look at promoting “system-wide coherence” of the UN’s operational activities.

Under this innocuous sounding term, many developed countries plan to close down most UN organizations involved in development work, or else have them merge into a single “UN Development Agency.”  

Among the organizations targeted for closure, or for being taken over, are UNCTAD (the agency dealing with trade), UNIDO (which deals with industrial development), UNIFEM (which promotes women’s rights), UNRISD (which conducts development research), and UN Volunteers.

Another change being proposed by the developed countries is that the various UN agencies operating at the country level will be merged into a single unit.  They will have one leadership, one programme and one budget.

In this scenario, the country offices of the World Health Organization, the Food and Agriculture Organization, the UNDP and others will merge into one.

Many observers of the UN scene believe the panel on coherence was set up in February by UN Secretary General Kofi Annan to provide a vehicle for the views of the donor countries to be aired and perhaps adopted.

The Dutch Minister for Development Cooperation, Agnes van Ardenne, has said the donors will use the “power of the purse” to put their plan into effect. 

She said it makes no sense for the UN to have 38 organizations, and the solution is to select worthwhile ones and reorganize them into only three agencies, dealing with development, humanitarian affairs and the environment.

UNCTAD (the UN Conference on Trade and Development) was set up by the UN General Assembly in 1964 after a big push by developing countries, which created the Group of 77 at the same time.

It is the UN’s premier organization dealing with development issues in an integrated way (combining trade, finance, technology and macro-economic issues).  It has had an impressive history, having hosted commodity agreements in the past that helped raise and stabilize prices.

During the Asian financial crisis, it was the only international agency that pinpointed speculative capital flows as the root cause, and it assisted the Asean secretariat in tracking the crisis.

While developing countries consider it their think-tank and supporter, the developed countries have been unhappy with how it helps the South negotiate at the World Trade Organisation and have been looking for a chance to shut it down.

UNIFEM (the UN Development Fund for Women) is a small UN unit promoting the rights of women.  It has been punching above its weight and making waves, having taken the gender issue into new areas, including helping women fight for peace and reconstruction in war-torn regions such as Afghanistan, Iraq and the Palestinian territories.

Its many supporters believe that if it were to merge into a much larger organization, such as UNDP, it would lose its individual identity and be lost in a bureaucratic maze.

UNCTAD is led by former Thai deputy premier Dr P. Supachai and UNIFEM by Noeleen Heyzer, a Singaporean.


While the “donor countries” who fund many of the UN agencies are well prepared in putting their views to the panel, the developing countries are also now waking up to the threat.

In a letter to the panel Co-Chairs, the Group of 77 stated that the coherence process should not lead to the elimination or erosion of the mandate of UN agencies, such as UNCTAD and UNIFEM.

It says that the reform process should lead instead to strengthening the role of the UN so that it becomes the premier international organization dealing with economic, social and development issues.