Dividends of peace: the economics of peacekeeping.

• Author: Hentges, Harriet
• Position: Economic and Social Implications

"If it's done well, the marginal cost of peacekeeping will yield a greater peace dividend to both the country in conflict and the wider international community."

The 1990s could be called the decade of peacekeeping. The number and variety of peacekeeping operations increased dramatically between 1991 and 2000. Of the 54 peacekeeping operations that the United Nations established between 1948 and 2000, 36 were after 1991. The missions were deployed worldwide: 14 in Africa, nine in Europe, six in the Americas, and three in Asia. (1) The increasing number of UN peacekeeping operations and personnel deployed throughout the 1990s reflected a new activism and multilateralism on the part of the international community in trying to solve some of the most severe security and humanitarian crises of the period.

Much has been written on the costs of peacekeeping operations in the past ten years. Relatively little has been written on the evolution, benefits, and long-run savings of these costs, however. These issues deserve attention not only as a formal inquiry but also because the financing of peacekeeping operations has been a matter of bitter debate, contention and misunderstanding throughout the 1990s. Reviewing the economics of peacekeeping operations is a complex and difficult undertaking: figures are difficult to obtain and are never as comprehensive as one would like. Furthermore, although the direct costs of peacekeeping operations are quantifiable, there are many related costs that are more difficult to identify and assess. Accordingly, we will limit ourselves to five points: first, peacekeeping operations costs throughout the 1990s; second, perspectives on these costs, which despite considerable increase remain relatively low, especially when compared to major member states' national defense budgets. Third, we will indicate how the financing of peacekeeping operations became a major domestic issue, especially in the United States. Fourth, we will assess whether or not peacekeeping operations costs have represented a good investment and how to consider the long-run return on that investment in terms of the original objective of conflict prevention. Finally, we will make some suggestions aimed at overcoming the shortcomings of peacekeeping financing.

THE COSTS OF PEACEKEEPING OPERATIONS IN THE 1990S

As the table opposite indicates, the 1990s witnessed a vast array of peacekeeping initiatives and UN-dominated operations.

The financial costs of these missions, which included military, police, humanitarian, rehabilitation and other tasks, were a striking departure from years before: They increased to close to ten times above what the United Nations spent on peacekeeping operations between 1948 and 1990. In 1991, the cost of peacekeeping operations was $0.4 billion and rose to $3.8 billion in 1993. The costs of peacekeeping operations throughout the 1990s reached a total of $19.9 billion. As such, the budget of peacekeeping operations during the 1990s far exceeded the regular budget of the United Nations, which did not surpass $13.7 billion between 1991 and 2000. (2)

Already a major departure from past expenditures, these amounts do not represent the full sum spent by the UN system on security and humanitarian crises associated with peacekeeping. To approach a fuller picture of the costs involved, one has to add the humanitarian, rehabilitation and other economic costs that were paid by other international organizations, such as the United Nations High Commissioner for Refugees (UNHCR), the World Health Organisation (WHO), the World Food Programme (WFP), the United Nations Children's Fund (UNICEF), and the World Bank. The sums are quite staggering. In 1994, UNHCR's budget (4) peaked at over $1.4 billion, primarily because of refugee emergencies in former Yugoslavia, the Great Lakes region of Africa and elsewhere. (5)

Furthermore, the cost of multinational deployments and interventions, particularly in Somalia, Bosnia, Haiti, Kosovo and East Timor, were also excluded from the peacekeeping cost figures. Although peacekeeping operations were authorized by the Security Council and conducted within the framework of the United Nations, the countries involved in and leading these deployments and interventions covered their costs. (6) In Somalia, Operation Restore Hope and UNITAF cost the United States more than $1 billion, (7) and the intervention in Haiti, approximately $2 billion. (8) In Bosnia, countries that participated in the NATO-led multinational Implementation Force (IFOR), designed to enforce the Dayton Peace Agreement, bore more than $5 billion in operation costs through the end of 1996. (9)

Direct contributions by countries and regional organizations, such as the European Union, the European Bank for Reconstruction and Development (EBRD) and nongovernmental organizations, also cover humanitarian, rehabilitation and other economic costs. In Haiti, non-military interventions cost the United States over $1 billion. Private and nongovernmental organizations also have spent hundreds of millions of dollars. (10)

THE ECONOMICS OF PEACEKEEPING OPERATIONS IN PERSPECTIVE

In contrast with the costs of peacekeeping operations prior to the 1990s, the above figures provide a telling indication of the willingness of the international community to engage in peacekeeping operations activities in the aftermath of the Cold War. Rising peacekeeping operation costs illustrate both the quantitative and qualitative changes that peacekeeping underwent after 1990. Yet, another side of the story reveals the limits of the international community's engagement in peacekeeping operations: the relatively small amount of funds allocated for this purpose in the 1990s. In this perspective, it is useful to put the costs of peacekeeping efforts in the context of total spending by member states, particularly major member states, on military personnel and defense. Increasingly, states see peacekeeping operations in a security context rather than in solely humanitarian terms.

The total UN expenditures for peacekeeping for the 1990s amounted to $19.9 billion. On the other hand, total world military expenditures for the period 1991 to 1999 amounted to approximately $6.9 trillion. (11) That is, the amount of money assessed by the United Nations from its members to confront the crises that arose in the 1990s was equal to only 0.3 percent of the total amount world governments spent on their militaries. For the United States alone, the total federal budget outlays for national defense functions between 1991 and 1999 were approximately $2.5 trillion, (12) or 125 times greater than the total UN peacekeeping budget.

On average, for every $1 spent on UN peacekeeping during the 1990s, $349 was spent on domestic militaries. Even for Western powers that contributed significantly to UN peacekeeping operations, peacekeeping remained a small proportion of military spending. In 1994, the most expensive year in UN peacekeeping history, the United States spent $1.08 billion for UN peacekeeping missions and $313.6 billion on national defense. During the same period, France and the United Kingdom spent $0.15 billion and $0.23 billion, respectively, on UN peacekeeping and spent $42.6 billion and $42.7 billion, respectively, on national defense. Thus, for every $1 spent on UN peacekeeping, the United States spent $290 on national defense, France spent $282, and the United Kingdom spent $182. (13)

Thus, despite the fact that the level of defense spending in Western countries declined steadily after the end of the Cold War, little of the excess was redirected to peacekeeping operations.

Moreover, given the relatively low level of funds allocated to peacekeeping operations throughout the 1990s, especially at a time...