U.N. Funds Yield Little in Somalia : Africa: Most of the hundreds of millions of dollars has been spent on its own troops and support services. Only a fraction has gone for projects that directly benefit the people.

The United Nations’ mission to feed and rebuild this war-ruined nation has spent more than $300 million in the last six months on its own forces and profit-seeking foreign contractors, according to documents and extensive interviews. But the armies have failed to restore peace, and the contractors have done little to reconstruct Somalia.

The United Nations’ most costly and ambitious operation--once billed as a historic blueprint for the United States and the United Nations to define a new world order of peacemaking and national reconstruction--has spent most of those millions on itself.

In the process, business people from Canada to Saudi Arabia, from Sweden to Texas, have reaped huge profits--from $6.50 fast-food pizzas and a $9-million sewer system for the isolated U.N. headquarters in Mogadishu to a $2-million-a-month helicopter taxi service to ferry U.N. personnel across a city of 2 million still unsafe for commuting by land. But in the capital itself, the United Nations has not installed a single telephone wire, electrical line or sewer pipe.

Indeed, only a fraction of the hundreds of millions of dollars that the United Nations has spent has gone toward projects that directly benefit the Somalis, according to documents examined and interviews conducted over six months with dozens of U.N. officials, contractors and business people in Somalia, the Middle East and Europe.

Somalia, in short, offers a case study in how the United Nations and the contractors who profit from its missions in troubled lands have transformed international peacekeeping into a growth industry, one that often helps the host nation least of all.

In its defense, the United Nations insists that the high administrative costs are built into multinational peacekeeping. The 29,000 soldiers of the peacekeeping force from around the world need to be fed, transported and cared for in a dangerous land with little infrastructure, U.N. officials say. Besides, humanitarian and development projects are financed out of a separate budget for which international contributions are harder to obtain, they said.

U.N. documents examined by The Times show that the largest single expenditure that the United Nations has made in Somalia--more than $200 million since last May--has been paid in cash to governments contributing to the peacekeeping force. The money, which mostly comes from donations by the United States and the wealthier European members of the United Nations, is a valuable source of foreign exchange for the poorer countries contributing troops, such as Bangladesh, Pakistan and India.

But that international force, thus far, has fallen far short of its mandate to maintain safe land supply routes throughout Somalia and to restore enough order to the capital for humanitarian groups to deliver aid safely. In Mogadishu, even the heavily armed peacekeepers rarely venture out of their well-guarded compounds.

That failure has increased the vast sums that the United Nations has had to spend on itself since the first week of May, when it assumed command and full financial responsibility from the United States for a military intervention that it estimates will cost the world’s taxpayers $1.5 billion before it is over.

For example, the international body spends $1 million every two weeks on the air-taxi service that ferries its personnel around the capital and the countryside--$10 million paid so far to a Canadian company since early June, when the United Nations lost control of Mogadishu and key national arteries to bandits and warlord militias.

It spends millions more to charter cargo planes from contractors in Florida and Ukraine to deliver food, water and equipment to peacekeeping troops in towns too dangerous to reach by land from the capital.

U.N. documents indicate that still more millions have been spent on structural improvements to accommodate most of its personnel at its sprawling, heavily guarded Mogadishu headquarters. Many of the United Nations’ own officials question the organization line that the improvements will be useful to the Somalis once the complex is left behind when the U.N. force withdraws.

In the first six months of the peacekeeping mission here, the documents indicate, just $7 million has been spent on infrastructure and repairs outside the agency’s compounds.

The documents show that disparity repeatedly: Spending on the U.N. operation itself vastly outweighs money for food, medical care, development and other humanitarian assistance for the Somalis. The documents also indicate that the United Nations could spend its vast peacekeeping sums more efficiently and productively to benefit the Somali people and their economy.

The U.N. peacekeeping operation spent more than $52 million just to feed its troops in the past six months. By contrast, UNICEF, the largest U.N. humanitarian agency in Somalia, is spending $30 million for the year on vaccinations, food and to provide primary health care at hundreds of centers throughout Somalia. The U.N. Development Program spent far less in the same period on projects to redevelop the Somali economy.

Rather than pouring some of that money into the Somali economy by buying from the country’s abundant supply of local meat and fish for its troops, the U.N. peacekeeping mission sent millions of dollars abroad. To feed its troops, it has imported frozen fish from New Zealand, the Netherlands and Kenya, and beef from Australia on chartered ships.

A recent document prepared by the U.N. coordinator for humanitarian assistance to Somalia singled out these huge food imports as costly and counterproductive. Buying local goods, the document urged, would boost the U.N. goal of helping to rebuild the ruined Somali economy, which once was fueled by livestock and fish exports.

“Reduce U.N. (mission) imports of products in favor of local purchasing” is the first priority listed in the report, which was prepared for a crucial meeting this week in Addis Ababa, Ethiopia, that will bring together all of Somalia’s clan leaders and representatives of U.N. agencies and dozens of the donor nations to determine the future funding and course of the U.N. intervention.

“This is a critically important issue,” said veteran U.N. official Hugh Cholmondeley, coordinator of the humanitarian side of the U.N. mission in Somalia. “There are more effective and efficient ways to spend the money that must be spent to keep these forces on the ground. We must start the process of putting the Somali people back to work.”

Privately, Cholmondeley and other key representatives of the U.N. humanitarian and development agencies, which were active in Somalia for years before the U.S.-led intervention began last December, have been sharply critical of the vast U.N. funds spent on the military side of the mission, even as humanitarian donations from a weary international community are growing scarce.

The United Nations’ own headquarters in Mogadishu, they say, is symbolic of the problem.

While UNICEF has received $7 million of the $30 million in commitments it needs to continue its Somali health and education programs, the U.N. peacekeeping mission is spending more than double that to renovate and improve its 80-acre Mogadishu headquarters compound.

Once the site of a $60-million U.S. Embassy complex, complete with its own nine-hole golf course, the compound was looted and gutted by Somalis when the government of dictator Mohamed Siad Barre fell in early 1991. For a variety of reasons, including size and location, the United States advised the United Nations against using it as a mission headquarters.

But the United Nations now has contracted with a Swedish construction firm to work on the complex. The firm is employing 300 Kenyans to install a $9-million, state-of-the-art sewage system.

The United Nations has indicated that it soon will award an additional $5 million to a Dubai-based firm for an air-conditioned trailer camp on the compound to house 880 staffers. Doug Manson, the U.N. chief administrator in Mogadishu, worries that the trailer camp will be a waste. Documents show that the United Nations, after six months, has been unable to fill even half of those 880 positions, largely because most agency professionals and civilian volunteers fear the lawless capital is unsafe for productive work.

Manson has been with the agency for 32 years. His job now is roughly equivalent to a city manager’s in a once-gutted satellite town. He blames the ballooning costs on the peacekeeping army and its contractors.

Of the vast difference between the U.N. mission’s internal costs and its direct contribution to Somalia, Manson does concede, “This is a military budget. The money for economic and social development comes from the humanitarian office.” But he notes that, given its performance, the military’s massive expenditures are increasingly difficult to justify.

“Why should we be here with 12,000 troops (in Mogadishu) when we’re still not safe to leave this compound?” he asked.

He also said that many of the international peacekeepers have acquired expensive tastes.

Explaining why, for example, the United Nations has spent millions of dollars importing and delivering expensive bottled mineral water from as far away as Israel, instead of using the local, potable well water, he said, “It’s a psychological thing for the troops. I’d love to stop bringing in these bottles, but they say they want to drink out of that bottle of water. This army wants to be supported like a big army, but it’s not doing the job of a big army.”

The peacekeepers cannot even prevent rampant theft of their own costly U.N. equipment. “I’m losing cars every day,” Manson said of the fleet of more than 500 late-model sedans, pickups and jeeps stored at Mogadishu’s port for months.

The vehicles--parked in long rows, each vehicle painted white with a black “U.N.” on its side--is a monument of sorts to the peacekeepers’ failure. The vehicles have sat idle since they arrived here from the U.N. mission in Cambodia. That’s because key streets of the capital are controlled by bandits and armed militiamen whose clan leader, Mohammed Farah Aidid, fought a four-month guerrilla war with the United Nations and now calls for the organization and its international force to leave Somalia.

But the United Nations is not leaving anytime soon. If anything, it is digging in at its expensive headquarters site. There, bulldozers, cranes, sophisticated machinery and an army of generators groan, churn and hum day and night. Each day seems to widen the gap between the United Nations and the land it came to save.

Inside the compound, workers are building roads with street signs, laying coaxial cable and installing miles of pipe. In the city on the other side of the compound’s concrete walls, there is little running water and no electricity, telephones, sewers or government; millions of Somalis commute in battered vans with no windows or doors, on cratered, unpaved, unmarked streets that wind through mile after mile of gutted neighborhoods.

Inside, most U.N. employees live and work in air-conditioned trailers bought and shipped in from a private company in Saudi Arabia. Most Somalis crowd into windowless hovels still shell-pocked from their devastating clan wars.

Inside, there is even a pizza parlor: Bogart’s opened last week to instant profits and long lines of U.N. personnel and civilian contractors. It is owned by a subcontractor of Houston construction giant Brown & Root Inc.

(Brown & Root itself has received $22 million from the United Nations since May 1 for logistics work on U.N. compounds. It will profit further from a recently won $31-million contract to take over the logistics support for the peacekeepers now being provided by the U.S. Army, whose logistics specialists are scheduled to begin withdrawing next month.)

Just around the corner from the pizza parlor is the United Nations’ privately run, hugely profitable duty-free shop. There, an Israeli firm, which won the no-bid U.N. contract here after many years of selling duty-free goods to U.N. peacekeepers in the Middle East, sells items such as Japanese televisions, air conditioners, Jack Daniels whiskey and Parker pens.

Any day now, renovation will begin on the complex’s swimming pool and tennis courts.

In a nation where antibiotics remain scarce and curable diseases are often fatal, the compound has two state-of-the-art medical facilities reserved largely for U.N. personnel. One is a U.S. Army field hospital that will leave when the American contingent begins its withdrawal. The United Nations plans to hire contractors to staff and operate the other, a Swedish field hospital, when Sweden pulls its contingent out, also next month.

For all its comparative luxury, the United Nations draws the most fervent criticism for its hiring practices. In a nation where most are still unemployed, that is what angers Somali leaders and some agency officials most about the whole operation.

For senior positions, the peacekeeping mission has been authorized to hire twice as many foreign officers as Somalis. Often, the Somalis who are hired are paid a fraction of what their foreign counterparts make.

The United Nations’ private contractors also often favor imported labor. The Swedish company Skanska was met with a Somali protest-turned-riot at the compound gate earlier this month when it brought in the 300 Kenyans to install the sewer system. Skanska says the foreign workers are needed to meet its U.N. contract deadlines and avoid financial penalties.

“Why doesn’t the U.N. employ Somalis in so many posts?” asked Mohammed Jirdeh, a widely respected Somali businessman who manages the only working hotel in south Mogadishu. “Are they all untrustworthy? Are they all spies? With this attitude, how can this U.N. help Somalia rebuild?”

Some foreign contractors say Somali labor represents a potential threat; most of the Somalis living just outside the compound are loyal to warlord Aidid, they say.

The United Nations and its contractors do employ thousands of Somalis daily at the headquarters complex and at Mogadishu’s port and airport, but most are casual laborers who are paid daily wages that rarely exceed $10; the overwhelming majority are hired to build facilities that, for now, are designed solely for the United Nations.

In an effort to justify the huge expenditures on its own facilities, the U.N. operation’s senior officials said all three facilities--the headquarters complex, the port and the airport will be turned over to the Somalis at the end of the U.N. mission, which the General Assembly has authorized to last at least until next May.

The U.N. work at the international port, at least, provides a positive model. There, a handful of foreign U.N. experts has used a budget of less than $1 million to hire scores of highly qualified Somalis and repair enough equipment to build what is already a functioning, profitable facility.

Under the management of a former U.S. Army harbor master, now working on a U.N. civilian contract, the port already has collected more than $100,000 in harbor fees; the fees were used to renovate several parts of the port.

Port manager Eddie Johns said his facility’s profits could increase enormously if the United Nations would invest a fraction of what it is spending at its headquarters on the port. The port, for example, has just one aging crane to unload container ships. It had been looted and damaged during the clan wars that destroyed much of the Somali capital. But the Somali technicians Johns recruited repaired the device for just $16,000 in U.N. money.