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Foreign Affairs Minister John Baird speaks during Question Period in the House of Commons on Nov. 1, 2011.BLAIR GABLE/Reuters

Canada will continue funding UNESCO even though it doesn't like the organization's move to recognize a Palestinian state, but Ottawa will rebuff appeals for more money to make up for a U.S. cut.

Foreign Affairs Minister John Baird said Tuesday that Canada will say no to new requests for voluntary funding to make up for a massive budget shortfall looming as the U.S. cuts its financial contribution to UNESCO. But Ottawa will continue to pay the roughly $10-million per year that UNESCO levies for Canadian membership.

"We're not reducing any current commitments, but we will not be undertaking any further ones," Mr. Baird said.

UNESCO's 194 members voted on Monday to grant full membership to the Palestinian Authority, although Canada, the United States and 12 others voted against it. Only states can be members of UNESCO, therefore the change effectively recognizes Palestinian statehood.

But it also triggered a budget crisis in the UN organization, which promotes literacy, education and science, and lists World Heritage Sites from the Great Barrier Reef to the Rideau Canal. In response to the decision, the United States will cut its UNESCO funding, about 22 per cent of the organization's budget.

The Obama administration has signalled that it doesn't want to stop supporting UNESCO, but is bound by laws that Congress passed in the early 1990s that require an end to funding for United Nations bodies that recognize a Palestinian state.

Canada didn't follow the U.S. move – which would amount to quitting UNESCO. So far, not even Israel, which vocally opposed the Palestinian bid, has done so.

However, a lack of new voluntary funding will likely hurt UNESCO, even though, according to a listing of grants published by the Department of Foreign Affairs, Ottawa hasn't provided any such cash in recent years.

The organization will likely ask member countries for more money as it faces trimming operations and laying off staff when a fifth of its budget vanishes. When U.S. president George W. Bush cut funding for the United Nations Populations Fund in 2002 over abortion, Canada and others increased contributions.

"The bottom line is there is going to be a large hole in UNESCO's budget because of the American law which withdraws funding. And UNESCO should not look to Canada to fill that budget hole. They'll have to go to the countries that supported the resolution that caused this budget hole," Mr. Baird told reporters.

UNESCO is an unlikely site for a debate over nationhood and Mideast politics. But it became a Plan B venue for the Palestinian Authority's campaign for international recognition.

The UN Security Council has delayed a vote on full Palestinian membership in the United Nations, and the United States has indicated it will veto it. In UNESCO, no country has a veto.

Israel opposes the Palestinian effort, calling it a step-by-step campaign to establish a state without negotiating a peace deal. It fears recognition could lead to other changes, like giving the Palestinian Authority standing at the International Criminal Court, where it could accuse Israeli officials of crimes.

UNESCO membership is unlikely to have such practical implications, said UBC international law professor Benjamin Perrin. The path to statehood is not carved in stone, and involves politics, but Mr. Perrin said the Palestinian Authority doesn't meet commonly accepted legal tests of statehood, like being able to conduct international relations freely.

The Palestinians have pledged to take a case for a lesser form of state recognition to all countries at the UN General Assembly, where a majority already recognize a Palestinian state, if they are blocked at the Security Council.

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