Annan Backs Deputy in Dispute With U.S.

Serbian President Boris Tadic, left, shakes hands with United Nations Secretary-General Kofi Annan, at U.N. headquarters in New York, Thursday, June 8, 2006. (AP Photo/Shiho Fukada) (Shiho Fukada - AP)

Those concerns are particularly pressing because member states imposed a budget cap at the U.N. that expires at the end of June and can only be lifted if they see progress on reform.

Annan told reporters he believed that member states would work out their differences over the budget cap.

"Quite frankly I think we are all too excited and nervous about this budget issue," he said. "I do not see a major budget crisis at the end of this month."

In Washington, State Department spokesman Sean McCormack said Secretary of State Condoleezza Rice expressed her disappointment over Malloch Brown's remarks in a phone conversation with Annan on Wednesday.

McCormack said the United States stands by Bolton's remarks about Malloch Brown's speech.

Yet he also sounded a note of reconciliation, saying that the United States and the United Nations "do a lot of good work together around the world."

"We're a leading supporter of the World Health Organization, which is fighting HIV/AIDS around the world as well as the threat of avian influenza," McCormack said.

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Associated Press reporters David Stringer in London and George Gedda in Washington contributed to this story.