The Palestinians can raise their flag alongside those of 194 full-fledged nations at UNESCO after signing a document Wednesday finally giving them a voice within the vast U.N. system — bringing pride across the Arab world yet hobbling the agency's pro-democracy projects around the globe.

Last month's decision by the Paris-based U.N. education and cultural organization to give Palestine membership triggered an immediate funding cutoff by the U.S. that will force UNESCO to scale down literacy and development programs in countries like Iraq, Afghanistan or the new nation of South Sudan.

Palestinian Foreign Minister Riad Malki will be signing the so-called instrument of accession Wednesday in London where UNESCO was created after World War II. The Palestinian flag can then go up at UNESCO, but a date wasn't immediately known.

For some, the U.S. funds cutoff is counterproductive and risks scrambling the message America tries to project to the world. UNESCO works to turn child soldiers into unarmed schoolkids, teach Muslims about the Holocaust and ensure clean drinking water in volatile regions — far from Israel and the territories the Palestinians want to call their nation.

After pounding at the doors of the United Nations in New York for full recognition, the Palestinians sought coveted U.N. access through the back door, requesting membership in UNESCO.

The funding crisis started immediately after the Oct. 31 vote that made Palestine a member of UNESCO, with two U.S. laws kicking in to stop the flow of U.S. funds for the organization. The United States contributes $80 million annually in dues — 22 percent of UNESCO's overall budget — and its 2011 contribution was not yet in when the laws took effect, immediately throwing UNESCO into crisis mode. Extra U.S. funds for special projects are also halted.

The U.N. Educational, Scientific and Cultural Organization is working to fill the money gap, even resorting to a newly created "click online and donate" site for individuals who might care to chip in. Appeals have gone out to member nations.

With the vote to admit Palestine, "some consider UNESCO as a hero, some as a villain," UNESCO Deputy Director-General Getachew Engida said.

"We're all caught in this cross-fire, unfortunately, and it is too bad. I'm an African and I feel the pain," said Engida, who is an Ethiopian.

UNESCO may be best known in the public mind for its program to protect the cultures of the world via its Heritage sites. But its core mission also includes life-sustaining activities like helping to eradicate poverty or ensure clean water as well as teaching girls to read and promoting freedom of expression and human rights. All these are essential elements of nation-building, and engendering a climate of peace and are in the public eye as the Arab Spring unfolds in painful fits of violence and hope in North Africa and the Middle East.

A grim reality is already setting in for many nations — including those which voted for Palestinian membership — particularly in projects where the United States was directly implicated.

A case in point is Iraq, where several projects are compromised and one may not see the light of day — just as the United States completes its troop pullout by year's end.

The U.S. Army Corps of Engineers had promised $900,000 for the first phase of a project to strengthen Iraq's National Water Council, joining $500,000 in Iraqi funds to set up a database to track water supplies. Without the U.S. funds, the project is at risk, officials say.

Another $1 million in U.S. funds have been suspended for a project to promote public confidence in Iraq's judiciary system through training to make the country's Higher Judicial Council more transparent, and accessible. Since the contract was signed on Sept. 23, before the vote to accept Palestine to UNESCO, the final outcome is not yet clear.

South Sudan, which became an independent nation in July after decades of civil war with Sudan, is getting a bittersweet welcome to the organization it joined last month.

UNESCO Director-General Irina Bokova had pledged that that the organization "will stand with the people of South Sudan to strengthen their education system and support the training of teachers and education professionals."

But plans to help create the country's first Ministry of Education, a 10-year project by UNESCO's International Institute for Education Planning, is among those that may suffer without the U.S. funds.

"This is a country starting from scratch and it needs all the help it can get," said Engida, UNESCO's deputy chief.

In a nation of 8 million, more than 1 million primary school-age children in South Sudan are out of school, among them returning refugees. UNESCO is also looking to support disarmament and integration into society of child soldiers.

Officials has warned that the U.S. move jeopardizes programs in America's core interests.

"In my personal view, I don't think that withholding funds is in the interest of the United States," Engida said. "UNESCO works in close cooperation with the U.S. administration ... to advance on common shared values, on democracy, good governance, freedom of the press, education for all."

Even without its largesse, the United States remains a welcome member. It was voted to UNESCO's executive board 48 hours after pulling out its money.

While the click-to-donate program aimed at the public has reportedly brought in paltry sums, some nations are digging into their pockets, notably Indonesia with a pledge Tuesday of $10 million and Gabon with an early pledge of $2 million, according to UNESCO spokeswoman Sue Williams.

Engida says he remains optimistic.

"I still believe in the sense of humanity."