Vienna Chapter
Madam Chairperson,
I have the honour to speak on behalf on the Group of 77 and China.
Let me at the outset express our most sincere thanks to Ambassadors Javier
Paulinich of Peru and Antonio Nuñez of Spain for the very able
manner in which they have steered the activities of the informal Working
Group on the Programme and Budget for 2004/2005. Their keen sense of
diplomacy and their proved commitment to the advancement of the Agency's
goals always represented the best assurances that our intensive process of
discussions and negotiations would eventually succeed in bringing about a
set of balanced and adequate decisions.
Madam Chairperson,
The Group of 77 and China is pleased to join the consensus, which, we
trust, will result from this meeting, to endorse the package
recommendations emanating from the informal Working Group.
During the past few months, this exercise offered us the opportunity
not only to have a thorough and illuminating exchange of views and conduct
negotiations on various issues pertaining to the budget and overall
financing of the IAEA, but also to renew our firm commitment and support
to the broad statutory mission entrusted to the Agency by its Member
States.
As we considered the many implications entailed by the proposal for a
substantial real increase in the regular budget of the Agency, the Group
of 77 and China never ceased to approach this exercise with an open mind
and a constructive spirit.
We have emphasized from the very beginning that any discussion on
such an eventual increase would of necessity imply the need to address a
broader set of issues, which went beyond the purely quantitative question
of the amount of resources eventually to be approved for the Agency's
budget.
From the very first moment in these negotiations we stressed that in
dealing with such a major increase, it was imperative to preserve the
profile of the Agency, in terms of the balance between its statutory
missions. At this particular juncture, it was, from our point of view, of
decisive significance to secure balance between verification and
promotional activities.
We also reiterated the Group's initial preference, in this context,
for the continued application, for still some time, of the principle of
zero real growth, in view of the very severe economic, financial and
budgetary constraints faced by most developing countries, and also not a
few developed countries.
The Group was never insensitive to the fact that changing
circumstances and needs might require certain flexibility in dealing with
budget issues. In this spirit, even the sectors of the G-77 and China that
were most reluctant to consider any move away from the policy of zero real
growth did not object to the launching of a negotiating process. The Group
engaged this process in good faith and in a constructive attitude. It thus
showed a readiness to consider the possibility of a certain increase in
the budget, provided that our broad concerns in terms of ensuring adequate
attention to technical cooperation and proper balance among the statutory
activities of the Agency would be duly reflected in the resulting package.
Madam Chairperson,
The Group of 77 and China's willingness to negotiate the budget
proposals was first made clear in a letter sent to you on February 24,
2003, in which we welcomed your wise initiative to establish an informal
working group to seek agreement on how best to ensure the balanced funding
and programming of the Agency's statutory activities. This initiative had
enjoyed widespread support within the G-77 and China.
In another letter sent on the same day to Mr. David Waller, who was
at that moment the acting DG of the Agency, the G-77 noted that the draft
programme and budget for 2004-2005, as presented by the Secretariat,
represented a drastic departure from the Zero Real Growth policy and that
the proposed overall increase was heavily skewed towards Major Programme
4, thus distressing the delicate balance between the funding of
verification and that of other statutory activities of the Agency. Those
increases would also bring about an added financial burden to the
contributions of developing Member States, many of which were already
faced with difficulties in meeting their current obligations.
The letter proceeded to remind that all major negotiations conducted
on budgetary and financial issues over the recent years were based on the
assumption of the continuity of the application of the ZRG criteria.
The proposed increases represented therefore a departure from a
practice which had long been applied in the organization, and constituted
a break with the whole negotiating context under which the G-77 and China
had previously agreed to a phased de-shielding of their mandatory
contributions for the financing of safeguards, and to important decisions
relating to technical cooperation, including the mechanism of the rate of
attainment and the definition of the TC programmes, as well as the
definition of the TCF targets and its indicative planning figures.
Hence our insistence on the fact that we were not facing at this time
a mere budgetary issue per se, but a much broader and fundamental
question, involving the very fundamentals upon which the Agency's
promotional role and international cooperation for the peaceful uses of
nuclear energy is based.
The Group of 77 and China sees the Agency, indeed, as a very unique
organization. On the one hand, it performs, in the broad framework of
international endeavours towards promoting non-proliferation and nuclear
disarmament, extremely important verification activities, which we
strongly support. On the other hand, it is also entrusted with a
fundamental function that cannot in any way be relegated to a secondary
position, namely its promotional role.
The Group of 77 and China had very much in mind,furthermore, the fact
that the negotiations could not proceed in abstraction of the current
international context in its various aspects. These include, undeniably,
certain pressing demands in the area of safeguards, to whose credibility
we are no less committed than we are committed to that of the other
statutory activities.
But we could not fail to take into account, on the other hand, that
the promotional role of this organization is a mandate clearly established
in many articles of its Statute (articles 2,3 and 11). That original
mandate should now be seen in the light of important new commitments and
endeavours undertaken by the international community at a series of recent
Summits on economic, financial and social issues (including the Millennium
Declaration). Those meetings called for greater synergy within the United
Nations system with respect to international cooperation for development -
a task with which there is clearly a need for greater involvement by the
Agency through its promotional dimension.
This was all the more a reason for our negotiations to take duly into
account another extremely important feature of the international context,
which is, as I said before, the fact that the whole international economy
is going through a very difficult period, with very serious, sometimes
devastating, effects for many developing countries. These difficulties
should inevitably have a bearing in our deliberations.
For developing countries, it was therefore essential that the
negotiating process would be conducted against this background, and would
achieve a set of decisions that would ensure the balance and credibility
of all statutory activities of the Agency, both in terms of the allocation
of resources within the regular budget programme, and between this one and
the TCF, and would also provide, where appropriate, for a minimisation of
the financial impact of any increase on developing Member States.
We had also very much in mind the fact that, given the present
economic and financial constraints, many Member States are already not
able to fully pay their mandatory contributions to the regular budget. It
is indeed a sad state of affairs that nearly thirty Member States, most of
them developing countries, have accumulated arrears that entailed a
deprivation of their voting rights.
We want this organization to be ever more inclusive. An organization
in which poorer countries will always be ensured adequate access to its
services, which are often of great significance to their efforts to meet
their pressing human, social and economic needs. An organisation in which
developing member States will enjoy full participation in the
deliberations and decision-making processes.
Madam Chairperson,
During this extensive dialogue, we took very seriously the elements
of information provided by the Secretariat, in which we recognise a body
of hard-working, dedicated and very competent professionals, under the
leadership of the respected Director-General, Mr. Mohamed ElBaradei.
But, as we said, while the Secretariat was discharging its most
pressing responsibilities about the budget itself, it was for Member
States to take the political decisions required to conform a package deal
capable of adequately addressing the wide range of issues involved.
The G-77 and China is perfectly aware of the different sets of norms
and procedures concerning the ways in which the various statutory
activities are programmed, budgeted, financed and implemented.
Let me say,in very clear terms, that it has never been the Group's
intention to undo what, in many ways, are valid, useful and necessary
differences in the way these activities are managed. But, given the
unprecedented scope of the increases and their heavy concentration in
Major Programme 4, it was fundamental to ensure that a new plateau for the
budget would not introduce a far-reaching element of imbalance between
verification and the other statutory activities of the Agency.
Hence the decisive importance given by the Group to the inclusion, in
the package that would result from negotiations, of certain decisions that
would lay the ground for greater correlation and symmetry between changes
in the regular budget and the TCF targets, as well as pave the way for an
eventual better synchronisation between the decision-making processes on
the two major aspects of the Agency's overall financing.
For the G-77, there were therefore two major areas of interest and
concern: on the one hand, the preservation of an adequate balance among
the statutory functions, and the assurance of the overall credibility of
the Agency; and on the other hand, given the very substantial increase in
the regular budget - which, by the way, is unparalleled in terms of the
decisions currently being made on the budgets of all other United Nations
agencies - it was indispensable to ensure financial relief for developing
countries through a postponement of de-shielding for at least the
phasing-in period, as well as a temporary suspension of APCs pending a
final decision on the future of those payments.
We, members of the Board, are very much aware of the fact that the
budget proposal essentially shifted a large amount of extra-budgetary
activities towards the regular budget, especially in major programme 4.
This resulted in a substantive transfer of financial responsibilities from
the main donors towards the entire membership. While relieving a few
Member States from their extra-budgetary commitments, the proposal would
result in a particularly heavy burden for developing countries, the
inequity lying basically in the fact that this redistribution of financial
burden would take place in the context of de-shielding. Developing
countries would therefore be doubly penalized, since the increase in the
budget would affect them twice.
This is the reason why it was so essential for us to obtain a
postponement of de-shielding. We are appreciative of the good-will
expressed by other parties in connection to this issue, following
extensive negotiations.
Madam Chairperson,
Throughout the negotiations, the G-77 was always keen to show
flexibility and sensitivity to the concerns of other parties, in addition
to our regard for the Secretariat's requirements.
When it came to the negotiations on the figures for the budget, the
G-77 made a remarkable departure from its original position. Although
continuing to sustain the validity of ZRG in case of an impasse, the Group
showed a very high level of flexibility by willing, in principle, to work
on the basis of the original proposal by the Secretariat. Of course, given
our great concern at the financial implications of such strong increase,
we did accompany other parties in proposals aimed at a reduction in the
scope of the proposed increase. We reacted constructively to those
proposals, while making the case for a more even distribution of the
additional resources among the various Major Programmes, so as to ensure
that the MPs which contain important elements of promotional activities,
such as MPs 1, 2, 3 and 6, could avail themselves in the years to come of
an amount of resources adequate to make possible the basic continuity of
important activities.
We were happy to see that in the prevailing spirit of mutual
understanding and accommodation it was possible to agree on a 4-year
phased-in increase which, while addressing the concerns on MP4, does
provide for further progress on issues relevant for developing countries,
such as nuclear power, applications, safety and management of technical
co-operation.
Madam Chairperson,
As was stated by many delegations in the final stages of these
negotiations, the package that was skilfully articulated by the two
co-chairmen is undoubtedly unsatisfactory to all sides. This is precisely
also the reason for its attractiveness.
From the point of view of the G-77, in several aspects the package
goes well beyond what we would have ideally wished, especially in what
regards the figures for the budget. On other aspects, on the contrary, the
results fall well bellow our aims.
We have to bear in mind, for instance, that the final figures of the
budget give MPs 1, 3 and 6 half of the increase initially proposed by the
Secretariat itself. So we trust that in years to come all parties will
unite efforts to ensure that those important programmes are adequately
supported. Likewise, it is clear that the availability of resources for
the TCF needs to be addressed in a positive spirit.
This statement of fact is not in any way intended as a complaint. The
point I want to make is that this package, however frustrating it may be
to all the parties involved in the negotiations, is a successful common
achievement, which provides us with a sounder basis on which to continue
over the years to carry out our common task of contributing to enhance the
IAEA's standing as a major UN organisation, capable of properly
conciliating, in a harmonious way, the different but equally important
activities assigned to it by the international community.
We have very much in mind that the elements of this package will
entail the need for successive exercises in dialogue and negotiation. The
G-77 looks forward to engaging in an ever more active way an enhanced
interaction with the Secretariat, as well as a smooth, fluid and
productive dialogue with other parties. This dialogue should also allow
for a thorough and systematic overview of the Agency's major lines of
action, so as to make sure that the Medium Term Strategy for 2006-2011
will enable it to adequately respond to emerging new trends, challenges
and needs.
We will remain vigilant to ensure that the spirit in which this
package was negotiated and approved will not be abandoned or weakened. We
still have much to accomplish. The task ahead is certainly not easy. But
we are confident that the goodwill of all parties and their commitment to
the elements of this package will not fade away after the budget increase
for safeguards begins to take place.
Madam Chairperson,
These negotiations have proved once again that through goodwill and
in a spirit of compromise we can harmoniously find solutions acceptable to
all parties.
We think this augurs well for the future. We thank our partners, we
thank the Secretariat, and we particularly thank you and the two
co-chairmen for the leadership you have shown throughout this process.
Thank you Madam Chairman.
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