The Chair, Mr. V. Koester (Denmark) introduced the Draft Financial Rules For the Secretariat of the Convention on Biological Diversity (UNEP/CBD/IC/2/5). Discussion regarding the basis of the budget focused on three options. The report described two options; voluntary or mandatory contributions. Australia suggested the third alternative: for funding to come from the main UN budget. However the only support for this came from China and Sri Lanka. Koester suggested that the issue of mandatory or voluntary is a question of semantics as any country could block a contribution if they chose. He suggested, rather, that it was whether parties should decide what to pay at will, or whether a scale of contributions should be agreed.
The Secretariat's report outlined: practices adopted in other conventions; the UN scale of assessment; and, three modified UN formulas for determining other scales. The US and Japan expressed support for voluntary contributions. However, the majority of States supported scaled assessments, and focused their interventions on the choice of formula. States supporting a scaled assessment include Austria, Germany, Switzerland, Sweden, Kenya, Netherlands, UK, Uruguay, Brazil, Senegal, Canada, Denmark, and Germany on behalf of the EU. Most countries supported the second formula that included a 25% ceiling for any one party.
As some governments have policies that all contributions should be voluntary (such as the US), the Netherlands suggested that as it is most likely that the scale finally adopted will be done so by consensus, it is of little practical concern if it is binding or not, as most countries who commit to pay, do so most of the time. By the end of discussion, several interventions had noted that voluntary contributions did not exclude a scaled assessment. The EU offered to contribute 2.5% of the administrative costs of the Convention (this would be in addition to individual member country contributions).
Brazil suggested that the scale agreed should ensure that no developing country paid more than any developed country. The Chair asked Brazil to consider this further and Austria noted that under such a system a country like Luxembourg would have to pay more than Brazil. Many interventions focused on the specific wording of the draft rules, contained in annex 1 of the report.
Discussion of the basis of contributions was followed by discussion of the size of the budget. Sweden noted the difficulty of such a discussion given the lack of proposals, outline or proposed budget and requested such a paper from the Secretariat. However the Secretariat and several other States noted that the activities of the Secretariat have not yet been defined, its location unknown, nor whether or not the budget must include the cost of COP meetings etc. Canada noted the interrelationship between these issues and the difficulties in knowing where to begin. Germany recommended that upon the conclusion of the session, a paper must be prepared outlining scale and amounts to ensure States approved contributions can be announced at the first COP.
Zimbabwe suggested the convening of a small open-ended working group to address divergences of opinion based on the afternoon's discussion. The group, to be chaired by Germany, includes Australia, Brazil, Sweden, Bahamas, India, and Zimbabwe. The Secretariat will provide the group with a revised draft of the financial rules based on the discussion in addition to a very preliminary budget. The Chair asked the group to provide a preliminary report at the start of the session on Wednesday afternoon.
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