The Chair introduced agenda item 4.1.6, "Policy, Strategy, Programme Priorities and Eligibility Criteria Regarding Access To and Utilization of Financial Resources" (UNEP/CBD/IC/2/8), which relates to Articles 20 & 21 of the CBD. He stressed that this discussion was about the financial structure, and not the institutional mechanism which may operate it. The discussion of this topic focused on three issues: Policy and strategy; Eligibility criteria and guidelines; and Programme priorities. At the beginning of the afternoon session, the Chair announced his intention to establish an open-ended working group to deal with matters related to the financial mechanism (items 4.1.6 and 4.1.7) that would produce recommendations for the COP.
POLICY AND STRATEGY: Discussion began with measures to ensure the mechanism functions under the authority of, and would be accountable to, the COP (Art 21, CBD). Australia, Zimbabwe, the US and the UK recommended that the institution chosen should report to the COP, and should not be micro-managed. Brazil, supported by other States, called for a short, background paper outlining precedents that may exist in other conventions. The Chair announced later that it will produce a short paper on the financial mechanism of the Montreal Protocol and the recommended mechanism developed by the Intergovernmental Negotiating Committee for a Framework Convention of Climate Change (INC/FCCC). Pakistan, the Bahamas, and Malaysia supported the creation of an intermediary body that would evaluate how the COP's policies and guidance are being adhered to by whatever institutional body is chosen. After the US and Austria had made reference to the GEF, Malaysia asked delegates to "not try to distort what is being developed here so it will fit into what the GEF is all about." India noted that the mechanism must be a dedicated one and cannot have conflicting interests or be subservient to other rules. That "the mechanism should operate within a democratic and transparent system of governance" was agreed. Some States noted that a "watchdog" group should be established to ensure that the chosen institution continues to meet these objectives. There was general agreement that: the mechanism should be carried out by the institutional structure chosen by the COP; contributions should be predictable and timely; and, the COP should decide periodically on the amount of resources needed.
ELIGIBILITY CRITERIA AND GUIDELINES: Brazil, supported by Argentina, Austria, Canada, Sweden and others, did not see the determination of what is a developing, developed or LDC as an appropriate exercise for the ICCBD. A general consensus that there was no need to develop either criteria or special lists emerged. It was noted that the situation of countries would be taken into consideration at the time of funding.
On the question of eligibility for access to grants vis vis concessional financing, France, supported by Australia and Sweden, suggested that this matter should be left to the COP. There was general agreement that the first phase of financing would be grants with a "wait and see" attitude towards concessional financing.
The Group agreed that there was no need to go into a detailed set of recommendations regarding eligibility criteria and guidelines for the utilization of financial resources but, as suggested by Mexico, criteria would be developed by the COP as it considers it appropriate. Sweden stated that the indicative list of incremental costs, (Annex: UNEP/CBD/2/17), was totally unacceptable to his delegation.
PROGRAMME PRIORITIES: The COP, at its first meeting, must determine programme priorities. The Secretariat proposed inter alia a list of six measures for consideration by the Committee. Germany suggested five further elements including: in situ conservation; integrated approaches to conservation and utilization using protected core areas, buffer and transition zones; innovative projects combining economic and ecological components; and key financing elements. The UK introduced the World Conservation Monitoring Centre document, "Priorities for Conserving Global Species Richness and Endemism." Malaysia, supported by Sweden and India, requested the Chair to incorporate the criteria developed at the first session of the ICCBD by the G-77 and the Nordics. The US suggested four priorities: projects that produce the most conservation for the dollar; those that fully engage developing countries; projects that maximize the leverage of resources; and those that use subsidiary bodies for scientific input. WWF suggested integrating human and conservation needs and creating incentives in projects. Sweden noted that there must be a balance between conservation and sustainable use and actions that add value to developing country genetic resources.
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