MEETING OF UNIDROIT FINANCE COMMITTEE

UNCLAS ROME 004701 SIPDIS FROM THE U.S. MISSION TO THE UN AGENCIES IN ROME L/PIL FOR HAL BURMAN AND JEFF KOVAR IO/S FOR LISA JACOBSON AND IO/EDA FOR SHARON KOTOK E.0. 12958: N/A TAGS: AORC ABUD UNIDROIT SUBJECT: MEETING OF UNIDROIT FINANCE COMMITTEE REF: A) STATE 287973 B) ROME 3361 ¶1. SUMMARY: THE FINANCE COMMITTEE OF THE INTERNATIONAL INSTITUTE FOR THE UNIFICATION OF PRIVATE LAW (UNIDROIT) MET ON OCTOBER 9 TO CONSIDER THE ORGANIZATION'S 2004 BUDGET. THE U.S. WAS ALONE IN DISASSOCIATING WITH CONSENSUS ON APPROVING THE BUDGET (AND ITS 3.61 PERCENT INCREASE),BUT ASSURED THE COMMITTEE, PER REF A GUIDANCE, THAT WE VALUE THE ORGANIZATION'S WORK. THE SECRETARIAT AS WELL AS SEVERAL COUNTRY REPS NOTED WITH APPROVAL THE RECENT U.S. VOLUNTARY CONTRIBUTION FOR THE CAPETOWN CONVENTION DEPOSITARY FUNCTION. END SUMMARY. ¶2. U.S. MISSION REP ATTENDED THE OCTOBER 9 FINANCE COMMITTEE MEETING. PER REF A GUIDANCE, U.S. MADE THE FOLLOWING POINTS: WHILE WE VALUE THE ORGANIZATION'S WORK (AND CAN CITE THE RECENT VOLUNTARY CONTRIBUTION FOR THE DEPOSITARY FUNCTION AS AN EXAMPLE),OUR POLICY FOR INTERNATIONAL ORGANIZATIONS IN GENERAL IS ZERO NOMINAL GROWTH; THE BUDGET PRESENTED BY UNIDROIT, WITH ITS 3.61 PERCENT INCREASE, IS A REAL GROWTH BUDGET (THIS POINT WAS ECHOED BY THE SPANISH REP); AND, WHILE WE CAN ABIDE A SMALL INCREASE AS A ONE-TIME EXCEPTION TO ZNG POLICY IN RECOGNITION OF THE ORGANIZATION'S HIGH PRIORITY WORK, WE CANNOT APPROVE PROGRAM FUNDING FOR THE LEGAL COOPERATION PROGRAM, WHICH WE BELIEVE SHOULD BE PAID WITH VOLUNTARY CONTRIBUTIONS. IN THE END, THE U.S. WAS FORCED TO DISASSOCIATE WITH CONSENSUS, WHILE AT THE SAME TIME STATING THAT OUR BUDGET POSITION IN NO WAY CHANGES THE HIGH REGARD IN WHICH WE HOLD THE ORGANIZATION. ¶3. COMMITTEE MEMBERS FROM AUSTRIA, FRANCE, GERMANY, ITALY, JAPAN, MEXICO, SPAIN AND THE UK VOICED SUPPORT FOR THE BUDGET AS STATED, WITH FEW RESERVATIONS AND QUESTIONS. THE ITALIAN GOVERNMENT, THE LARGEST CONTRIBUTOR AT E220,000 PER YEAR (THE U.S. CONTRIBUTION IS HALF THAT AMOUNT) VOWED TO CLEAR THEIR ARREARS FROM 2002 BUT SAID THEIR CONTRIBUTION WOULD REMAIN AT A LOWER LEVEL (E220,000 INSTEAD OF E258,000) FOR THE FORESEEABLE FUTURE. THE REPS FROM SWITZERLAND AND RUSSIA REMAINED SILENT THROUGHOUT. ¶4. THE JAPANESE REP, SUPPORTED BY SEVERAL OTHER COUNTRIES, ARGUED THAT THE CAPETOWN CONVENTION DEPOSITARY FUNCTION SHOULD BE FUNDED BY THE REGULAR PROGRAM BUDGET IN FUTURE YEARS AND NOT FROM VOLUNTARY CONTRIBUTIONS. HE REITERATED THE IMPORTANCE OF THE CONVENTION, ADDING THAT IF THE ORGANIZATION IS TASKED TO PERFORM A FUNCTION, IT MUST BE ABLE TO BUDGET FOR IT RATHER THAN RELY ON VOLUNTARY FUNDS. THE RECENT U.S. VOLUNTARY CONTRIBUTION OF USD 110,000 FOR THE DEPOSITARY FUNCTION WAS HIGHLIGHTED BY THE SECRETARIAT AND NOTED WITH APPROVAL BY SEVERAL REPRESENTATIVES. ¶5. A BRIEF DISCUSSION REGARDING THE LINK BETWEEN STRATEGIC PLANNING AND BUDGET FORMULATION WAS INITIATED BY THE SECRETARIAT AND GREETED WITH APPROVAL BY A MAJORITY OF MEMBER STATES. THERE WAS GENERAL AGREEMENT, INCLUDING FROM THE CONCLUSIONS OF THE APRIL 2003 BRAINSTORMING SESSION, THAT THE ORGANIZATION NEEDS TO DO MORE STRATEGIC PLANNING AND TO LINK THAT PLANNING WITH FUTURE BUDGET REQUESTS. THE SECRETARIAT PROPOSED THE CREATION OF A SMALL WORKING GROUP TO EXAMINE THE ISSUE, AND THE ITALIAN REPRESENTATIVE VOLUNTEERED TO BE A PART OF THE WORKING GROUP. QUESTIONS OF HOW THIS GROUP WOULD FUNCTION OR WHEN IT WOULD MEET REMAIN OPEN. HALL NNNN 2003ROME04701 - Classification: UNCLASSIFIED