Identifier
Created
Classification
Origin
06USUNNEWYORK1848
2006-09-21 19:56:00
CONFIDENTIAL
USUN New York
Cable title:  

UN SCALE OF ASSESSMENTS: EXPERT LEVEL MEETING WITH

Tags:  AORC KUNR UNGA 
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DE RUCNDT #1848 2641956
ZNY CCCCC ZZH
O 211956Z SEP 06
FM USMISSION USUN NEW YORK
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0254
INFO RUEHLO/AMEMBASSY LONDON IMMEDIATE 1049
C O N F I D E N T I A L USUN NEW YORK 001848 

SIPDIS

SIPDIS

E.O. 12958: DECL: 09/21/2016
TAGS: AORC KUNR UNGA
SUBJECT: UN SCALE OF ASSESSMENTS: EXPERT LEVEL MEETING WITH
THE UNITED KINGDOM

Classified By: Ambassador Mark Wallace for reason 1.4B and D

C O N F I D E N T I A L USUN NEW YORK 001848

SIPDIS

SIPDIS

E.O. 12958: DECL: 09/21/2016
TAGS: AORC KUNR UNGA
SUBJECT: UN SCALE OF ASSESSMENTS: EXPERT LEVEL MEETING WITH
THE UNITED KINGDOM

Classified By: Ambassador Mark Wallace for reason 1.4B and D


1. (C) On September 20, USdel met with UK Fifth Committee
delegate Wasim Mir to discuss the UN scale of assessment
methodology. Mir emphasized that the European Union
collectively is assessed well beyond its capacity to pay, and
the group's bottom line is to ensure that it does not see any
increase in its rate in the 2007-2009 period. Under the
current (2004-2006) scale, the EU collectively is assessed
36.525 per cent. Should the methodology remain the same, its
rate would increase to 38.836 per cent. While the EU has not
yet agreed upon a common position, Mir believed that a
position would be reached in capitals by September 25 and
that a key element of the group's position in maintaining its
current rate would be to extend the base period from its
current 4.5 years to 6 years. Under a 6 year base period,
and assuming that all other elements of the methodology
remained the same, the EU collective rate would be 38.123 per
cent, leaving 1.598 per cent still to be found to keep the
group's rate at its current level. As such, there were two
logical places for the EU to seek changes to make up the
difference: the low per capita income adjustment (gradient)
and the ceiling.


2. (C) USdel emphasized that rather than challenging the
ceiling rate, which at its current level is a redline for the
USG and therefore will not yield results for the EU, the EU
should seriously consider working with the U.S. and other
major financial contributors on advocating changes to the
gradient which currently affords an 80 per cent discount to
132 countries. USdel also stressed that the USG has always
supported a shorter base period, and that a 6 year base
period would be particularly difficult for some countries,
not least Japan (which is seeking a 3 year base period).


3. (C) While Mir agreed that there could be considerable room
for cooperation on gradient possibilities (including a
sliding gradient or a cap on the percentage that a country
could benefit from the gradient -- for instance, not more
than .5 per cent),he argued that if the ceiling remains
intact then the U.S. should have no objection to a longer
base period because the U.S. rate would remain the same. He
also pointed out that under the current methodology, Japan
will see a considerable decrease in its rate, and he believed
that whether it ended up with a rate of 16.624 per cent
(under the current base period) or 17.442 per cent (under a 6
year base period) Japan would be able to "announce a victory"
to its Diet because its rate has decreased from the current
level of 19.468 per cent. Mir also clearly stated that if
the U.S. wants any help from the EU in maintaining the
current ceiling rate, then it would need to find a way to
support the EU's goal of maintaining its current collective
rate. He said the choice was clear for the U.S.: either
support the EU with a 6 year base period and other
adjustments to keep its rate static in exchange for support
on the ceiling, or support the Japanese.


4. (C) As for "making up the difference" in the EU rate, Mir
agreed that it was time for some major developing countries
to assume a greater share of the UN's financing. He
expressed his concern that Japan's proposal for a floor was
viewed by many as being toxic and, if pushed by Japan this
fall, would make it very difficult to get any increase in
rates for Russia and China which already feel distinctly
targeted by Japan. Alternatively, major contributors should
privately approach China and Russia (as well as Brazil,
India, and Argentina) to voluntarily increase their rates.


5. (C) At the same time, Mir expressed appreciation for the
USG idea of a sliding gradient and he believed a common
approach in the General Assembly on modifying the gradient
should be seriously considered. He also appeared to be open
to the idea of a future application of purchasing power
parity but stressed that the time has not yet come to have it
included in the scale, not least because most delegations do
not understand the link between the PPP concept and the
principle of capacity to pay. Mir concluded by repeating his
opening comment that it would be worthwhile for U.S. and UK
capitals to begin a dialogue on how to mutually support each
other's goals for the scale methodology.
BOLTON