WORLD TRADE WT/BFA/35
8April 1998
ORGANIZATION
(98-1427)
Committee onBudget, Finance andAdministration
REPORT OFTHE MEETING HELD ON12MARCH 1998
Introduction
1. TheWTO Committee onBudget, Finance andAdministration meton12March 1998 under
thesuccessive chairmanship ofAmbassador K.Morjane ofTunisia andMr.W.Meier ofSwitzerland
andadopted theAgenda contained indocument WTO/AIR/791. Theterms ofreference and
composition oftheCommittee aresetoutindocument WT/L/44/Rev.1.
I. USEOF1996 SURPLUS
2. TheChairman, Ambassador Morjane, opened thefirstmeeting oftheCommittee in1998and
recalled thatthequestion oftheutilization ofthebalance ofthe1996 surplus hadbeendiscussed at
several meetings towards theendoflastyear. InFebruary andMarch 1998, several informal
meetings todiscuss thequestion onceagain hadbeenorganized. Based onthese discussions, the
Chairman prepared adraftresolution fordiscussion atthemeeting.
3. Onedelegate informed theCommittee thathehadreceived instructions thathecould not
support those parts ofthedraft resolution which would have provided funds (i)fortheWTO
Programme forTechnical Assistance and(ii)foraugmenting resources inorder toassist developing
countries requesting theservices ofalegalexpert under Article 27.2oftheUnderstanding onRules
andProcedures Governing theSettlement ofDisputes. Another Member indicated thathewould have
toconsult hisauthorities before being abletotakeaposition onthedraftrecommendation. However,
thevastmajority ofMembers indicated thattheycould support thedraft resolution. Ofthose
supporting thedraft resolution inaspirit ofconsensus, some mentioned thattheywould have
preferred toseethebalance ofthe1996 surplus allocated toother purposes suchastoincrease of
theWorking Capital Fund orfortheexpenses ofthe1999-2000 Ministerial Conference.
4. Two Members oftheCommittee whose Governments hadprovided voluntary funds for
technical assistance activities indicated thattheirGovernments might havetoreview theircontinuing
support ofsuchactivities, inthelightofthefactthattheprovision ofthenecessary complementary
funding hadnowbeenblocked.
5. Another Member indicated thathehadsupported thefunding fortheAppellate Body
Operating Fund attheendof1997ontheunderstanding thatlegalassistance fordeveloping countries,
ascalled forinthecontext ofdispute settlement procedures, would beprovided.
6. Many delegations stressed thatitwasoftheutmost importance toassist developing country
Members, andespecially leastdeveloped countries, through training andtechnical assistance activities,
sothattheywould beinaposition tofulfiltheirobligations vis-à-vis theother Members oftheWTO
more consistently andtoparticipate more fullyinthework oftheOrganization. Inthiscontext, they
re-iterated theposition thatregular technical assistance activities should befinanced fromtheregular
budget.WT/BFA/35
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7. After detailed discussion, theCommittee noted thatnoconsensus could bereached onthe
utilization ofthebalance ofthe1996 surplus atthattimeandthatdiscussion onthesubject should be
continued andefforts should bemade toidentify asolution.
II. ELECTION OFCHAIRPERSON
8. TheChairman oftheGeneral Council hadcarried outinformal consultations onthe
appointment ofchairpersons tothedifferent WTO standing bodies inaccordance withtheestablished
guidelines fortheappointment ofsuch officers. Onthebasis oftheunderstanding reached,
Ambassador Morjane proposed thattheCommittee onBudget, Finance andAdministration formally
elect Mr.Wilhelm Meier asChairman byacclamation. The Committee soagreed.
Ambassador Morjane thencongratulated Mr.Meier andthanked theMembers oftheCommittee as
well astheSecretariat fortheir cooperation throughout theyear. Hethen handed over the
chairmanship toMr.Meier whoinreturn thanked theMembers fortheirconfidence.
III. ADMINISTRATIVE UPDATES AND PROGRESS REPORTS
A. Cashsituation andstatement ofoutstanding contributions asat28February 1998(CRP(98)06,
WT/BFA/SPEC/18)
B. Instalment payments forcountries inarrears (contributions from 1987 andearlier years) -
Progress report asat28February 1998 (CRP(98)07)
C. Contributions ofObserver countries towards thecostofservices provided bytheSecretariat -
Progress report asat28February 1998 (CRP(98)08)
9. TheSecretariat presented reports onthecash situation andstatement ofoutstanding
contributions asat28February 1998, theinstalment payments forcountries inarrears, andthe
contributions ofObserver countries towards thecostofservices provided bytheSecretariat. Thetotal
contributions received amounted toCHF 60,336,256, andtheWorking Capital Fund stood at
CHF 7,394,252. Since thedateoftheStatement ofOutstanding Contributions (28February 1998),
Portugal, Peru, Colombia andGuyana hadmade contributions, therefore, asfromMarch 1998, Peru
would nolonger belisted under theAdministrative Measures. Inthecontext oftheinstalment
payment scheme forcountries inarrears (contributions for1987 andearlier years), there wasno
change inthesituation ofWTO Members since 28February 1998. With regard toObservers,
Kazakstan andGeorgia hadmade contributions inMarch 1998.
10. Inreply toaquery, theSecretariat clarified thatthefinalbalances oftrustfunds werehandled
onacasebycasebasis. Onthebasis ofconsultations undertaken withthedonor country concerned,
anybalance iseither returned tothelatter orusedtofundanother activity. TheSecretariat also
informed theCommittee that,asinthepast,theperformance against budget report would beprepared
atthesame timeofthesubmission ofthebudget estimates.
11. TheCommittee tooknoteofthereports.
IV. UN/WTO COOPERATION WITH REGARD TOITCBUDGETARY ARRANGEMENTS
12. TheChairman recalled that, in1997, theInternational Trade Centre UNCTAD/WTO
presented itsbudget incompliance withtherequirements ofboththeUNandtheWTO, which created
considerable technical difficulties andresulted ininefficient useofexisting resources. TheCommittee
noted atthattimethatthequestion should betaken upbetween thegoverning bodies ofthetwo
organizations. Inthiscontext, Ambassador Morjane, accompanied byofficials from theWTO and
theITC, visited theUNinNewYork todiscuss thematter.WT/BFA/35
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13. Ambassador Morjane gaveanoralreport onhisvisit, themain objectives ofwhich were:
(i)tocontinue thediscussion onthesubject, and(ii)toseeifthequestion wasmore ofapolitical or
technical nature. Thecontacts included meetings withtheChairman andtheBureau oftheFifth
Committee, theChairman oftheAdvisory Committee onAdministrative andBudgetary Questions
(ACABQ) andmembers oftheUN,ACABQ andFifth Committee Secretariats. Themeetings were
heldinacooperative atmosphere andtheWTO position wasexplained. Itwasagreed thatafactual
noteonthequestion ofbudgetary aspects ofthecooperation between theUnited Nations andtheWTO
concerning theITCwould beprepared bytheWTO andtheITCSecretariats fortheFifthCommittee.
Thisnotewould alsobeforwarded totheACABQ aswellastotheWTO Committee onBudget,
Finance andAdministration forconsideration. Inaddition, itwould beuseful fortheBudget
Committee tohavecontacts withtheACABQ inJunewhen thelatter would beinGeneva.
14. TheCommittee tooknoteoftheoralreport presented byAmbassador Morjane.
V. ADMINISTRATIVE MEASURES -MEMBERS INCATEGORY IV
15. Following therecommendation ofthePreparatory Committee oftheWorld Trade
Organization ontheissue ofMembers incategory IVoftheadministrative measures, theSecretariat
prepared alistofMembers which have accumulated more thanthree years ofarrears uptoand
including thefinancial year1997 asat5March 1998 (WT/BFA/W/24).
16. Consequently, inaccordance withparagraph 7(b)ofdocument PC/7, L/7578, theCommittee
recommends totheGeneral Council thatthefollowing Members beurged toliquidate theirarrears:
Angola Ghana
Antigua andBarbuda Guinea
Burundi Guinea-Bissau
Cameroon Mauritania
Central African Republic Nicaragua
Chad Niger
Congo Rwanda
Democratic Republic oftheCongo Sierra Leone
Djibouti Solomon Islands
Gabon Togo
Gambia
VI. WORK PLAN FOR 1998
17. TheChairman referred tothedocument CRP(97)23 of10November 1997 ontheproposed
schedule ofmeetings for1998 which wasdiscussed inNovember 1997. Hethenreferred tothe
review ofthefunctioning ofthesystem fortheassessment ofcontributions totheWTO budget. He
recalled that,withthetransition fromGATT totheWTO, aWorking Group hadbeensetupin1995
toexamine howitwould bepossible toincorporate international trade shares inservices and
intellectual property rights intothecalculation ofassessments totheWTO budget. TheWorking
Group made itsrecommendation ontheissue inJune1995.
18. Aspartoftherecommendation, itwasstipulated thatthree years aftertheintroduction ofthe
system, areview ofthefunctioning ofthesystem should beundertaken. Since thebudgetary
contributions for1996, 1997 and1998 havebeensubject tothenewsystem, thereview should be
undertaken inthecurrent year.
19. Inaddition, inthecontext ofidentifying possible measures infavour ofleastdeveloped
countries, theCommittee agreed lastNovember toexamine thelevel oftheminimum contributionWT/BFA/35
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within theframework oftheabove-mentioned review. Inview ofthefactthattheworking group
approach hadinitially beenusedtodealwiththisquestion, theChairman proposed tosetupanother
Working Group toundertake thereview including theleveloftheminimum contribution.
20. Inreply toqueries, theSecretariat clarified thattheWorking Group would discuss, in
informal meetings, technical issues relating tothesystem. Asaresult ofthediscussions, theWorking
Group would make preliminary proposals totheCommittee which would then make
recommendation(s) totheGeneral Council forapproval.
21. TheChairman would consult shortly onthechairmanship oftheWorking Group anditwas
hoped thatthelatter would report totheCommittee before endofJune. TheSecretariat would
prepare abackground paper fortheWorking Group ontheissue anditwould becirculated tothe
Members oftheCommittee.
22. TheCommittee tooknoteofthesetting upoftheWorking Group forthereview ofthesystem
ofassessment ofcontributions totheWTO budget. Ontheother hand, itwasagreed thatthe
question ofthelevelofminimum contribution would bedealtwithintheCommittee asawhole, given
thatthequestion waslessofatechnical nature.
VII. COMMUNICATION FROM NICARAGUA
23. TheAmbassador ofNicaragua tookthefloor andreferred toparagraph 13oftheSingapore
Ministerial Declaration. Heinformed theCommittee thatNicaragua, inspiteofthedifficult situation
itwasfacing, hadmade twopayments totalling CHF 133,875 inthelastthree months toshow its
serious intentions andgoodwill tofulfil itsfinancial commitments totheWTO. Furthermore, his
Government hadundertaken topaywithin fourmonths anamount ofCHF 44,275 which still
remained dueinorder thatNicaragua would nolonger beincategory IVoftheadministrative
measures. TheAmbassador therefore requested theMembers oftheCommittee toconsider waiving
theapplication ofthecategory IVadministrative measures. Thiswould enable Nicaragua tohave
access rapidly totheimportant andnecessary technical assistance andtraining thattheWTO could
provide tohiscountry.
24. Many Members oftheCommittee supported Nicaragua 'sefforts andrequest. However, some
Members showed concern overthepossibility ofmaking anexception totherules which would set
aprecedent which could influence future implementation oftherules.
25. After detailed discussions, Members considered thatasolution might befound inreserving
aplace forNicaragua inthetraining course which would beheldinSeptember/October 1998, since
bythattimeNicaragua would nolonger beunder theconstraints ofcategory IVifthepayment
mentioned above weremade. Moreover, nothing would preclude making preliminary plans forother
forms oftechnical assistance which could beimplemented afterNicaragua isnolonger incategory IV.
26. TheChairman alsoindicated thathewould consult withregard tothepossibility ofidentifying
ageneric approach tothisparticular problem.
VIII. OTHER BUSINESS
27. TheChairman referred tothepoint relating tothecirculation ofdocuments brought upbya
Member oftheCommittee ataprevious meeting. Herecalled thatanother Delegation hadrequested
thatthisitembeplaced ontheagenda oftheGeneral Council andindicated thatthequestion could
bediscussed inthatcontext.WT/BFA/35
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28. With regard totheparking attheCentre William Rappard, theSecretariat informed the
Committee that,duetocertain localcomplexities, theconstruction ofanunderground parking which
hadbeenforeseen forWTO delegates andstaffbehind thenewWorld Meteorological Organization
building would notbepossible. Instead, itwasplanned thatanabove-ground parking would bebuilt
nearby, overtherailway yard. Anabove-ground facility would havetheadvantage ofbeing built
more quickly thananunderground parking and,inaddition, would serve asasound barrier inthe
area. Theproject hadtheapproval ofthecantonal andcityauthorities aswellasoftherailroad
administration.
29. TheSecretariat informed theCommittee thatapaper onthequestion ofoverhead ontrust
funds, brought upbyaMember atthelastmeeting oftheCommittee inNovember 1997, wasin
preparation. Theissue would bedealtwithinthenextmeeting.
30. TheSecretariat informed theCommittee thatapaper ontheadministrative functioning ofthe
Appellate Body requested byaMember would alsobeprepared fordiscussion atthenextmeeting.
POINT FOR DECISION :Paragraph 16
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