For the period 1991 through 1996, 49 countries were assessed about $688 million. The United States’ share was about $174 million, or about 25 percent of the total. Appendix I shows the assessments, payments, and outstanding balances for all 49 countries as of January 31, 1997. For the 3-year period 1997 through 1999, the Parties to the Protocol approved $466 million in new assessments. The United States’ share of the new assessment is about $39 million for each of these 3 years. For 1997, the list of contributors has been reduced to 34 countries primarily because countries that had not ratified the 1990 amendments (which established the Fund) were deleted from the list of contributors. There is substantial variability among the countries in paying their assessments. As of January 31, 1997, 22 countries had fully paid their assessments for 1991 through 1996, 13 countries (including the United States) had paid most of their assessments, 3 had paid less than half, and 11 had not paid anything. The countries that had not paid any part of their assessments were primarily those of the former Soviet Union. These countries, because of their economic position, are referred to as “economies in transition.” While not eligible for funding support from the Multilateral Fund, they are eligible to receive assistance for their efforts to phase out ozone-depleting substances from the Global Environment Facility. Cumulatively, as of January 31, 1997, of the $688 million assessed for the period 1991 through 1996, about $550 million, or about 80 percent, had been paid. Countries can pay their assessed contributions with cash or promissory notes, or by providing bilateral assistance to recipient countries. In 1993, the Parties to the Montreal Protocol agreed that promissory notes would be acceptable as payment of a country’s contribution to the Fund. Since that time, five countries have used promissory notes to pay at least part of their assessments, deferring the actual outlay of cash. In essence, these contributors benefit from the time value of money between the date a note is provided to the Fund and the date it is cashed. While the Fund can cash promissory notes at any time to meet its needs, the general practice is to cash the notes in six equal payments over a 3-year period. We estimate that based on current U.S. Treasury borrowing rates and the Fund’s general practice for cashing the notes over time, the U.S. government could save between $2 million and $3 million on each of its annual contributions to the Multilateral Fund by using the promissory notes. Although the U.S. government makes its payments to the Fund in cash, the Department of the Treasury currently administers over 10 international accounts using letters of credit, which also defer payments, similar to promissory notes. Since the establishment of the Multilateral Fund in 1991 through May 1997, the Fund’s Executive Committee has approved a total of 1,810 projects in more than 100 countries and allocated about $570 million to fund these projects. The geographical distribution of projects supported by the Multilateral Fund shows that the Asia and Pacific region has both the largest number of approved projects, 826, and the greatest share of approved funding—over $330 million or almost 60 percent of the total funding approved. China has been the Fund’s largest recipient with almost $150 million, or 26 percent, of all approved funding. The dominant share of projects and approved funding represented by the Asia and Pacific region is explained by the region’s rapidly expanding economies and population and by its current consumption and enormous potential for the use of ozone-depleting substances. Six of the 10 top recipients of aid from the Multilateral Fund are countries in the Asia and Pacific region, which together have been allocated nearly 50 percent of the total approved funding. The Latin American and Caribbean region ranks next with 473 projects having total approved funding of almost $130 million or nearly 23 percent of all funding approved to date, followed by the Africa region with 320 projects and approved funding of about $67 million. Europe has the smallest number of projects—56—with approved funding of about $21 million. This reflects the fact that relatively few European countries are eligible for assistance. The Fund also supports a category of projects, known as global projects, that transcend regional boundaries. As of May 31, 1997, the Fund had approved 135 global projects with a total allocation of almost $22 million. The table below shows funding for the top 10 recipient countries; appendix II provides a breakdown of approved funding by regions and by types of projects. There are seven broad purposes or categories for which the projects have been funded: (1) country program preparation, (2) institutional strengthening, (3) technical assistance, (4) training, (5) demonstration projects, (6) project preparation, and (7) investment projects. Preparation of a country program is generally the starting point for a country that is seeking the Fund’s assistance in converting to non-ozone-depleting technologies. A country program sets out a country’s strategy for phasing out ozone-depleting substances. It provides basic information on the use of ozone-depleting substances, the institutional framework for controlling them, relevant industry and government involvement, an action plan with time frames and budgets, and a list of specific projects requiring financial support from the Multilateral Fund. To date more than $7 million has been approved for the preparation of 108 country programs. Institutional strengthening projects build a country’s capacity to phase out ozone-depleting substances. The establishment of a national ozone unit within the country’s national government is frequently a key element of this activity with the goal of satisfying the basic need for institutional, legal, and regulatory capacity to support the implementation of national phaseout plans. As of the most recent meeting of the Fund’s Executive Committee (May 1997), a total of 97 institutional strengthening projects had been approved in 81 recipient countries with a total approved funding of slightly more than $15 million. Technical assistance, training, and demonstration projects constitute vehicles for transferring state-of-the-art technologies to recipient countries to help them meet their phaseout obligations under the Montreal Protocol. As of May 31, 1997, 394 demonstration, technical assistance, and training projects had been approved by the Fund’s Executive Committee, with a combined approved funding level of over $60 million. Project preparation, which involves developing projects for conversion from ozone-depleting to ozone-benign technologies, is an important prerequisite for investment projects. As of May 31, 1997, the Multilateral Fund had approved a total of 383 project preparation activities with a total approved funding level of over $30 million. Project preparation activities typically result in the development of a group of investment project proposals. Investment projects are the largest category of projects and the most important from the standpoint of protecting the stratospheric ozone layer. These projects, which account for slightly over 80 percent of total approved funding, assist business entities in recipient countries in converting domestic and commercial refrigeration, manufacturing, firefighting, and other economic sectors from processes that use ozone-depleting substances to technologies and products that are not ozone-depleting or are at least significantly less so. A typical investment project in the refrigeration sector, for example, may involve eliminating CFCs in the manufacture of domestic refrigerators and freezers. It may also include conversion to CFC-free technology in the manufacture (or “blowing”) of the polyurethane foam used in insulating the refrigerators and freezers. To date, 813 investment projects, with funding allocations of about $458 million, have been approved in 55 countries in all major regions of the world. When fully implemented, projects approved to date are expected to phase out the annual use of almost 84,000 metric tons of ozone-depleting potential. This is about 40 percent of the estimated ODP-weighted consumption of ozone-depleting substances in Article 5 countries. Appendix IV provides a breakdown of ODP metric tons to be phased out by type of project and by implementing agency as of May 31, 1997. As of December 31, 1996, however, only 20,487 ODP metric tons had actually been phased out. This difference is attributable to two factors. First, because of time lags between project approvals and the start of project implementation, the number of projects actually in progress or completed at a particular point in time is significantly smaller than the total number of projects approved by the Multilateral Fund’s Executive Committee. Second, projects that are under way, particularly investment projects, often take longer to complete than originally projected. As of December 31, 1996, only 688, or 45 percent of the 1,537 projects approved since 1991 had been completed. Of the approved funding of $485 million for these projects, only $197 million (41 percent) had been disbursed, leaving an undisbursed balance of about $288 million for completion of those projects. Planned spending commitments by the four implementing agencies in 1997 total about $128 million, meaning that less than half of the undisbursed funds approved for projects through 1996 is expected to be disbursed by the end of 1997. Some of the reasons cited for delays in project implementation and completion include the following: Recipients attempted to renegotiate projects after Executive Committee approval. The business entity needed more time to secure financing from counterparts. The grant recipients decided to change project specifications. The business entity chose to delay conversion until competitors’ projects were approved by the Executive Committee. The business entity wanted government regulations passed before allowing implementation to proceed. The bidding process resulted in higher costs than budgeted for the project. Delays in the start of projects and slower than anticipated progress once they have begun have concerned the Multilateral Fund’s Executive Committee.