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GENERAL
A/CONF.151/26 (Vol. III)
14 August 1992
ORIGINAL: ENGLISH
REPORT OF THE UNITED NATIONS CONFERENCE ON
ENVIRONMENT AND DEVELOPMENT
(Rio de Janeiro, 3-14 June 1992)
SECTION IV. MEANS OF IMPLEMENTATION
Chapter 33
FINANCIAL RESOURCES AND MECHANISMS
INTRODUCTION
33.1. The General Assembly, in resolution 44/228 of 22 December 1989,
inter alia, decided that the United Nations Conference on Environment
and Development should:
Identify ways and means of providing new and additional financial
resources, particularly to developing countries, for
environmentally sound development programmes and projects in
accordance with national development objectives, priorities and
plans and to consider ways of effectively monitoring the
provision of such new and additional financial resources,
particularly to developing countries, so as to enable the
international community to take further appropriate action on the
basis of accurate and reliable data;
Identify ways and means of providing additional financial
resources for measures directed towards solving major
environmental problems of global concern and especially of
supporting those countries, in particular developing countries,
for which the implementation of such measures would entail a
special or abnormal burden, owing, in particular, to their lack
of financial resources, expertise or technical capacity;
Consider various funding mechanisms, including voluntary ones,
and examine the possibility of a special international fund and
other innovative approaches, with a view to ensuring, on a
favourable basis, the most effective and expeditious transfer of
environmentally sound technologies to developing countries;
Quantify the financial requirements for the successful
implementation of Conference decisions and recommendations and
identify possible sources, including innovative ones, of
additional resources.
33.2. This chapter deals with the financing of the implementation of
Agenda 21, which reflects a global consensus integrating environmental
considerations into an accelerated development process. For each of
the other chapters, the secretariat of the Conference has provided
indicative estimates of the total costs of implementation for
developing countries and the requirements for grant or other
concessional financing needed from the international community. These
reflect the need for a substantially increased effort, both by
countries themselves and by the international community.
BASIS FOR ACTION
33.3. Economic growth, social development and poverty eradication are
the first and overriding priorities in developing countries and are
themselves essential to meeting national and global sustainability
objectives. In the light of the global benefits to be realized by the
implementation of Agenda 21 as a whole, the provision to developing
countries of effective means, inter alia, financial resources and
technology, without which it will be difficult for them to fully
implement their commitments, will serve the common interests of
developed and developing countries and of humankind in general,
including future generations.
33.4. The cost of inaction could outweigh the financial costs of
implementing Agenda 21. Inaction will narrow the choices of future
generations.
33.5. For dealing with environmental issues, special efforts will be
required. Global and local environmental issues are interrelated. The
United Nations Framework Convention on Climate Change and the
Convention on Biological Diversity address two of the most important
global issues.
33.6. Economic conditions, both domestic and international, that
encourage free trade and access to markets will help make economic
growth and environmental protection mutually supportive for all
countries, particularly for developing countries and countries
undergoing the process of transition to a market economy (see chapter
2 for a fuller discussion of these issues).
33.7. International cooperation for sustainable development should
also be strengthened in order to support and complement the efforts of
developing countries, particularly the least developed countries.
33.8. All countries should assess how to translate Agenda 21 into
national policies and programmes through a process that will integrate
environment and development considerations. National and local
priorities should be established by means that include public
participation and community involvement, promoting equal opportunity
for men and women.
33.9. For an evolving partnership among all countries of the world,
including, in particular, between developed and developing countries,
sustainable development strategies and enhanced and predictable levels
of funding in support of longer term objectives are required. For that
purpose, developing countries should articulate their own priority
actions and needs for support and developed countries should commit
themselves to addressing these priorities. In this respect,
consultative groups and round tables and other nationally based
mechanisms can play a facilitative role.
33.10. The implementation of the huge sustainable development
programmes of Agenda 21 will require the provision to developing
countries of substantial new and additional financial resources. Grant
or concessional financing should be provided according to sound and
equitable criteria and indicators. The progressive implementation of
Agenda 21 should be matched by the provision
of such necessary financial resources. The initial phase will be
accelerated by substantial early commitments of concessional funding.
OBJECTIVES
33.11. The objectives are as follows:
(a) To establish measures concerning financial resources and
mechanisms for the implementation of Agenda 21;
(b) To provide new and additional financial resources that are
both adequate and predictable;
(c) To seek full use and continuing qualitative improvement of
funding mechanisms to be utilized for the implementation of Agenda 21.
ACTIVITIES
33.12. Fundamentally, the activities of this chapter are related to
the implementation of all the other chapters of Agenda 21.
MEANS OF IMPLEMENTATION
33.13. In general, the financing for the implementation of Agenda 21
will come from a country's own public and private sectors. For
developing countries, particularly the least developed countries, ODA
is a main source of external funding, and substantial new and
additional funding for sustainable development and implementation of
Agenda 21 will be required. Developed countries reaffirm their
commitments to reach the accepted United Nations target of 0.7 per cent
of GNP for ODA and, to the extent that they have not yet achieved that
target, agree to augment their aid programmes in order to reach that
target as soon as possible and to ensure prompt and effective
implementation of Agenda 21. Some countries have agreed to reach the
target by the year 2000. It was decided that the Commission on
Sustainable Development would regularly review and monitor progress
towards this target. This review process should systematically combine
the monitoring of the implementation of Agenda 21 with a review of the
financial resources available. Those countries that have already
reached the target are to be commended and encouraged to continue to
contribute to the common effort to make available the substantial
additional resources that have to be mobilized. Other developed
countries, in line with their support for reform efforts in developing
countries, agree to make their best efforts to increase their level of
ODA. In this context, the importance of equitable burden-sharing among
developed countries is recognized. Other countries, including those
undergoing the process of transition to a market economy, may
voluntarily augment the contributions of the developed countries.
33.14. Funding for Agenda 21 and other outcomes of the Conference
should be provided in a way that maximizes the availability of new and
additional resources and uses all available funding sources and
mechanisms. These include, among others:
(a) The multilateral development banks and funds:
(i) The International Development Association (IDA). Among the
various issues and options that IDA deputies will examine
in connection with the forthcoming tenth replenishment of
IDA, the statement made by the President of the World Bank
at the United Nations Conference on Environment and
Development should be given special consideration in order
to help the poorest countries meet their sustainable
development objectives as contained in Agenda 21;
(ii) Regional and subregional development banks. The regional
and subregional development banks and funds should play an
increased and more effective role in providing resources on
concessional or other favourable terms needed to implement
Agenda 21;
(iii) The Global Environment Facility, managed jointly by the
World Bank, UNDP and UNEP, whose additional grant and
concessional funding is designed to achieve global
environmental benefits, should cover the agreed incremental
costs of relevant activities under Agenda 21, in particular
for developing countries. Therefore, it should be
restructured so as to, inter alia:
Encourage universal participation;
Have sufficient flexibility to expand its scope and
coverage to relevant programme areas of Agenda 21,
with global environmental benefits, as agreed;
Ensure a governance that is transparent and
democratic in nature, including in terms of
decision-making and operations, by guaranteeing a
balanced and equitable representation of the
interests of developing countries and giving due
weight to the funding efforts of donor countries;
Ensure new and additional financial resources on
grant and concessional terms, in particular to
developing countries;
Ensure predictability in the flow of funds by
contributions from developed countries, taking into
account the importance of equitable burden-sharing;
Ensure access to and disbursement of the funds under
mutually agreed criteria without introducing new
forms of conditionality;
(b) The relevant specialized agencies, other United Nations
bodies and other international organizations, which have designated
roles to play in supporting national Governments in implementing Agenda
21;
(c) Multilateral institutions for capacity-building and
technical cooperation. Necessary financial resources should be
provided to UNDP to use its network of field offices and its broad
mandate and experience in the field of technical cooperation for
facilitating capacity-building at the country level, making full use of
the expertise of the specialized agencies and other United Nations
bodies within their respective areas of competence, in particular UNEP
and including the multilateral and regional development banks;
(d) Bilateral assistance programmes. These programmes will
need to be strengthened in order to promote sustainable development;
(e) Debt relief. It is important to achieve durable solutions
to the debt problems of low- and middle-income developing countries in
order to provide them with the needed means for sustainable
development. Measures to address the continuing debt problems of low-
and middle-income countries should be kept under review. All creditors
in the Paris Club should promptly implement the agreement of December
1991 to provide debt relief for the poorest heavily indebted countries
pursuing structural adjustment; debt relief measures should be kept
under review so as to address the continuing difficulties of those
countries;
(f) Private funding. Voluntary contributions through
non-governmental channels, which have been running at about 10 per cent
of ODA, might be increased.
33.15. Investment. Mobilization of higher levels of foreign direct
investment and technology transfers should be encouraged through
national policies that promote investment and through joint ventures
and other modalities.
33.16. Innovative financing. New ways of generating new public and
private financial resources should be explored, in particular:
(a) Various forms of debt relief, apart from official or Paris
Club debt, including greater use of debt swaps;
(b) The use of economic and fiscal incentives and mechanisms;
(c) The feasibility of tradeable permits;
(d) New schemes for fund-raising and voluntary contributions
through private channels, including non-governmental organizations;
(e) The reallocation of resources at present committed to
military purposes.
33.17. A supportive international and domestic economic climate
conducive to sustained economic growth and development is important,
particularly for developing countries, in order to achieve
sustainability.
33.18. The secretariat of the Conference has estimated the average
annual costs (1993-2000) of implementing in developing countries the
activities in Agenda 21 to be over $600 billion, including about $125
billion on grant or concessional terms from the international
community. These are indicative and order-of-magnitude estimates only,
and have not been reviewed by Governments. Actual costs will depend
upon, inter alia, the specific strategies and programmes Governments
decide upon for implementation.
33.19. Developed countries and others in a position to do so should
make initial financial commitments to give effect to the decisions of
the Conference. They should report on such plans and commitments to
the United Nations General Assembly at its forty-seventh session, in
1992.
33.20. Developing countries should also begin to draw up national
plans for sustainable development to give effect to the decisions of
the Conference.
33.21. Review and monitoring of the financing of Agenda 21 is
essential. Questions related to the effective follow-up of the
Conference are discussed in chapter 38 (International institutional
arrangements). It will be important to review on a regular basis the
adequacy of funding and mechanisms, including efforts to reach agreed
objectives of the present chapter, including targets where applicable.
END OF CHAPTER 33
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