US embassy cable - 04THEHAGUE195

UNCLAS SECTION 01 OF 02 THE HAGUE 000195 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR AC/CB, NP/CBM, VC/CCB, L/ACV, IO/S 
SECDEF FOR OSD/ISP 
JOINT STAFF FOR DD PMA-A FOR WTC 
COMMERCE FOR BIS (GOLDMAN) 
NSC FOR CHUPA 
WINPAC FOR LIEPMAN 
 
E.O. 12958: N/A 
TAGS: PARM, PREL, CWC 
SUBJECT: CHEMICAL WEAPONS CONVENTION (CWC): WRAP-UP FOR 
WEEK ENDING JANUARY 23, 
 
This is CWC-10-04. 
 
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Geneva Group 
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1.  (U)  The one agenda item for the January 22 meeting of 
the Geneva Group was Article IV/V financing, and the proposal 
from the ABAF for expansion of the Working Capital Fund.  At 
the time, the U.S. Del did not have guidance on the proposed 
expansion of the Working Capital Fund.  We have since 
deployed the guidance (State 17041), to the overwhelming 
support of other delegations. 
 
2.  (U)  At the Geneva Group meeting, Chiho Komuro (Japan) 
said that Tokyo is very interested in the proposal.  Mark 
Matthews (U.K.) said that London supports the idea, and finds 
it particularly attractive as it envisions drawing the funds 
for the expanded WCF from existing surpluses.  Ruth Flint 
emphasized that it would be important to pitch this proposal 
the right way to the other regional groups to be sure they do 
not view this as a bonus for possessor states.  She suggested 
that the more effective message is that the WCF change would 
ensure proper levels of financial support to ensure 
sufficient resources for ICA and other programs supported by 
the NAM. 
 
3.  (SBU)  The other topics of discussion were raised by the 
U.S.  The first was whether the Geneva Group would want to 
assess possible steps that would lead to more effective 
operations by the Office of Internal Oversight (OIO).  We 
noted that the OPCW does not have an independent Inspector 
General, and for that reason it is particularly important to 
ensure that the OIO has the ability to operate freely.  One 
suggestion that had been bandied about was to have the OIO 
report directly to the Executive Council.  But the point made 
by the U.S. was that it might be worthwhile for the Geneva 
Group to consider possible changes to the operations of the 
OIO which could make it a more effective oversight body. 
 
4.  (SBU)  Amb. Marc Vogelaar (Netherlands) said that 
changing the regulations and organizational chart to have the 
OIO report to the EC may simply be too bureaucratically 
difficult.  However, there are other steps that could be 
taken to improve oversight, such as expanding the mandate of 
the External Auditor.  Peter Beerwerth (FRG) suggested that 
the OIO might be directed to take more action in direct 
response to the EC.  He also noted the shortcomings of the 
external audits, and that it would indeed be worthwhile to 
see that these are "value for money" audits.  Sophie 
Moal-Makame (France) also expressed doubts about whether 
far-reaching changes concerning the OIO were feasible.  Mark 
Matthews (U.K.) voiced support for improving the External 
Auditor in the short term. 
 
5.  (SBU)  The other issue raised by the U.S. was how the 
Geneva Group should tackle budget and finance questions 
remaining from last year, particularly on some particularly 
costly issues such as financing of home leave.  Peter 
Beerwerth said that home leave financing and other issues 
such as insurance had been put to the TS while Beerwerth was 
running the budget facilitation.  If the Geneva Group thought 
it worthwhile to pursue these outstanding issues, it would be 
most appropriate to give it to the next budget facilitator. 
 
6.  (SBU)  Vogelaar noted that while he understood the 
substantial savings  that were possible in connection with 
home leave financing, the national delegations should keep 
two points in mind.  First, there is an open legal issue of 
whether these constituted acquired rights.  Second, and more 
important, delegates should bear in mind the impact on 
already poor staff morale of substantially pruning an 
arrangement that is clearly beneficial to the staff. 
Matthews echoed the point about the abysmally low staff 
morale.  However, he recommended that if this issue is 
revisited, it would be best to simply approach the Technical 
Secretariat for a progress report on where things stand on 
 
SIPDIS 
the entire range of issues raised during last year's budget 
facilitation. 
 
----------------------------------- 
Amendments to Financial Regulations 
----------------------------------- 
 
7.  (U)  The January 20 consultations provided one key answer 
sought by Washington, but little else.  The U.S. expressed 
its support for the changes to regulation 12.1 and 12.3 which 
would add the monitoring mandate to the Office of Internal 
Oversight.  The one question from Washington was whether 
there would be any cost implications for such a change.  OIO 
Director Louati informed the delegates that the new P-4 
position authorized last year would also handle any 
monitoring tasks.  In response to a question from the U.S. 
Del, Louati flatly stated that no additional resources or 
personnel would be required if the proposed amendments were 
adopted. 
 
8.  (U)  That, however, was not the thrust of the discussion, 
and the result was no consensus on the proposed amendments. 
Much of the commentary focused on whether there is a 
definition of "monitoring."  Louati asserted that there is a 
UN definition, but that did not seem to satisfy delegates. 
Ruth Flint (Switzerland) asked whether there would be a 
connection between the issue of OIO monitoring and the 
introduction of results based budgeting, but the discussion 
was inconclusive. 
 
9.  (U)  With regard to the proposed change to regulation 
12.7 which would distinguish "core" and "non-core" functions, 
there was opposition from Louati and substantial skepticism 
among delegates about the ability to separate core from 
non-core activities.  At the end of the discussion, 
facilitator Peter van Brakel (Canada) suggested that the best 
course of action would be clearly defining monitoring in 
Regulation 12.1 and dropping the addition of Regulation 12.7, 
and delegates merely agreed to consider the suggestion. 
 
10.  (U)  The consultations ended before discussion of 
Regulation 12.4.  U.S. Del met with van Brakel separately to 
inform him that the U.S. did not object to listing the 
reports now being provided to the External Auditor, but did 
not want to limit the types of reports available to the 
auditor.  For that reason, the U.S. suggested that reports on 
personnel and financial matters would be provided to the 
External Auditor "routinely" and other reports, as 
appropriate, "upon request."  Van Brakel appreciated the U.S. 
point, and was generally supportive of the suggested change. 
However, he noted that the language in the proposed amendment 
does not specifically cite "reports," so the U.S. proposal 
could be viewed as somewhat more restrictive.  Van Brakel 
asked whether that was the intention of the U.S.  If not, he 
suggested the U.S. consider whether more all-encompassing 
language might be more suitable. 
 
11.  (U)  Javits sends. 
RUSSEL