EU statement on the Euro - IAEA Budget Committee - Vienna

Madam Chairperson,

1. I have the honour to speak on behalf of the European Union. The following countries associate themselves with this statement: Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Lithuania, Malta, Poland, Romania, Slovakia, Slovenia, Turkey and Norway.

2. Madam Chairperson, allow me first to express our recognition of the efforts undertaken by the Secretariat since the June Board, to present for discussion, in this informal Programme and Budget Committee meeting a further Report on the introduction of a euro-based financial system, contained in document GOV/INF/2003/1.

3. As we all know, this exercise has been initiated by the EU which proposed the introduction of a single currency system based on EURO in the IAEA. In fact the overwhelming majority of its expenditures in the regular budget (more than 80%) are in EURO and even though the EURO share of the smaller TCF and extra budgetary contributions is less than 40%, the EURO share of the IAEA's total expenditure (Regular Budget + TCF) is very high and may be increased.

4. The EU continues to believe that the full conversion of the IAEA to EURO, as the legally valid budgeting and accounting currency, for the Regular Budget and the Working Capital Fund, including the Audited Accounts and Financial Statements, is beneficial both to the IAEA and to the member states.

5. While recognizing the efforts of the Secretariat to produce this Report we only note that it does not meet our expectations since it fails to address in a satisfactory manner our concerns and suggestions. Further clarifications are needed on a number of points. For instance the question whether the second reporting currency which the accounting system is capable of handling, would have the same legal standing as the first from the auditing point of view. It follows that the EU considers that options 1 and 2 are not acceptable because: option 1 does not address the issue of our initial proposal and option 2 maintains the accounting in a currency in which only a small fraction of expenditure takes place. In this context the EU understands that some donors occasionally require the use of US dollars for reporting purposes. Practical solutions could be worked out.

6. In conclusion, Madam Chairperson, the EU would like to reiterate its readiness to work closely with the Secretariat and other interested member states with a view of reaching as soon as possible a comprehensive solution reflected in a new Report with its final Recommendations to be submitted in the PBC, in May 2003, together with the implementation schedule for the new EURO-based financial system.

Thank you Madam Chairperson.

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