Statement by Chief of Staff Sununu on the Establishment of an International Fund for the Termination of Chlorofluorocarbon Production

The administration will propose a fund, operated and administered by the World Bank, to assist less developed countries (LDC's) in phasing out the production of CFC's by the year 2000. The President's proposal is intended to allow the parties to the Montreal protocol to conclude an acceptable agreement on a package of amendments. The proposal includes specific requirements addressing the uses of the fund, the precedential nature of the fund, the administration of the fund, assessments, control of the fund, and voting rights within the fund.

The President's proposal is structured to reflect the unique circumstances that create the need for a fund specifically designed to assist LDC's in phasing out CFC's in a nonprecedential framework. This approach meets the President's essential criteria for any such funding mechanism:

-- First, there is adequate scientific evidence of the causes and effects -- in this case, of ozone depletion.

-- Second, there is strong evidence that the steps to be taken, under the amended protocol, will successfully address the problem.

-- Third, the resources needed to address the problem are reasonable and predictable.

The President expects the parties to the Montreal protocol to successfully conclude negotiations on a package of amendments to the protocol next week in London. The administration's proposal will be offered at that time. The President's proposal is designed to meet the financial needs of LDC's as they transition from the production of ozone-depleting substances to environmentally safe alternatives. At the same time, it addresses previously stated, significant U.S. concerns about the use and management of the fund and the concern that there be no precedent-setting nature to such aid.

The United States has been a world leader in efforts to control emissions that adversely affect the ozone layer: The United States outlawed the use of CFC aerosol propellants in 1978, strongly supported the initial negotiations that led to the Vienna Convention for the Protection of the Ozone Layer in 1985, and was among the first to sign the Montreal protocol in 1987.