Introductory Statement to the Board of Governors
As you are aware, at the invitation of the Democratic People´s Republic of Korea (DPRK), an Agency team visited the DPRK during the last week of June with a view to agreeing on modalities for verification and monitoring by the IAEA of the shutdown and sealing of the Yongbyon nuclear facility, as foreseen in the "Initial Actions" agreed at the Six Party Talks in Beijing on 13 February 2007.
Document GOV/2007/36 details the ad hoc monitoring and verification arrangement that was worked out between the DPRK and the Agency.
I welcome the return of the DPRK to the verification process. I am particularly pleased with the active cooperation of the DPRK that the IAEA team received during the visit and I look forward to continuing to work with the DPRK as the verification process evolves as envisaged in the Initial Actions.
You may recall that the Board concluded in June that, "a successfully negotiated settlement of the Korean nuclear issue, maintaining the essential verification role of the Agency, would be a significant accomplishment for international peace and security". In this context, I would invite the Board to take the actions recommended in document GOV/2007/36.
As explained in my report, the conduct of the verification activities requested by the DPRK was not foreseen in the Agency´s budget. The initial costs of these activities, estimated at €1.7 million for 2007 and €2.2 million for 2008, would cover inter alia the replacement of cameras and installation of containment and surveillance devices, the purchase of other needed equipment, and logistical and staff costs. I am requesting Member States therefore to provide funding for the implementation of these verification activities in 2007 and 2008. I should emphasize that, as with all our verification work under the Statute, verification in the DPRK should not have to rely on donations by individual States. I intend therefore to include the associated costs in the draft regular budget for 2009.
The DPRK case clearly illustrates the need for the Agency to have an adequate reserve that can be drawn upon to enable it to respond promptly and effectively to unexpected crises or extraordinary requests, whether in the areas of verification, nuclear and radiological accidents, or other emergencies.
The Agency´s financial vulnerability is also demonstrated by our current cash situation, which indicates that unless some major donors pay their outstanding contributions by the end of next month, the Agency will have to draw from the Working Capital Fund in order to continue operations. And unless contributions are received by September, that Fund would be depleted.
Finally, let me stress that the recent process of preparing and getting approval for the programme and budget for the next biennium has once again highlighted the urgent need for adequate resources to ensure effective delivery of the entire programme that you have requested. As I made clear during the last Board, even with the budget originally proposed by the Secretariat, the Agency remains under-funded in many critical areas, a situation which, if it remains unaddressed, will lead to a steady erosion of our ability to perform key functions, including in the verification and safety fields. To this end, and in order to remedy this unsustainable situation, I have initiated a study to examine the programmatic and budgetary requirements of the Agency over the next decade or so. It is my intention to engage a high level panel of experts to review the study and consider options for financing the requirements identified therein. Once completed, the study and the recommendations of the panel will be submitted to the Board.
I believe that the study will help to clarify expectations about the Agency´s mission over the medium term and how these expectations can be matched by the necessary financial and human resources in a predictable and assured manner. The Agency´s critical missions in the fields of development, safety and security, and verification deserve no less.