VZCZCXYZ0008
OO RUEHWEB

DE RUCNDT #0843/01 2602129
ZNR UUUUU ZZH
O 172129Z SEP 09
FM USMISSION USUN NEW YORK
TO SECSTATE WASHDC IMMEDIATE 7190

UNCLAS USUN NEW YORK 000843 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL AMGT AORC UN
SUBJECT: G7 AND EU MEETING ON THE SCALES OF ASSESSMENT 
 
REF: A. USUN 518 
     ¶B. USUN 562 
     ¶C. USUN 655 
     ¶D. USUN 663 
 
¶1. (U) SUMMARY: On September 4, 2009 the Canadian Mission, 
hosted a meeting to discuss the next steps in the joint 
strategy for the scales debate this fall. The attendees were: 
Wasim Mir for the UK, Gregory Cazelet for France, Masatoshi 
Sugiura and Akihiro Okochi for Japan, Thomas Mangartz for 
Germany, Chris Plunkett, Veronique Pepin-Halle and Phillip 
Lafortune for Canada, Maria Hakansson for the EU Presidency, 
Bruce Rashkow, Eugene Chen and Eileen Merritt for the US 
Mission. The Canadian outlined an agenda for the discussion 
that consisted of four key issues; 1) opening statements at 
the start of the GA debate on scales, 2) Geneva Group 
Directors Level Meeting on scales, 3) refinement of an LPCIA 
option, and 4) Outreach. 
 
¶2. (U) Both the UK and France made it clear that the status 
quo on the regular budget scale was unacceptable and that 
obtaining a change to the scales methodology is a national 
priority this year. Both indicated that these positions 
should be reflected by the entire group in the opening 
statements made in plenary on the item. The U.S. cautioned 
that the decision whether to make such a statement is a 
question of strategy and tactics and that making such a 
statement runs the risk of antagonizing Brazil, Russia, India 
and China (BRIC) and the G-77 at the outset of the session. 
The US argued and most of the group agreed that while the 
core principles of the group should be reflected in the 
opening statements, the particulars of the approach should be 
discussed at a higher level. In this respect, the Canadian 
suggested a Director's Level meeting on scales at the margins 
of the Geneva Group (GG) to discuss goals and strategy. The 
day and time of that meeting has yet to be determined. On 
outreach, there was a discussion of whether to support 
including Mexico and the Republic of Korea (ROK) in the 
discussions of the group as we move forward. Concerns were 
raised by a number of the participants because of Mexico's 
position on the peacekeeping scales (see para 6). It was 
agreed to leave this question for Capitals - perhaps to be 
discussed at the proposed meeting on the margins of the GG 
meeting. 
END SUMMARY 
 
 
------------------- 
Opening Statements 
------------------- 
¶3. (U) Participants discussed coordination of the opening 
statements for the scales item when the debate opens. The 
Secretariat coordinator of the Fifth Committee indicated that 
the scales of assessment item will be introduced in the first 
two days of the October session of the Fifth Committee, with 
the first day devoted to regular budget scales and the second 
day devoted to the peacekeeping scale. Discussions will cease 
after two weeks and then resume in late November. The 
Canadian suggested that the group should coordinate language 
for the opening statements to reflect the group position on 
the item. The U.S. noted that the agreed approach was to 
recognize the redlines of the participants, including the US 
redline respecting the cap, and focus on the BRIC through an 
LPCIA approach. From a tactical perspective, the U.S. 
stressed that the statements should focus on general 
principles and the concept of fairness of the scales 
methodology rather than a particular model. In response, the 
UK stated emphatically the statements should make it clear 
that status quo is unacceptable and that it should be changed 
at this session of the GA. The U.S. cautioned against at the 
outset of deliberations on rejecting the status quo and 
insisting on changing the methodology at this session. He 
suggested that taking such a position runs a high risk of 
prematurely driving the G-77 into the hands of the BRIC and 
polarizing the discussion before there has been any 
opportunity to explore possible changes. The UK expressed 
grave concern at this remark. Japan stated that the 
statements should reflect our core principles rather than get 
into specific proposals and should be delivered at a high 
level. In the end, most agreed with a more general approach. 
 
 
-------------------------------- 
Director Level Meeting on Scales 
-------------------------------- 
¶4. (U) All agreed that a higher level of engagement on the 
scales issue should be addressed at a meeting of the G-7 plus 
Sweden GG Directors on the margins of the GG meeting to be 
held September 29, 2009. In this respect, all agreed that the 
meeting should address the goals and strategy of the group 
for moving forward on this initiative, including coordination 
of opening statements, bearing in mind that there will be 
separate sessions on the regular budget scales and the 
peacekeeping scales. A time and date has yet to be determined 
 
and will be coordinated in the coming weeks. 
 
 
------ 
LPCIA 
------ 
¶5. (U) The Canadian indicated that the group should consider 
alternative models that might benefit member states within 
the G77 to help efforts to weaken the solidarity amongst the 
G77 so a change in the scale methodology can be more 
achievable. The UK recommended the group look at methods to 
either benefit the G77 at the expense of the BRIC or find 
ways to defer the savings to the G7 group until future years. 
The U.S. suggested that if we can't get a change in the scale 
methodology at this session, we may want to consider a phased 
in approach to change where agreement is reached in principle 
to make a change but defer taking concrete action until a 
later time. The UK seemed receptive to the U.S. proposal and 
indicated the suggestion warrants study but cautioned that it 
must be realized within a 3-year period, and not deferred to 
the next scales debate. 
 
 
---------- 
Outreach 
---------- 
¶6. (U) The question of when to expand the group to Mexico and 
other member states was raised to which the UK responded that 
the Director's meeting might be a good opportunity to begin 
outreach. The Canadian pointed out that the inclusion of 
Mexico introduces a number of interesting challenges because 
it hinders the freedom of movement of the group on the 
particular elements of the scales methodology (e.g. debt 
burden), while also giving the group the benefit of an 
influential voice. The U.S. noted that the scheduling of two 
days for the opening of the scales discussion means that the 
group will need to prepare two statements, one on the regular 
budget and another on the peacekeeping scale. As a result, 
the group will have to consider how this will fit into the 
groups tactical strategy in dealing with potential partners 
such as Mexico and the ROK. It will be harder to coordinate 
on both scales especially in the event that Mexico, which 
receives a 70 percent discount as a member state in Level H 
in the peacekeeping scale of assessment, and others are 
included. 
 
 
¶7. (U) Possible outreach to the BRIC was also raised as a way 
to explain that the G7 group respects the BRIC's growing 
importance and influence and that the assessments should be 
reflective of that growth. The German suggested that China 
appears to want to talk about scales to avoid a 
confrontation. The group will also need to coordinate the 
response to Russia's attempt to have its conversion rate 
changed from the market exchange to a price-adjusted rate of 
exchange. The resulting discounts would be offset through a 
voluntary increase in their assessment that will benefit the 
smaller G77 countries to obtain their support. All agreed 
that a strong response to Russia's attempt would be needed to 
avoid harm to the scales. The German recommended that the 
group appeal to Russia's self-perception of importance even 
though it pays less than many small EU countries. 
 
 
--------------------- 
G77 Leadership Vaccum 
--------------------- 
¶8. (U) According to Italy, the G77 is engaging in internal 
discussions on the scales moving toward considering both the 
regular budget and peacekeeping scales together to obtain a 
method that doesn't hurt or help too much. Given the void of 
strong G77 leadership, the possibility of repeating the 
western unified front displayed for the peacekeeping 
negotiation in June was mentioned. The U.S. suggested that 
weak leadership in the G77, rather than offering an 
opportunity, could present a challenge - undermining the 
ability of the G77 to coordinate effectively in order to 
reach a consensus. The UK and Canada expressed the view that 
the weakness can be an advantage in obtaining a change given 
the diversity of strong national interests in the scales 
debate. 
 
----------- 
Conclusion 
----------- 
¶9. (U) The Canadian proposed an additional G7 plus one 
meeting on scales scheduled before the opening of Fifth 
Committee on October 2. In the meantime,  coordination 
continues on scheduling of the Director's level meeting, on 
scales to be held on the margins of the GG meeting. 
RICE