Foreign Relations of the United States, 1981–1988, Volume XLI, Global Issues II

362. Telegram From the Department of State to Multiple Diplomatic Posts¹

Washington, May 8, 1987, 2316Z

140948. Subject: U.S. Delegation Report: Third Session of UNEP Negotiations on Ozone Layer Protocol (April 27–30, Geneva). Ref: (A) Geneva 4835, (B) Geneva 4744, (C) Geneva 4742.²

1. Summary: Difficult but productive protocol negotiating session ended with participating nations in reach of final agreement by September diplomatic conference in Montreal. Ad Hoc “Chairman’s Group”, aided by hard-driving and effective leadership of UNEP Executive Direct Tolba, made considerable progress in narrowing differences on control stringency and timing. Based on his discussions with smaller sub-group of this group, Tolba developed a compromise control article text with stringency and timing levels between that of initial (Dec. 1986) EC³ and U.S. negotiating positions, which he intends to use as negotiating text for subsequent meeting of sub-group (see para. 11).

—Productive discussions within trade group resulted in proposal for compromise production/consumption “formula” for defining what is to be controlled. However, group was unable to resolve substantive differences on control of trade between parties and non-parties. Similarly, no agreement emerged on treatment of developing countries.

—Scientific group, drawing on results of recent UNEP-sponsored meeting of scientists to compare ozone-depletion under alternative control strategies, gave strong support for the need for broad chemical coverage. The group also confirmed that a freeze would not prevent long-term depletion, strengthening the view that further reductions were necessary to adequately protect the ozone layer.

—Session concluded with plans for further informal meetings in June and July, a formal working group session September 8–11 and diplomatic conference in Montreal September 14–16. End Summary.

2. Participating Countries: Argentina, Australia, Austria, Canada, Colombia, Belgium, Denmark, Egypt, Finland, France, FRG, Ghana, Hungary, Italy, Japan, Kenya, Luxembourg, Malaysia, Mexico, Netherlands, New Zealand, Nigeria, Norway, Poland, Qatar, Sweden, Switzerland, USSR, UK, US, Venezuela.

3. Stringency and Timing: Chairman Lang’s (Austria) group, which initially consisted of all heads of delegations with advisors, was supplanted by a smaller ad hoc group consisting only of heads of delegation for the U.S., EC (UK, Denmark, Belgium, and the Commission), Canada, Norway, USSR, and Japan. Tolba took over chairmanship of this group on Wednesday, after Lang was unexpectedly called back to Vienna. With the assistance of the smaller group, Tolba produced a compromise text for use in subsequent negotiations. Text calls for:

—(A) A freeze at 1986 levels within two years of protocol’s entry into force (EIF) (Tolba strongly urged that protocol be ratified by 1988, so that the freeze would take effect by 1990);

—(B) A 20 percent reduction within four years of EIF;

—(C) A further reduction of 30 percent, following a periodic scientific/technical/economic review, for which two options were provided: (1) within six years after entry into force if a majority of the parties so decide; (2) within eight years after entry into force unless two-thirds of the parties otherwise decide;

—(D) A future decision (based on scientific/technical/economic assessment) regarding further actions, which could be put into effect by either a majority or two-thirds vote of the parties (both alternatives still in brackets).

—None of the delegations represented at Geneva gave formal assent to this control package, with some (Canada, Nordics, Switzerland, New Zealand) indicating that it might be “too weak”, and others (EC, USSR, Japan) that it might be “too strong”. U.S. stated that we would carefully study the details, noting, inter alia, that text may need further refinement to ensure proper synchronization between scientific assessment and control decisions. Nevertheless, there was general agreement among delegations that the text represents the closest to a consensus yet attained on the contentious issue of control stringency and timing.

4. Scope of Chemical Coverage: The chair’s group moved closer to consensus on which chemicals to include for control. U.S., Canada, and Nordics pushed for inclusion on CFC 11, 12, 113, 114, 115, and halons 1211 and 1301 for at least the freeze, perhaps with only 11, 12, and 113 included for subsequent reduction phases. The EC’s opening position was to include only 11 and 12, but they subsequently added 113 and—while not consenting—agreed to consider inclusion of others. By contrast, at the outset of discussions, Japan actively opposed inclusion of 113. By end of week, however, GOJ Delegation had agreed to take question back to Tokyo for reconsideration in light of “broad consensus” at the meeting (important element for Japan was agreement by other delegations to aggregated emissions, with each chemical weighted by its ozone depletion potential). USSR still opposed including halons, due to legal questions of whether inclusion is allowed by working group’s formal mandate. However, Soviets appeared more sympathetic to the scientific rationale for including halons, and Tolba agreed to seek enlargement of the mandate at the UNEP Governing Council in June. Overall, movement toward U.S. position on the issue was facilitated by conclusions of scientific group emphasizing need for broad chemical coverage (see para. 9).

5. Further, it was agreed that the chemicals would be grouped together and weighted according to their ozone-depletion potential (see para. 9). This would enable individual countries to “trade off” freeze or reductions among individual chemicals within the basket, so long as the weighted total for the entire basket met the protocol freeze/reduction target. This flexibility was critical in moving Japan to at least consider inclusion of CFC 113.

6. Control Formula: The question of the control “formula” (i.e., whether to freeze and reduce national production, adjusted production, or some hybrid formulation) was taken up by the trade sub-group. U.S., Canada, Nordics, and New Zealand supported adjusted production (AP) formula (production imports—exports to parties—amount destroyed). With main opposition to it coming from the EC. EC’s stated reasons for opposing AP formula were: (A) It would be difficult to implement and enforce; (B) adequate data to calculate base year level might not be available for many countries (they proposed using 1990 for base year); (C) subtracting only exports to parties might put the EC at a disadvantage, since they could not ensure that their existing export market would become parties; (D) subtracting exports might create an incentive for some parties to maintain or increase production. Based on a Swedish proposal to combine both approaches, Trade Group developed an ad referendum draft text, which calls for initially freezing production and imports separately, and then reducing both production and consumption in parallel (with the latter defined as adjusted production but with all exports subtracted). Parties would subsequently assess treatment of the export term (e.g., whether it would apply for exports to parties only). Text remains bracketed, however, because Nordics, New Zealand, and some LDCs insisted on a provision to allow non-producing countries to produce up to their allocated level of imports, providing that imports are reduced by an equal amount. Japan proposed a second alternative allowing for inter-party transfer of production capacity, providing that total global production does not increase. EC opposed both proposals. Beyond these substantive differences, full consensus on this compromise formulation was not reached, because many delegations expressed need to assess implications of compromise formula in more detail.

—In addition, the trade group agreed that the protocol should provide credit to a party for the amount of the controlled substances destroyed, provided that destruction is by techniques approved by the parties. This preserved U.S. interest in creating an incentive for the development of CFC destruction technologies, while allaying prior USSR concern that the amounts reported for some countries might not be reliable until the technologies are known and widely accepted.

7. Trade between parties and non-parties: EC insistence that GATT representative be present before Trade Group could take up discussions of trade article prevented Trade Group from devoting adequate time for discussion of trade article. However, this tactic backfired somewhat when GATT legal advisor appeared and (contrary to expectations of UK and EC Reps) stated that in his opinion non-party import restrictions would be supportable under Article 20 of the GATT⁴ (although final determination would be by GATT members). When Trade Group took up consideration of substantive elements of trade article, it became clear that the EC Commission (at least at the staff level) and the UK are opposed to any restrictions (export or import) except for bulk chemicals. Their ostensive reasons were: (A) increased possibility of being challenged within the GATT, and (B) possible conflict with bilateral trade agreements. Other than Canada, which supported U.S. out of principle, other participants were non-committal on trade issue. Other than agreement to remove exemption for non-party compliance (which was replaced with a more restrictive provision for developing countries) result was little movement since last meeting, a heavily bracketed text, with substantial differences in positions of U.S. and EC, and positions of other key players as yet unarticulated.

8. Developing Countries: Very little time was spent on the LDC issue, despite somewhat greater number of LDC representatives present and more vocal participation. Only substantive proposal, by Canada (and amended by others), would exempt parties with per capita consumption less than 0.1–.0.2 kg/yr from the controls for the first 5–10 years of the protocol, after which they be subject to the controls in a manner “parallel” to other parties. Although there appeared to be sentiment for Canadian approach of only allowing LDCs to be exempted for a period of years (rather than indefinitely), group concluded that Canadian proposal, as well as proposals from previous sessions, be assessed further prior to next negotiating session. Lack of data on current levels of developing country consumption continues to hamper resolution of this issue.

9. Scientific Group: Scientific group issued very strong report which supported USG positions on: (A) the need for broad chemical coverage of all fully-halogenated compounds, and (B) the need for reduction steps beyond a freeze. Latter point was buttressed by the group’s high-lighting the importance of potential changes in the vertical distribution of ozone and latitudinal gradients in estimates of total column ozone depletion. Group also agreed on ozone depletion potential values for all of the chemicals under discussion, which were recommended for use in the protocol for calculating weighted emissions. In addition, scientific group reaffirmed need for major scientific assessment every four years, and the need to develop an improved ground-based stratospheric monitoring system.

10. Future Work: Canada confirmed that the diplomatic conference will be held in Montreal September 14–16, to be preceeded by a fourth working group session September 8–11. Prior to that, two informal meetings have been scheduled. The Chair’s Group will meet June 29–30 in Brussels and a legal drafting group will meet July 6–8 in The Hague.⁵ Tolba requested that delegations submit to him, by June 19, comments on the control article text.

11. Next steps: The U.S. Delegation recommends that:

—(A) Low-key and carefully planned bilateral contacts with the other countries in the Chair’s Group begin as soon as possible, in order to maximize the likelihood of an outcome favorable to USG objectives (specific guidance will follow for relelvant posts);

—(B) Timing of control article steps should be reviewed to ensure that they are properly synchronized with the periodic scientific assessments;

—(C) The relevant USG agencies assess the compromise control “formula” developed by the trade group, to see whether it protects U.S. interests, whether it is feasible from a domestic regulatory standpoint (including the question of data availabiltiy), and whether there are any simpler alternatives which accomplish the same thing;

—(D) Consideration be given to how the remaining substantive areas for which consensus has not been reached (e.g., non-party trade, LDCs) might be moved toward resolution prior to the September working group session; in particular, whether it would be useful to gauge the interest of other countries in: (1) an additional informal meeting to discuss trade issues, and (2) informal discussions of the LDC issue during the UNEP Governing Council (latter was already discussed with Peter Usher, UNEP Secretariat).

Whitehead

1. Source: Reagan Library, Bledsoe, Ralph: Files, 330—Stratospheric Ozone (1985 to June 1987) [2]. Limited Official Use; Priority. Drafted by Losey; cleared in EPA/OIA, EPA/OAR, NOAA, Interior, Energy, USTR, L/OES, Commerce, and NASA. Sent priority to all OECD capitals, Algiers, Bangkok, Bogota, Brasilia, Bucharest, Budapest, Buenos Aires, Cairo, Caracas, Dakar, USUN Geneva, Hong Kong, Jakarta, Kuala Lumpur, Kuwait City, Lagos, Lilongwe, Lima, Manila, Mexico City, Montevideo, Moscow, Nairobi, New Delhi, Ouagadougou, Rabat, Santiago, Seoul, Singapore, Sofia, Tel Aviv, Tunis, and USUN Vienna.
2. In telegram 4835 from Geneva, April 30, USUN provided a summary of the second day of ozone protocol negotiations. (Ibid.) In telegram 4744 from Geneva, April 28, USUN provided a summary of the first day of ozone protocol negotiations. (Ibid.) In telegram 4742 from Geneva, April 28, USUN transmitted Benedick’s plenary statement given on April 27. (Department of State, Central Foreign Policy File, D870327–0544)
3. See Document 356.
4. Article 20 of the GATT provides exceptions to the restriction of trade in order to protect a variety of causes, including environmental ones.
5. In telegram 9255 from Brussels, July 1, the Embassy provided a summary of the June 29–30 Chairman’s Group meeting. (Reagan Library, Risque Files, Stratospheric Ozone [7]) In telegram 217952 to multiple recipients, July 16, the Department provided a summary of the Legal Drafting Group meeting. (Reagan Library, Bledsoe, Ralph: Files, 330—Stratospheric Ozone [1985 to June 1987] [1])