Mr. Chairman,

At the outset, the Chinese delegation would like to thank UN Secretary-General Mr. Annan for his introduction of the proposed program budget for the biennium 2002-2003. Our thanks also go to Ambassador Mselle, Chairman of the ACABQ and Madame Chairperson of the CPC for their introduction of the report of their respective committee on the same subject.
The Chinese delegation agrees in principle with the conclusions and recommendations of the CPC reached at its 41st session.  We have also taken note of the fact that the Committee was unable to arrive at a consensus on some issues.  While fully concurring with the statement made by the distinguished representative of  Iran on behalf of G77 and China, we would like to make the following additional comments.

---------------------------------------------Firstly, the format of the proposed program budget
As pointed out by the Secretary General in the foreword and introduction, this is the first program budget proposal within the medium-term plan for the period 2002-2005 as well as the first proposal using a results-based budget format and it incorporates the concepts approved by the General Assembly in its resolution 55/231 of 23 December 2000.  We would like to reiterate that the Chinese delegation supports any budge format that can improve the efficiency and quality of  the work of this Organization.  In light of the observations and recommendations of the ACABQ on this matter, we would like to stress two points:

The new budget format is an innovation, a complex system project and, in our view, calls for a gradual approach. Results-based budget (RBB) is still at an exploratory stage for the UN system as a whole, neither the Secretariat nor the member states are yet familiar with it and there are so far no authoritative explanations for the terms and concepts used in RBB.  For example, how do you define objectives, expected accomplishments or indicators of achievement, how are they different from each other and who are to accomplish them.  As the Chinese saying goes, practice is the criterion for testing truth, the feasibility of results-based budget also needs to be tested by practice.  It is therefore necessary for the UN to constantly learn from experience, separating the wheat from the chaff.

The Chinese delegation is of the view that certain areas of UN work should be measured by uniform standards and that there is no need for (program managers) to come up with "expected accomplishments" or "indicators of achievement" for activities that are difficult to measure and forecast.  In this context, I would like to recall paragraph 9 of GA resolution 55/231 which "requests the Secretary-General to ensure that, in preparing the program budget, expected accomplishments and, where possible, indicators of achievement are included to measure achievements in the implementation of the programs of the Organization and not those of individual member states".

Whatever the budget format, the proposed program budget for the biennium cannot exceed the medium-term plan for the period 2002-2005.  We have noted that on the whole, the objectives and expected accomplishments included in the proposed program budget are in conformity with the MTP, but the narratives are sometimes vague and at times even depart from the MTP, we will flag these concerns of ours during informal consultations.  

Secondly, the level of the proposed program budget
Mr. Chairman, My delegation always believes that the UN program budget should be prepared on the basis of ensuring adequate resources for the mandated programs and activities, hence the need to fully consider and reflect their actual requirements in the biennium.  We fully agree with the ongoing reforms and economy measures undertaken by the Organization, but these measures should not be taken at the expense of the full implementation of programs.  These measures should instead facilitate and deepen the reforms so as to ensure that programs and activities of our Organization will never face the dilemma of having to stop halfway due to the lack of funds.

In recent years, controversy over the general level of the biennium budget has never died down, we call upon all countries concerned to take a pragmatic approach and try to resolve this important question rationally and realistically.

Thirdly, distribution of resources
The preparation of the UN program budget requires the setting of priorities, and the distribution of resources ought to be reasonable and balanced on the basis of those priorities.  But both the priority setting and the distribution of resources must be in conformity with the interests and requirements of the general membership and be decided by them on the basis of full consultations.  My delegation has noted that under the Secretary-General's proposal, some questions of vital interest to the developing countries, such as the environment, crime prevention, development of Africa and economic development and regional economic cooperation, have not been given adequate resources or increase in resources compared to the 2000-2001 biennium.

The Chinese delegation is concerned about this and would like to stress here that while the UN should try to strike a balance in its resource input to peacekeeping and development, it should also take more effective measures to ensure that priority programs relating to the economic development of the developing countries will receive the necessary attention as well as assured financing.

Mr. Chairman,
The proposed program budget for the biennium 2002-2003 is the most important agenda item for the 5th Committee and for this session of the General Assembly as well, it is also a time-consuming item.  In view of the fact that a large number of states participated this year in the meetings of the CPC and carried out more in-depth discussions on this question there, the Chinese delegation hopes that in the next two months all parties concerned can work realistically and efficiently.