GUIDELINES STRATEGIC V.03-81608—March 2003—500 Printed …

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATIONVienna International Centre, P.O. Box 300, A-1400 Vienna, AustriaTelephone: (+43 1) 26026-0, Fax: (+43 1) 26926-69E-mail: [email protected], Internet: http://www.unido.org

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATIONeconomy env i ronment employment

Printed in AustriaV.03-81608—March 2003—500

S T R AT E G I CG U I D E L I N E S

“towards improved UNIDO

programme delivery”

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATIONVienna, 2003

S T R AT E G I C G U I D E L I N E S



The twenty-sixth session of the Industrial Development Board, held in November 2002,adopted a set of Strategic Guidelines for UNIDO aimed at improving the Organization'sprogramme delivery. The Strategic Guidelines, "Towards improved UNIDO programmedelivery", initially proposed by Japan, were finalized over a period of several weeksthrough closely coordinated and concerted efforts of UNIDO Member States.

While the Business Plan on the Future Role and Functions of UNIDO, endorsed by theseventh session of the General Conference in 1997, remains the basis of UNIDO's orga-nizational and programmatic transformation, this new document provides theOrganization with guidelines to further focus its technical cooperation and global forumactivities on producing practical and useful deliverables in areas where it has a com-parative advantage. In particular, they are intended to point the way for the imple-mentation of the medium-term programme framework for 2002-2005, the formulationof the medium-term programme framework for 2004-2007, and the preparation of theprogramme and budgets for 2004-2005.

I regard it as very important that all UNIDO staff, including those in the field, shouldfully understand the guidance given by the Member States in these Strategic Guidelines,so that our Organization can meet fully their expectations and requirements in the designand implementation of our activities. In addition, I believe that these Guidelines canmake an important contribution in providing external readers with an understanding ofUNIDO's activities and future direction.

It is in this context that I am very pleased to publish this booklet containing the StrategicGuidelines and the policy documents to which they are linked for circulation both withinUNIDO and externally. I am convinced that this will contribute to enhancing the impactof UNIDO's activities for sustainable industrial development, and to promoting a widerunderstanding of the objectives and achievements of our Organization.

Carlos MagariñosDirector-General

Foreword

I I I

Contents

Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

Strategic Guidelines "Towards improved UNIDO programme delivery" . . . . . . . 1

Annexes

A. Industrial Development Board decision IDB.26/Dec.7 on Strategic Guidelines"Towards improved UNIDO programme delivery" . . . . . . . . . . . . . . . . . . . 7

B. Business Plan on the future role and functions of UNIDO . . . . . . . . . . . . . . 8

C. Medium-term programme framework, 2002-2005: The Business Plan and medium-term programme development . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

D. General Conference resolution GC.9/Res.2 on medium-term programme framework, 2002-2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

V

INTRODUCTION

1. As stated in General Conference ResolutionGC.9/Res.2, the Business Plan remains the basis forenabling UNIDO to adapt its functions and prioritiesand to orient its activities to the new realities of the changing global economic environment, whileensuring its viability and efficiency in the context ofthe ongoing reform process. The core principles of theBusiness Plan, i.e. good management and a clear focus on identified priority areas therein, remainvalid. Though remarkable achievements in developinga clear thematic focus have been made by UNIDOsince the adoption of the Business Plan, there is still scope for further sharpening the focus of its tech-nical cooperation activities. In particular, UNIDOshould focus on producing practical and usefuldeliverables through its technical cooperation acti-vities in areas where its comparative advantage couldbe most beneficial with a view to achieving tangibleresults.

2. Considering the need to enhance the cost-effectiveness of UNIDO's use of resources, and therelevance of its cooperation activities and their socio-economic benefits, UNIDO should be encouraged tostrive for further efficient and effective operations.This would lead the international community torecognize UNIDO as a revitalized and viable organi-zation. It is sincerely hoped that through such efforts,UNIDO will attain the widest possible membership.

3. This set of strategic guidelines should be takeninto account when implementing the medium-termprogramme framework (MTPF), 2002-2005, whendeveloping the medium-term programme framework,2004-2007, and during the preparation of the pro-gramme and budgets, 2004-2005.

4. The areas upon which UNIDO should focus itstechnical cooperation activities, and the key consi-derations in implementing these activities, are indi-cated in chapters II and III, respectively.

I. GUIDING PRINCIPLES

5. The implementation of the MTPF, 2002-2005,the preparation of the MTPF, 2004-2007, and thepreparation of the programme and budgets 2004-2005, should be carried out in a manner supportive tothe overall aim of focusing and further improvingUNIDO's technical cooperation activities in line withavailable resources. The planning of activities shouldbe within the themes and priorities laid down in theBusiness Plan and in line with the funds that UNIDOcan mobilize for their implementation through exist-ing resources and increased efforts to raise additionalfunds from new and innovative sources.

6. In conformity with the Business Plan and themedium-term programme framework, 2002-2005approved by the General Conference in resolutionGC.9/Res.2, UNIDO's technical cooperation activitiesshould be demand-led and should focus on areaswhere the Organization has a comparative advantage.

7. UNIDO should be guided by the emerging inte-rests and concerns of developing countries facingchanging conditions in international trade and invest-ment as the process of globalization intensifies. Bythus responding to the demands of its Member States,UNIDO could foster a greater sense of ownership ofits technical cooperation activities, which should befocused on those areas within its mandate that areclearly identified in national poverty reduction plansand within agreed country strategies, and therebyensure the successful implementation of its pro-grammes and projects.

8. As stipulated in the Business Plan, while main-taining its universal character and vocation UNIDO

STRATEGIC GUIDELINES 1

Strategic Guidelines "Towards improved UNIDO programme delivery"1

1Adopted by the Board in decision IDB.26/Dec.7 on21 November 2002.

should pursue a geographical, sectoral and thematicconcentration of its activities by giving added empha-sis to services provided to least developed countries(LDCs), in particular in Africa, with special attentionto regional and subregional levels, as well as to thoseservices in support of agro-based industries andSMEs. UNIDO should pay increasing attention to theneeds of LDCs and to projects that would benefit thepoor. Additionally, UNIDO should continue to giveemphasis to the integration of women in industrialdevelopment.

9. In order to ensure the most effective contributionto the wider development goals of its beneficiarystates, UNIDO should give particular consideration toother major United Nations development initiativeswhen developing its future activities. WithinUNIDO's existing mandate, this would include givingparticular emphasis to relevant recommendations inthe Plan of Implementation adopted by the WorldSummit on Sustainable Development (WSSD) andensuring that planned activities in Africa take intoaccount the priorities established by the NewPartnership for Africa's Development (NEPAD). Itwill also be necessary to ensure that activities aredeveloped, where appropriate, within the context ofthe United Nations Development AssistanceFramework (UNDAF) and in such a way that theycontribute to the achievement of the MillenniumDeclaration Goals (MDGs).

II. AREAS OF FOCUS FOR UNIDO'S TECHNICAL COOPERATION ACTIVITIES

A. Strengthening industrial capacities

10. UNIDO should assist developing countries andinterested countries with economies in transition tostrengthen their institutional capacities to benefitfrom improvements in market access, and promotethe rapid and full integration of these countries intothe multilateral trading system, particularly in thelight of the new round of WTO trade negotiations.This may be achieved, inter alia, by:

(a) Developing programmes for strengtheningproductive capacities, in particular throughtechnology-based interventions, that target micro,small and medium enterprises and specific sectors,especially agro-based industries (in particular, textile,

leather, food-processing and wood), with a view toenhancing the competitiveness of their products inworld markets;

(b) Providing support in the field of standardiza-tion, quality control and conformity assessment pro-cedures;

(c) Promoting the transfer of technology with aview to enhancing the productivity, competitivenessand quality of the industrial base of all developingregions of the world, particularly in the followingareas: agro-related technology, new information andcommunication technologies and biotechnologies,bearing in mind the special importance of biotech-nology and related activities for those regions.Although UNIDO has accumulated a notable expert-ise in the area of bio-technology, it should neverthelessbe acknowledged that an organization of UNIDO'ssize needs to be very selective when working in such avast area. Further discussions are warranted, relatingin particular to any follow-up to the Global Bio-technology Forum to be held in Chile in December2003 and the preparatory work for the Forum.

11. UNIDO should also promote investment andtechnology in developing countries through technicalcooperation services and associated global forumactivities in the following areas, with a particularfocus on the development of agro-based industriesand small and medium enterprises:

(a) Building institutional capabilities in invest-ment and technology promotion;

(b) Promotion of management advisory servicesand improvement of the business environment;

(c) Support in the selection of appropriate tech-nology to meet specific industrial development needsof developing countries and countries with economiesin transition;

(d) Promotion of business alliances;

(e) Extension of technology foresight activitiesto all interested countries and regions in a demand-driven manner;

(f) Promotion of renewable and clean energyservices for poor communities, particularly wherethese would contribute to increased productivity orlocal income generation.

12. UNIDO should support developing countriesand countries with economies in transition in thedesign, formulation, implementation and monitoringof industrial policies and strategies.

2 STRATEGIC GUIDELINES

B. Cleaner and sustainable industrial development

13. Assistance should be provided to Member Statesto facilitate effective compliance with their inter-national commitments with regard to environmentalprotection, including:

(a) The phasing-out of ozone depleting sub-stances as defined in the Montreal Protocol;

(b) The adoption of sustainable industrial devel-opment strategies and technologies and the imple-mentation of international instruments, such as theStockholm Convention on Persistent Organic Pollu-tants, the Kyoto Protocol to the United NationsFramework Convention on Climate Change includingthe Cleaner Development Mechanism, and theCartagena Protocol on Biosafety to the Conventionon Biological Diversity, inter alia through the de-velopment of national environmental norms andstandards.

14. UNIDO should support the promotion of cleanerand sustainable industrial development, inter alia by:

(a) Continuing to cooperate with the GlobalEnvironment Facility (GEF) and to provide services toMember States in the GEF focal areas where UNIDOhas a comparative advantage;

(b) Developing further cleaner production activ-ities centred, among others, around the UNIDO/UNEP National Cleaner Production Centres (NCPCs)and focusing on specific subsectors, including indus-trial waste and pollution control activities;

(c) Helping to assess and overcome the negativeenvironmental consequences of industry and miningon water degradation.

C. Global forum activities

15. These should focus on improving the under-standing of how best to use sustainable industrialdevelopment to reduce poverty and ensure that thepoor benefit from the process of globalization.

16. They should involve both strategic and action-oriented, project-related research; this shouldstrengthen the systematic promotion of industrialdevelopment through UNIDO's technical cooperationprogrammes in developing countries and countrieswith economies in transition.

17. UNIDO should contribute actively to relevantglobal forums and the implementation of their out-comes, such as WSSD, the International Conferenceon Financing for Development, World Water Forum,World Summit on the Information Society, the TICADprocess (Tokyo International Conference on AfricanDevelopment) and NEPAD (New Partnership forAfrica's Development); such contributions can takethe form, inter alia, of disseminating UNIDO's expe-rience, highlighting the outcomes of its technicalcooperation activities, and promoting the importanceof implementing technologically sound projects.

III. CRITICAL ISSUES IN THE PROVISIONOF TECHNICAL COOPERATION SERVICES

A. Organization and field representation

18. UNIDO’s recent restructuring was intended toimprove the Organization's ability to implement moreeffectively and efficiently its activities in line with thesectoral priorities defined in the Business Plan.UNIDO should continue to consolidate the benefits ofthis re-structuring, inter alia by improving coordina-tion across UNIDO’s technical branches and amongits staff. The further strengthening of internal coordi-nation, including teamwork of the staff, would yieldsubstantial benefits.

19. UNIDO’s field presence at the national and inparticular at the regional level should be optimizedand strengthened, as appropriate, to ensure that it iswell-targeted, efficient and effective, and to promoteregional integration through, inter alia, interactionand coordination with all relevant actors and stake-holders involved.

20. UNIDO should promote coordination and,where appropriate, partnerships with other actors atfield level, taking into account existing coordinationmechanisms.

21. Better use should be made of the existing net-work of institutions such as Investment andTechnology Promotion Offices (ITPOs) and NCPCsto enhance synergy and create better relations with itsclients.

B. Funds mobilization

22. Within the scope of UNIDO’s mandate,increased use should be made of global funds such as


the Multilateral Fund for the implementation of theMontreal Protocol, the Clean Development Mecha-nism of the Kyoto Protocol, and GEF; increasedcooperation should also be encouraged with suchfunds as the United Nations Fund for InternationalPartnership (UNFIP) and the Common Fund forCommodities, and with foundations and bilateraldevelopment assistance agencies.

23. Efforts should be further enhanced to mobilizefunds in cooperation with recipient countries, placingspecial emphasis on funds for jointly developedIntegrated Programmes (IPs) and Country ServiceFrameworks (CSFs) and other high priority activitiesin developing countries, particularly LDCs.

C. Cooperation with the private sector and civil society

24. Cooperation should be enhanced with privateenterprises, foundations, research institutes and uni-versities to make use of their experience; UNIDOshould also further develop the business partnershipprogramme, and sustain its active participation in theGlobal Compact process, inter alia, as a means of pro-moting corporate social responsibility.

25. UNIDO should identify and, where appropriateand in consultation with concerned Member States, use the services of technologically advanced non-governmental organizations (NGOs) and volunteers,including United Nations Volunteers and associationssuch as the “silver volunteers”, with a view to makinguse of their expertise and technology in a cost-effectivemanner.

D. Sustainability of development assistance

26. The transition from aid to self-sustained growthshould be encouraged, inter alia by promoting thenational and local ownership of UNIDO’s pro-grammes and utilizing systems, equipment, and facili-ties that reflect the maintenance and managementcapabilities of the countries in question.

27. UNIDO should engage locally-recruited expertswhenever possible with a view to facilitating thegrowth and development of indigenous knowledgeand capabilities.

E. South-South cooperation

28. Efforts should continue to be made to assist inthe transfer of technology and lessons learned fromregions to other regions and from developing coun-tries to other developing countries.

29. The implementation of projects by developingcountries, and their transition from recipient to donorstatus, should be facilitated.

F. Efficient administration andeffective oversight functions

30. UNIDO should review at regular intervalsthroughout their implementation and revise as neces-sary its IPs or CSFs, which remain the principal modeof delivery of its technical cooperation services, andits stand-alone projects on the basis of a thoroughevaluation of the difference they have made in therecipient countries, taking into account the progressof funds mobilization, the performance of individualcomponents and new realities in the subject countries,with a view to ensuring that these activities remainresponsive to changing requirements.

31. A holistic and comprehensive result-basedmanagement system incorporating effective methodsof performance measurement, monitoring and eval-uation should be implemented. If quantificationshould prove initially difficult, the impact of pro-grammes, projects and global forum activitiesshould be reported in qualitative/ narrative terms asan interim measure.

32. The transparency and accountability of the uti-lization of external expertise should be increased.

G. Enhancing UNIDO’s profile

33. UNIDO should strive to enhance its profileamong decision-makers, the development community,the United Nations system and the public at largethrough interaction and complementarity with theprogrammes and activities of other actors in the fieldof development cooperation and through increasedcooperation with enterprises and other entities indonor countries.

34. The revitalized UNIDO has found a niche foritself in global efforts at industrialization by


innovative approaches to sustainable developmentranging from assisting industries to eliminate CFCsand to promoting environmentally compatibleadvanced and cleaner technologies. There is now gen-eral recognition of UNIDO’s important role as a cata-lyst for industrial development in developing coun-tries. However, a significant number of countries,including some that have left the Organization, stillremain outside the membership of UNIDO. UNIDOshould make systematic efforts to encourage non-Member States to join/rejoin the Organization.

35. UNIDO’s global forum activities should also beconsidered as an ideal opportunity for disseminatinginformation on its activities to the public.

IV. ACTION REQUIRED OF THE BOARD

36. The Board may wish to consider the informationprovided in the present document in the context of thedraft decision submitted by Japan on this subject.


The Industrial Development Board:

(a) Recalled General Conference resolutionGC.7/Res.1 of 4 December 1997 endorsing the BusinessPlan on the Future Role and Functions of UNIDO, whichremains the basis of UNIDO's organizational and program-matic transformation;

(b) Also recalled General Conference resolutionGC.9/Res.2 of 7 December 2001 concerning the medium-term programme framework, 2002-2005;

(c) Took note of the information provided in docu-ment IDB.26/8 concerning the medium-term programmeframework, 2004-2007;

(d) Emphasized the importance for UNIDO to strivecontinuously for efficient and effective programme deliveryin order to gain better recognition and stronger support inthe international community;

(e) Welcomed the initiative of Japan, which had ledto the formulation of strategic guidelines aimed at improv-ing UNIDO's programme delivery;

(f) Adopted the strategic guidelines "Towardsimproved UNIDO programme delivery", as contained in

document IDB.26/15, as an important contribution to theefforts to make UNIDO a more efficient and effectiveorganization, and in particular for the formulation andimplementation of the medium-term programme frame-works, 2002-2007;

(g) Requested the Director-General to take the strate-gic guidelines fully into account when implementing themedium-term programme framework, 2002-2005, andwhen developing his proposals for the medium-term pro-gramme framework, 2004-2007, and preparing his propos-als for the programme and budgets, 2004-2005;

(h) Requested the Director-General to draw attentionto the strategic guidelines during the consultations withnon-Member States that the Board at its twenty-fifth sessionhad requested him to begin with a view to encouraging themto join/rejoin the Organization (IDB.25/Dec.2);

(i) Requested the Director-General to keep MemberStates regularly informed and to report thereon to theBoard.

6th plenary meeting21 November 2002


Annex A. Industrial Development Boarddecision IDB.26/Dec.7 on Strategic Guidelines "Towards improved UNIDO programme delivery"

In the context of the ongoing reform process, the pres-ent business plan provides the basis for enabling UNIDO toadapt its functions and priorities and orient its activities tothe new realities of the changing global economic environ-ment and ensure its viability and efficiency.

UNIDO will concentrate on those support functions inwhich the Organization has a comparative advantage overother multilateral development organizations and bilateralassistance. Activities will be directed primarily to supportinstitutions rather than to individual enterprises, thusemphasizing upstream activities such as policy advisoryservices and institutional capacity-building. Support will beprovided for the development of small and medium enter-prises (SMEs) as the principal means for achieving equitableand sustainable industrial development. Emphasis will begiven by UNIDO to the integration of women in industrialdevelopment.

UNIDO will provide its support primarily in compre-hensive packages of integrated services and will furtherstrengthen its existing capacity in this regard through inter-disciplinary team-building.

While sharpening its focus in accordance with theabove direction, UNIDO should continue to pursue theimplementation of its mandates to support and promote thesustainable industrial development of developing countriesand countries with economies in transition. Preserving theuniversal character of the Organization, UNIDO will givespecial emphasis to least developed countries, in particularin Africa.

Throughout its programmes, UNIDO will promoteinternational industrial cooperation: between developed anddeveloping countries, among developing countries andbetween developing countries and countries with economiesin transition.

FUTURE ACTIVITIES OF UNIDO

The activities of UNIDO will be regrouped in twoareas:

A. Strengthening of industrial capacities

1. Promotion of investment and related technologies;

2. Programmes in support of the global forum functionand policy advice, including those relating to:

(a) Industrial policy advice based on action-orientedresearch;

(b) Institutional capacity-building at the country andsectoral levels;

(c) Quality, standardization and metrology;

(d) Industrial information through networking,including information on the transfer of technology;

(e) Industrial statistics.

B. Cleaner and sustainable industrial development

1. Support programmes on environmentally sustain-able industrial development strategies and technologies,including on transfer of environmental technologieswithin industrial subsectors assigned high priority;

2. Development of specific norms and standards relat-ing to environmentally sustainable industrial develop-ment strategies and technologies, and implementation ofinternational protocols, agreements and conventions.

The above implies discontinuation of a number of acti-vities:

(a) Activities in the field of privatization;

(b) Separate enterprise-level interventions not linkedto the institutional or policy level;

(c) The preparation of project-specific feasibilitystudies within investment promotion activities, whilemaintaining a basic training capacity on relevantmethodologies;

(d) Promotion of advanced technologies withoutproven industrial use;


Annex B. Business plan on the future role and functions of UNIDO1

1Adopted by the Industrial Development Board on 27 June1997 (decision IDB.17/Dec.2). Endorsed by the GeneralConference on 4 December 1997 (resolution GC.7/Res.1).

(e) Research and industrial studies which are notclearly target-oriented;

(f) Activities in the field of energy, except thoserelated to improvement of energy-efficiency of industriesand to cleaner production;

(g) Activities in non-agro-based industries (engi-neering, metallurgical and chemical industries), unlessrelated primarily to environmental issues or to agro-based industries;

(h) Services in relation to industrial subsectors whichhave already been assigned low priority;

(i) General activities related to country-level pro-gramming at Headquarters, in light of the future changesin field representation;

(j) Human resources development activities notintegrated in a specific project or programme;

(k) Emergency relief activities with no industrialdevelopment aspect.

The discontinuation of activities will apply to new projectsonly. It is understood that approved projects will be imple-mented in accordance with the relevant project documents.

CONCENTRATION OF ACTIVITIES

While maintaining its universal character and vocation,a geographical, sectoral and thematic concentration of theactivities of UNIDO will be pursued by giving addedemphasis to the following:

(a) Services to LDCs, in particular in Africa, withspecial attention to the regional and subregional level;

(b) Services in support of agro-based industries andtheir integration through subsectoral linkages into nationalindustrial structures;

(c) Services in support of SMEs and their integrationinto national industrial structures.

FINANCING AND BUDGET

The format and presentation of the programme andbudget document is to be revised to reflect a programmaticapproach, in particular by grouping the substantive activi-ties of the Organization into two major programme areascovering (a) the strengthening of industrial capacities and(b) cleaner and sustainable industrial development.

The preparation of the proposed 1998-1999 pro-gramme and budgets should be based on the programmes aselaborated in the business plan, reflecting a number of issues,i.e. changes in membership, discontinuation of activities,streamlining the organizational structures and introducing

efficiency-enhancing measures. In this respect, an indicativelevel of 20 per cent and 10 per cent reduction of the budgetis proposed for the preparation of the budget proposals.

Budgetary adjustments are to be achieved by:

(a) The introduction of efficiency-enhancing meas-ures, including, inter alia, outsourcing of some administra-tive activities, reduction in the number and/or length ofpolicy-making organs meetings, and reduction in non-staffexpenditure items, including travel, publications, con-sultants and meetings;

(b) The discontinuation of activities;

(c) The streamlining of organizational structures.

It is understood that the implementation of budgetaryadjustments could result in costs for staff separations in theprogrammes affected.

New approaches to (a) enhance funds mobilization,including cost-sharing arrangements for programmes and(b) promote the timely payment of assessed contributions byMember States are to be pursued.

NEW ORGANIZATIONAL STRUCTURE

The structure of UNIDO will emanate from the busi-ness plan and, based on the two clusters, will include the fol-lowing substantive divisions: (a) Investment promotion andinstitutional capacity-building, and (b) Sectoral support andenvironmental sustainability. A third component will com-prise functions related to administration, operationalsupport and coordination of field representation. The Officeof the Director-General will include a small organizationalunit dealing with functions related to policy coordination,external relations, legal advice and internal audit.

In the interest of ensuring a flat organizationalstructure, the head of one of the three organizational com-ponents will be designated, on a continuing basis, to act asdeputy to the Director-General, whose responsibilities shallinclude coordination within UNIDO and acting on behalf ofthe Director-General, in the case of the latter’s absence fromVienna. Also in keeping with the leaner hierarchical struc-ture, authority will be delegated to the maximum extentpossible to the middle-management levels of the Organi-zation, whose role would be accordingly strengthened.

In defining the organizational structure of theOrganization, an effective decentralization of activities andstrengthened field representation has to be secured. Thisimplies, inter alia:

(a) Redeployment of resources and professional staffwith required level of expertise from Headquarters to thefield;


(b) Appropriate delegation of authority;

(c) Formulation of key functions and responsibilitiesof field offices.

In this context, subregional offices will be establishedwherever functionally justified. Contributions from hostcountries, through cost-sharing or other arrangements, aswell as the particular situation of the least developed coun-

tries, will be important elements to be taken into accountwhen determining the location of individual field offices.

Functional and programmatic coordination betweenUNIDO field representation and that of other UnitedNations bodies have to be improved. UNIDO countryoffices will be integrated in a unified United Nations repre-sentation whenever feasible and cost-effective.


INTRODUCTION

1. This document is presented in two main parts. Part Icontains a description of how the Business Plan has beenimplemented since 1997 as well as outstanding tasks. Part IIdescribes the priorities for the medium term and should beconsidered in conjunction with the description of the servicemodules in the annex, as well as other reports issued to thegoverning bodies, in particular the annual reports for 1998,1999 and 2000, and the report to the Conference at itseighth session on progress in the transformation of UNIDO(GC.8/10 and Corr.1 and 2).

I. IMPLEMENTATION OF THEBUSINESS PLAN

2. In December 1997, the General Conference convenedits seventh session and adopted resolution GC.7/Res.1, inwhich the Member States endorsed the reform packageentitled “Business Plan on the Future Role and Functions ofUNIDO”. For the past four years (1998-2001), this hasbeen the basis for the organizational and programmatictransformation of UNIDO. The present note gives anaccount of progress in the transformation, and seeks tooutline the priorities for the future, in particular for themedium term, 2002-2005.

3. The Business Plan was the product of an intensiveprocess of consultations, compromise and consensus-build-ing and was meant to provide an agreed framework andgeneral guidance for re-launching the Organization. By itsvery nature, it contained guiding principles to determine theOrganization’s development in the medium to long term;there were also elements emanating from the contemporarypolitical and economic realities that were relevant for theshort term. Thus the need for further elaboration and refine-ment as well as reassessment was inherent in the Plan.

4. The Business Plan sought to focus UNIDO activities andredefine its programmatic functions and principles by identi-fying those areas in which the Organization should be engagedand those that should be discontinued. It also laid down guide-lines for streamlining its structure and management.

5. The Plan grouped UNIDO activities into two areas ofconcentration:

(a) Strengthening of industrial capacities;

(b) Cleaner and sustainable industrial development.

6. While maintaining its universal character, and adheringto the principle of achieving equitable and sustainableindustrial development, UNIDO was required to concen-trate its activities:

(a) In the least developed countries (LDCs), in parti-cular in Africa;

(b) On agro-industries;

(c) On support to small and medium enterprises(SMEs).

7. Emphasis was also to be given to the integration ofwomen in industrial development. Activities were to coverUNIDO’s dual role, i.e. its technical cooperation or opera-tive function, and the global forum or normative function.

8. The Plan emphasized that UNIDO should provide itssupport primarily in comprehensive packages of integratedservices and should further strengthen its capacity in thisregard through interdisciplinary team-building.

9. An important prescription, interfacing with both pro-grammatic and organizational aspects of UNIDO reform,related to the decentralization of activities to the field andcreation of a strengthened field representation systemthrough redeployment of resources and Professional staffand delegation of authority to the field. This was intendedto make the Organization more demand-oriented, and tofunctional and programmatic coordination with otherUnited Nations bodies, particularly in the field.

10. This political agreement contained a series of basic orminimum understandings to implement administrativereforms and changes in respect of UNIDO programmes.

11. In the administrative area, the Business Plan involveda reduction in the UNIDO budget of about 20 per cent, withthe aim of bringing it into line with the new levels of con-tributions resulting from the withdrawal of substantialcontributors from the Organization. At the same time, thenumber of divisions was reduced from six to three. Since


Annex C. Medium-term programme framework 2002-20051

The Business Plan and medium-term programme development

1Note by the Director-General submitted to the GeneralConference at its ninth session in December 2001 (GC.9/11).

personnel expenditures are a substantial item in the budgetof the Organization, a cut by the said amount meant aproportional cut in staffing, requiring the approval of about$16 million by the General Conference for compensationpayments. This, in turn, meant that, were additional contri-butions not obtained in order to avoid personnel reductions,as eventually was the case, the effective budget cut for thebiennium 1998-1999 would have approached 30 per cent.

A. Administrative and financial reforms

12. All administrative and financial reforms requested bythe Business Plan were implemented between December1997 and March 1998.

13. Staffing was reduced by around 100 employeesthrough a system of voluntary separation, at an approxi-mate cost of $10 million. The figure required to arrive at the20 per cent reduction of staff (some 20 additional people)was achieved by natural attrition due to retirements and res-ignations. In this way, some $6 million was saved as com-pared to the amount approved by the General Conference.These savings made it possible to re-establish the WorkingCapital Fund in February 1998 and to finish the year with-out any financial shocks. The new UNIDO structure withonly three divisions was announced in the same month.

14. At the same time, a new financial management systemwas implemented and a new policy for the renewal oflonger-term contracts was introduced at the end of 1998.

15. As a result of these reforms, UNIDO re-established itsfinancial viability in a robust fashion and has not faced anycash problems, even in difficult years like the last two.

16. Another substantial result of the reforms is the feelingof stability enjoyed by the Organization’s staff. For the firsttime in many years, UNIDO has established a policy ofissuing three-year contracts with renewals for similarperiods.

B. Programme reforms

17. Between March and September 1998, UNIDO beganto concentrate its areas of specialization in accordance withthe criteria contained in the Business Plan. This process washighly interactive and benefited from a very proactive roleon the part of UNIDO staff who participated in numerousseminars and workshops. At the same time, conferences andevents were organized to facilitate participation by membercountries of the Organization, the private sector (corpora-tions such as Mercedes-Benz or business associations suchas the Spanish Confederation of Business Organizations(CEOE)), and the academic sector (Rockslide, Westminster,Oxford or Columbia).

18. As a result of this, UNIDO became the first agency ofthe United Nations system to identify and describe clearlyand accurately its technical cooperation activities in servicemodules, all 16 of which were fully in line with the priori-ties set out in the Business Plan.

19. A new system of formulating technical cooperationwas developed between September 1998 and December1999 in accordance with the provisions of the Business Plan.Based on the 16 service modules, and together with thecountries receiving technical cooperation, UNIDO formu-lated a new portfolio of “Integrated Programmes” in orderto satisfy the requirement of the Business Plan to developdemand-oriented “integrated packages of services” in placeof isolated projects.

20. As a result of this, between January 1999 and the endof September 2001, UNIDO approved 44 integrated pro-grammes with an estimated cost (current planning figure) of$257 million (including support costs). By the end ofSeptember 2001 UNIDO had mobilized a total of $92 mil-lion for the integrated programmes and this is likely to riseto $100 million by the end of 2001.

C. Overall results

21. During the biennium 2000-2001, the Organizationhas been dedicated to consolidating and stabilizing thechanges introduced in previous years and to refining theirpotential, based on the experience accumulated during theirimplementation. Thus, for instance, the budget for the bien-nium 2002-2003 has been drawn up based on only 8 serv-ice modules instead of 16.

22. The reforms have reinforced the confidence ofUNIDO member countries in the possibilities and capabili-ties of the Organization. There are no longer any countriesevaluating whether or not they will remain in theOrganization. On the contrary, at present new countries areevaluating whether to join in the Organization, such asMonaco, and others which have decided to do so and havejoined, as is the case with South Africa, which became the169th Member State of UNIDO in October 2000.

23. Furthermore, various donor countries increased or insome cases started their voluntary contributions for techni-cal cooperation activities. The United Kingdom, Denmark,Norway, Austria, Italy, Japan, Spain and the EuropeanCommission are among the leaders in this process.

24. The region that has benefited most from this process,in accordance with the priority laid down by the BusinessPlan, is Africa. Indeed, during the 1994-1997 period, of allfunds approved for UNIDO activities, an average 19 percent were approved for Africa excluding Arab States, and31 per cent for the region as a whole. However, under the


new integrated programmes the composition changedsharply. Of the total funds allocated to these programmes,54 per cent went to sub-Saharan Africa and 74 per centwere allocated to the African region as a whole.

D. Tasks outstanding

25. There are still some tasks outstanding both withregard to administrative and financial reform as well as pro-grammatic reform, including the issue of decentralization.

26. In the areas of administration and finance, computer-ization of activities still remains to be completed, a taskwhich started this year with the implementation of amodern commercial software. It is likewise necessary tostrengthen the control systems to continue to increase thetransparency of administrative and financial management.

27. Recognizing that the human resource managementfunction plays a central role in the programmatic success ofthe Organization, UNIDO has promulgated a comprehen-sive Human Resource Management Framework that isbeing implemented in a phased approach.

28. The first phase focuses on providing employment sta-bility. It provides streamlined guidelines for the engagementof staff through recruitment, selection and placement, andincludes the introduction of appointments of limited dura-tion that are non-career appointments, for tasks that areclearly finite in time and nature under the 300 series of StaffRules.

29. The second phase of the framework is currently beingdeveloped and addresses career growth. It includes thedevelopment and implementation of a solid performanceappraisal system; recognition of meritorious performanceand the development of promotion mechanisms, including,inter alia, promotion through vacancy announcement com-petition, job classification upgrading, merit promotion andhorizontal growth recognition. The framework also concen-trates on promoting an environment of continuous learning,high performance and managerial excellence.

30. There are, in essence, four outstanding tasks concern-ing programmes.

31. The first of these is to increase integration of techni-cal cooperation activities at the implementation phase.Integrated Programmes have managed to integrate knowl-edge available within the Organization in an acceptablemanner during the formulation phase of the technical coop-eration programmes. However, such integration is still notbeing consistently achieved when the programmes areimplemented in the field. To this end, different strategies arebeing attempted, e.g. the application of techniques ofcause/effect analysis.

32. The second task outstanding is to complete the “effec-tive decentralization” of UNIDO (a task which was leftincomplete due to lack of financial resources). This taskcorrelates intimately with the previous one, since greaterdecentralization will allow better coordination of the imple-mentation tasks at field level.

33. These two outstanding tasks express the need for thepackage of transformations implemented at headquarters tobe applied at the field level.

34. The third task is to strengthen the agro-industrial sec-tor with increased staffing and improved programmes. Thisis essential in order to increase our efficiency and theeffectiveness of our programmes, especially in the poorestcountries.

35. Finally, with regard to programmes, the need tostrengthen the presence of UNIDO and its capability forproviding services in various regions of the world should bepointed out, in addition to—and not at the expense of—what is being done in Africa. It is very important tostrengthen membership of the Organization among middle-income countries, by improving the visibility of UNIDOactivities to increase the interest of those countries in theOrganization.

II. PRIORITIES FOR THE MEDIUM TERM

36. A business plan by its very nature is a dynamic docu-ment, tailor-made for particular circumstances and a partic-ular time frame. To maintain its value, it must be revisitedand fine-tuned at intervals so as to ascertain areas to beretained and those requiring adjustment in order to meetnew circumstances.

37. In defining the medium-term priorities for the period2002-2005, the following has been taken into account:

� The Business Plan as defined in 1997 and the expe-rience gained with its implementation during thepast four years;

� New international development targets agreed inthe Millennium Declaration (2000), the related“Roadmap” and the New Africa Initiative, nowrenamed the New Partnership for AfricanDevelopment (NEPAD) (2001);

� New and existing international conventions andagreements related to areas in which UNIDO has acomparative advantage;

� International conferences covering subjects ofimportance for UNIDO, including LDC III (May2001), as well as preparatory work for forthcomingconferences including Financing for Development(March 2002), and “Rio + 10” (September 2002);


• Actual demand for services from Member States asexperienced recently.

38. Also, UNIDO’s service modules have been redesigned,focusing on the main international targets and MillenniumDeclaration goals. During the period 2002-2005, UNIDOwill pursue its medium-term priorities through these eightnew service modules (see annex). Modalities for the deliveryof UNIDO services will continue to be through integratedprogrammes, country service frameworks and stand-aloneprojects.

39. An increasing part of UNIDO’s activities is coveredby, or developed in direct response to, international conven-tions and agreements. As these represent the explicit agree-ment of the international community on these subjects, andusually include implementation and funding mechanisms,UNIDO’s response is presented separately. The remainingactivities are presented under “Strengthening of IndustrialCapacities”, “Cleaner and Sustainable Industrial Develop-ment” and “Global Forum Activities”.

40. The following section is intended to highlight thefuture direction that UNIDO will take on key areas.

A. International conventions and agreements

41. The Montreal Protocol, defined and agreed by theglobal community in the late 1980s and early 1990s, aimsat the phasing out of ozone depleting substances. By July2002, UNIDO will have been serving the Montreal Protocolas one of the implementing agencies of the relatedMultilateral Fund for a decade. With over 750 investment,non-investment and demonstration projects in 60 countriesand all regions, that will eliminate around 30,600 ODP tonsof ozone-depleting substances, and a total budget includingsupport cost of $272 million, this constitutes the largestprogramme of UNIDO. This activity will continue through-out this decade to assist developing countries in securingtheir compliance with the international commitments in thegradual phase-out of regulated ozone depleting substancesby the year 2010.

42. The Stockholm Convention on Persistent OrganicPollutants (POPs), adopted in May 2001, obliges the partiesto the Convention to take measures to reduce or eliminateemissions of POPs and their by-products, and defines aframework for doing so.

43. As UNIDO is one of the very few international organ-izations with immediately relevant experience and expertiseit has responded rapidly, with strong support of the GlobalEnvironment Facility (GEF). In close cooperation with over50 countries that have requested UNIDO assistance withenabling activities, projects are being developed and pro-posals for activities in over 20 countries have already been

submitted to GEF for funding. The first approvals have beenreceived and implementation has started. UNIDO technicalcapabilities will also be required to assist countries in enact-ing their national implementation plans.

44. Specific activities on which UNIDO will focus includemeasures to reduce or eliminate production of POPs (e.g.pesticides), measures to reduce or eliminate releases in otherproduction processes where POPs may be by-products andmeasures to reduce or eliminate releases from stockpiles andwastes (e.g. destruction of obsolete pesticides). For the lat-ter, UNIDO is already evaluating techniques for the treat-ment and disposal of stockpiles of POPs. An overall strategyhas been formulated and cooperation with some donorGovernments is envisaged. It is anticipated that this activity,based on existing expertise that now received a new empha-sis and recognition, will grow rapidly, funded to a largeextent by GEF.

45. The operational details for reducing greenhouse gas(GHG) emissions under the 1997 Kyoto Protocol wereagreed upon at Marrakech, Morocco, in November 2001,paving the way for timely entry into force of the Protocol.UNIDO has been taking an active role in assisting theParties to mobilize and strengthen national capacities forparticipating in the implementation of the Climate ChangeConvention and the Protocol through the Kyoto ProtocolMechanism, particularly the Clean DevelopmentMechanisms and Joint Implementation (JI). In particular,UNIDO carried out capacity-building projects in Africa andAsia addressing the assessment of technological opportuni-ties to reduce GHGs and capacity-building needs in indus-try. In order to reduce transaction costs in CDM/JI projectdevelopment, particularly for small-scale projects in indus-try, UNIDO carried out work in developing methodologicalguidelines for the so-called “baseline studies” to help proj-ect developers in developing countries and economies intransition to ensure that CDM/JI projects in their countriesdeliver real, measurable and long-term GHG emissionsreduction.

46. The Cartagena Protocol of the Convention onBiological Diversity (CBD) is a legally binding instrumentregulating the transboundary movement of living modifiedorganisms, often also described as genetically modifiedorganisms. It envisages, inter alia, the establishment of aBiosafety Clearing House Mechanism (BCHM) to serve as adepository of mandatory information relevant to the imple-mentation of the Protocol. UNIDO’s Biosafety InformationNetwork and Advisory Service (BINAS) are to serve as anintegral part of pilot phase of BCHM through a memoran-dum of understanding signed with the secretariat of CBD.Furthermore, in view of its in-house technical capability,UNIDO has been requested by the GEF Secretariat to assistin the implementation of four national biosafety capacity-building programmes (Bulgaria, Colombia, Malaysia,Mexico).


47. The “Technical Barriers to Trade (TBT)” and the“Sanitary and Phyto-Sanitary Standards” agreements nego-tiated as part of the Uruguay round of international tradenegotiations, while realizing important progress alsoimposes major obligations on developing countries andeconomies in transition. This was recognized in the TBTagreement, which in Article 12.7 specifically states:“Members shall ... provide technical assistance to develop-ing country Members to ensure that the preparation andapplication of technical regulations, standards and con-formity assessment procedures do not create unnecessaryobstacles to the expansion and diversification of exportsfrom developing country Members”.

48. Based on the already well-established and, within theUnited Nations system unique, strengths in quality, stan-dardization, metrology, certification and accreditation,UNIDO has in the last year launched a major new initiative:“Enabling developing countries to access markets”.

49. The basis for UNIDO’s response lies in the analysisthat while major progress has been made with liberalizationof trade, and tariffs and quota for imports from developingcountries have been reduced or eliminated by several majorimporters, this has not until now resulted in rapid increasesin exports from developing countries. In UNIDO’s analysisthere are two main reasons for this. Firstly, many develop-ing countries do not have the productive capacities torapidly respond to these opportunities; and, secondly, devel-oping countries do not have the ability to ensure or to provethat exportable products comply with international stan-dards and requirements.

50. The strengthening of productive capacities is beingaddressed by UNIDO, mainly through a number of inte-grated programmes that aim at strengthening the productivebasis of developing countries, primarily focusing on agro-related activities, as presented later.

51. To address the second, much more focused issue,countries and their producers need a rather complex, butnot well-known, physical and institutional capacity to beable to ensure that exportable products satisfy the technicalrequirements of the global trading system. Few developingcountries have this institutional infrastructure.

52. The new initiative of UNIDO consists of an integratedapproach to assist countries or regional groups in establish-ing these capacities. Building on the existing strengths ofUNIDO, a number of activities are under way. Theseinclude a programme already under implementation, fundedby the European Union, covering the core requirements ofthe eight member countries of the West African Economicand Monetary Union (UEMOA). A similar regional pro-gramme with the Southern African Development Com-munity (SADC) countries is being developed, a programmeis being drawn up for the Central American region in close

cooperation with ITC, and other needs analysis activitiesare being carried out.

53. As this subject has become very prominent in inter-national discussions, UNIDO presented the initiative toLDC III and has also contributed this to the preparatorywork for the Financing for Development Conferencescheduled for March 2002 at Monterrey, Mexico. The ini-tiative has been well received.

54. The September 2001 meeting of the ACC High-LevelCommittee on Programmes also discussed the initiative andencouraged UNIDO to pursue bilateral consultations withUnited Nations organizations and WTO to solicit theirviews on the scope and areas of their potential collabora-tion. Development and implementation of the programmes,and cooperation with these partners will be vigorously pur-sued during the coming years. Talks and actual cooperationwith ITC, UNCTAD and WTO have already taken placewith a view to complementing UNIDO’s strengths withthose of other organizations. It is expected that this initia-tive, which is a very innovative approach, and related exist-ing UNIDO strengths will expand rapidly in response tomuch higher priority given to the issue by developing coun-tries and the international community as a whole.

B. Strengthening of industrial capacities

55. The strategy described in this section attempts toaddress the modern interlinkages between investment, tech-nology and trade. Nowadays companies trade to invest andinvest to trade. Intra-firm trade accounts for more than 50per cent of world trade. The level of technology embodieddetermines the potential of developing countries to useindustry in their fight against poverty and to connect theirdomestic economies with the global economy.

Investment

56. Developing countries and countries with economies intransition are risking marginalization from the global econ-omy by failing to gain access to sources of technology, toinvestment and to markets. Foreign direct investment andinternational reallocation of industrial resources are indis-pensable elements for the economic transformation thesecountries require to achieve sustainable economic growthand to eradicate poverty.

57. Within the scope of the UNIDO investment pro-gramme, increased coordination will be pursued withUNCTAD to assist Governments and counterpart institu-tions in improving the investment climate and the legalenabling environment. Furthermore, UNIDO will seek topursue the transformation of national investment promo-tion agencies as one-stop shops for investment promotionand business alliances.


58. Doubtless not all types of investment (sectoral, infra-structural, etc.) require or benefit equally from the type ofpromotion that UNIDO is capable of carrying out. As aresult UNIDO will exercise greater selectivity and focus inthe type of investment projects and sectors to be promotedwith a view to improving the cost-effectiveness of itsprogrammes.

59. UNIDO will continue to conduct investment promo-tion forums. Experience has shown that there is a need formore analytical preparatory work and to move away froma general to a sector-specific approach.

60. Greater interaction in this area with the private sectorcould likewise increase the impact of our activities. A pilottrial here, targeting SMEs, is being conducted in West Africain a project involving private investors in equity andUNIDO in order to improve and increase the ability tocapture flows of private investment.

61. Finally, it will be necessary in this regard to strengtheninterregional cooperation significantly. A good example ofthis is the project to promote Asian investment in Africathrough a specially established centre based in Malaysia,funded by Japan within the implementation framework ofthe Second Tokyo International Conference of AfricanDevelopment (TICAD II). It would be important to furtherevaluate the best possibilities for cooperation betweendeveloping regions.

Technology

62. The global economy has become increasingly knowl-edge and technology-driven, with a small number of indus-trialized countries providing most of the world’s technologyinnovation. The problem of development and technologytransfer is however very broad, its extent being such that itwould be difficult for any multilateral organization toembrace all aspects. This is most evident under conditionsof financial constraint, as is the case with UNIDO.

63. For this reason, UNIDO will concentrate its effortsregarding technological promotion basically on three areasor types of technology: agro-related technology (see para-graph 72), new information and communication tech-nologies (and their application to enable an increase inproductivity) and biotechnology.

64. Concentration of efforts to promote transfer andadoption of new information technologies to the maximumextent can make a decisive contribution to ensuring theeconomies and societies of developing countries areconnected to the global society. In this field UNIDO isdeveloping initiatives that need to be consolidated andexpanded, such as the recent partnership agreement withthe private sector (Ericsson), reached in order to facilitateand ensure the use of new information and communication

technologies in developing countries, the testing of whichwill commence in the countries of North Africa.

65. Biotechnology has been listed in the industrializedworld as a pervasive cutting-edge technology with profitpotential across sectors and as a strategic component ofindustrial competitiveness. The progress of biotechnologyand regulations relating to new developments as well aspublic perceptions on the subject are topics of great concernto all developing countries given their far reaching socio-economic implications and those relating to the system ofintellectual property rights. Because biotechnology applica-tions in the food and agricultural industry are those whichgive rise to better developmental prospects, UNIDO is alsodirecting its activity towards biotechnology applications inthe food and agricultural industry and towards three basicaspects within this sector: risk assessment and safety assur-ance, access to proprietary technology and targeted researchin priority areas.

66. At the policy level, emphasis will be given to technol-ogy foresight activities, based on the lessons learned.Experience gained in the first initiative launched in LatinAmerica in 1999 suggested that technology foresight activi-ties would gain from being more sector-specific. Thereforethe regional foresight initiative in Central and EasternEurope and NIS countries aims to address common issuesrelated to regional development with special focus onbiotechnology (food and medicine applications) and envi-ronment technologies for water protection. UNIDO is cur-rently undertaking an assessment on a proposal for the Araband Mediterranean region.

67. At the institutional level UNIDO will promote thecreation of high-tech parks as a mechanism to attract suc-cessful and innovative technology-oriented enterprises andstimulate partnerships with public, private industry, univer-sities and R&D institutions. Furthermore UNIDO intendsto make its international technology centres more business-oriented by networking them with industries and withUNIDO Investment and Technology Promotion Offices.

Small business development

68. UNIDO will continue to place special emphasis onsupport programmes aimed at the promotion of SMEs in alldeveloping regions. These programmes aim at strengtheningnational and local capacities for the development and imple-mentation of effective SME policies and of a coherent set ofspecialized support institutions and programmes to stimu-late and promote SME development, such as business cen-tres, local business systems based on SME networks, clus-ters and private sector partnerships. Special emphasis isplaced on rural entrepreneurship development programmesin support of national poverty reduction strategies throughpromoting rural and micro enterprises and improving thepolicy environment at local level. Emphasis is also placed on


addressing the gender gap through promotion and develop-ment of women’s entrepreneurship.

69. While continuing those well-established support pro-grammes, a number of new initiatives will be pursued on apriority basis within the next years. It is recognized that pol-icy work is important to achieve sustainability and effec-tiveness of technical cooperation in support of SMEs and toensure that such programmes are embedded in the cultureand national economic and social goals. UNIDO will there-fore develop a comprehensive conceptual framework for theformulation of entrepreneurship policies in developingcountries and transition economies. The policy frameworkwill reflect broader issues of developing and promotingenterprise culture and stakeholder environment. Policyguidelines and best practices, possibly a “tool box” ofappropriate policy measures, will provide support tonational and local governments.

70. UNIDO intends to further deepen its operational rela-tionships with the global business community. The pro-gramme will support SMEs in meeting the demanding per-formance requirements for their sustainable integration intoglobal value chains governed by transnational corporations.Seen in the broader perspective of the “Global Compact”launched by the Secretary-General of the United Nations,UNIDO’s practical technical cooperation experience in thisfield will add value to ongoing debate on various approach-es to corporate social responsibility. As mentioned in para-graph 60, UNIDO is also working with the private sector inincreasing the availability of equity finance for SMEs.

71. Action-oriented research of UNIDO will concentrateon the contribution of cluster and networking approachesto the goal of poverty reduction. It is intended to also devel-op a global training programme through which UNIDO’stools and methodologies and best practice guidelines in thisfield can be disseminated.

C. Cleaner and sustainable industrial development

Agro-industries

72. Agro-industries constitute the central sectoral priorityof UNIDO’s Business Plan. The transfer of technologies willconstitute the main driver of the programme (in accordancewith the focus mentioned in para. 63). Within the frame-work of UNIDO’s market access initiative, subsectoral pro-grammes will focus on adding value to agricultural produce,on assisting institutions in supporting productive enterprisesin Africa and LDCs, on linking industry to agriculture, andon assisting producers to meet market and environmentalrequirements.

73. The food programme will focus on the areas of foodproduct and process improvement, preservation, safety,storage and by-product utilization. Successful market access

programmes undertaken by UNIDO, such as the pro-gramme in fish safety and quality in Uganda and UnitedRepublic of Tanzania, will be replicated. In the frameworkof UNIDO’s market access initiative (see para. 48), packag-ing will be a new priority area.

74. The leather programme will increasingly focus ontechnical support for market access, environmental issues,eco-labelling and safety at work. In addition, successful pro-grammes such as the Training and Production Centre for theShoe Industry at Thika, Kenya, will be replicated.

75. The textile programme will focus on helping develop-ing countries to adjust to the challenges of the Multi-FibreAgreement and help countries in sub-Saharan Africa toprofit from the Africa Growth and Opportunity Act.Successful programmes such as the tissuthèque in WestAfrica (garments, patterns and fabrics library) will be repli-cated.

76. In the wood programme future initiatives will focuson promoting the industrial processing of bamboo andother non-wood forest products.

Cleaner production

77. UNIDO will continue the joint UNIDO/UNEPNational Cleaner Production Centre (NCPC) programme,which has proved highly successful over the past sevenyears. Experience has shown that while the existing 21NCPCs have been very good at persuading enterprises toadopt cleaner production measures that require little or noinvestment on their part, they have been less successful inbringing about large-scale adoption of cleaner (hard) tech-nologies. In light of this, UNIDO will work to make exist-ing and future centres more sector-specific or at the veryleast have strong strategic alliances with institutions in theircountries that do have the necessary sector-specific know-how. Initiatives in this direction have already started with acentre in Moscow specifically for the oil and gas industry.

78. In many cases cleaner production alone cannot reducethe environmental impacts of enterprises to acceptablelevels. Therefore future programmes will also go beyondcleaner production to include end-of-pipe solutions that willprovide more complete solutions to certain developingcountries’ environmental problems.

79. It has become clear that the kind of cleaner produc-tion activities that a country can absorb depends very muchon that country’s level of industrialization. Six differentcleaner production modules will therefore be designed andappropriately combined to match the level of industrializa-tion of the host country: (a) awareness-raising; (b) training;(c) demonstration projects; (d) policy advice; (e) insertion ofcleaner production into other related tools; and (f) cleanertechnology transfer.


Industrial waste and pollution control

80. UNIDO has been leading the efforts of the UnitedNations system in the past in the area of solid wastemanagement, through the implementation of over 40 dif-ferent projects of a regional nature, such as the joint pro-gramme with UNDP in Africa, and addressing individualcountries, such as the programme now under implementa-tion in China. The role of UNIDO has been acknowledgedand endorsed by the Environment Management Group, thesystem-wide coordinating group for environment-relatedactivities established by the General Assembly in 1998.UNIDO will continue these activities in the future in com-plete coordination with other relevant United Nations pro-grammes and specialized agencies, including UNEP, WHO,FAO, UNDP and the World Bank.

81. Special attention will be given by UNIDO to increasethe number of countries assisted by the programme for theremoval of barriers to the abatement of global mercurypollution from artisanal gold mining.

Energy

82. Energy is a key global issue on the internationalagenda for sustainable development and UNIDO’s compe-tence and potential in the energy sector has been recognizedby the United Nations system. In May 2001, UNIDO wasgiven the task of lead agency of the Thematic Energy Sessionof LDC III, which recommended that UNIDO undertake awide range of actions over the next decade prior to the nextconference.

83. UNIDO will focus its energy programme on assistingcountries in (a) the formulation of energy policies to reducegreen house gases and therefore climate change; (b) increas-ing energy efficiency on both the supply and demand side;and (c) promoting the application of renewable (alternative)energies.

D. Global forum activities

84. The Business Plan recognized the global forum func-tion as a crucial component of UNIDO’s mandate tostrengthen industrial capacities in developing countries andcountries with economies in transition. Specific globalforum activities are described under the respective activitiesin the programme and budgets, 2002-2003. The overall ori-entation of the global forum will be as follows:

� They will continue to be used as an important toolto increase common understanding on the contri-bution of industry to fight poverty and to connectthe national economy to the global economy. Thisimproved understanding of the modern role ofindustry in the global economy should supportUNIDO’s efforts in the field of funds mobilization;

� It will be increasingly output-oriented in the sensethat global forum activities should provide an ana-

lytical foundation for, as well as define and focus,UNIDO’s technical cooperation interventions;

� It should also help UNIDO to identify and refinethe global public goods to be supplied by theOrganization. UNIDO will build on the prelimi-nary efforts that have been made in that regard inorder to further develop and refine specificindustry-related global public goods.

III. OTHER CONSIDERATIONS

85. The Business Plan prescribed that activities in non-agro-based industries should be discontinued unless“related primarily to environmental issues or to agro-basedindustries”. The experience is that UNIDO sometimes needsto support the promotion of the so-called non-agro-basedindustries from the point of view of investment and tech-nology promotion, small and micro-enterprise development,utilization of agricultural and industrial waste, and employ-ment creation in low-income countries. While the basicthrust not to promote such industries per se is recognized,the list of exceptions must also include these factors.

86. The transformation has changed the internal workingmethods in UNIDO and has also created considerableresponsibilities for programme management and coordina-tion. This resulted in particular from the launching andimplementation of integrated programmes through team-work. Therefore, as mandated by the UNIDO Constitution(Article 11.3), and within the parameters set by theapproved programme and budgets, it may be necessary forthe Director-General to reorganize the work of theOrganization and of the staff in order to align these to thenew and emerging requirements.

87. It is evident that the revised medium-term priorities aspresented above will require considerable extrabudgetaryresources for successful implementation. In respect of theactivities in chapter II.A (international conventions and pro-tocols), the Multilateral Fund for the Montreal Protocol andthe Global Environment Facility are expected to provide themain funding for the first three groups of activities(paras. 41-46). For support in response to trade-relatedagreements (paras. 47-54), funding is expected from donorcountries and the European Union, in view of the increasinginternational recognition of the urgency involved. For theother priorities presented, the main source of funding willcontinue to be donor countries, although the Organizationwill continue its efforts to diversify sources of funding.

IV. ACTION REQUIRED OF THE CONFERENCE

88. The Conference may wish to consider the informationprovided in the present document and provide appropriateguidance.


INDUSTRIAL GOVERNANCE AND STATISTICS

(Programme C.1)

Context

Inadequate governance inhibits the growth potential ofdomestic industries. At the same time, liberalization, globaliza-tion and rapid technological change constantly alter the com-petitive environment in which firms operate. Governments,therefore, must adapt their role to assist domestic enterprises tocompete in the international arena. Institutions and industries ofdeveloping countries typically operate in a situation of incom-plete or imperfect information and rarely possess the knowledge,skills and organizational capacities necessary to formulateappropriate industrial strategies, policies and programmes.

Services provided and expected outputs

01: Policy advice:

(a) Support policy design, implementation and monitoring;

(b) Assist the public and private sectors to draw sectoralcompetitiveness profiles. Diagnostic surveys are conductedusing tested methods such as UNIDO’s “Made in Country X”to identify strengths and weaknesses, opportunities and threats;

(c) Assist in the establishment of permanent public-pri-vate partnerships at country or local level to enable stakehold-ers to share strategic information, design joint strategies andformulate consistent policies and programmes. Tools such as agame-theory framework developed by UNIDO are used by thisservice;

(d) Help streamline and improve policy processes, whilereflecting the interaction of several stakeholders with distinctand diverse objectives. Advice on faster and simpler proceduresconsistent with the objectives and strategies of all stakeholdersis provided;

(e) Advise Governments in enforcing competitionpolicies through appropriate reforms of the regulatoryenvironment. This service is based on experience gained fromthe constant monitoring of successful policy experiencesworldwide;

(f) Develop national capacities to monitor manufactur-ing performance and track the evolution of the main deter-minants of industrial growth from a sector- or economy-wideperspective by relying on worldwide databases such as the“Scoreboard of Industrial Performance and Capabilities”, andcomparative analyses available at the UNIDO KnowledgeCentre (see paragraph C.9 01 (c)).

02: Organizing national and regional exchange platforms:

(a) Promote and support a network of dynamic locationsin industrialized and developing countries to facilitate exchangeof information and experience, and cooperation in local devel-opment strategies and initiatives;

(b) Promote cooperation among groups of countriesfaced with similar development challenges by organizingregional dialogue on policy issues through seminars and net-working of regional research institutions.


Annex. Technical assistance provided (by service module)

Service modules

Former (1998-2001) New (2002-2005)

1. Industrial policy formulation and implementation 1. Industrial governance and statistics2. Statistics and information networks 2. Investment and technology promotion3. Metrology, standardization, certification and 3. Quality and productivity

accreditation4. Continuous improvement and quality management 4. Small business development5. Investment and technology promotion 5. Agro-industries6. Environmental policy framework 6. Industrial energy and Kyoto Protocol7. Climate Convention and Kyoto Protocol 7. Montreal Protocol8. Energy efficiency 8. Environment management9. Renewable energy development

10. Cleaner production11. Pollution control and waste management12. Montreal Protocol13. SME policy framework14. Policy for women’s entrepreneurship development 15. Entrepreneurship development16. Upgrading agro-industries and related technical skills

For ease of reference, relevant text from the programme and budget proposals, 2002-2003 (IDB.24/3) for each of the eight service modulesis reproduced on the following pages.

Global forum functions

01: Industrial governance:

(a) Manage a dynamic Knowledge Centre on IndustrialStrategies, which will provide information to and facilitateexchange of experiences between public and private stake-holders involved in the formulation, implementation andmonitoring of industrial strategies, policies and programmes.The Knowledge Centre will be supported by a network ofresearch centres of developing and industrialized countries,which will undertake policy- and action-oriented researchissues related to the process of industrialization under the newconditions of globalization and technological innovation. ThisKnowledge Centre will both feed from and support relatedtechnical cooperation services; it will serve as the source forregular publications on industrial development issues of globalrelevance;

(b) Publish an annual World Industrial DevelopmentReport. This flagship publication provides information andanalysis to policy makers, business leaders and institutions toassist them to better understand the process of innovation andlearning in developing countries and the challenges and oppor-tunities of globalization and new technologies. It will provideinformation of relevance to the formulation of strategies, poli-cies and programmes to support innovation and learning, aswell as on the organization of appropriate support systems topromote entrepreneurship and mobilize information, knowl-edge, skills and business partners;

(c) Develop, maintain and publish a “Scoreboard ofIndustrial Performance and Capabilities”, which will monitorthe main determinants of manufacturing progress in a sample ofmore than 90 countries. The Scoreboard will allow for cross-country benchmarking of industrial development patterns.

02: Issue various publications such as:

(a) Surveys of global value chains;

(b) Country surveys of industrial competitiveness;

(c) Industrial policy briefs.

03: Compilation and continuous improvement of industrial statistics:

(a) Industrial statistics collection, preparation andpresentation: Collection includes contacting the sources?180 national statistical offices, but also other national andinternational sources; providing media and routines adapted tothe reporting capability of the source; providing feedback to thesources with queries concerning dubious data or services suchas pre-filled questionnaires, amended data, reference datawhere reports of respondents are related to those of otherrespondents, projections and metadata. Data preparationincludes data entry, data editing, data supplementing, inputtingmissing observations and projections. Data presentationincludes tabulations, construction of indicators, design of sta-tistical reports as well as the systematic descriptions of statisti-cal data and the processes behind them;

(b) Promotion of international recommendations: Thisincludes contributing, through papers and participation ininternational meetings, to the dissemination and application ofthe recommendations made to world users and producers ofdata by the Statistical Commission in matters relevant to indus-trial statistics;

(c) Data-acquisition support: It includes guiding users insearch of data or indicators that could be relevant in describingor treating their problem. It includes customized face-to-facehelp functions as well as off-the-shelf metadata needed to sup-port a data search starting from vaguely expressed informationneeds;

(d) Output dissemination: This includes the dissemina-tion to all users of the UNIDO INDSTAT databases. The result-ing databases offer a unique source of information used byhundreds of private subscribers and international organizationsworldwide. Perhaps the most distinctive characteristic of thisinformation is that it is established at the level of industrialbranches and, in some instances, sub-branches;

(e) Statistical research and development: It includes notonly the methodological activities to improve the data and tomaintain the databases, but also research and publicationsbased on the first-hand data available to UNIDO;

(f) Participation in international statistical surveys:UNIDO survey specialists join international surveys to intro-duce new methods to collect and process industrial statistics.The data collected in the field are inserted in the UNIDO data-bases for further analysis and dissemination.

INVESTMENT AND TECHNOLOGY PROMOTION

(Programme C.2)

Context

The global economy has become knowledge- and tech-nology-driven, but while innovation and rapid technologicalchanges are the reasons for unprecedented prosperity andgrowth in industrialized countries, many developing countriesand countries with economies in transition are risking margin-alization by being trapped in a technology divide and an invest-ment gap. Foreign direct investment and acquisition of technol-ogy are indispensable elements for the economic transformationthese countries require to achieve sustainable economic growthand to eradicate poverty. Although SMEs in developing coun-tries and countries with economies in transition are consideredto be an engine of economic growth, they face enormous diffi-culties in attracting investors and accessing technology. Barriersinclude the lack of effective investment and technology promo-tion policies, inappropriate legal and regulatory frameworks,inadequate capabilities of investment promotion and techno-logy support institutions, and the lack of access to potentialinvestors and sources of new technology.


During the biennium, the Programme will focus on the follow-ing services and outputs:


01: Enhancement of national policies, strategies and regulatory frameworks for investment and technology promotion:

(a) Assist Governments to design or enhance policies,strategies and instruments for investment and technology pro-motion within the new economic context as well as strengthenrelated legal and regulatory frameworks;

(b) Assist Governments with the development orenhancement of technology foresight programmes to definefuture orientation of technology programmes in accordancewith rapid technological change.

02: Building institutional capabilities in investment and technology promotion:

(a) Establish or strengthen national investment and tech-nology promotion institutions and upgrade their capacities inthe identification, formulation, appraisal and promotion ofinvestment and technology projects and technology transfernegotiations;

(b) Provide opportunities for staff of national invest-ment- and technology-related institutions to upgrade their skillsthrough on-the-job advanced training in the ITPO under theDelegates Programme;

(c) Establish or strengthen international and nationaltechnology centres to enhance North-South and South-Southtechnology flows in order to achieve innovation results; tobring advanced and new appropriate technologies to themarketplace; to facilitate technology sourcing, transfer andacquisition; and to assist in managing technological change;

(d) Assist public- and private-sector institutions to estab-lish or strengthen national subcontracting partnershipexchanges (SPXs);

(e) Undertake training programmes in regional andnational financial institutions in developing countries andeconomies in transition in contemporary investment promotiontechniques, UNIDO’s on-line promotional tools and projectfinancial appraisal methodologies;

(f) Assist Governments in the formulation, packagingand promotion of “private financing of industrial infrastruc-ture” projects.

03: Promotion of business alliances:

(a) Support national investment- and technology-relatedinstitutions in their efforts to develop business alliances withforeign partners by providing access to potential investors andtechnology suppliers;

(b) Facilitate completion of investment and technologyprojects by disseminating screened and appraised project pro-posals among financial institutions interested in seeking directinvestment opportunities in developing countries andeconomies in transition.


(a) Monitor technological developments and trends andexamine the underlying driving forces: On this basis, developguidelines and methodologies for technology foresight pro-grammes as a decision-making tool for technology policy andlong-term industrial development;

(b) Offer an institutionalized IT platform for on-lineassistance: Promotion of investment and technology; sharingand dissemination of knowledge; strengthening the capacities ofinvestment promotion agencies, technology centres, SPXs andother members of the “UNIDO Exchange” community;

(c) Organize regular meetings, workshops and seminarsfor national counterpart institutions, representatives of sisterorganizations (such as Foreign Investment Advisory Service(FIAS), Multilateral Investment Guarantee Agency (MIGA) andUNCTAD) and a standing advisory panel of representativesfrom the private sector to facilitate follow-up and to updateUNIDO methodologies;

(d) Develop, update and publish manuals, guidelines andtraining modules as well as on-line services for investment pro-motion, technology management and technology transfer;

(e) Develop and maintain new advanced versions ofUNIDO’s COMFAR financial project appraisal software systemto meet new information technology requirements;

(f) Maintain a global outsourcing and suppliers networkand improve its efficiency by application of new “Outsourcing2000” software.

QUALITY AND PRODUCTIVITY

(Programme C.3)

Context

International economic exchanges have grown exponen-tially over recent years and have become a major source ofeconomic growth and social development. Enterprises in devel-oping countries are more and more excluded from the newproduction and trade patterns. The lack of quality and pro-ductivity infrastructure, services and related skills prevents theenterprises from accessing global markets and from integratinginto international production and supply chains.

To survive in a competitive global production and tradeenvironment, enterprises have to offer competitive, safe, reli-able and cost-effective products. Enterprises have to increasetheir productivity and competitiveness to increase manufactur-ing value added, to maintain or increase employment and toincrease their export and domestic market shares, while betterprotecting the environment. Industrial enterprises are increas-ingly aware of the need to improve product quality and pro-ductivity; however, they typically do not have the knowledgeand skills to develop and implement appropriate qualitymanagement system solutions.

Developing countries also need to assist their industriesand concerned government institutions to overcome or elimi-


nate unnecessary technical barriers to trade caused by dispari-ties in standards, metrology and conformity assessment prac-tices between different trading partners. This requires mutuallydeveloped and recognized systems of metrology, standardiza-tion, testing and quality (MSTQ) that enhance market trans-parency for manufacturers and purchasers and perform impor-tant protective functions for consumers and employees. MSTQtechniques and methodologies could also be used for the estab-lishment of an internationally recognized measuring and moni-toring system to qualify and quantify mineral and agriculturalexports before they are shipped to ensure revenues and preservethe natural resource base.


01: Strengthen the legal and regulatory framework:

(a) Assist Governments with the development of a qua-lity and productivity policy by assessing the existing policyframework and advising on the establishment of incentive andsupport programmes, such as quality awards;

(b) Assist Governments to develop and harmonize thelegal and regulatory framework relating to quality, standardi-zation and metrology for better protection of consumer healthand safety of the environment and to act against fraud byassessing the existing framework and providing advice on nec-essary adjustments.

02: Standardization and conformity assessment:

(a) Establish or strengthen the capacity of existingstandardization bodies by providing training, setting up sub-sectoral technical committees, assist with the design and imple-mentation of awareness programmes to promote the adoptionof standards at national and regional level, and assist participa-tion in regional and international standards-setting forums andnetworks;

(b) Establish or strengthen the capacity of accreditationbodies for the purpose of being recognized by the InternationalAccreditation Forum (IAF) or the International LaboratoryAccreditation Cooperation (ILAC) by conducting pre-evaluations and assisting in networking and partnershiparrangements with other national/regional institutions;

(c) Establish or strengthen laboratory capacities forsampling, inspection, material and product testing, includingmicrobiological and chemical analysis by specifying testing andequipment requirements. Provide technical support for theharmonization of testing procedures, training of staff throughtwinning arrangements, as well as assistance in net-working, partnership and agreements for conformity assess-ment.

03: Metrology (measurement):

(a) Establish or strengthen laboratory capacities forindustrial and legal metrology by identifying calibration, verifi-cation and equipment requirements, assisting in the physicalset-up and start-up of laboratories; upgrading measurement

equipment according to international standards; training tech-nicians and assistance in networking, inter-comparisons,mutual recognition arrangements and accreditation;

(b) Implement UNIDO software Measurement andControl-Chart Toolkit (MCCT) to meet the requirements re-lated to metrological control of the ISO 9000/2000 standards.

04: Quality management and productivity improvement:

(a) The UNIDO quality approach enables the enterprisesto enter into self-sustained and continuous improvements with-out the need for continued assistance by:

(i) Building institutional and human capacity atthe level of Governments and institutions forimplementing quality management metho-dologies and systems (TQM, ISO 9000/2000,statistical process control, etc.) through practi-cal demonstration in groups of pilot enterprisesfor improving their quality and productivity;

(ii) Promoting productivity by establishing regio-nal and national quality and productivitycentres. The centres act as one-stop-shops forproductivity and quality improvements in themanufacturing sector and associated institu-tions by fostering production managementupgrading at the level of enterprises, industrialsectors, supply chains, technology institutesand policy-related government bodies. Further-more, through process and competitivenessbenchmarking services, the centres will be ableto help identify, adapt and promote best manu-facturing practices;

(iii) Improving capability to monitor and increasebusiness performance through the imple-mentation of UNIDO business excellence soft-ware packages: PHAROS (Business Navigator)suitable for SMEs, BEST (Business Environ-ment Strategic Toolkit) and FIT (FinancialImprovement Toolkit) and MCCT for moni-toring calibration of equipment and carryingout simple statistical process control.

05: Industrial restructuring and upgrading:

(a) Build capacities in public- and private-sector institu-tions to develop national industrial upgrading and restructuringpolicies, support mechanisms, including financing schemes, andrestructuring and upgrading programmes;

(b) Develop national consulting capability to address therestructuring and upgrading needs.


(a) Foster linkages and cooperation among regional andinternational organizations such as ISO, WTO, ILAC, IAF,International Organization of Legal Metrology (OIML) andregional and international standardization and accreditation


bodies to facilitate networking, promotion of mutual recogni-tion of certificates and harmonization of standards;

(b) Monitor global trends in standardization, conformityassessment, metrology and testing to promote awareness andstrengthen the trade capacity of developing countries throughapplied research and benchmarking studies, training and par-ticipation in international conferences;

(c) Carry out and disseminate benchmarking analyses toidentify best practices of standardization bodies and laborato-ries;

(d) Develop and improve business excellence tools suchas BEST, FIT and PHAROS, and printed material for upgradingbusiness performance such as the manual on diagnostic forrestructuring and upgrading through applied research andbenchmarking studies in quality management, industrymodernization and productivity.

SMALL BUSINESS DEVELOPMENT

(Programme C.4)

Context

A competitive and resilient industrial sector relies on anappropriate mix of large, medium and small enterprises. SMEsplay a leading role in creating employment, income and valueadded, accounting for up to 90 per cent of manufacturingenterprises and between 40 and 80 per cent of manufacturingemployment. In LDCs, their role is even more important, sinceSMEs often offer the only realistic prospect for creating addi-tional employment and thus reducing poverty. A healthy SMEsector is, therefore, crucially important for inclusive andsocially sustainable development. However, institutions provid-ing support services are often limited in their coverage andcapacity. Existing institutions are frequently poorly designedand have difficulty in providing their services effectively andefficiently. SMEs, in general, face problems associated withtheir size and relative isolation such as inability to achieveeconomies of scale and difficulties in entering into national andglobal value chains driven by large transnational corporations.The constraints of individual SMEs include limited technicaland managerial skills, difficulty in obtaining financing andinsufficient knowledge about laws and regulations.


During the biennium, the Programme will focus on the follow-ing services and outputs:

01: Development and implementation of SME policies:

(a) Strengthen the capacity of the public and private sec-tors to formulate and implement national and regional policies,strategies and programmes to promote SME development aswell as to monitor their effectiveness. This is done by setting upconsultative mechanisms, supporting strong departmental SMEadvocacy units in Government and strengthening their capacityto collect and analyse SME-related information;

(b) Improve the regulatory framework for SME develop-ment by reviewing existing laws, administrative rules and pro-cedures; developing recommendations for corrective measures;training public administrators and disseminating informationto raise entrepreneurs’ awareness of regulatory and administra-tive issues affecting their business operations.

02: Development of local business systems:

(a) Promote the collective efficiency of SME clusters andnetworks by undertaking diagnostic studies, developing a jointvision, formulating a network/cluster action plan, and estab-lishing cooperation with similar networks/clusters for bench-marking and exchange of best practices;

(b) Build multisector partnerships and strategic knowl-edge alliances between UNIDO, transnational corporations,SMEs, business associations, research and other civil societyorganizations within specific manufacturing subsectors aimedat integrating SMEs into global value chains.

03: Business advisory services:

(a) Establish or strengthen business centres and otherbusiness advisory mechanisms to provide targeted services forSMEs by assisting in the design of their organizational struc-ture, determining the mix of services to be provided, and train-ing staff in the provision of basic or more sophisticated businesssupport to entrepreneurs;

(b) Design and implement programmes that build capac-ity to promote business incubators to support new businessesduring their start-up and early growth phase. This is done bypromoting awareness of the concept among potential incubatordevelopers and sponsors, preparing a framework for develop-ment and advising on specific feasibility and operational issues.

04: Rural entrepreneurship development:

(a) Support Governments and other stakeholders indesigning programmes in support of national poverty reductionstrategies through promoting rural micro and small enterprisesand in improving the enabling policy and regulatory environ-ment at the local level;

(b) Strengthen affordable and effective business develop-ment services in rural areas to develop entrepreneurial, mana-gerial and technical skills, with emphasis on micro enterprisesand self-help capacities of civil society institutions, and facili-tate access to finance schemes bridging the gap between micro-finance and commercial bank finance.

05: Women’s entrepreneurship development:

(a) Strengthen the capacity of public and private supportinstitutions to identify and alleviate the constraints faced bywomen entrepreneurs by equipping these institutions with toolsto formulate and implement targeted skills enhancement pro-grammes and by organizing training of trainers courses;

(b) Organize, on a pilot basis, managerial and technicalskills development programmes for women entrepreneurs at the


level of selected industrial subsectors such as food-processingand textiles, with emphasis on micro and small enterprises.


(a) Participate in the Donor Committee for SmallEnterprise Development which—based on a broad membershipfrom both multilateral and bilateral development agencies—seeks to develop best practices of SME promotion throughdonor interventions;

(b) Undertake action-oriented research and issue techni-cal working papers covering lessons learned from programmesand projects as well as contributions to the general debate onprivate sector and SME development;

(c) Cooperate with OECD in the Forum on Enterpriseand Entrepreneurship Development and with UNDP on the reg-ular updating of the United Nations Inter-agency ResourceGuide for Small Enterprise Development.

AGRO-INDUSTRIES

(Programme D.1)

Context

Agro-industrial products greatly contribute to meetingbasic human needs and to sustaining livelihoods. Only a smallproportion of produce is now processed and there is great post-harvest waste due to lack of storage facilities, infrastructure andpoor knowledge of even basic techniques for conversion andmanufacturing. Support institutions lack capacity for extensionservices, professional and sectoral trade associations are weakand there are few specialized consulting firms able to advise onprocess and machinery selection, production planning and con-trol, waste minimization, product mix, choice of raw materialsand technical inputs. Unemployment, especially in rural areas,is high and existing artisanal SMEs cannot meet the qualitystandards for export or compete with imports. Adding value toraw materials is the only sustainable way to create wealth at thegrass roots or community level.


01: Food sector:

(a) Services cover advice to support institutions andassisting with enterprise-level demonstration and trainingprojects covering grain milling, bakery products, includingenrichment; vegetable oils, fruits and vegetables (solar drying,canning, juicing and freezing); meat and fish; dairy products,including dried and powdered milk, yoghurt and similar items;sugar and derivatives; beverages; animal feed production usingcrop residues and wastes, including agro-industrial by-products;

(b) UNIDO advises enterprises and helps demonstrateprocessing technologies, product testing and packaging pro-cedures to ensure that products meet quality requirements, con-sumer health and safety (GMP and HACCP) and environmental

concerns, and that they meet and maintain the product andprocess control standards necessary to succeed in local andexport markets.

02: Leather sector:

(a) Services encompass advice to support institutions atnational and regional levels and assistance in the demonstrationof environmentally-friendly processes and technologies for thetanning of hides and skins as well as in application of improvedprocesses and production technologies to ensure competitivelyproduced high-quality leather and footwear products;

(b) Assistance is provided for the establishment offootwear and leather product market intelligence systems andof leather grading standards, in training of trainers and in thedesign and manufacture of products;

(c) Advice is given on selection and use of equipment,process optimization (CAD/CAM), style and fashion trends andon promotion programmes for exporters.

03: Textiles sector:

(a) Assistance is given to support institutions and enter-prises in demonstration of modern textile and garment produc-tion technologies to optimize production and minimize wastewhen cutting out garments (CAD/CAM); on the use of naturalfibres and synthetics for textiles; on selection and use of equip-ment for spinning, weaving and knitting;

(b) Assistance is provided in the field of dyeing and fin-ishing to help introduce computerized colorimetry and colour-matching to meet international standards and to reduce pollu-tion from pigments;

(c) Support is given to enterprises during the phase-outof the Multi-Fibre Agreement and to help the African textileindustry benefit from the US-Africa Bill.

04: Wood sector:

(a) Advice and demonstration activities are provided toincrease value added to wood and non-wood (e.g. bamboo) for-est products through manufacture of furniture and joineryitems for building and the rational use of timber for the con-struction of durable structures;

(b) Coverage includes technical cooperation to apply therelated wood technologies of grading, drying and preservation;product design, selection of machinery and equipment forrough milling, machining, assembly and finishing plus struc-tural design and demonstration of structures such as bridges,housing, farm and community buildings as well as to strength-ening of support institutions and sectoral associations.

05: Agro-machinery and re-engineering:

(a) Advisory services are provided to the agriculturalmachinery industrial system and cover the design and manu-facture of basic machinery implements and tools used for agri-cultural production and processing, including technical inputs;


(b) Advice is also given on the establishment of ruralrepair and maintenance workshops for cars, trucks and trac-tors, farm implements, tyre repair and re-treading, outboardmotors, spare part manufacture and on equipment for storage,handling and packaging of processed agricultural products; andinnovation, upgrading and/or re-engineering of factory produc-tion lines in agro-machinery sectors.


(a) Organization of International Food Safety Panel(called for by leaders of G-8, 28 July 2000) and associatedregional seminars;

(b) Organization of the Leather Panel to advise on pro-grammes and funding;

(c) Organization of periodic sectoral (Wood and Food)Industry Advisers Group meetings;

(d) Development of sectoral databases on machinery andequipment and on processes.

INDUSTRIAL ENERGY AND KYOTO PROTOCOL

(Programme D.2)

Context

Energy is essential to economic and social developmentand to improving the quality of life. However, accessibility toreliable and affordable energy is very unevenly distributed, bothbetween countries and within countries. Many developingcountries—in particular LDCs—and countries with economiesin transition face the urgent need to provide adequate, reliableand affordable energy services, especially electricity, to billionsof people in rural areas. On the other side, the production/gen-eration, distribution and use of energy are sources of global pol-lution and waste, inter alia, substantially increasing the atmos-pheric concentrations of greenhouse gases. Particularly, theimportance of carbon dioxide emissions as an environmentalissue of international concern has grown substantially since1992, when the UNFCCC was adopted because of increasingconcern over rising atmospheric concentrations of greenhousegases and their possible adverse effects on the global climatesystem.

World energy use has emerged at the centre of the issueand since then increased greenhouse gas emissions from fossilfuel combustion dominate the climate change debate. In thiscontext, UNFCCC and Kyoto Protocol call for enhancement ofenergy efficiency and increase of new and renewable energy aswell as measures to limit or reduce emissions of greenhousegases. Global climate change mitigation particularly depends onwidespread use of energy efficiency and renewable energy tech-nologies in all countries.

To enable developing countries and economies in transi-tion to meet both national development and global climatechange goals, the multilateral funding mechanism of GEF andits partner agencies and regional development banks develop,

finance and implement projects that reflect the GEF’s climatechange mitigation strategies. Following the adoption of resolu-tion GC.8/Res.2, reaffirmed by the Industrial DevelopmentBoard at its twenty-third session, UNIDO was accorded part-nership status with the GEF Secretariat at its Council meetingin November 2000.


01: Rural energy:

(a) Assess the market feasibility of the introduction ofcommercially viable rural energy systems based on clean orrenewable energy sources in cooperation with national coun-terparts;

(b) Assist with the design and implementation of ruralenergy programmes based on clean and renewable energysources such as biomass fuels, solar, wind and hydropower, aswell as cleaner fossil fuels such as liquid petroleum gas;

(c) Strengthen the capacity of local manufacturing ofappropriate energy equipment and energy systems.

02: Industrial energy efficiency:

(a) Assist recipient countries with developing an energy-efficiency programme that would help to attain greater energysecurity by bridging the gap between energy demand and sup-ply and to address broader national and global environmentalconcerns, including greenhouse gas emissions;

(b) Enhance energy-efficiency measures and harmonizenational technical standards through and with industrial asso-ciations, and promote voluntary agreements of industry withlocal beneficiaries and authorities;

(c) Analyse and assess energy-intensive industrial sectors,identify the barriers to the implementation of energy efficiencymeasures and develop strategies for overcoming economic,institutional, regulatory and market barriers in cooperationwith national counterparts;

(d) Conduct plant-level energy audits to assess the cur-rent situation, analyse the performance of existing energy-inten-sive equipment and machinery, and introduce appropriatehousekeeping measures;

(e) Demonstrate new technologies and process optionsfor cases when the above-mentioned measures are no longersufficient.

03: Climate change and Kyoto Protocol:

(a) Develop methodologies for the Clean DevelopmentMechanism (CDM) and Joint Implementation under the KyotoProtocol to assist the effective implementation of those mecha-nisms overall and to assist developing countries in their imple-mentation;

(b) Strengthen institutional capacity in developing coun-tries to correctly apply the guidelines and methodologies for thedevelopment and implementation of projects under the CDMand Joint Implementation under the Kyoto Protocol;


(c) Act under a GEF partnership as executing agencywith expanded opportunities for the preparation and imple-mentation of GEF-funded projects in line with the GEF climatechange mitigation strategies;

(d) Seek international collaboration, especially withinternational and regional organizations, development banksand energy technology centres.


(a) Be involved in a number of activities in the energyfield to enhance the awareness of energy and climate changeproblems, and to develop the strategy and methodologies tosolve the problems. These activities include those under theUNFCCC and Kyoto Protocol process, such as CDM and JointImplementation, as well as those specifically targeting energyconcerns of LDCs;

(b) Carry out activities bringing stakeholders together todiscuss, recommend solutions and take action to help to reducepoverty through provision of energy services in the least devel-oped regions;

(c) Actively take part in the Rio + 10 preparations andthe main event;

(d) The form of activities described above includes prepa-ration of technical papers/studies, organizing national, regionaland international meetings, involvement with activities of otherstakeholders, hosting business and industry events, participa-tion in main forums and so on.

MONTREAL PROTOCOL

(Programme D.3)

Context

In the past, the lack of knowledge about atmosphericchemistry and processes resulted in stratospheric ozone deple-tion. Man-made chemicals, especially chlorine and brominecompounds, such as chlorofluorocarbons (CFCs), halons, and abroad range of industrial chemicals used as aerosol propellants,refrigerants, fire retendants, solvents, process agents, foamingagents and fumigants, attack the ozone layer and are recognizedas ODSs. The depletion of the ozone layer allows ultraviolet–Bradiation to reach the ground, which could raise the incidenceof skin cancer, cataracts, and other adverse effects on thehuman immune system. Moreover, the climate change isenhanced disturbing the ecological food chains, affecting agri-culture, fisheries and biological diversity.

The Vienna Convention on Protection of the Ozone Layer(1985) and the subsequent Montreal Protocol on Substancesthat Deplete the Ozone Layer (1987) form the basis for globalcooperation for the protection of the ozone layer. As of May2000, 173 countries ratified the time schedule to “freeze” andreduce consumption of ODSs. In this context, the developingcountries (Article 5 Parties) have agreed to freeze most of CFCconsumption as of 1 July 1999 based on 1995-1997 averages,to reduce consumption by 50 per cent by 1 January 2005 and

to fully eliminate CFCs in 2010. For methyl bromide, usedmainly as a fumigant, developing countries will freeze their con-sumption by 2002 based on average 1995-1998 consumptionlevels.

With the onset of the freeze on CFC production and con-sumption, the Article 5 countries—63 of which are assisted byUNIDO—are entering a new phase. The “grace period”marked by no control measures under the Montreal Protocol isno longer valid, and these countries are now in the “compli-ance” period in which they have to achieve specific reductionsin national ODS phase-out programmes. With the move intothe compliance period, the importance of the country-drivenand compliance-based approach has now been recognized, pro-viding the Article 5 countries further flexibility in the use ofapproved funding of their phase-out processes. UNIDO, as oneof the four implementing agencies of the Montreal Protocolsince 22 October 1992, continues to assist the developing coun-tries in their national processes within the agreed time frameand modality.


01: Policy, strategy and programme design:

(a) Assist Governments in the preparation of policies,strategies and national programmes and in updating relevantdata and information for the phasing out of ODS (by assistingthem in the identification of technology options and the mosteffective ODS-related activities);

(b) Assist Governments in the preparation of sectoral sur-veys and profiles to define specific strategies and requirementsin sectors (e.g. process agents for pharmaceutical and tobaccoand for developing industrial rationalization concepts forSMEs).

02: Support institutions:

(a) Assist in the establishment of national demonstrationand training centres to provide awareness and training forindustrial and agricultural technical personnel and plant man-agers in the management and handling of non-ODS technolo-gies as well as in identifying and testing alternatives to the useof specific fumigants, such as methyl bromide;

(b) Assist the local authorities through institution-build-ing projects in establishing National Ozone Units, in training ofnational experts (Ozone Officers, Customs Officers, etc.) in thepreparation of regulations, codes of good servicing, mainte-nance, safety and production practices (by the preparation ofrefrigerant management plans) and in techniques of demolish-ing of equipment.

03: Direct support to enterprises by project implementation:

(a) Assist the industry in the identification and imple-mentation of state-of-the-art non-ODS production technologyby assessing respective capital and operational costs and safetyissues, assisting in the transfer of clean (non-ODS) technology,including the use and/or acquisition of overseas technology


rights, equipment procurement, the conversion of productionlines, retrofitting, maintenance, recovery and recycling, trainingof staff, commissioning of production lines and quality certifi-cation;

(b) Assist the industry in phasing out the use of specificfumigants, such as methyl bromide (by identifying and testingnational alternatives and providing advice on their implemen-tation);

(c) Assist industry in industrial rationalization throughlarge-scale umbrella projects, optimizing available funds andcontributing to the sustainability and market competitiveness of“grouped” SMEs.


01: Compulsory protocol functions:

(a) Attend regularly (three times per year) the sessionsorganized by the Executive Committee of the Multilateral Fundfor annual business plans, project approvals and discussions onpolicy issues and for reporting on annual work plans;

(b) Attend inter-agency coordination and advisory groupmeetings organized by the Montreal Protocol Secretariat andUNEP to review technical and economic issues concerned withthe effective use of funding, formulation of projects, emergingtechnologies and chemicals, evaluation and reporting schemesand on data processing;

(c) Attend regional networking meetings organized byUNEP, as technical experts to review with Ozone Officers anytechnical, economic and policy issues related to formulationand implementation of projects, technologies, products andadoption of new policies for compliance and planning.

02: Other organizational functions:

(a) Organize regional workshops in cooperation withUNEP to disseminate information and provide advice based onUNIDO’s experience in sectors where the Organization has theleading position (e.g. methyl bromide, process agents);

(b) Organize expert group meetings for consultations onthe implications of new technological trends, new chemicalalternatives and/or on the common constraint areas of SMEs;

(c) Preparation of country-specific publicity materialsand an updated mobile exhibition reflecting the Organization’sachievements, activities and experience in relevant areas.

ENVIRONMENTAL MANAGEMENT

(Programme D.4)

Context

Few now doubt that the continuing degradation of the nat-ural environment poses one of the deepest challenges to modernindustrial societies. Major problems include global warming,loss of biodiversity, water and air pollution, POPs and toxicsubstances, and soil erosion. Institutions and industries of

developing countries and economies in transition face severalconstraints in combating the loss of natural environmentalresources at the national level and emerging environmentalissues of a transboundary, regional and global nature.


01: Environmental planning and policy formulation:

(a) Assist Governments in preparing audits of environ-mental status enabling the cost-benefit analysis of environmen-tally sound non-combustion technologies and alternative reme-diation technologies, and the development of sustainable envi-ronmental policies and action plans;

(b) Build the capacities of Governments to enforce envi-ronmental policy and monitor compliance with regulationsthrough the strengthening of their infrastructure and humanresources, thereby enabling them to formulate sector-specificpollutant discharge standards, prepare and operate sustainableregulatory regimes and implement monitoring programmes;

(c) Assist Governments to operate collectively in themanagement and sustainable use of integrated transboundaryriver basin, wetland, coastal zone and large marine ecosystems;

(d) Strengthen the capacity of public- and private-sectorinstitutions, at national, regional and provincial levels, to eval-uate the relative contributions of different industrial subsectorsto sustainable development and thus to formulate and imple-ment cost-effective and consensus-based environmental policiesand regulations for industry.

02: Cleaner and sustainable production:

(a) Establish and strengthen NCPCs, which raise aware-ness in the private and public sectors of the purpose andbenefits of cleaner production, and assist enterprises with theimplementation of environmental management systems and theidentification, evaluation, and financing of cleaner productionoptions;

(b) Assist Governments, institutions and enterprises withthe removal from manufacturing processes of POPs and per-sistent toxic substances through the introduction of substitutesor alternative environmentally sound non-combustion tech-nologies;

(c) Develop and disseminate expert systems for environ-mental impact assessment;

(d) Promote cleaner environmental practices such as bio-and phytoremediation in the public and private sectors;

(e) Develop information systems consistent with theClearinghouse Mechanism of the Convention of BiologicalDiversity.

03: Pollution control and waste management:

(a) Assist the private and public sectors (including localgovernment) to identify, evaluate and implement pollution-control and waste-management systems and to apply new


bioremediation technologies to the clean-up of polluted indus-trial sites and areas;

(b) Strengthen the capacity of subsector institutions toassist enterprises to evaluate and take up environmentallysound non-combustion technologies, thereby decreasing emis-sions of polluting by-products such as POPs (dioxins andfurans);

(c) Assist the artisanal and small-scale gold mining sectorto minimize the discharge of highly poisonous mercury used ingold extraction through the introduction of technologies for itssafe handling within closed systems.


01: Indicators of sustainable development and triple bottom line:

(a) Convene two expert group meetings, whose conclu-sions will be included in its interventions and presentations atRio + 10 (summer 2002). The first will be a peer review ofUNIDO’s assessment of whether industrial development indeveloped and developing countries has converged on ordiverged from sustainable development targets over the pastdecade and what measures can be taken to accelerate conver-gence. The second will assess the global supply chain effects ofcorporate responsibility efforts of transnational corporationsand how exporters in developing countries can best respond tothe new social and environmental requirements while at thesame time remaining competitive.

02: Biodiversity:

(a) Analyse critical issues affecting the development anduse of genetically modified organisms, as well as their impacton biodiversity and the sustainable utilization of biologicalresources.

03: Millennium Declaration:

(a) Contribute to the implementation of the Declaration,in particular through activities—in coordination with WHO—to provide safe drinking water. UNIDO will seek to identify,develop and deploy environmentally sound management strate-gies and technologies to overcome potential contaminants suchas arsenic and fluoride.

04: Environmentally sound management of chemicals, POPs and toxic substances:

(a) Cooperate and coordinate UNIDO activities in thecontext of the inter-organization programme for the soundmanagement of chemicals, with UNEP, ILO, FAO, WHO,UNITAR and OECD.

05: International waters:

(a) Participate in the two Committees on WaterResources and Oceans and Coastal Areas, where UNIDO part-ners are UNEP, ILO, FAO, WHO, UNITAR, OECD, CSD, andUNESCO.


The General Conference,

Recalling its resolution GC.7/Res.1 endorsing theBusiness Plan on the Future Role and Functions of UNIDO,which remains the basis for the organizational and pro-grammatic transformation of the Organization and whichgrouped UNIDO activities into two areas of concentration:

(a) The strengthening of industrial capacities,

(b) Cleaner and sustainable industrial development,

Recalling also that while maintaining the universalcharacter and vocation of UNIDO, a geographical, sectoraland thematic concentration of its activities would be pur-sued by giving added emphasis to the following:

(a) Services to least developed countries, in particularin Africa, with special attention to the regional and sub-regional level,

(b) Services in support of agro-based industries andtheir integration through subsectoral linkages into nationalindustrial structures,

(c) Services in support of small and medium enter-prises and their integration into national industrial struc-tures,

Recognizing the importance of the proposal for themedium-term programme framework 2002-2005 as con-tained in document GC.9/11, which also reports on progressin implementing the Business Plan,

Noting the developments in the implementation of theBusiness Plan, as reported in documents GC.8/10, Corr.1and 2 and GC.9/11, aware that outstanding tasks remain,partly due to resource shortages,

Taking into account other innovative measures under-taken to bring about the programmatic and organizationaltransformation of UNIDO, as covered in the annual reportssince 1997,

Acknowledging the need for a strong UNIDO presenceand capability to provide services in middle-income devel-oping countries and in countries with economies in transi-tion, in addition to, and not at the expense of what is beingdone in Africa,

Stressing the importance of promoting South-South col-laboration and cooperation activities, taking into accountthe interests of all relevant actors and stakeholders,

Acknowledging the dynamic nature of internationaldevelopment issues and the need for UNIDO to adapt to thechanging industrial development requirements of develop-ing countries, in particular least developed countries andcountries with economies in transition,

Recognizing the contribution that UNIDO can make tothe realization of international development agendas andtargets, especially the goals contained in the United NationsMillennium Declaration and in the final document of theThird United Nations Conference on Least DevelopedCountries,

Considering the importance of technology for indust-rial development, and thus the necessary transfer of tech-nology, as an essential element for the economic growth ofdeveloping countries in their fight against poverty and forconnecting with the world economy,

Taking into account that technical barriers to trade arean impediment in the current international trade system andtherefore recognizing that technical cooperation can helpdeveloping countries and countries with economies in tran-sition to overcome those barriers,

Underlining that UNIDO should bear in mind, whileimplementing the Business Plan, resource constraints andthe need to adhere to the principles of comparative advan-tage and inter-agency coordination,

Convinced that poverty reduction is a key developmentchallenge and that UNIDO can do much to address it,

1. Confirms that in the context of the ongoing reformprocess, the Business Plan remains the basis for enablingUNIDO to adapt its functions and priorities and to orient itsactivities to the new realities of the changing global eco-nomic environment and ensure its viability and efficiency;

2. Takes into account the proposals contained in doc-ument GC.9/11 based on experience and the need to con-sider and to respond to evolving circumstances;

3. Encourages the Director-General, in imple-menting the Business Plan in the period 2002-2005, todevote particular attention to the following:


Annex D. General Conference resolution GC.9/Res. 2on medium-term programme framework, 2002-2005

A. Strengthening of Industrial Capacities

(a) Maintain and reinforce all the sectoral prioritiesand activities of UNIDO as defined in the Business Plan;

(b) Assist developing countries and countries witheconomies in transition to build up their institutional capa-cities, especially those relating to the preparation andapplication of technical regulations and standards, and con-formity assessment procedures with a view to their benefitingfrom improvements in market access and promoting theirrapid and full integration into the multilateral trading system;

(c) Promote investment and technology transfer, interalia, through the network of Investment and TechnologyPromotion Offices and investment promotion forums, andpursue sectoral interaction with the private sector and inter-regional cooperation;

(d) Contribute to the development of small andmedium enterprises and assist Member States in the devel-opment and the implementation of effective policies, and inthe establishment of a coherent set of specialized supportinstitutions and programmes, paying special attention torural entrepreneurship development as well as to womenentrepreneurs, particularly in the poorest countries;

(e) Promote South-South cooperation and assistance,taking into account the dual role of middle-income countriesas recipients and donors, using their experience in advancedsectors to alleviate poverty in least developed countries;

(f) Promote transfer of technology with a view toenhancing the productivity, competitiveness and quality ofthe industrial base of all developing regions of the world,particularly in the following areas: agro-related technology,new information and communication technologies andbiotechnologies, bearing in mind the special importance ofbiotechnology and related activities for those regions;

(g) Extend the technology foresight activities to allregions, taking into account the experience of the regionalinitiative in Latin America, as well as the new initiative forCentral and Eastern Europe and NIS countries, which aimsto address common issues related to regional development;

B. Cleaner and Sustainable Industrial Development

(a) Develop further cleaner production activities,especially in the agro-industrial sector, centred, amongothers, around the UNIDO/UNEP National Cleaner Pro-duction Centres, focusing on specific subsectors, includingindustrial waste and pollution control activities;

(b) Continue to focus the assistance programme ongreenhouse gas reduction policies and increasing energy effi-ciency, as well as on renewable and alternative sources ofenergy in developing countries, particularly in the least devel-oped countries and countries with economies in transition;

(c) Support programmes on environmentally sustain-able industrial development strategies and technologies inagro-industrial sectors particularly textile, leather, food andwood-related activities;

(d) Assist Member States, in those aspects related tosustainable industrial development strategies and technolo-gies, in the implementation of international instruments,such as the Stockholm Convention on Persistent OrganicPollutants, the Kyoto Protocol to the United NationsFramework Convention on Climate Change, the CartagenaProtocol on Biosafety of the Convention on BiologicalDiversity, inter alia, through the development of environ-mental norms and standards;

(e) Give special emphasis to initiatives, in coordinationwith other relevant actors and stakeholders, providing accessto modern and efficient energy services for the poorest, withthe goal of contributing to the international developmenttargets;

(f) Continue to cooperate with the Global Environ-ment Facility and to provide services to Member States in allGlobal Environment Facility focal areas where UNIDO hasa comparative advantage;

(g) Pursue activities related to the phasing-out of ozonedepleting substances as defined in the Montreal Protocol;

C. Global Forum Activities

(a) Within each priority area, ensure that cost-effectiveand output-oriented analytical activities with clear objec-tives provide a strong analytical foundation for technicalcooperation activities;

(b) Use and promote the global forum activities as animportant tool to improve programmatic activities and toenhance common understanding on the contribution ofindustry to poverty alleviation and to the connection ofnational economies to the global economy;

(c) Participate, within its areas of competence, inmajor development conferences to make a visible andfocused contribution;

D. Field Representation

(a) Establish an appropriate monitoring and evalua-tion system for the field structure;

(b) To optimize and strengthen, as appropriate, thefield presence to ensure that it is well targeted, efficient andeffective, and to promote regional integration through, interalia, interaction and coordination with all relevant actorsand stakeholders involved;

E. Human Resources Management

To encourage the further development of the HumanResources Management Framework while ensuring its effec-tiveness and efficiency;

4. Requests the Director-General to report to theConference at its tenth session, through the IndustrialDevelopment Board, on the implementation of the presentresolution.

8th plenary meeting7 December 2001


UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATIONVienna International Centre, P.O. Box 300, A-1400 Vienna, AustriaTelephone: (+43 1) 26026-0, Fax: (+43 1) 26926-69E-mail: [email protected], Internet: http://www.unido.org

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATIONeconomy env i ronment employment

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