Statement by H.E. Mr. Mitsuru Kitano, Permanent Representative, Ambassador Extraordinary and Plenipotentiary of Japan at the 35th Session of the Programme and Budget Committee of UNIDO

[Agenda Item 4: Report of the External Auditor for 2018]
Mr. Chairman,
I would like to begin by congratulating your Excellency Ambassador Andor NAGY of Hungary on your election as Chair of the thirty-fifth session of the PBC.  I am sure that this session will be successful under your able leadership.  I would also like to thank the outgoing Chair, H.E. Ambassador Shi of China, and the acting Chair, Ms. Khutorskaya of Russia, together with the Bureau members, for their dedicated work.
My appreciation also goes to the External Auditor, Mr. Michael Aguinaldo, for his diligent work resulting in the report on the accounts of UNIDO for the financial year 2018.  We hope that UNIDO will continue to make its best efforts to follow up on his recommendations.
Mr. Chairman,
We appreciate that UNIDO’s activities proceeded to develop steadily throughout 2018.  The organization sustains its key role within the international community in implementing the SDGs, especially in relation to Goal 9, and in promoting the IDDA III.
Japan highly values these roles of UNIDO, and works towards aligning its cooperation activities accordingly.  This year, Japan renewed with 5.8 million USD its contributions to the areas of humanitarian-development nexus and clean-water supply via clean energy.
DG Li Yong’s visit to Japan in April of this year has turned to be another great success.  Intensive discussions were held regarding possible cooperation on newly emerging global issues, such as the fight against marine plastic litter.  It was also confirmed that we bolster our cooperation, gaining momentum from two important international meetings to be held in Japan this year: The G20 in June and the Seventh Tokyo International Conference on African Development (TICAD7) in August.
At the upcoming G20 meetings under our presidency, we look forward to receiving UNIDO’s reports on important topics related to industrialization, such as the industrial development of African countries and LDCs, and circular economy. With regard to TICAD7, we look back in satisfaction to the successful panel exhibition, co-organized by Japan and UNIDO in March.  It focused on our longstanding cooperation for industrial development of Africa.  This event was the prelude of our intensified cooperation towards TICAD7 in August, including a pre-TICAD event to be held here in the VIC on 4th of July.
Mr. Chairman,
Let me turn to the management and finance issues of the organization.
First of all, we reaffirm our belief that the ongoing UN Development System reform is of particular importance.  The reform is a common goal for Member States and participating agencies.  Close dialogues and joint efforts between UNIDO and Member States should be continued.  We would appreciate insight into UNIDO’s strategy on proactively adapting its work to this new environment.   UNIDO should explore a way to optimize its performance, and generate efficiency gains.  We further anticipate a concrete cost-benefit analysis.
As to the Programme & Budget Proposal for 2020-2021, the Japanese Government places high importance on the principle of Zero Nominal Growth. 
As for UNIDO's share for the cost-sharing for the UN Resident Coordinator System, we welcome the inter-agency dialogue as reported by DG Li Yong in his statement, particularly on the issue that the payment by UNIDO should be double of the current limit.  We hope the matter would be confirmed solidly, and for constructive budget discussions, we hope the result be reflected in the official budget document, as soon as possible.  In our view, the increase in UNIDO's cost share for the UNRC system should be primarily financed from existing resources, through scrap-and-build, further saving and efficiency gain.
In this regard, I also wish to recall that, at its 17th Session, the General Conference requested the Secretariat to report to this PBC on “all de-prioritization and efficiencies identified and or implemented” since the 33rd session.  Member States must find a solution, paying attention not to impair UNIDO’s core functions.  We stand ready to engage in constructive budget discussions with our colleagues.
As to the issues related to unutilized balances (UBs), we appreciate that the discussions within the Informal Working Group resulted in the submission of Co-Chair’s draft proposals to this PBC.  It is our hope that Member States will find consensus on a concrete solution using the Working Capital Fund, to mitigate the impact of late payment on the regular budget implementation.  At the same time, we reiterate that Member States should act on their obligations under the Charter to pay their assessed contributions in a timely manner.  Further efforts by the Secretariat to improve the collection rate remain fundamental.
In order for the Secretariat to respond to the increasing demand for its services by the international community, efficient management and governance is indispensable.  We therefore hope that UNIDO will follow up on the External Auditor’s recommendations, in close cooperation with the Audit Advisory Committee.
Mr. Chairman,
In closing, I wish to assure you of our fullest support for the success of this PBC session.