PROPOSALS FROM THE FACILITATORS

TERMS OF REFERENCE
OF THE
BELIZE-GUATEMALA DEVELOPMENT TRUST FUND

I. Establishment of the Trust Fund

1. The Trust Fund is being established by the President of the Inter-American Development Bank (hereinafter referred to as 'the IDB') at the request of the Secretary General of the Organization of American States (hereinafter referred to as 'the OAS') pursuant to the acceptance in principle by the Governments of Belize and Guatemala (hereinafter referred to as 'the Parties') of Proposals 'for a comprehensive, definitive, honourable and permanent resolution of the territorial differendum between Belize and Guatemala' presented to them by the Facilitators appointed by them for that purpose.

   II. Purpose of Establishing the Trust Fund

2. The Trust Fund is being established to receive contributions to facilitate the development of Belize and Guatemala in the context of Treaties of Settlement to be concluded by the Parties, and as appropriate by the Government of Honduras, in implementation of the Proposals accepted by them for a peaceful and definitive settlement of the territorial differendum as specified in paragraph 1 above (hereinafter referred to as 'the Treaties of Settlement').

   III. Activities to be Financed from the Trust Fund

3. The Trust Fund shall be used for the purposes described in paragraph 2 above and specifically to finance the following activities:

• the implementation of the Proposals of the Facilitators and the Treaties of Settlement.

• the alleviation of extreme poverty and landlessness in the border provinces of Guatemala;

• the establishment of a special Human Settlement in Guatemala;

• the establishment, development and protection of the Belize-Guatemala-Honduras Ecological Park.

  IV. Authority

4. The establishment and management of the Trust Fund will be governed by the regulations and rules of the IDB and other relevant policies and procedures promulgated by the President of the IDB (hereinafter referred to as 'the President'). Exceptions to such regulations, rules, policies and procedures are not permissible unless specifically authorised by the President in the context of the purposes of the establishment of the Trust Fund.

   V. Contributions to the Trust Fund

5. Contributions to the Fund are to be made voluntarily by States, international financial institutions, including he IDB, intergovernmental and non-governmental organisations or private institutions and individuals. A pledge may only be accepted by the President of the IDB, the Secretary General of the OAS, or by officials having the authority to do so under the provisions of paragraph 11 below.

6. Contributions to the Fund may be accepted in United States dollars or other fully convertible currencies. Contributions in currencies which are not convertible may be accepted only if the President of the IDB determines that the currency can be fully utilised in the implementation of the related activity. Contributions in kind are given an estimated monetary value by the President at the time the pledges are received. The making of a pledge and its acceptance are to be recorded in an exchange of letters, or if deemed appropriate, in a formal agreement.

7. The IDB will designate the following bank account in which the resources of the Trust Fund shall be deposited and maintained:

8. Contributions will normally be received for general administrative, logistical and management support of the implementation of the activities listed in paragraph 3 above.

9. Contributions made to the Fund may be earmarked and disbursed in accordance with the intention of the respective donor. If they cannot be used as intended, consultations will be held with the donor on the appropriate use of the contribution.

   VI Administration of the Trust Fund

10. The President of the IDB will designate the implementing office of the Fund. That Office will be responsible for coordinating all aspects of the work programme to be financed from the Fund.

11. For the purpose of ensuring proper financial controls, the President of the IDB will designate the Programme Manager of the Trust Fund and the Certifying Officer.

12. The Programme Manager shall be responsible for ensuring that the Trust Fund is utilised for the purpose as described in paragraph 2 above and for the execution of the projects/programmes carried out under the Fund.

13. The Certifying Officer shall ensure that expenditures are incurred in accordance with the existing financial and staff regulations, rules and procedures, for the purpose intended and within the limits allotted, and to draw to the attention of the President any proposed commitment or expenditure which, in his view, is inconsistent herewith.

    VII. Preparation of a Cost and Action Plan

14. All the cost plans for the Fund, including those for operational activities, must include provision for programme support costs. The cost plans, together with a schedule of delivery detailing the timing for the proposed distribution of funds, will be submitted to the President for approval.

    VII Spending Authority

15. No commitments, obligations or disbursements against any funds may be incurred without the written authorisation of the President. Such authorisations take the form of allotments, which will be issued only after sufficient contributions have been received to meet the requirements for initial financial obligations and for any reserves which may be required. Spending authority will be exercised by certifying officers, designated by the President, in accordance with paragraph 11 above.

    IX. Assets and Liabilities of the Trust Fund

16. Ownership of equipment, supplies and other property financed from the Fund shall be vested in the IDB. On the termination and expiration of the Fund, the matter of ownership shall be decided on the advice of the Secretary General of the OAS.

    X. Reporting and Evaluation

17. The Programme Manager will make available the following reports:

    1) an annual financial statement showing contributions to the Fund and expenditures, as of 31 December each year; and

    2) an evaluation report and expenditure reports within six months after the date of the expiration and termination of activities. All financial statements and accounts shall be expressed in United States dollars.

    XI. Programme Support Costs and Reserves

18. The Fund will be charged a percentage of all expenditures in respect of programme support services for the implementation of the projects, unless otherwise agreed with the President. In addition, the Trust Fund operating reserve will be applied against the expenditures from the Fund to cover any delays in payment and to meet final expenditures of the Fund activities, including liquidating liabilities.

    XII. Audit

19. The Trust Fund will be subject to audit under regulations and rules of the IDB.

    XIII. Closure of the Trust Fund

20. The Implementing Office will arrange for the President to be informed if in its opinion the purposes for which the Fund was established have been met. The Fund may be terminated after a decision by the President.

21. Any balances remaining at the time the Fund is closed will be disposed of in a manner consistent with the purposes of the Fund and the financial regulations of the IDB.