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Incremental costs of phasing out ozone depleting substances (Inglês)

The Montreal Protocol stipulates a complete phase-out of substances that deplete the ozone layer. The Multilateral Fund has been established to provide grant finance to help developing countries that are signatories to the Protocol to meet their obligations on an incremental cost basis. This paper discusses specific issues to incremental cost, the basis for eligibility for financing under the Fund. The first three sections comprise introductory and some background material. Section IV interprets the incremental cost concept broadly. While the important effect of country policies is noted, the design of appropriate national policies for implementing the Protocol is not covered in this particular paper. Section V is the main focus: it refers to the incremental cost concept for individual economic agents (principally firms). Section VI concludes by commenting on certain related operational matters: leverage, project and financial cost focus of the Fund, and the relationship of the Country Program Framework Papers to project selection on an incremental basis. Some interim rules for application of the Fund's resources are proposed.

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