Loan Number 3706 RU
LOAN AGREEMENT
(HIGHWAY REHABILITATION AND MAINTENANCE PROJECT)
BETWEEN RUSSIAN FEDERATION AND INTERNATIONAL
BANK FOR RECONSTRUCTION AND DEVELOPMENT
(Washington, 22.VI.1994)
Agreement, dated June 22, 1994, between Russian Federation (the
Borrower) and International Bank for Reconstruction and
Development (the Bank).
Whereas: A) the Borrower, having satisfied itself as to the
feasibility and priority of the Project described in Schedule 2 to
this Agreement, has requested the Bank to assist in the financing
of the Project;
B) the Borrower has obtained from the United States of America
a grant in an amount equivalent to 5,000,000 USD to assist in
financing the Project on the terms and conditions set forth in the
agreement entered into between the Borrower and the United States
of America; and
C) the Bank has agreed, on the basis, inter alia, of the
foregoing, to extend the Loan to the Borrower upon the terms and
conditions set forth in this Agreement;
Now therefore the parties hereto hereby agree as follows:
Article I
General Conditions; Definitions
Section 1.01. The "General Conditions Applicable to Loan and
Guarantee Agreements" of the Bank, dated January 1, 1985, with the
modifications set forth below (the General Conditions) constitute
an integral part of this Agreement:
a) The last sentence of Section 3.02 is deleted.
b) In Section 6.02, sub-paragraph (k) is re-lettered as sub-
paragraph (1) and a new sub-paragraph (k) is added to read:
"(k) An extraordinary situation shall have arisen under which
any further withdrawals under the Loan would be inconsistent with
the provisions of Article III, Section 3 of the Bank's Articles of
Agreement."
Section 1.02. Unless the context otherwise requires, the
several terms defined in the General Conditions and in the
Preamble to this Agreement have the respective meanings therein
set forth and the following additional terms have the following
meanings:
a) "FHD" means the Federal Highway Department within MOT;
b) "MOT" means the Borrower's Ministry of Transport;
c) "PIU" means Project Implementation Unit established within
FHD;
d) "Project Account" means the account referred to in Section
6.01 (a) of this Agreement, maintained by the Borrower in local
currency and to be used for financing the Borrower's contribution
to Project expenditures;
e) "Project Preparation Advance" means the project preparation
advance granted by the Bank to the Borrower pursuant to an
exchange of letters dated September 10, 1992 and May 15, 1993
between the Borrower and the Bank;
f) "Regional Road Administration" means a regional road
administration agency in charge of road construction and
maintenance;
g) "Road Funds" means the funds established in accordance with
the Law of the Russian Federation "On Road Funds", dated October
18, 1991, to finance all construction and maintenance activities
for both the federal and regional public road network; and
h) "Special Account" means the account referred to in Section
2.02 (b) of this Agreement.
Article II
The Loan
Section 2.01. The Bank agrees to lend to the Borrower, on the
terms and conditions set forth or referred to in the Loan
Agreement, various currencies that shall have an aggregate value
equivalent to the amount of three hundred million dollars
(300,000,000 USD), being the sum of withdrawals of the proceeds of
the Loan, with each withdrawal valued by the Bank as of the date
of such withdrawal.
Section 2.02. a) The amount of the Loan may be withdrawn from
the Loan Account in accordance with the provisions of Schedule 1
to this Agreement for expenditures made (or, if the Bank shall so
agree, to be made) in respect of the reasonable cost of goods and
services required for the Project described in Schedule 2 to this
Agreement and to be financed out of the proceeds of the Loan.
b) The Borrower shall, for the purposes of the Project, open
and maintain in dollars a special deposit account in a commercial
bank on terms and conditions satisfactory to the Bank, including
appropriate protection against set-off, seizure or attachment.
Deposits into, and payments out of, the Special Account shall be
made in accordance with the provisions of Schedule 6 to this
Agreement.
c) Promptly after the Effective Date, the Bank shall, on behalf
of the Borrower, withdraw from the Loan Account and pay to itself
the amount required to repay the principal amount of the Project
Preparation Advance withdrawn and outstanding as of such date and
to pay all unpaid charges thereon. The unwithdrawn balance of the
authorized amount of the Project Preparation Advance shall
thereupon be cancelled.
Section 2.03. The Closing Date shall be June 30, 1998 or such
later date as the Bank shall establish. The Bank shall promptly
notify the Borrower of such later date.
Section 2.04. The Borrower shall pay to the Bank a commitment
charge at the rate of three-fourths of one percent (3/4 of 1%) per
annum on the principal amount of the Loan not withdrawn from time
to time.
Section 2.05. a) The Borrower shall pay interest on the
principal amount of the Loan withdrawn and outstanding from time
to time, at a rate for each Interest Period equal to the Cost of
Qualified Borrowings determined in respect of the preceding
Semester, plus one-half of one percent (1/2 of 1%). On each of the
dates specified in Section 2.06 of this Agreement, the Borrower
shall pay interest accrued on the principal amount outstanding
during the preceding Interest Period, calculated at the rate
applicable during such Interest Period.
b) As soon as practicable after the end of each Semester, the
Bank shall notify the Borrower of the Cost of Qualified Borrowings
determined in respect of such Semester.
c) For the purposes of this Section:
i) "Interest Period" means a six-month period ending on the
date immediately preceding each date specified in Section 2.06 of
this Agreement, beginning with the Interest Period in which this
Agreement is signed.
ii) "Cost of Qualified Borrowings" means the cost, as
reasonably determined by the Bank and expressed as a percentage
per annum, of the outstanding borrowings of the Bank drawn down
after June 30, 1982, excluding such borrowings or portions thereof
as the Bank has allocated to fund:
A) the Bank's investments; and
B) loans which may be made by the Bank after July 1, 1989
bearing interest rates determined otherwise than as provided in
paragraph (a) of this Section.
iii) "Semester" means the first six months or the second six
months of a calendar year.
d) On such date as the Bank may specify by no less than six
months' notice to the Borrower, paragraphs (a), (b) and (c)(iii)
of this Section shall be amended to read as follows:
"a) The Borrower shall pay interest on the principal amount of
the Loan withdrawn and outstanding from time to time, at a rate
for each Quarter equal to the Cost of Qualified Borrowings
determined in respect of the preceding Quarter, plus one-half of
one percent (1/2 of 1%). On each of the dates specified in Section
2.06 of this Agreement, the Borrower shall pay interest accrued on
the principal amount outstanding during the preceding Interest
Period, calculated at the rates applicable during such Interest
Period."
"b) As soon as practicable after the end of each Quarter, the
Bank shall notify the Borrower of the Cost of Qualified Borrowings
determined in respect of such Quarter."
"c) iii) 'Quarter' means a three-month period commencing on
January 1, April 1, July 1 or October 1 in a calendar year."
Section 2.06. Interest and other charges shall be payable
semiannually on February 15 and August 15 in each year.
Section 2.07. The Borrower shall repay the principal amount of
the Loan in accordance with the amortization schedule set forth in
Schedule 3 to this Agreement.
Article III
Execution of the Project
Section 3.01. a) The Borrower declares its commitment to the
objectives of the Project as set forth in Schedule 2 to this
Agreement, and, to this end, shall carry out the Project through
MOT and FHD with due diligence and efficiency and in conformity
with appropriate administrative, financial and technical
practices, and shall provide, promptly as needed, the funds,
facilities, services and other resources required for the Project.
b) Without limitation upon any of its obligations under
paragraph (a) of this Section, the Borrower shall: (i) maintain
the Project Account referred to in Section 6.01 (a) of this
Agreement, and shall replenish said account promptly before each
quarter so that the amount deposited in the account at the
beginning of each quarter shall not be less than the equivalent of
500,000 USD; (ii) use said account for financing the Borrower's
contribution to Project expenditures, including but not limited to
expenditures for rent, maintenance and repair of laboratories and
office buildings and transportation; and (iii) ensure that
sufficient annual allocations will be made within the Road Funds
for the Borrower's counterpart contribution to the costs of the
Project.
c) Without limitation upon the provisions of paragraph (a) of
this Section and except as the Borrower and the Bank shall
otherwise agree, the Borrower shall carry out the Project in
accordance with the Implementation Program set forth in Schedule 5
to this Agreement.
Section 3.02. a) Except as the Bank shall otherwise agree,
procurement of the goods, works and consultants' services required
for the Project and to be financed out of the proceeds of the Loan
shall be governed by the provisions of Schedule 4 to this
Agreement.
b) For the purposes of bid evaluation, the Borrower shall set
up a bid evaluation committee within FHD which shall include, on
ad hoc basis, a representative from each Regional Road
Administration in whose territory the contract is to be executed.
Article IV
Financial Covenants
Section 4.01. a) The Borrower shall maintain or cause to be
maintained records and accounts adequate to reflect in accordance
with sound accounting practices the operations, resources and
expenditures in respect of the Project of the departments or
agencies of the Borrower responsible for carrying out the Project
or any part thereof.
b) The Borrower shall:
i) have the records and accounts referred to in paragraph (a)
of this Section including those for the Special Account and the
Project Account for each fiscal year audited, in accordance with
appropriate auditing principles consistently applied, by
independent auditors acceptable to the Bank;
ii) furnish to the Bank as soon as available, but in any case
not later than six months after the end of each such year, the
report of such audit by said auditors, of such scope and in such
detail as the Bank shall have reasonably requested; and
iii) furnish to the Bank such other information concerning said
records and accounts and the audit thereof as the Bank shall from
time to time reasonably request.
c) For all expenditures with respect to which withdrawals from
the Loan Account were made on the basis of statements of
expenditure, the Borrower shall:
i) maintain or cause to be maintained, in accordance with
paragraph (a) of this Section, records and accounts reflecting
such expenditures;
ii) retain, until at least one year after the Bank has received
the audit report for the fiscal year in which the last withdrawal
from the Loan Account or payment out of the Special Account was
made, all records (contracts, orders, invoices, bills, receipts
and other documents) evidencing such expenditures;
iii) enable the Bank's representatives to examine such records;
and
iv) ensure that such records and accounts are included in the
annual audit referred to in paragraph (b) of this Section and that
the report of such audit contains a separate opinion by said
auditors as to whether the statements of expenditure submitted
during such fiscal year, together with the procedures and internal
controls involved in their preparation, can be relied upon to
support the related withdrawals.
Article V
Effective Date; Termination
Section 5.01. The following events are specified as additional
conditions to the effectiveness of the Loan Agreement within the
meaning of Section 12.01 (c) of the General Conditions:
a) the Borrower shall have opened a Project Account in a
commercial bank on terms and conditions acceptable to the Bank
with an initial deposit in local currency equivalent to 500,000
USD;
b) the bidding documents for contracts to be executed in 1994
shall have been prepared and submitted to the Bank for its
approval; and
c) FHD shall have appointed consultants to strengthen the PIU's
project management capacity pursuant to Section II of Schedule 4
to this Agreement.
Section 5.02. The date ninety (90) days after the date of this
Agreement is hereby specified for the purposes of Section 12.04 of
the General Conditions.
Article VI
Representative of the Borrower; Addresses
Section 6.01. The Minister of Finance of the Borrower is
designated as representative of the Borrower for the purposes of
Section 11.03 of the General Conditions.
Section 6.02. The following addresses are specified for the
purposes of Section 11.01 of the General Conditions:
For the Borrower:
Ministry of Finance
103097, Moscow
Ilyinka Street 9
Russian Federation
Telex:
112008
For the Bank:
International Bank for
Reconstruction and Development
1818 H Street, N.W.
Washington, D.C. 20433
United States of America
Cable address: Telex:
INTBAFRAD 248423 (RCA)
Washington, D.C. 82987 (FTCC)
64145 (WUI) or
197688 (TRT)
In witness whereof, the parties hereto, acting through their
duly authorized representatives, have caused this Agreement to be
signed in their respective names in the District of Columbia,
United States of America, as of the day and year first above
written.
SCHEDULE 1
WITHDRAWAL OF THE PROCEEDS OF THE LOAN
1. The table below sets forth the Categories of items to be
financed out of the proceeds of the Loan, the allocation of the
amounts of the Loan to each Category and the percentage of
expenditures for items so to he financed in each Category:
---------------------T------------------T------------------------¬
¦ Category ¦ Amount of the ¦ % of Expenditures ¦
¦ ¦ Loan Allocated ¦ to be Financed ¦
¦ ¦ (Expressed in ¦ ¦
¦ ¦Dollar Equivalent)¦ ¦
+--------------------+------------------+------------------------+
¦(1) Civil works ¦ 233,800,000 ¦90% ¦
¦ ¦ ¦ ¦
¦(2) Equipment, ¦ 3,500,000 ¦100% of foreign ¦
¦ materials and ¦ ¦expenditures, ¦
¦ supplies ¦ ¦100% of local ¦
¦ ¦ ¦expenditures ¦
¦ ¦ ¦(ex-factory cost) and ¦
¦ ¦ ¦70% of local ¦
¦ ¦ ¦expenditures for ¦
¦ ¦ ¦other items ¦
¦ ¦ ¦procured locally ¦
¦ ¦ ¦ ¦
¦(3) Consultants' ¦ 20,600,000 ¦100% ¦
¦ services, ¦ ¦ ¦
¦ training, and ¦ ¦ ¦
¦ studies ¦ ¦ ¦
¦ ¦ ¦ ¦
¦(4) Refunding of ¦ 750,000 ¦Amount due ¦
¦ Project ¦ ¦pursuant to ¦
¦ Preparation ¦ ¦Section 2.02 (c) ¦
¦ Advance ¦ ¦of this Agreement ¦
¦ ¦ ¦ ¦
¦(5) Unallocated ¦ 41,350,000 ¦ ¦
+--------------------+------------------+------------------------+
¦ TOTAL 300,000,000 ¦
L-----------------------------------------------------------------
2. For the purposes of this Schedule:
a) the term "foreign expenditures" means expenditures in the
currency of any country other than that of the Borrower for goods
or services supplied from the territory of any country other than
that of the Borrower; and
b) the term "local expenditures" means expenditures in the
currency of the Borrower or for goods or services supplied from
the territory of the Borrower; provided, however, that if the
currency of the Borrower is also that of another country from the
territory of which the goods and services are supplied,
expenditures in such currency for such goods or services shall be
deemed to be "foreign expenditures".
3. Notwithstanding the provisions of paragraph 1 above, no
withdrawals shall be made in respect of payments made for
expenditures prior to the date of this Agreement.
SCHEDULE 2
DESCRIPTION OF THE PROJECT
The objectives of the Project are to:
i) rehabilitate and improve maintenance of major federal and
regional roads;
ii) to strengthen FHD's capacity in the highway management
system;
iii) to initiate reform of the financial and institutional
structure of the road construction industry; and
iv) to increase the capacity of MOT to develop a policy, legal
and institutional framework for transport sector.
The Project consists of the following parts, subject to such
modifications thereof as the Borrower and the Bank may agree upon
from time to time to achieve such objectives:
Part A
Road Rehabilitation
1) Rehabilitation of about 1,500 km of high priority links of
federal roads selected in accordance with criteria satisfactory to
the Bank.
2) Maintenance and road improvements on about 9,500 km of
federal roads and 500 km of regional roads selected in agreement
with the Bank, in accordance with criteria satisfactory to the
Bank.
Part B
Equipment, Materials and Supplies
Acquisition of equipment and materials for laboratories, field
testing, traffic counts and vehicle weighing; computers and other
office technology and supplies and vehicles for surveying, field
inspection, design and supervision of works for FHD to improve its
capacity for road management.
Part C
Consultants' Services, Training and Studies
1) Design, preparation of bidding documents and supervision of
road rehabilitation and maintenance works.
2) Development of FHD staff and local consulting capabilities
in highway planning, financing, design and supervision of
construction and maintenance, and environmental assessment through
provision of consultants' services and training.
3) Training to prepare local contractors to bid for and
contract road works.
4) Carrying out of a study to improve the management and
efficiency of public expenditures on roads.
5) Implementation of a pavement management system for the
federal road network.
6) Assistance for MOT to develop the policy, legal and
institutional framework for the transport sector and to
restructure the MOT.
The Project is expected to be completed by December 31, 1997.
SCHEDULE 3
AMORTIZATION SCHEDULE
-------------------------------------T---------------------------¬
¦ Date Payment Due ¦ Payment of Principal ¦
¦ ¦(expressed in dollars) <*> ¦
+------------------------------------+---------------------------+
¦On each February 15 and August 15 ¦ ¦
¦ ¦ ¦
¦ beginning August 15, 1999 ¦ 12,500,000.00 ¦
¦ through August 15, 2010 ¦ ¦
¦ ¦ 12,500,000.00 ¦
¦And on February 15, 2011 ¦ ¦
L------------------------------------+----------------------------
--------------------------------
<*> The figures in this column represent dollar equivalents
determined as of the respective dates of withdrawal. See General
Conditions, Sections 3.04 and 4.03.
PREMIUMS ON PREPAYMENT
Pursuant to Section 3.04 (b) of the General Conditions, the
premium payable on the principal amount of any maturity of the
Loan to be prepaid shall be the percentage specified for the
applicable time of prepayment below:
--------------------------------T--------------------------------¬
¦ Time of Prepayment ¦ Premium ¦
+-------------------------------+--------------------------------+
¦ ¦The interest rate (expressed ¦
¦ ¦as a percentage per annum) ¦
¦ ¦applicable to the Loan on the ¦
¦ ¦day of prepayment multiplied ¦
¦ ¦by: ¦
¦ ¦ ¦
¦Not more than three years ¦ 0.18 ¦
¦ before maturity ¦ ¦
¦ ¦ ¦
¦More than three years but ¦ 0.35 ¦
¦ not more than six years ¦ ¦
¦ before maturity ¦ ¦
¦ ¦ ¦
¦More than six years but ¦ 0.65 ¦
¦ not more than 11 years ¦ ¦
¦ before maturity ¦ ¦
¦ ¦ ¦
¦More than 11 years but not ¦ 0.88 ¦
¦ more than 15 years ¦ ¦
¦ before maturity ¦ ¦
¦ ¦ ¦
¦More than 15 years before ¦ 1.00 ¦
¦ maturity ¦ ¦
L-------------------------------+---------------------------------
SCHEDULE 4
PROCUREMENT AND CONSULTANTS' SERVICES
Section I. PROCUREMENT OF GOODS AND WORKS
Part A
International Competitive Bidding
1. Except as provided in Part C hereof, goods and works shall
be procured under contracts awarded in accordance with procedures
consistent with those set forth in Sections I and II of the
"Guidelines for Procurement under IBRD Loans and IDA Credits"
published by the Bank in May 1992 (the Guidelines).
a) For fixed-price contracts, the invitation to bid referred to
in paragraph 2.13 of the Guidelines shall provide that, when
contract award is delayed beyond the original bid validity period,
the successful bidder's bid price will be increased for the period
to be established in the bidding document by two predisclosed
correction factors acceptable to the Bank, one to be applied to
all foreign currency components and the other to the local
currency component of the bid price. Such an increase shall not be
taken into account in the bid evaluation.
b) In the procurement of goods and works in accordance with
this Part A, the Borrower shall use the relevant standard bidding
documents issued by the Bank, with such modifications thereto as
the Bank shall have agreed to be necessary for the purposes of the
Project. Where no relevant standard bidding documents have been
issued by the Bank, the Borrower shall use bidding documents based
on other internationally recognized standard forms agreed with the
Bank.
2. Bidders for civil works shall be prequalified as provided in
paragraph 2.10 of the Guidelines.
3. To the extent practicable, contracts for civil works shall
be grouped into bid packages estimated to cost the equivalent of
1,000,000 USD or more.
Part B
Preference for Domestic Manufacturers
In the procurement of goods in accordance with the procedures
described in Part A.1 hereof, goods manufactured in the Russian
Federation may be granted a margin of preference in accordance
with, and subject to, the provisions of paragraphs 2.55 and 2.56
of the Guidelines and paragraphs 1 through 4 of Appendix 2
thereto.
Part C
Other Procurement Procedures
1. Civil works estimated to cost the equivalent of 1,000,000
USD or less per contract, up to an aggregate amount equivalent to
95,000,000 USD, may be procured under contracts awarded on the
basis of competitive bidding, advertised locally, in accordance
with procedures satisfactory to the Bank, including
prequalification of local contractors.
2. Items or group of items estimated to cost the equivalent of
300,000 USD or less per contract, up to an aggregate amount
equivalent to 800,000 USD, may be procured under contracts awarded
on the basis of comparison of price quotations obtained from at
least three suppliers from at least three different countries
eligible under the Guidelines, in accordance with procedures
acceptable to the Bank.
3. Items or group of items estimated to cost the equivalent of
20,000 USD or less per contract, up to an aggregate amount
equivalent to 200,000 USD, may be procured under contracts awarded
on the basis of comparison of price quotations obtained from at
least three suppliers eligible under the Guidelines, in accordance
with procedures acceptable to the Bank.
4. Contracts for goods which are of proprietary nature or which
require standardization with existing equipment, up to an
aggregate amount equivalent to 1,200,000 USD, may be awarded after
direct negotiations with suppliers, in accordance with procedures
acceptable to the Bank.
Part D
Review by the Bank of Procurement Decisions
1. Review of prequalification:
With respect to the prequalification of bidders as provided in
Part A.2 and Part C.1 hereof, the procedures set forth in
paragraph 1 of Appendix 1 to the Guidelines shall apply.
2. Review of invitations to bid and of proposed awards and
final contracts:
a) With respect to each contract for civil works and goods
estimated to cost the equivalent of 300,000 USD or more, the
procedures set forth in paragraphs 2 and 4 of Appendix 1 to the
Guidelines shall apply. Where payments for such contracts are to
be made out of the Special Account, such procedures shall be
modified to ensure that the two conformed copies of the contract
required to be furnished to the Bank pursuant to said paragraph 2
(d) shall be furnished to the Bank prior to the making of the
first payment out of the Special Account in respect of such
contract.
b) With respect to each contract not governed by the preceding
paragraph, the procedures set forth in paragraphs 3 and 4 of
Appendix 1 to the Guidelines shall apply. Where payments for such
contract are to be made out of the Special Account, said
procedures shall be modified to ensure that the two conformed
copies of the contract together with the other information
required to be furnished to the Bank pursuant to said paragraph 3
shall be furnished to the Bank as part of the evidence to be
furnished pursuant to paragraph 4 of Schedule 5 to this Agreement.
c) The provisions of the preceding subparagraph (b) shall not
apply to contracts on account of which withdrawals are to be made
on the basis of statements of expenditure.
3. The figure of 15% is hereby specified for purposes of
paragraph (A) of Appendix 1 to the Guidelines.
Section II. EMPLOYMENT OF CONSULTANTS
1. In order to assist the Borrower in carrying out the Project,
the Borrower shall employ consultants whose qualifications,
experience and terms and conditions of employment shall be
satisfactory to the Bank. Such consultants shall be selected in
accordance with principles and procedures satisfactory to the Bank
on the basis of the "Guidelines for the Use of Consultants by
World Bank Borrowers and by the World Bank as Executing Agency"
published by the Bank in August 1981 (the Consultant Guidelines).
For complex, time-based assignments, the Borrower shall employ
such consultants under contracts using the standard form of
contract for consultant's services issued by the Bank, with such
modifications as shall have been agreed by the Bank. Where no
relevant standard contract documents have been issued by the Bank,
the Borrower shall use other standard forms agreed with the Bank.
2. Notwithstanding the provisions of paragraph 1 of this
Section, the provisions of the Consultant Guidelines requiring
prior Bank review or approval of budgets, short lists, selection
procedures, letters of invitation, proposals, evaluation reports
and contracts shall not apply to contracts estimated to cost less
than 75,000 USD equivalent each. However, this exception to prior
Bank review shall not apply to the terms of reference for such
contracts nor to the employment of individuals, to single source
selection of firms, to assignments of a critical nature as
reasonably determined by the Bank and to amendments of contracts
raising the contract value to 75,000 USD equivalent or above.
SCHEDULE 5
IMPLEMENTATION PROGRAM
1. For the purpose of administration, of the activities to be
carried out under the Project, except for Part C (5) of the
Project, the Borrower shall maintain within FHD the PIU to be
headed by a full-time project coordinator to be employed in
accordance with Section II of Schedule A to this Agreement, who
shall be assisted by competent staff in adequate numbers.
2. The Borrower shall carry out or cause FHD to carry out an
action plan, satisfactory to the Bank, which shall include:
a) exchange of views on the program of road reconstruction,
rehabilitation and maintenance during the annual budget
preparation;
b) development of accounting and auditing system for the
Federal Road Fund by January 31, 1995;
c) development of a maintenance strategy for the Russian
federal road system based on a model calibrated for Russian road
conditions. The Borrower shall submit the maintenance strategy for
the Bank's review by December 31, 1994;
d) preparation of a road safety program by December 31, 1994;
and
e) development of an adequate system of environmental
assessments of road maintenance and construction by July 1, 1994.
3. The Borrower shall:
a) by March 1, 1994, implement the results of a study to
develop cost-escalation formulae to be included in civil works
contracts;
b) by March 31, 1995, on the basis of a study to be carried out
under Part C(3) of the Project, prepare recommendations for
improved road financing, including a timetable to implement said
recommendations; and
c) consult with the Bank on any proposed changes to the road
financing system.
4. Not later than one month after the end of each quarter, the
Borrower shall furnish to the Bank quarterly progress reports, of
such coverage, detail and format as the Bank may reasonably
request, and review, thereafter, with the Bank issues related to
the execution of the Project.
5. Not later than June 30, 1996, a mid-term review shall be
carried out by the Borrower and the Bank, in order to evaluate and
assess, inter alia:
a) the overall progress of Project implementation;
b) the adequacy of the Borrower's counterpart fundings; and
c) the results of recommendations of completed studies and the
ongoing technical assistance and training programs.
6. The Borrower shall retain the auditors, acceptable to the
Bank, to review the accounting systems and supporting internal
procedures and practices for the Special and Project accounts and
statement of expenditures, and recommend any needed changes which
shall be implemented by the Borrower after Bank agreement not
later than November 30, 1994.
SCHEDULE 6
SPECIAL ACCOUNT
1. For the purposes of this Schedule:
a) the term "eligible Categories" means Categories (1), (2),
(3) and (4) set forth in the table in paragraph 1 of Schedule 1 to
this Agreement;
b) the term "eligible expenditures" means expenditures in
respect of the reasonable cost of goods and services required for
the Project and to be financed out of the proceeds of the Loan
allocated from time to time to the eligible Categories in
accordance with the provisions of Schedule 1 to this Agreement;
and
c) the term "Authorized Allocation" means an amount equivalent
to 5,000,000 USD to be withdrawn from the Loan Account and
deposited in the Special Account pursuant to paragraph 3 (a) of
this Schedule.
2. Payments out of the Special Account shall be made
exclusively for eligible expenditures in accordance with the
provisions of this Schedule.
3. After the Bank has received evidence satisfactory to it that
the Special Account has been duly opened, withdrawals of the
Authorized Allocation and subsequent withdrawals to replenish the
Special Account shall be made as follows:
a) For withdrawals of the Authorized Allocation, the Borrower
shall furnish to the Bank a request or requests for a deposit or
deposits which do not exceed the aggregate amount of the
Authorized Allocation. On the basis of such request or requests,
the Bank shall, on behalf of the Borrower, withdraw from the Loan
Account and deposit in the Special Account such amount or amounts
as the Borrower shall have requested.
b) (i) For replenishment of the Special Account, the Borrower
shall furnish to the Bank requests for deposits into the Special
Account at such intervals as the Bank shall specify.
ii) Prior to or at the time of each such request, the Borrower
shall furnish.to the Bank the documents and other evidence
required pursuant to paragraph 4 of this Schedule for the payment
or payments in respect of which replenishment is requested. On the
basis of each such request, the Bank shall, on behalf of the
Borrower, withdraw from the Loan Account and deposit into the
Special Account such amount as the Borrower shall have requested
and as shall have been shown by said documents and other evidence
to have been paid out of the Special Account for eligible
expenditures.
All such deposits shall be withdrawn by the Bank from the Loan
Account under the respective eligible Categories, and in the
respective equivalent amounts, as shall have been justified by
said documents and other evidence.
4. For each payment made by the Borrower out of the Special
Account, the Borrower shall, at such time as the Bank shall
reasonably request, furnish to the Bank such documents and other
evidence showing that such payment was made exclusively for
eligible expenditures.
5. Notwithstanding the provisions of paragraph 3 of this
Schedule, the Bank shall not be required to make further deposits
into the Special Account:
a) if, at any time, the Bank shall have determined that all
further withdrawals should be made by the Borrower directly from
the Loan Account in accordance with the provisions of Article V of
the General Conditions and paragraph (a) of Section 2.02 of this
Agreement; or
b) once the total unwithdrawn amount of the Loan allocated to
the eligible Categories, less the amount of any outstanding
special commitment entered into by the Bank pursuant to Section
5.02 of the General Conditions with respect to the Project, shall
equal the equivalent of twice the amount of the Authorized
Allocation.
Thereafter, withdrawal from the Loan Account of the remaining
unwithdrawn amount of the Loan allocated to the eligible
Categories shall follow such procedures as the Bank shall specify
by notice to the Borrower. Such further withdrawals shall be made
only after and to the extent that the Bank shall have been
satisfied that all such amounts remaining on deposit in the
Special Account as of the date of such notice will be utilized in
making payments for eligible expenditures.
6. a) If the Bank shall have determined at any time that any
payment out of the Special Account:
i) was made for an expenditure or in an amount not eligible
pursuant to paragraph 2 of this Schedule; or
ii) was not justified by the evidence furnished to the Bank,
the Borrower shall, promptly upon notice from the Bank:
A) provide such additional evidence as the Bank may request; or
B) deposit into the Special Account (or, if the Bank shall so
request, refund to the Bank) an amount equal to the amount of such
payment or the portion thereof not so eligible or justified.
Unless the Bank shall otherwise agree, no further deposit by
the Bank into the Special Account shall be made until the Borrower
has provided such evidence or made such deposit or refund, as the
case may be.
b) If the Bank shall have determined at any time that any
amount outstanding in the Special Account will not be required to
cover further payments for eligible expenditures, the Borrower
shall, promptly upon notice from the Bank, refund to the Bank such
outstanding amount.
c) The Borrower may, upon notice to the Bank, refund to the
Bank all or any portion of the funds on deposit in the Special
Account.
d) Refunds to the Bank made pursuant to paragraphs 6 (a), (b)
and (c) of this Schedule shall be credited to the Loan Account for
subsequent withdrawal or for cancellation in accordance with the
relevant provisions of this Agreement, including the General
Conditions.
|
