Senegal - Senegal River Polders Project : Credit 0350 - Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 350 SE Development Credit Agreement (Senegal River Polders Project) BETWEEN REPUBLIC OF SENEGAL AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JANUARY 9, 1973 CREDIT NUMBER 350 SE Development Credit Agreement (Senegal River Polders Project) BETWEEN REPUBLIC OF SENEGAL AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JANUARY 9, 1973 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated January 9, 1973, between REPUBLIC OF SENEGAL (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) The Borrower has requested the Association to assist in the financing of the Project descriLed in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; (B) The Project will be carried out by the Socidtd d'Aminagement et d'Exploitation des Terres du Drlta du Fleuve Sigal, a public corporation (dtablissement public) of the Borrower (hereinafter called SAED) with the Borrower's assistance and, as part of such assistance, the Borrower will make available to SAED the proceeds of the Credit as hereinafter provided; and (C) The Association is willing to make the Credit available upon th2 terms and conditions set forth hereinafter and in a project agreement of even date herewith between the Association and SAED; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated January 31, 1969, with the same force and effect as if they were fully set forth herein, subject, however, to the deletion of Sections 5.01 and 6.02(h) thereof and to the renumbering of Section 6.02(i) into 6.02(h) thereof (said General Conditions Applicable to Development Credit Agreements of the Association, as so modified, being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth and the following additional terms have the following meanings: 4 (a) "Project Agreement" means the agreement between the Association and SAED of even date herewith, as the same may be amended from time to time, and such term includes all schedules to the Project Agreement; (b) "SAED Financing Agreement" means the agreement to be entered into between the Borrower and SAED pursuant to Section 3.01(b) of this Agreement, as the same may be amended from time to time, and such term includes all schedules (if any) to the SAED Financing Agreement; (c) "SAED" means the Socitd d'Amenagement et d'Exploitation des Terres du Delta du Fleuve Sendgal, a public corporation (etablissement public) of the Borrower, established pursuant to Law No. 65-001 of the Borrower, dated January 20, 1965, and organized pursuant to Decree No. 65-026 of the Borrower, dated January 20, 1965, and includes any successor thereto; (d) "IRAT" means the Institut de Recherches Agronomiques Tropicales et des Cultures Vivridres, an association existing under the laws of the Republic of France, and includes any successor thereto; (e) BNDS means the Banque Nationale de Dchveloppement du S6negal, a public corporation (socite t dconomie mixte) of the Borrower, established pursuant to Law No. 64-33 of the Borrower, dated May 26, 1964, and operating tinder by-laws (Statuts) approved pursuant to Decree No. 64-492 of the Borrower, dated July 3, 1964, and includes any successor thereto; (f) ONCAD means the Office National de Cooperation et d'Assistance pour le Developpement, a public corporation (etablissement public) of the Borrower, established pursuant to Law No. 66-60 of the Borrower, dated June 30, 1966 as amended by Law No. 67-46 of the Borrower, dated October 12, 1967, and includes any successor thereto; (g) "SCET-International" means the Socidtd Central Pour l'Equipment diu Territoire-International, a socidtd existing under the laws of the Republic of France, and includes any successor thereto; (h) "Project period" means the period during which the proceeds of the Credit will be disbursed, estimated to extend about 4 years from the Effective Date; (i) "Project Area" means an approximately triangular area of about 1200 km2 in the Delta and Lower Valley of the Senegal River, in the northwestern part of the territories of the Borrower, having as its base the main highway between 5 St. Louis and the Dagana basin; its apex the Debi basin; and its western and eastern sides, the main stream of the Senegal River; all as demarcated on Map No. 3984, dated July, 1972, of the International Bank for Reconstruction and Development; (j) "Dagana Sub-Project" means Part A of the Project; (k) "Debi Sub-Project" means Part B of the Project; (1) "Lampsar Sub-Project" means Part C of the Project; (m) "Dagana Sub-Project Area" means an area of about 5000 ha in which the Dagana Sub-Project is to be carried out, as demarcated on Map No. 10041, dated July, 1972, of the International Bank for Reconstruction and Development; (n) "Debi Sub-Project Area" means an area of about 1500 ha in which the Debi Sub-Project is to be carried out, as demarcated on Map No. 10008, dated July, 1972, of the International bank for Reconstruction and Development; (o) "Lampsar Sub-Project Area" means the two areas totalling about 2,000 ha in which the Lampsar Sub-Project is to be carried out, as demarcated on Map No. 10042 and Map No. 10054, respectively, dated July, 1972, of the International Bank for Reconstruction and Development; and (p) "participating farmer" means a farmer or fanner group participating under Parts A, B or C of the Project. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equivalent to four million five hundred thousand dollars (S4,500,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule I to this Agreement, as such Schedule shall be amended from time to time, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed under the Development Credit Agreement; provided, however, that, except as the Association 6 shall otherwise agree, no withdrawal shall be made on account of expenditures in the territories of any country which is not a member of the Bank (other than Switzerland) or for goods produced in, or services supplied from, such territories. Section 2.03. Except as the Association shall otherwise agree, the goods and services required for the Project and to be financed out of the proceeds of the Credit shall be procured pursuant to the provisions set forth or referred to in Section 2.04 of the Project Agreement. Section 2.04. The Closing Date shall be December 31, 1977 or such other date as shall be agreed between the Borrower and the Association. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on January I and July 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each January 1 and July 1 commencing January 1, 1983 and ending July 1, 2022, each installment to and including the A installment payable on July 1, 1992 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment therea(ter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the Republic of France is hereby specified for the purposes of Section 4.02 of the General Conditions. Section 2.09. SAED is designated as representative of the Borrower for the purposes of taking any action required or permitted to be taken under the provisions of Section 2.02 of this Agreement and Article V of the General Conditions. ARTICLE III Execution of the Project Section 3.01. (a) Without any limitation or restriction upon any of its other obligations under the Development Credit Agreement, the Borrower shall cause SAED to perform in accordance with the provisions of the Project Agreement all the obligations therein set forth, shall take and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary 7 or appropriate to enable SAED to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of subsection (a) of this Section, the Borrower shall make available to SAED the equivalent of the proceeds of the Credit, and such additional funds as are required to enable SAED to carry out the Project, and it- other operations, under a financing agreement to be entered into between the Borrower and SAED under terms and conditions (including, inter alia, those set forth in Schedule 3 to this Agreement as such Schedule may be modified from time to time by agreement between the Borrower and the Association) which shall have been approved by the Association. (c) The Borrower shall exercise its rights inder the SAED Financing Agreement in such manner as to protect the interests of the Borrower and the Association and to accomplish the purposes of the Credit, and except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive the SAED Financing Agreement or any provision thereof. Section 3.02. Except as the Association shall otherwise agree, the Borrower shall take all necessary steps to enable SAED to obtain the services, during the Project period, of a suitably qualified training specialist to supervise and advise in the operations of the training center to be established inder Part E of the Project. Section 3.03. (a) The Borrower shall make available to SAED such additional personnel as may be required by SAED to enable it to carry out the Project. (b) The Borrower shall replace or cause to be replaced personnel assigned to SAED in accordance with subsection (a) above at the request of SAED if their performance is found by SAED to be unsatisfactory. (c) The Borrower shall take all necessary steps to ensure that expatriate technicians in the employ of SAED shall be replaced only by personnel with qualifications and experience acceptable to the Association. Section 3.04. The Borrower shall inform the Association of any new irrigation development proposed within its territories on the SOnOgal River upstream of Dagana, and shall not implement any such development or permit such development to be implemented unless arrangements satisfactory to the Association first shall have been made to ensure the availability of sufficient water for the Dagana Sub-Project. 8 Section 3.05. The Borrower shall take all necessary steps to ensure that regular checks are made in the Project Area, in accordance with appropriate public health practices, for the presence of the disease bilharzia and of its vector. Section 3.06. Except as the Association shall otherwise agree, the Borrower shall cause ONCAD to make payment without delay for all rice and other produce delivered by SAED to ONCAD. Section 3.07. (a) The Borrower shall, for a period of ten years from the date of this Agreement, consult with the Association annually on the level of subsidies for fertilizers accorded to farmers. (b) Except as the Association shall otherwise agree, the Borrower shall take all necessary steps to eliminate all subsidies for mechanical cultivation services accorded to participating farmers, after the first year of their participation. Section 3.08. The Borrower shall, promptly as required, take all action necessary on its part to enable SAED to impose and collect consolidated fees, as provided in Section 2.12(a) of the Project Agreement. Section 3.09. The Borrower shall furnish to the Association, promptly after final approval by the Borrower, SAED's annual operating budgets. Section 3.10. Except as the Association shall otherwise agree, the Borrower shall take all necessary steps to ensure that each annual operating budget of SAED as approved by the Borrower shall be executed in accordance with its terms and the funds therein provided made available to SAED promptly as required. ARTICLE IV Consultation, Information and Inspection Section 4.01. The Borrower and the Association shall cooperate fully to assure that the purposes of the Credit will be accomplished. To that end, the Borrower and the Association shall from time to time, at the request of either party: (a) exchange views through their representatives with regard to the performance of their respective obligations under the Development Credit Agreement, the performance by SAED of its obligations under the Project Agreement, the administration, operations, resources and expenditures of SAED 9 and, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out any part of the Project, and other matters relating to the purposes of the Credit; and (b) furnish to the other all such information as it shall reasonably request with regard to the general status of the Credit. On the part of the Borrower, such information shall include information with respect to financial and economic conditions in the territories of the Borrower, including its balance of payments, and the external debt of the Borrower, of any of its political subdivisions and of any agency of the Borrower or of any such political subdivision. Section 4.02. (a) The Borrower shall furnish or cause to be furnished to the Association all such information as the Association shall reasonably request concerning the administration, operations, resources and expenditures of SAED and, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out any part of the Project. (b) The Borrower and the Association shall promptly inform each other of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Credit, the maintenance of the service thereof, the performance by either of them of its obligations under the Development Credit Agreement or the performance by SAED of its obligations under the Project Agreement. Section 4.03. The Borrower shall afford all reasonable opportunity for accredited representatives of the Association to visit any part of the territories of the Borrower for purposes related to the Credit. ARTICLE V Taxes and Restrictions Section 5.01. The principal of, and service charges on, the Credit shall be paid without deduction for, and free from, any taxes imposed under the laws of the Borrower or laws in effect in its territories. Section 5.02. The Development Credit Agreement, the Project Agreement and the SAED Financing Agreement shall be free from any taxes on or in connection with the execution, delivery or registration thereof, imposed under the laws of the Borrower or laws in effect in its territories. 10 Section 5.03. The payment of the principal of, and service charges on, the Credit shall be free from all restrictions, regulations, controls and moratoria of any nature imposed tinder the laws of the Borrower or laws in effect in its territories. ARTICLE VI Remedies of the Association Section 6.01. If any event specified in Section 7.01 of the General Conditions or in Section 6.03 of this Agreement shall occur and shall continue for the period, if any, therein set forth, then at any subsequent time during the continuance thereof, the Association, at its option, may by notice to the Borrower declare the principal of the Credit then outstanding to be due and payable immediately together with the service charges thereon and upon any such declaration such principal and service charges shall become due and payable immediately, anything to the contrary in the Development Credit Agreement notwithstanding. Section 6.02. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified: (a) SAED shall have failed to perform any covenant, agreement or obligation of SAED under the Project Agreement or the SAED Financing Agreement. (b) Law No. 65-001 of the Borrower, dated January 20, 1965, or Decree No. 65-026 of the Borrower, dated January 20, 1965, shall have been amended, suspended, abrogated, repealed or waived in such a way as to materially and adversely affect the ability of SAED to carry out the covenants, agreements and obligations set forth in the Project Agreement or the SAED Financing Agreement. (c) The Borrower or any other authority having jurisdiction shall have taken any action for the dissolution or disestablishment of SAED or for the suspension of its operations without the prior consent of the Association. (d) An extraordinary situation shall have arisen which shall make it improbable that SAED will be able to perform its obligations under the Project Agreement or the SAED Financing Agreement. Section 6.03. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified: 11 (a) any event specified in paragraph (a) of Section 6.02 of this Agreement shall occur and shall continue for a period of 60 days after notice thereof shall have been given by the Association to the Borrower, and (b) any event specified in paragraph (b) or (c) of Section 6.02 of this Agreement shall occur. ARTICLE VII Effective Date; Termination Section 7.01. The following events are specified as additional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 10.01(b) of the General Conditions: (a) The execution and delivery of the Project Agreement on behalf of SAED have been duly authorized or ratified by all necessary corporate and governmental action. (b) The execution and delivery of the SAED Financing Agreement on behalf of the Borrower and SAED, respectively, have been duly authorized of ratified by all necessary corporate and governmental action. (c) A form of agreement between SAED and participating farmers, providing for the rights and obligations of SAED and participating farmers or farmer groups, respectively, regarding land use and cropping in the Project Area, has been approved by the Association. Section 7.02. The following are specified as additional matters, within the meaning of Section 10.02(b) of the General Conditions, to be included in the opinion or opinions to be furnished to the Association: (a) That the Project Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, SAED, and constitutes a valid and binding obligation of SAED in accordance with its terms. (b) That the SAED Financing Agreement has been duly authorized or ratified by and executed and delivered on behalf of, the Borrower and SAFD, respectively, and constitutes a valid and binding obligation of the Borrower and SAED in accordance with its terms. Section 7.03. The date April 9, 1973 is hereby specified for the purposes of Section 10.04 of the General Conditions. 12 Section 7.04. The obligations of the Borrower under Sections 3.04, 3.05, 3.06, 3.08, 3.09, 3.10 and 4.02(a) of this Agreement and the provisions of paragraph (c) of Section 6.02 of this Agreement and those of paragraph (b) of Section 6.03 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date thirty-five years after the date of this Agreement, whichever shall be the earlier. ARTICLE VIII Representative of the Borrower; Addresses Section 8.01. The Ministre charge des Finances of the Borrower is designated as representative of the Borrower for the purposes of Section 9.03 of the General Conditions. Section 8.02. The following addresses are specified for the purposes of Section 9.01 of the General Conditions: For the Borrower: Ministfre des Finances Rue Charles Lafn6 Bofte Postale 4017 Dakar, S6ndgal Cable address: MINIFINANCES Dakar For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: INDEVAS Washington, D.C. 13 IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names and to be delivered in the District of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF SENEGAL By /s / Andr6 Coulbary Authiorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s / Roger Chaufournier Reg)iol Fi1'ce Presilent 11estern A4fi-ica 14 SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of amounts of the Credit to each Category and the percentage of eligible expenditures so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Categories Dollar Equivalent) to be Financed I. Hydraulic and agri- 750,000 100% of foreign cultural equipment, expenditures or and vehicles 60% of total expenditures II. Irrigation works 60% of total and building expenditures construction (a) at Dagana 2,080,000 (b'. Debi 160,000 (c) at Lampsar 240,000 III. Consultants' services 450,000 100% of total expenditures IV. Operating costs, 160,000 60% of total training and expenditures research V. Unallocated 660,000 TOTAL 4,500,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures for goods produced in, or services supplied from, the territories, and in the currency, of 15 any country other than the Borrower; provided, however, that if the currency of the Borrower is also that of another country in the territories of which goods are produced or from the territories of which services are supplied, expenditures in such currency for such goods or services shall be deemed to be "foreign expenditures"; and (b) the term "total expenditures" means the aggregate of foreign expenditures and of expenditures for goods produced in, or services supplied from, the territories of the Borrower. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of: (a) expenditures prior to the date of this Agreement, except that withdrawals may be made in respect of Category III on account of expenditures for topographic surveys incurred after May 31, 1972 in an aggregate amount not exceeding the equivalent of $100,000; (b) payments for taxes imposed under the laws of the Borrower or laws in effect in its territories on goods or services, or on the importation, manufacture, procurement or supply thereof. To the extent that the amount represented by the percentage set forth in the third column of the table in paragraph I above in respect of any Category would exceed the amount payable net of all such taxes, such percentage shall be reduced to ensure that no proceeds of the Credit will be withdrawn on account of payments for such taxes; and 4. Notwithstanding the allocation of an amount of the Credit set forth in the second column of the table in paragraph I above: (a) if the estimate of the expenditures under any Category shall decrease, the amount of the Credit then allocated to such Category and no longer required therefor will be reallocated by the Association by increasing correspondingly the unallocated amount of the Credit; (b) if the estimate of the expenditures under any Category shall increase, the percentage set forth in the third column of the table in paragraph I above in respect of such expenditures shall be applied to the amount of such increase, and a corresponding amount will be allocated by the Association, at the request of the Borrower, to such Category from the unallocated amount of the Credit, subject, however, to the requirements for contingencies, as determined by the Association, in respect of any other expenditures; and 16 (c) if the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in Section 2.04 of the Project Agreement, no expenditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. 5. Notwithstanding the percentages set forth in the third column of the table in paragraph 1 above, if the estimate of total expenditures under any Category shall increase and no proceeds of the Credit are available for reallocation to such Category, the Association may, by notice to the Borrower, adjust the percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 17 SCHEDULE 2 Description of the Project The Project is the implementation of a series of measures designed to improve and expand irrigation in order to increase the production of rice and other crops in the Project Area. The Project consists of the following Parts: A. At Dagana: The construction of irrigation works at Dagana, to permit the year-round cultivation of about 2730 ha including: the construction of about 19 km of perimeter dike; installation of separate irrigation and drainage systems; construction of three pumping stations; and necessary land clearing and preparation. B. At Debi: The improvement of water control in the Debi cuvette, by the construction of dikes, dual purpose irrigation and drainage canals, a pumping station, and ancillary hydraulic structures. C. At Lampsar: The improvement of water control in seven cuvettes in the Lampsar Valley, by the construction of dikes, a system of canals to serve as supply and drainage conduits, and ancillary hydraulic structures. D. Strengthening of SAED: 1. The employment by SAED, during the Project period, of additional staff to enable it to carry out Parts A, B and C of the Project and to furnish extension and other services to farmers utilizing land developed under said Parts of the Project, and the provision of related housing and transport means. 2. The provision by SAED, during the Project period, of extension, land cultivation, credit, processing and marketing services to about 1600 farmers allocated land in the Sub-Project Areas. 18 E. Dagana Training Center: The establishment and operation during the Project period of a training center at Dagana, including the employment of training staff; the construction of staff housing; the provision of vehicles and equipment; and the carrying out of training programs to train field agents, farmers, tractor and implement operators; and to provide demonstrations and courses for farmers. F. Research: The carrying out, through collaboration with IRAT, during the Project period, of a program of applied research to support agricultural operations at Dagana, and the provision of staff, vehicles and equipment required therefor. G. Agricultural Equipment: Expanding the SAED machinery pool to enable the provision of land preparation services to farmers allocated land developed under the Project. The Project is expected to be completed by December 31, 1976. 19 SCHEDULE 3 Terms and Conditions of SAED Financing Agreement 1. The Borrower shall relend to SAED a part of the proceeds of the Credit in an amount equivalent to four million three hundred thousand dollars ($4,300,000), for a term of thirty-five (35) years, including five (5) years of grace, at an interest rate of one per cent (1%) per annum on amounts withdrawn and outstanding, with interest to be capitalized for five years. 2. In addition to the part of the proceeds of the Credit made available to SAED under paragraph I above, and subject to paragraph 3 below, the Borrower shall make available to SAED, in the form of a grant, the balance of the proceeds of the Credit, and such additional funds, as are required to enable SAED to carry out the Project and its other operations. 3. No part of the proceeds of the Credit shall be made available under paragraph 2 above until the entire amount to be relent under paragraph I shall have been so relent. 4. Funds required for the Project shall be made available to SAED every three months in advance on the basis of estimates prepared by SAED and approved by Borrower and the Association, covering SAED's funding requirements for the Project for the following three months. 5. The funds to be provided under paragraph 4 above shall be deposited with BNDS for credit to the account of SAED. The operation of such account will be carried out by the Agence Comptable Central of the Borrower, acting on instructions of the Directeur Gcnral of SAED, and will be exempt from the prior controls provided under paragraph 4 of Article 12 of Law No. 72-48 of the Borrower, dated June 12, 1972, and from all similar controls. 6. The Borrower shall take all necessary steps to ensure that each annual operating budget of SAED as approved by the Borrower shall be executed in accordance with its terms and the funds therein provided made available to SAED promptly as required. 7. Without limitation or restriction upon the provisions above, the Borrower shall establish and thereafter maintain in favor of SAED, an advance working capital fund (caisse d'avance), subject to the control of the agent comptable particulier of the Borrower attached to SAED, for the purpose of meeting SAED's cash requirements for salaries and working expenses. Such fund shall be credited from 20 time to time with an amount (which amount shall be reviewed from time to time and increased or decreased if appropriate) sufficient to enable SAED to meet, on a regular basis, its salaries and other working expenses (including, without limitation, expenses for routine maintenance required for the efficient carrying out of SAED's activities), and shall be replenished by the Borrower promptly at such time as sixty-five per cent of the original amount shall have been drawn down. 8. Without limitation or restriction upon the provisions above, the Borrower shall, at the beginning of each harvest, make available to SAED, either in the form of Treasury advances or bank overdraft, sufficient funds to enable SAED to initiate the marketing cycle.