Mali - Technical Assistance And Engineering Project : Credit 0854 - Development Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 854 MLI Development Credit Agreement (Technical Assistance and Engineering Project) between REPUBLIC OF MALI and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated October 30, 1978 CDIT NUMER 654 MLI DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated October 30, 1978, between the REPUBLIC OF MALI (hereinafter called the Borrower) and INTERNATIONAL DEVEL- OPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) the Borrower has requested the Association to assist in the financing of the foreign exchange cost of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; (B) by letter addressed by the Association to the Minister of Finance and of Commerce of the Borrower on February 13, 1978 the Association granted an advance to the Borrower of $20,000 for the preparation of the Project described in Schedule 2 to this Agreement; (C) pursuant to the terms of said advance the amount thereof is to be refunded to the Association out of the proceeds of the Credit pro-7ided for in this Agreement; and WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions hereinafter set forth; 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 March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association 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 "Office" means the Office du Niger. -2- 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 equiva- lent to four million five hundred thousand dollars ($4,500,000). Section 2.02. (a) The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of this Section and of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Association, 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 out of the proceeds of the Credit. (b) Promptly after the Effective Date, the Association shall, on behalf of the Borrower, withdraw from the Credit Account and pay to itself the amount required to repay the principal amount of the advance referred to in the preamble to this Agree- ment withdrawn and outstanding as of such date and to pay any unpaid charges thereon. Any unwithdrawn balance of the authorized amount of such advance shall automatically be cancelled on the same date. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be September 30, 1982 or such later date as the Association shall establish. The Association shall promptly notify the Borrower of such later date. 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 semiannually on April 1 and October 1 in each year. -3- Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each April 1 and October 1 commencing April 1, 1989, and ending October 1, 2028, each installment to and including the installment payable on October 1, 1998, to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the French Republic is hereby specified for the purposes of Section 4.02 of the General Condi- tions. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project through the Office with due diligence and efficiency and in conformity with appropriate administrative, financial and agri- cultural practices. and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. (a) In order to assist the Borrower in carrying out the Project, the Borrower shall, by November 30, 1978 or such later date as may be agreeable to the Association, employ engi- neering and management consultants, whose qualifications, experi- ence and terms and conditions of employment shall be satisfactory to the Association, as set forth in Schedule 4 to this Agreement. (b) Not later than October 31, 1978 the Borrower shall assign to the Bureau d'Etudes Generales of the Office three Malien engineers to work with the engineering consultants referred to in paragraph (a) of this Section. Section 3.03. The population study included in Part D of the Project shall be conducted under terms of reference satisfac- tory to the Association, a proposal for which shall be furnished to the Association no later than December 31, 1978. Section 3.04. The Borrower shall cause the Office to allocate to the teams carrying out the works included in the Project three tractors, one water tank truck and one trailer truck, all to be maintained in good repair. -4- Section 3.05. The Borrower shall cause the Office to carry out the preparatory surveys and studies described in Schedule 5 to this Agreement by November 30, 1978. Section 3.06. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, all goods and services financed out of the proceeds of the Credit shall be used exclusively for the Project until its completion. Section 3.07. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, reports, contract documents and work and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borrower: (i) shall maintain records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit, and to disclose their use in the Project; (ii) shall enable the Association's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) shall furnish to the Association at regular intervals all such information as the Association shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. (c) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Association, the Borrower shall prepare and furnish to the Association a report, of such scope and in such detail as the Association shall reasonably request, on the execution and initial operation of the Project, its cost and the benefits derived and to -5- be derived frcm it, the performance by the Borrower and the Association of their respective obligations under the Development Credit Agreement and the accomplishment of the purposes of the Credit. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall cause the Office to maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. (b) The Borrower shall cause the Office to: (i) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later than six months after the end of each such year, (A) certified copies of its financial statements for such year as so audited and (B) the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested; and (iii) furnish to the Associa- tion such other information concerning the accounts and financial statements of the Office and the audit thereof as the Association shall from time to time reasonably request. Section 4.02. The Borrower shall cause the Office to take out and maintain with responsible insurers, or to make other provision satisfactory to the Association for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. ARTICLE V Remedies of the Association Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional event is specified pursuant to paragraph (h) thereof, namely, that the Statuts of the Office approved by Decree No. 108/PG-RM of December 21, 1971 shall have been amended or supplemented in such a manner as to threaten the ability of the Office to carry out the Project. -6- Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional event is specified pursuant to paragraph (d) thereof namely, that the event specified in Section 5.01 of this Agreement shall occur and shall continue for a period of 30 days after notice thereof shall have been given by the Association to the Borrower. ARTICLE VI Termination Section 6.01. The date November 30, 1978 is hereby speci- fied for the purposes of Section 12.04 of the General Conditions. Section 6.02. The obligations of the Borrower under Article IV of this Agreement and the provisions of Section 5.02 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date fifteen years after the date of this Agreement, whichever shall be the earlier. ARTICLE VII Representatives of the Borrower; Addresses Section 7.01. The Minister of the Borrower responsible for finance is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministere des Finances et du Commerce Koulouba Republic of Mali Cable address: Telex: MINIFINANCES 972559 Koulouba -7- For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INDEVAS 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in Bamako, Republic of Mali, as of the day and year first above written. REPUBLIC OF MALI By Is/ Amadou Baba Diarra Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By Is! Roger Chaufournier Regional Vice President Western Africa W8 - 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 the amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Construction equipment, 1,940,000 87% spare parts, workshop tools, micellaneous instruments, vehicles (2) Consultants' services 1,400,000 100% for engineering and management (3) Farm equipment for 65,000 87% rice research (4) Fodder plant pilot 195,000 87% project (5) Aerial photographic 185,000 100% survey (6) Socio-economic study 75,000 100% (7) Audit of accounts of 50,000 100% the Office (8) Training scholarships 25,000 100% (9) Refunding of advance 20,000 100% of amount for Project prepara- outstanding at tion Effective Date (10) Unallocated 545,000 TOTAL 4,500,000 - 9 - 2. The disbursement percentages have been calculated in com- pliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for expendi- tures prior to the date of this Agreement, except that withdrawals in amounts not to exceed in the aggregate the equivalent of $200,000 may be made in respect of Category (1) on account of payments made for such expenditures before that date but after September 1, 1978. 4. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in para- graph 1 above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expendi- tures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 5. 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 this 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 10 the Borrower, cancel such amount of the Credit as, in the Associ- ation's reasonable opinion, represents the amount of such expendi- tures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 11 - SCHEDULE 2 Description of the Project The Project is designed to prepare for the rehabilitation of the Office's irrigation infrastructure, which rehabilitation is scheduled for 1981-1988, by: (i) strengthening the technical and administrative capabilities of the Office; (ii) preparing the designs necessary to carry out a rehabilitation project; (iii) testing methods for cost-effectiveness; and (iv) supporting agricultural research and pilot programs. The Project includes the following: Part A: (i) the carrying out of an experimental program of land-levelling and other on-farm works on about 1,500 ha in order to establish the most cost-effective methods and the most suitable equipment to be used in a subse- quent large-scale rehabilitation project; (2) the repairing and strengthening of critical points of the irrigation infrastructure, in particular dikes of main canals, pending their general overhaul in a subsequent rehabilitation project; (3) the procurement of equip- ment for the foregoing and of spare parts, maintenance equipment and tools for existing Office equipment; (4) the carrying out of topographical works, hydrological measurements, etc and the procurement of miscellaneous instruments and equipment therefor; and (5) the pro- curement of vehicles. Part B: Strengthening the Bureau of Technical Studies of the Office as well as its Works Department, through the employment of additional engineers, as specified in Schedule 4 to this Agreement, and strengthening the overall operations of the Office through the employment of a management consultant to design improved accounting and management information systems and of other consul- tants, as specified in such Schedule; conducting a study ot the accounts of the Office and an audit of such ac.ounts for 1978. Part C: Support for agricultural research and trial programs through: (i) procurement of equipment for the Rice Research Station at Kogoni; - 12 - (ii) execution of a pilot program of irrigated fodder production at the village level on 3 areas of about 20 ha each; (iii) execution of a hydrological survey in the Mema area proposed for irrigated cotton production; and (iv) a study required for the reopening of the feedlots of the Office. Part D: Carrying out an aerial photographic survey of the entire area served by the Office and a socio-economic study of its population, the latter with the assistance of the Institut d'Economie Rural of the Ministry of Rural Development. Part E: Training of engineers through study of irrigation schemes outside Mali. The Project is expected to be completed by March 31, 1982. - 13 - SCHEDULE 3 Procurement A. International Competitive Bidding 1. Except as provided in Part B hereof, goods shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1977 (hereinafter called the Guidelines), on the basis of inter- national competitive bidding as described in Part A of the Guidelines. 2. For goods to be procured on the basis of international competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Association as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender or prequalification documents relating thereto, as the case may be, a general procurement notice, in such form and detail and containing such information as the Association shall reasonably request; the Association will arrange for the publica- tion of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international compe- titive bidding. 3. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international competitive bidding, (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically manufactured goods; (ii) customs duties and other import taxes on imported goods, and sales and similar taxes on domestically supplied goods, shall be excluded; and (iii) the cost to the Borrower of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be included. B. Other Procurement Procedures 1. Equipment for the Rice Research Station, miscellaneous instruments, vehicles, spare parts for existing equipment and - 14 - tools shall be procured on the basis of competitive bidding advertized locally according to the procedures acceptable to the Association, unless the estimated value thereof, after grouping, is less than the equivalent of $10,000, in which case negotiated purchases may be made, up to a total of $100,000. 2. The contract for the aerial survey included in Part D of the Project shall be awarded on the basis of competitive quotes from at least two offerors. C. Review of Procurement Decisions by the Association 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts estimated to cost the equiva- lent of $10,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, the Borrower shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and shall furnish to the Associa- tion, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (d) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to - 15 the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 2. With respect to each contract not governed by the preceding paragraph, the Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respective bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. - 16 - SCHEDULE 4 Consultants 1. Engineers: (a) Three engineers will be employed to strengthen the Bureau of Technical Studies of the Office for periods from 12 to 30 months; their terms of reference will include assistance in the preparation of plans and cost estimates for a rehabilitation project. (b) Two engineers would support the Works Department of the Office for 18 months each; one would assist in carrying out and monitoring a pilot program of on-farm development; and the other would act as technical inspector of the equipment to be provided under the Project, as well as of existing equipment. 2. Management: One management consultant would be attached to the Office of the Director General of the Office for 24 months; he would design and implement an improved accounting and management information system. 3. Short-term Consultancies: These would be arranged, as required, in agreement between the Association and the Office, in various cields, such as engineering, hydrology, pedology, agricul- ture, management and others. 17 - SCHEDULE 5 Preparatory Surveys and Studies 1. Selection of four pilot zones (one of 500 ha at Molodo, one of 250 ha at Niono, one of 250 ha at N'Debougou, and one of 500 ha at Kouroumari). 2. Collection of detailed information on urgent repairs and reinforcements to be carried out for individual irrigation and drainage canals; this information is to be gathered from the staff of the works department and of the extension service, and to be ranked in works of first, second, and third priority. 3. Preparation of longitudinal profiles of the two dikes of the Canal du Sahel and the Fala de Molodo on their entire lengths, and of a first set of cross profiles for the most degraded sections, which are to be rehabilitated in 1979. 4. For the sections of the main supply canal, the primary and secondary canals which are in urgent need of repair (and in particular for the sections which service the pilot zones to be rehabilitated in 1979 (item below), cross profiles will be estab- lished. 5. For the two pilot zones to be rehabilitated in 1979 (about 750 ha), plans will be established at a scale of 1:2,000 with contour lines every 10 cm on the basis of reference points derived from 20 m. grids.