Cameroon - Fourth Highway Project : Credit 0926 - Credit Agreement - 2 - Conformed

CONFORMED COPY CREDIT NUMBER 926 CM Development Credit Agreement (Fourth Highway Project) between UNITED REPUBLIC OF CAMEROON and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated August 23, 1979 CREDIT NUMBER 926 CM DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated August 23, 1979, between UNITED REPUBLIC OF CAMEROON (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 foreign exchange cost of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; (B) the Borrower has also requested the International Bank for Reconstruction and Development (hereinafter called the Bank) to provide additional assistance towards the financing of the Project and by an agreement of even date herewith between the Borrower and the B4nk (hereinafter called the Loan Agreement), the Bank is agreeing to provide such assistance in an aggregate principal amount equivalent to thirty eight million dollars ($38,000,000) (hereinafter called the Loan); (C) the Borrower and the Association intend, to the extent practicable, that the proceeds of the Credit provided for in this Agreement be disbursed on account of expenditures on the Project before disbursements of the proceeds of the Loan provided for in the Loan Agreement are made; (D) the Borrower has undertaken to provide for adequate maintenance of its road network to the extent not covered by the Project, in particular periodic maintenance of its paved roads; and WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to thev 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, -2- with the same force and effect as if they were fully set forth herein, subject, however, to the following modifications thereof (said General Conditions Applicable to Development Credit Agree- ments of the Association, as so modified, being hereinafter called the General Conditions): (a) Paragraph 9 of Section 2.01 is deleted and the following is substituted therefor: "9. The term Project means the project for which the Credit is granted, as described in the Development Credit Agreement and as the description thereof may be amended from time to time by agreement between the Borrower, the Association and the Bank." (b) Paragraph (b) of Section 6.02 is deleted and the follow- ing is substituted therefor: "(b) The Borrower shall have failed to perform any other obligation under the Development Credit Agreement or the Loan Agreement (as such term is defined in the Develop- ment Credit Agreement)." (c) Paragraph (c) of Section 7.01 is deleted and the following is substituted therefor: "(c) A default shall occur in the performance of any other obligation on the part of the Borrower under the Development Credit Agreement or the Loan Agreement (as such term is defined in the Development Credit Agreement), and such default shall continue for a period of sixty days after notice thereof shall have been given by the Association or the Bank to the Borrower." 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: (a) "Loan Agreement" means the agreement of even date herewith between the Borrower and the Bank for the purpose of the Project, as such agreement may be amended from time to time; and such term includes the General Conditions Applicable to Loan and Guarantee Agreements of the Bank, dated March 15, 1974, as made applicable to such agreement, all agreements supplemental to the Loan Agreement and any schedule to the Loan Agreement; a MIM -3- (b) "Loan" means the loan provided for in the Loan Agree- ment; (c) "Loan Account" means the account defined in paragraph 10 of Section 2.01 of the General Conditions referred to in Section 1.01 of the Loan Agreement; (d) "DH" means the Department of Highways of the Borrower's Ministry of Equipment and Housing, or any successor thereto; (e) "NCEEP" means the National Civil Engineering Equipment Pool, an autonomous public corporation of the Borrower, or any successor thereto; (f) "NCASMSE" means the National Center for Assistance to Small and Medium Scale Enterprises, a public corporation of the Borrower, or any successor thereto; (g) "Road Planning Unit" means the Road Planning Unit to be set up under Part E of the Project in accordance with Section 3.07 of this Agreement, or any successor thereto; and (h) "IGERA" means the Inspection Gen6rale de l'Etat et de la Reforme Administrative of the Borrower, or any successor thereto. 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 ten million dollars ($10,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower, the Association and the Bank, 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. -4- Section 2.03. Except as the Association shall otherwise agree, procurement of the goods and civil works 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 June 30, 1983, or such later date as the Association shall establish. The Associa- tion 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 15 and October 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each April 15 and October 15 commencing October 15, 1989, and ending April 15, 2029, each installment to and including the installment payable on April 15, 1999, 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 Republic of France is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. (a) The Borrower shall carry out Parts A and B of the Project through DH and NCEEP, Parts C (i) and (iii), D, E and F through DH, and Part C (ii) through NCASMSE, all with due diligence and (efficiency and in conformity with appropriate engineering, planning, training, economic, financial and admin- istrative practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. (b) In order to carry out its obligations pursuant to paragraph (a) of this Section and without any limitation or restriction upon such obligations, the Borrower, in particular: -5- (i) shall employ qualified local personnel as required for the diligent and efficient execution of the Project, including, except as the Association may otherwise agree, inter alios staff to fill the main Project positions as provided in Part A of Schedule 4 to this Agreement; and (ii) shall carry out Part B of the Project in accordance with a work organization and maintenance procedures and standards which shall be satisfactory to the Association. In particular, the Borrower shall cause DH to prepare an annual work program for the road rehabilitation works to be carried out under Part B (ii) of the Project and, not later than three months before the start of the works under any such annual program, the Borrower shall furnish such proposed program to the Association for review and approval. The roads to be included in such annual work programs shall be selected in accor- dance with the provisions of Schedule 5 to this Agreement. Section 3.02. In order to assist DH, NCEEP and NCASMSE in carrying out the Project, the Borrower, except as the Association may otherwise agree, shall employ experts and consultants in accordance with the provisions of Part B of Schedule 4 to this Agreement. Such experts and consultants shall have such qualifica- tions and experience and be employed on such terms and conditions as shall be satisfactory to the Borrower and the AssAciation. Section 3.03. (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, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 3.04. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, reports, contract documents and construction, work and procurement -6- 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 for the Loan 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 execu- tion and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Association of their respective obligations under the D)evelopment Credit Agreement and the accomplishment of the purposes of the Credit. (d) In order to carry out its obligations pursuant to paragraphs (a), (b) and (c) of this Section and without limitation thereon, the Borrower shall designate a qualified and experienced Project coordinator who shall be responsible for, inter alia: (i) keeping the Association currently informed of the progress of the Project and, in particular, furnishing to the Association quarterly Project progress reports of such scope and in such form and detail as the Association shall reasonably request; and (ii) preparing a final report to serve as a basis for the Project completion report to be furnished by t. Borrower to the Associ- ation pursuant to paragraph (c) of this Section. Section 3.05. The Borrower shall take all such action as shall be necessary to make available, as and when needed, all such 71 -7 - land and rights in respect of land as shall be required for carrying out the Project. Section 3.06. The Borrower shall select recipients and establish training curricula acceptable to the Association for the fellowships under Parts A (ii) and (iii) of the Project. Section 3.07 The Borrower shall set up and staff the Road Planning Unit under Part E of the Project not later than December 31, 1979, and thereafter maintain it. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with consistently maintained appropriate 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) maintain, or cause to be maintained, as part of the records referred to in paragraph (a) of this Section, separate accounts reflecting all expenditures on account of which withdrawals are requested from the Credit Account on the basis of certificates of expenditure; and (ii) retain, until one year after the Closing Date, all records (orders, invoices, bills, receipts and other documents) evidencing the expenditures on account of which withdrawals are requested from the Credit Account on the basis of certifi- cates of expenditure and shall enable the Asso- ciation's accredited representatives to examine such records. (c) The Borrower shall: (i) have the separate accounts and records referred to in paragraph (b) of this Section for each semester audited, in accordance with appropriate auditing principles consistently applied, by IGERA or any other independent auditors acceptable to the Borrower and the Association; (ii) - 8 - -8- furnish to the Association as soon as available, but in any case not later than six months after the end of each such semester, a certified copy of the report of such audit by IGERA or such auditors, of such scope and in such detail as the Association shall have reasonably requested, including, without limitation to the foregoing, an opinion by IGERA or said auditors in respect of the expenditures and records referred to in said paragraph as to whether the proceeds of the Credit withdrawn from the Credit Account on the basis of certificates of expenditure have been used for the purpose for which they were provided; and (iii) furnish to the Association such other information concerning said separate accounts, records and expenditures and the audit thereof as the Association shall from time to time reasonably request. Section 4.02. (a) The Borrower shall cause its classified road network and its road maintenance equipment to be adequately maintained and shall cause all necessary repairs and renewals thereof to be made promptly, all in accordance with appropriate technical and economic practices, and shall provide or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for this purpose. To that end, the Borrower shall in particular and without limitation to the generality of the foregoing: (i) cause NCEEP to open and maintain a special account for the exclusive purpose of financing the renewal of road maintenance equipment and funded through annual provisions out of the revenues from the lease of NCEEP equipment, such provisions to be determined on the baais of the replacement cost of such equipment and its average economic life so as to ensure the regular renewal thereof; and (ii) after completion of the Project, maintain the rehabilitation brigades established under Part B (ii) thereof and provide, promptly as needed, the funds required to cover their operating expendi- tures. (b) Not later than April 30 of each year until Project completion, the Borrower shall furnish to the Association, for its review and comments, the draft budget for the road maintenance operations proposed to be undertaken in the fiscal year commencing on the following July 1, together with a list of the equipment and --9- personnel foreseen to be available for such operations and a report on the progress of its road maintenance program for the current fiscal year. Section 4.03. In the course of the periodic consultations on the execution of the Project, the Borrower shall inter alia exchange views with the Association, if it intends to take any of the following measures: (i) any major reform or reorganization of its departments or agencies partaking in road maintenance operations; or (ii) creation or any subsequent modification of a road fund or similar special account for the financing of road construction and maintenance. Section 4.04. The Borrower shall collect and record in accordance with appropriate statistical methods and procedures (including regular and systematic traffic counts) such technical, economical and financial information as shall be required for the proper monitoring and planning of maintenance, improvements and extensions of its classified road network. Section 4.05. The Borrower shall take all reasonable measures, including the establishment and enforcement of appropriate limitations on size and weight of vehicles, necessary to ensure that the dimensions and axle-loads of vehicles using its classified road network shall not exceed limits consistent with the design standards of the roads in such network. ARTICLE V Effective Date; Termination Section 5.01. The following event is specified as an addi- tional condition to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions, namely, that all conditions precedent to the effec- tiveness of the Loan Agreement, other than fulfillment of the conditions precedent to the effectiveness of the Development Credit Agreement, have been met. Section 5.02. The date October 22, 1979, is hereby specified for the purposes of Section 12.04 of the General Conditions. - 10 - Section 5.03. The obligations of the Borrower under Sections 3.07, 4,02 (a), 4.04 and 4.05 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date twenty years after the date of this Agreement, whichever shall be the earlier. ARTICLE VI Representatives of the Borrower; Addresses Section 6.01. The minister of the Borrower responsible for planning 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 Economic Affairs and Planning Yaounde United Republic of Cameroon Cable address: Telex: MINEP 8268 KN or Yaounde 8203 KN 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) - 11 - 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 the District of Columbia, United States of America, as of the day and year first above written. UNITED REPUBLIC OF CAMEROON By Is/ Michael T. Kima Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By Is/ Roger Chaufournier Regional Vice President Western Africa - 12 - SCHEDULE 1 Withdrawal of the Proceeds of the Credit and of the Loan 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit and of the Loan, the allocation of amounts of such proceeds to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit and of the Loan Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Equipment for road 24,000,000 100% of foreign maintenance and expenditures rehabilitation, and 63% of local workshops, train- expenditures ing and weighing stations (2) Materials, fuel 6,800,000 63% and lubricants, and spare parts for the rehabili- tation brigades under Part B (ii) of the Project (3) Civil works for 5,100,000 55% construction of buildings under Part A (ii), road rehabilitation under Part C (i) and weighing stations under Part D of the Project - 13 - Amount of the Credit and of the Loan Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (4) Experts and 6,700,000 100% of foreign consultants' expenditures services and and 65% of local fellowships expenditures (5) Unallocated 5,400,000 TOTAL 48,000,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; provided, however, that if the currency of the Borrower is also that of another country from the territory of which goods or services are supplied, expenditures in such currency for such goods or services shall be deemed to be "foreign expenditures"; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Association and the Bank that no proceeds of the Credit or of the Loan 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 or of the Loan decreases or increases, the Association or the Bank may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be con- sistent with the aforementioned policy of the Association and the Bank. -14- 4. Notwithstanding the provisions of paragraph 1 above, no with- drawals shall be made in respect of payments made for expenditures prior to the date of this Agreement, except that withdrawals, in an aggregate amount not exceeding the equivalent of $300,000, may be made in respect of Category (4) on account of payments made for such expenditures for Part F (i) of the Project before that date but after March 31, 1979. 5. Except as the Borrower, the Association and the Bank -shall otherwise agree, and until all amounts of the Credit shall have been withdrawn or committed, no withdrawals shall be made from the Loan Account except under commitments entered into by the Bank pursuant to Section 5.02 of the General Conditions referred to in Section 1.01 of the Loan Agreement. 6. Notwithstanding the allocation of an amount of the Credit and of the Loan or the disbursement percentages set forth in the table in paragraph 1 above, if the Association or the Bank has reasonably estimated that the amount of the Credit and of the Loan then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association or the Bank may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit or of the Loan, as the case may be, which are then allocated to another Category and which in the opinion of the Association and the Bank are not needed to meet other expenditures; 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. 7. If the Association or the Bank shall have reasonably deter- mined that the procurement of any item in any Category is incon- sistent with the procedures set forth or referred to in this Agreement, no expenditures tor such item shall be financed out of the proceeds of the Credit or of the Loan and the Association or the Bank may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement or of the Bank under the Loan Agreement, by notice to the Borrower, cancel such amount of the Credit or of the Loan (as the case may be) as, in the Bank's or the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of t'.e proceeds of the Credit or of the Loan. - 15 - SCHEDULE 2 Description of the Project The purpose of the Project is to improve maintenance of the Borrower's classified road network and the operation of the entities responsible therefor, to promote small and medium scale domestic civil works contractors, to control vehicle loads and to improve road planning. The Project consists of the following Parts: Part A: Training A training program of about three years for DH and NCEEP personnel in road maintenance operations and administration, to train, or upgrade the skills of, about 600 foremen, gang leaders, operators, drivers, mechanics and accountants, through: (i) establishment, equipping and initial operation, for on-the-job training, of a DH training/production brigade; (ii) construction, equipping, staffing and initial operation of a DH training center in the Yaounde area, including fellowships for training abroad of the senior staff of such center; and (iii) strengthening of the existing NCEEP training centers for mechanics in Douala and for operators in Yaounde through provision of equipment and about ten fellowships for training abroad of Cameroonian instructors for said centers. Part B: Road Maintenance and Rehabilitation A program of about four years to provide for routine main- tenance and minor repairs by force account of about 16,900 km of main classified roads during such period and rehabilitation by force account of about 1,350 km of major unpaved roads, through: (i) establishment and operation of mechanical and manual DH road maintenance units; (ii) establishment and operation of 9 DH rehabilitation brigades (including the brigade under Part A (i) of the Project) for unpaved roads; - 16 - (iii) provision of road maintenance equipment for the DH units and brigades to be established under Parts B (i) and (ii) of the Project to NCEEP which shall make it available, on a permanent basis, to such units and brigades; and (iv) provision of workshop equipment and tools to NCEEP's existing seven workshops and to DR subdi- visions. Part C: Promotion of Small and Medium Scale Domestic Civil Works Contractors (i) Rehabilitation of about 340 km of unpaved roads by contractors. (ii) Technical assistance to small and medium scale domestic civil works contractors to advise them, in particular, on the preparation of bidding documents, the selection of equipment, the organi- zation of works, administrative and financial management and applications for equipment loans. (iii) Preparation and subsequent implementation of policy measures to further the development of small and medium scale domestic civil works contractors. Part D: Control of Vehicle Loads Installation of two weighing stations, one on the Douala- Bafoussam road and the other on the Ngaoundere-Garoua road, including offices and unloading and storage areas or facilities. Part E: Road Planning Setting up and staffing of a Road Planning Unit within DR responsible, in particular, for: (i) collection and analysis of basic transport data; (ii) carrying out of prefeasibility studies and supervision of economic studies undertaken by consultants; and (iii) preparation and follow-up of road investment programs. Part F: Preinvestment Studies (i) Completion of the preinvestment study currently being undertaken for the Douala-Yaounde road. - 17 - (ii) Preparation by the Road Planning Unit of feasi- bility studies for the improvement of about 500 km of forestry roads selected by agreement between the Borrower and the Association. (iii) Detailed engineering studies for about 250 km of the roads included in Part F (ii) of the Project, to be selected by agreement between the Borrower and the Association. The Project is expected to be completed by December 31, 1985. - 18 - SCHEDULE 3 Procurement A. International Competitive Bidding 1. Except as provided in Part C of this .Schedule, 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 international competitive bidding as described in Part A of the Guidelines. 2. For goods to be procured on the basis of international com- petitive 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 !'.Lrst tender documents relating thereto, 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 publication of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods remain to be procured on the basis of international competitive 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. 4. To the extent feasible, equipment shall be grouped for purposes of bidding so as to permit bulk procurement. In view of the substantial financial, administrative and manpower resources required on the part of the Borrower to carry out the full road maintenance and rehabilitation program under Part B of the - 19 - Project, the equipment needed therefor shall be procured in three successive phases. Before ordering the equipment for phase two or three, the Borrower shall first satisfy the Association that: (a) adequate financing is available for road mainte- nance during the on-going fiscal year; (b) road maintenance units and road rehabilitation brigades previously equipped under the Project are perform- ing adequately; and (c) the training program under Part A of the Project is progressing as required to ensure an adequate and timely supply of trained manpower. For that purpose, the Borrower shall in particular make arrangements satisfactory to the Association for the assignment of DH and NCEEP personnel to said program. B. Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A of this Schedule, goods manufactured in Cameroon may be granted a margin of preference in accordance with, and subject to, the following provisions: 1. All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in Cameroon if the bidder shall have established to the satisfaction of the Borrower and the Associ- ation that the manufacturing cost of such goods includes a value added in Cameroon equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in Cameroon. (3) Group C: bids offering any other goods. - 20 - 3. All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. Such lowest evaluated bids shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. 4. If, as a result of the comparison under paragraph 3 above, the lowest bid is a bid from group C, all group C hids shall be further compared with the lowest evaluated bid from group A after adding to the evaluated bid price of the imported goods offered in each group C bid, for the purpose of this further comparison only, an amount equal to: (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such group C bid; or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from group C which as a result of the comparison under paragraph 3 is the lowest evaluated bid shall be selected. C. Other Procurement Procedures 1. Contracts for the purchase of equipment items which cannot be grouped as provided in paragraph 4 of Part A of this Schedule and are estimated to cost less than the equivalent of $50,000 each may be procured on the basis of competitive bidding advertised locally, in accordance with local procedures acceptable to the Association; provided, however, that the aggregate amount of the contracts so procured shall not exceed the equivalent of $1,000,000. 2. Contracts for the purchase of materials, fuel and lubricants, and spare parts may be procured on the basis of competitive bidding advertised locally, in accordance with local procedures acceptable to the Association. 3. Contracts for civil works under Parts A (ii), C (i) and D of the Project shall be procured on the basis of competitive bidding advertised locally, in accordance with local procedures acceptable to the Association; provided that bidders for civil - 21 - works under Part C (i) and infrastructure works under Part D of the Project shall be prequalified in accordance with paragraph 1.3 of the Guidelines. D. Review of Procurement Decisions by the Association 1. Review of prequalification. The Borrower shall, before qualification is invited, inform the Association in detail of the procedure to be followed, and shall introduce such modifica- tions in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a state- ment of their qualifications and of the reasons for the exclusion of any applicant for prequalification shall be furnished by the Borrower to the Association for its comments before the applicants are notified of the Borrower's decision, and the Borrower shall make such additions to, deletions from, or modifications in, the said list as the Association shall reasonably request. 2. Review of invitations to bid and of proposed awards and final contracts, with respect to all contracts estimated to cost the equivalent of $250,000 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 Bor- rower 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. - 22 - (d) One original and one copy of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first applica- tion for withdrawal of funds from the Credit Account in respect of such contract. 3. 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, one original and one copy 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. 4. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an ext(nsion of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cost of the contract by more than 20% of the original price, the Borrower shall inform the Association of the proposed modification, waiver, extension or change order and the reasons therefor. The Association, if it determines that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform the Borrower and state the reasons for such determination. - 23 - SCHEDULE 4 Staffing and Technical Assistance (Sections 3.GI (b) (i) and 3.02 of the DevelopmenA-- Credit Agreement) A. Staffing 1. Main Project Positions in DH: (a) for the training/production brigade under Part A (i) of the Project: (i) a road engineer, a chief operator and a chief mechanic, as counterparts to the experts referred to in paragraph 1 (b) of Part B of this Schedule; and (ii) two road foremen and one senior mechanic; (b) a head and, as instructors, two road supervisors, a chief mechanic, a chief operator and an admin- istrative/accounting specialist all of whose qualifications and experience shall be satisfactory to the Association, for the DH training center under Part A (ii) of the Project; and (c) an economist or statistician in charge of the Road Planning Unit and two senior technicians for that Unit. 2. Main Project Positions in NCEEP: (a) two auto mechanics, two diesel mechanics and two electricians for the NCEEP training center for mechanics in Douala included in Part A (iii) of the Project; and (b) four chief operators for the NCEEP training center for operators in Yaounde included in said Part of the Project. 3. Other Main Project Positions: a counterpart to the expert referred to in paragraph 3 (b) of Part B of this Schedule, to be designated within one year after said expert is in post. - 24 - B. Technical Assistance 1. For Training (Part A of the Project): (a) a training advisor to assist DH and NCEEP in carrying out Part A and coordinating it with the other Parts of the Project; and (b) a road engineer, a chief operator and a chief mechanic to assist DH in carrying out Parts A (i) and (ii) of the Project, to be employed upon designation of the counterparts to said experts referred to in subparagraph 1 (a) (i) of Part A of this Schedule. 2. For Road Maintenance and Rehabilitation (Part B of the Project): (a) a road engineer, as leader of the team of experts listed in paragraphs (b) and (c) below, to assist DH and NCEEP in carrying out Part B and coordinat- ing it with the other Parts of the Project; (b) an organization/accounting expert to assist DH in carrying out Parts B (i) and (ii) of the Project; and (c) a procurement advisor, a mechanical engineer, an equipment specialist and a spare parts management specialist to assist NCEEP in carrying out Parts B (iii) and (iv) of the Project. 3. For the Promotion of Small and Medium Scale Domestic Civil Works Contractors (Part C of the Project): (a) a road engineer to assist DH in carrying out Part C (i) of the Project; (b) an advisor to assist NCASMSE in carrying out Part C (ii), and the Borrower in carrying out Part C (iii) of the Project; and (c) an administrative expert to assist DH in carrying out Part C (iii) of the Project. - 25 - 4. For Road Planning and Preinvestment Studies (Parts E and F of the Project): (a) a transport economist to assist the Road Planning Unit in carrying out Part E of the Project, to be employed upon designation of the staff referred to in paragraph 1 (c) of Part A of this Schedule; and (b) consultants to assist DH in carrying out Parts F (i) and (iii) of the Project. I .- - 26 - SCHEDULE 5 Criteria for Selection of Roads to be Rehabilitated under Part B of the Project (Section 3.01 (b) (ii) of the Development Credit Agreement) Except as the Association may otherwise agree, the roads to be included in the annual work programs referred to in sub- paragraph (ii) of Section 3.01 (b) of the Development Credit Agreement for rehabilitation under Part B (ii) of the Project shall meet the following criteria: (a) On a priority basis, unpaved roads with an average daily traffic of not less than 100 vehicles or, alternatively, serving specific development projects. (b) An estimated economic rate of return of not less than 15% for the rehabilitation works proposed to be carried out. Benefits will be calculated principally on the basis of road-user savings on vehicle operating costs (VOC); however, for those roads serving specific development projects, part of the incremental value added generated by the development project may be included instead of VOC savings on the generated traffic. (c) Priority in terms of size and characteristics of the population and the social and administrative centers served by the road. (d) Geographical distribution of roads to be included in a particular annual work program so as to facilitate logistics for the rehabilitation brigades.