Senegal - Dakar Container Port Project : Credit 1459 - Project Agreement - Conformed

F6FICIAL CREDIT NUMBER 1459 SE SPECIAL FUND CREDIT NUMBER SF-14 SE Project Agreement (Dakar Container Port Project) among INTERNATIONAL DEVELOPMENT ASSOCIATION and INTERNATIONAL DEVELOPMENT ASSOCIATION as ADMINISTRATOR of the SPECIAL FUND established with funds contributed by certain members of the International Development Association and PORT AUTONOME DE DAKAR Dated 0Inc O , 1984 CREDIT NUMBER 1459 SE SPECIAL FUND CREDIT NUMBER SF-14 SE PROJECT GREEMENT AGREEMENT, dated 'I - tC , 1984, between INTERNATIONAL DEVELOPMENT ASSOCIATION, acting on its own behalf and as ADMINISTRATOR of the SPECIAL FUND established with funds contributed by certain members of the International Development Association (hereinafter called the Association) and PORT AUTONOME DE DAKAR (hereinafter called PAD). WHEREAS by the Development Credit Agreement of even date herewith between the Republic of Senegal (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to two million six hundred thousand Special Drawing Rights (SDR 2,600,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that PAD agree to undertake such obligations toward the Association as are hereinafter set forth; WHEREAS by the Special Fund Credit Agreement of even date herewith between the Borrower and the Association, acting as Administrator of the Special Fund established by Resolution No. IDA 82-6, adopted on October 26, 1982 by the Executive Directors of the Association, the Association, acting as such Administra- tor, has agreed to make available to the Borrower an amount in various currencies, equivalent to four million seven hundred thousand Special Drawing Rights (SDR 4,700,000) on the terms and conditions set forth in the Special Fund Credit Agreement and on the further condition that PAD undertake such obligations as are hereinafter set forth; WHEREAS by a subsidiary loan agreement to be entered into between the Borrower and PAD, the proceeds of the credits provided for under the Development Credit Agreement and the Special Fund Credit Agreement will be made available to PAD on the terms and conditions therein set forth; and WHEREAS PAD, in consideration of the Association's entering into the Development Credit Agreement and the Special Fund Credit Agreement with the Borrower, has agreed to undertake the obliga- tions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: -2- ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Development Credit Agreement and in the Special Fund Credit Agreement and in the General Conditions (as so defined) in each case have the respective meanings therein set forth, except that the term "Association" means either the International Development Association or the Administrator or both, as the context requires. ARTICLE II Execution of the Project Section 2.01. PAD declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Development Credit Agreement and to the Special*Fund Credit Agreement and, to this end, shall carry out the Project described in said Schedule with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and port practices. Section 2.02. In order to assist PAD in carrying out Parts A.5 and B of the Project, PAD shall employ consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association, such consultants to be selected in accordance with principles and procedures satis- factory to the Association on the basis of the "Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency" published by the Bank in August 1981. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods and civil works required for the Project and to be financed out of the proceeds of the Credit or the Special Fund Credit shall be governed by the provisions of the Schedule to this Agreement. Section 2.04. (a) PAD undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit or the Special Fund Credit and relent to it by the Borrower against hazards incident to the acquisition, transportation and delivery thereof to the place of -3- use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by PAD to replace or repair such goods. (b) PAD shall cause all goods and services financed out of the proceeds of the Credit or the Special Fund Credit and relent to it by the Borrower to be used exclusively for the purposes of the Project. Section 2.05. (a) PAD shall furnish to the Association, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) PAD shall: (i) 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 or the Special Fund Credit, and to disclose their use in the Project; (ii) enable the Association's 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 the Special Fund Credit and any relevant records and documents; (iii) furnish to the Association quarterly progress reports of such scope as the Association shall reasonably request; and (iv) 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 expenditures of such proceeds and the goods and services financed out of such proceeds. (c) Upon the award by PAD of any contract for goods, works or services to be financed out of the proceeds of the Credit or the Special Fund Credit, the Association may publish a descrip- tion thereof, the name and nationality of the party to whom the contract was awarded and the contract price. (d) 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 PAD and the Association, PAD 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 be derived from it, the performance by PAD and the Association of their respec- tive obligations under the Project Agreement and the accomplish- ment of the purposes of the Credit and the Special Fund Credit. (e) PAD shall enable the Association's representatives to examine all plants, installations, sites, works, buildings, property and equipment of PAD and any relevant records and documents. Section 2.06. PAD shall duly perform all its obligations under the Subsidiary Loan Agreement. Except as the Association shall otherwise agree, PAD shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or any provision thereof. Section 2.07. (a) PAD shall, at the request of the Associa- tion, exchange views with the Association with regard to the progress of the Project, the performance of its obligations under this Agre(!ent, and the Subsidiary Loan Agreement, and other matters relating to the purposes of the Credit and the Special Fund Credit. (b) PAD shall promptly inform the Association of any condi- tion which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of the Credit and the Special Fund Credit, or the performance by PAD of its obligations under this Agreement and the Subsidiary Loan Agree- ment. ARTICLE III Management and Operations of PAD Section 3.01. PAD shall carry on its operations and conduct its affairs in accordance with sound administrative, financial and port practices under the supervision of qualified and experienced management assisted by competent staff in adequate numbers. Section 3.02. PAD shall at all times operate and maintain its plant, machinery, equipment and other property, and from time to time, promptly as needed, make all necessary repairs and renewals thereof, all in accordance with sound engineering, financial and port practices. - 5 - Section 3.03. To permit sound operation of its container terminal and adequate maintenance of the container handling equipment to be operated in such terminal, PAD shall ensure that all necessary office space and workshop facilities shall be available in a timely manner. Section 3.04. PAD shall take out and maintain with responsible insurers, or make other provisions satisfactory to the Association for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 3.05. PAD shall take all necessary measures, including all arrangements as may be required with stevedoring enterprises, to ensure that: (i) sufficient modern container handling equipment willI be available at all times to permit operation of PAD's container terminal included in Part A of the Project in accordance with Section 3.01 of this Agreement; and (ii) sheds for stuffing and unstuffing of containers will be made available at a reasonable fee to stevedoring enterprises which, because of the size of their operations, do not own such sheds. Section 3.06. PAD shall duly exercise its rights and comply with its obligations under the agreement referred to in Section 5.01 (b) of the Development Credit Agreement. ARTICLE IV Financial Covenants Section 4.01. PAD shall maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. Section 4.02. PAD shall: (a) 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 satisfactory to the Association; - 6 - (b) furnish to the Association as soon as available, but in any case not later than six months after the end of each such year: (i) certified copies of its financial statements for such year as so audited, and (ii) the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested; and (c) furnish to the Association such other information concerning said accounts, financial statements, records and expenditures, as well as the audit thereof, as the Association shall from time to time reasonably request. Section 4.03. Except as the Association shall otherwise agree: (a) PAD shall, from time to time take, or cause to be taken, all such measures (including, without limitation, adjust- ments of the structure or levels of its tariffs) as shall be required to produce, for each of its fiscal years after its fiscal year ending on June F", 1984, funds from internal sources equivalent to not less than 40% of the annual average capital expenditures of PAD incurred, or expected to be incurred, during the year, the prior fiscal year, and next following fiscal year. (b) For the purpose of this Section: (i) The term "funds from internal sources" means the difference between: (1) the sum of gross revenues from all sources related to its current operations, net non- operating income and any reduction in non- cash working capital; and (2) the sum of all expenses of current opera- tions, including maintenance and adminis- tration (excluding depreciation and other non-cash operating charges), interest or other charges on debt (excluding interest during construction), repayment of loans (including sinking fund payments, if any), all taxes or payments in lieu of taxes, all cash dividends and other cash distributions of surplus, increase in net working capital -7- other than cash, and any other cash outflows other than cash expenditures related to current operations. (ii) The term "capital expenditures" means all expendi- tures incurred on account of fixed or capital assets, including interest during construction of the container terminal. Section 4.04. Except as the Associ.tion shall otherwise agree: (a) PAD shall, from time to time, take, or cause to be taken, all such measures (including, without limitation, adjustments of the structure or levels of the tariffs for all services of PAD) as shall be required to produce, for each of its fiscal years after its fiscal year ending on June 30, 1987, an annual return of not less than 6% of the average current net value of PAD's fixed assets in operation. (b) For the purpose of this Section: (i) The annual return shall be calculated by dividing PAD's net operating income for the fiscal year in question by one-half of the sum of the current net value of PAD's fixed assets in operation at the beginning and at the end of that fiscal year. (ii) The term "net operating income" means gross revenues from all sources related to PAD's current operations less all expenses related to PAD's current operations, including administra- tion, adequate maintenance and taxes or any payments in lieu of taxes, and provision for depreciation on a straight-line basis at a rate of not less than 2.5% per annum of the average current gross value of PAD's fixed assets in operation. Interest and other charges on medium and long-term debt shall not be deducted from gross revenues. (iii) The term "current net value of PAD's fixed assets in operation" means the gross value of PAD's fixed assets in operation less the amount of accumulated depreciation, as valued from time to - 8 - time in accordance with sound and consistently maintained methods of valuation satisfactory to the Association. Section 4.05. (a) Except as the Association shall otherwise agree, PAD shall: (i) as soon as possible upon its completion and not later than March 31, 1987, review with the Borrower and the Association the recommendations of the tariff study to be carried out under Part B.2 (d) of the Project; and (ii) before March 31 in each of its fiscal years after its fiscal year ending on June 30, 1984 on the basis of forecasts to be prepared by PAD on a basis satisfactory to the Association, review the adequacy of all its tariffs to meet the requirements of Sections 4.03 and 4.04 of this Agreement and shall furnish to the Association the results of such review upon its completion. (b) If any such review shall show that PAD would not meet the said requirements in the course of PAD's fiscal year covered by such review, PAD shall promptly take all the necessary measures (including, without limitation, adjustments of the structure of levels of its tariffs) in order to meet such requirements. Section 4.06. Except as the Association shall otherwise agree, PAD shall take all necessary measures to reduce its accounts receivable to a level of not more than 40% of gross revenues by June 30, 1985, 35% by June 30, 1986, 30% by June 30, 1987 and 25% by June 30, 1988, and thereafter maintain its accounts receivable at such latter level. For the purposes of this Section: (a) the term "accounts receivable" means all amounts due to PAD on account of services rendered by PAD; and (b) the term "gross revenues" means gross revenues from all sources related to PAD's current operations. Section 4.07. Except as the Association shall otherwise agree, PAD shall not incur any debt unless a reasonable forecast of the revenues and expenditures of PAD shows that the projected internal cash generation of PAD for each fiscal year during the term of the debt to be incurred shall be at least two times the projected debt service requirement of PAD in such year on all debt of PAD, including the debt to be incurred. For the purposes of this Section: - 9 - (a) The term "debt" means any indebtedness of PAD maturing by its terms more than one year after the date on which it is originally incurred. (b) Debt shall be deemed to be incurred: (i) under a loan contract or agreement or other instrument providing for such debt or further modification of its terms of payment, on the date of such contract, agreement or instrument; and (ii) under a guarantee agreement, on the date the agreement providing for such guarantee has been entered into but only to the extent that the guaranteed debt shall be outstanding. (c) The term "internal cash generation of PAD" means gross revenues of PAD from all sources, adjusted to take account of PAD's rates in effect at the time of the incurrence of debt even though they were not in effect during the twelve-month period to which such revenues relate, less all operating expenses of PAD, including expenses chargeable to administration, maintenance and taxes (or payments in lieu of taxes), but before provision for depreciation of assets and interest and other charges on debt. (d) The term "debt service requirement" means the aggregate amount of amortization (including sinking fund payments, if any) of, and interest and other charges on, debt. (e) The term "reasonable forecast" means a forecast pre- pared by PAD in the fiscal year in which the debt in question is to be incurred, which both the Association and PAD accept as reasonable and as to which the Association has notified PAD of its acceptability, provided that no event has occurred since such notification which has, or may reasonably be expected in the future to have, -a material adverse effect on the financial condition or future results of PAD. (f) Whenever for the purposes of this Section it shall be necessary to value, in terms of currency of the Borrower, debt payable in another currency, such valuation shall be made on the basis of the prevailing lawful rate of exchange at which such other currency is, at the time of such valuation, obtainable for the purposes of servicing such debt, or, in the absence of such rate, on the basis of a rate of exchange acceptable to the Association. Section 4.08. Until the steps referred to in Section 3.02 (ii) of the Development Credit Agreement and in Section 3.02 (ii) of the Special Fund Credit Agreement shall have been - 10 - taken, PAD shall take all necessary measures required on its part to: (i) maintain its special account (hereinafter called the Special Account) established at the Borrower's Treasury from which PAD shall be able to transfer in a timely manner to its commercial bank accounts all funds necessary for carrying out the project and for covering all its renewal expenses; (ii) transfer on a daily basis to the Special Account 30% of its gross revenues in fiscal year 1984-1985 and 40% in the following fiscal years; and (iii) ensure that, until the completion of the Project, at least 50% of the transfers referred to in paragraph (i) above be made into PAD's bank accounts from which shall be debited the funds necessary for carrying out the Project. ARTICLE V Effective Date; Termination; Cancellation and Suspension Section 5.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement and the Special Fund Credit Agreement become effective. Section 5.02. (a) This Agreement and all obligations of the Association and of PAD thereunder shall terminate on the earlier of the following two dates: (i) either the date on which the Development Credit Agreement or the date on which the Special Fund Credit Agreement shall terminate in accordance with their terms whichever date shall be the later; or (ii) a date 25 years after the date of this Agreement. (b) If either the Development Credit Agreement or the Special Fund Credit Agreement terminates in accordance with their respective terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify PAD of this event. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. - 11 - ARTICLE VI Miscellaneous Provisions Section 6.01. Any notice or request required or permitted to be given or made under this Agreement and any agreement between the parties contemplated by this Agreement shall be in writing. Such notice or request shall be deemed to have been duly given or made when it shall be delivered by hand or by mail, telegram, cable, telex or radiogram to the party to which it is required or permitted to be given or made at such party's address hereinafter specified or at such other address as such party shall have designated by notice to the party giving such notice or making such request. The addresses so specified are: 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) For PAD: Port Autonome de Dakar 14, Boulevard de la Libgration Dakar S6n6gal Cable address: Telex: PORCOMER 406 SG Section 6.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of PAD may be taken or executed by PAD's Director General or such other person or persons as PAD's Director General shall designate in writing, and PAD shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of each such person. - 12 - Section 6.03. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. 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 4ritten. INTERNATIONAL DEVELOPMENT ASSOCIATION acting for itself and as ADMINISTRATOR of the SPECIAL FUND established with funds contributed by certain members of the International Development Association 4(//'ij Regional Vice President Western Africa PORT AUTONOME DE DAKAR ByA/u thorize Re 4 a Authorized Representative - 13 - SCHEDULE Procurement A. International Competitive Bidding 1. Except as provided in Part B hereof, goods and civil works shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the current edition of 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; provided, however, that in the case of goods and civil works to be financed out of the proceeds of the Special Fund Credit, the eligibility restrictions set forth in Section 2.02 (b) of the Special Fund Credit Agreement shall apply and such restrictions shall be stated in the tender documents for the procurement of such goods and civil works. 2. For goods and works to be procured on the basis of inter- national competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, PAD 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 publication of such notice in order to provide timely notifica- tion to prospective bidders of the opportunity to bid for the goods and works in question. PAD 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 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 com- petitive bidding: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for the imported goods, or the ex-factory price or off-the-shelf price of other goods, offered in such bid; (ii) customs duties and other import taxes levied in connection with the importation, or the sales and similar taxes levied in connection with the sale or delivery, pursuant to the bid, of the goods shall not be taken into account - 14 - in the evaluation of the bids; and (iii) the cost of inland freight and other expenditures incidental to the delivery of the goods to the place of their use or installation shall be included. B. Other Procurement Procedures Individual works included in Part A.4 of the Project may be procured following competitive bidding advertised locally in accordance with the Borrower's procurement procedures acceptable to the Association, provided that under such procedures the selection method of the lowest evaluated bid ("appel d'offres") shall be applied. C. Review of Procurement Decisions by the Association 1. Review of prequalification. PAD shall, before qualification is invited, inform the Association in detail of the procedure to be followed, and shall introduce such modifications in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and of the reasons for the exclusion of any applicant for prequalification shall be furnished by PAD to the Association for its comments before the applicants are notified of PAD's decision, and PAD shall make such additions to, dele- tions 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, other than those referred to under Part B above, estimated to cost the equivalent of $100,000 or more: (a) Before bids are invited, PAD 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. - 15 - (b) After bids have been received and evaluated, PAD 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 Association, in sufficient time for its review, a detailed report, by the con- sultants referred to in Section 2.02 of this Agreement, on the evaluation and comparison of the bids received, together with the recommendations for award of the said consultants 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 PAD 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 was invited. (d) Two conformed copies of tie contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for with- drawal of funds from the Credit Account in respect of such contract. 3. With respect to each contract not governed by the preceding paragraph, PAD 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 PAD 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 extension 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 5% of the original price, PAD shall inform the Associa- tion 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 PAD and state the reasons for its determination. INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Development Association. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the day of 198 FOR SECRETARY