Conformed Copy - C1976 - Forest Resource Management Project - DANIDA Grant Agreement

Page 1 DANIDA GRANT RELATED TO CREDIT NUMBER 1976 GH DANIDA Grant Agreement (Forest Resource Management Project) between REPUBLIC OF GHANA and INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of Grant Funds Provided by the DANISH INTERNATIONAL DEVELOPMENT AGENCY Dated September 20, 1989 DANIDA GRANT RELATED TO CREDIT NUMBER 1976 GH DANIDA GRANT AGREEMENT AGREEMENT, dated September 20, 1989, between REPUBLIC OF GHANA (the Recipient) and the INTERNATIONAL DEVELOPMENT ASSOCIATION, as Administrator (the Administrator) of Grant Funds provided by the DANISH INTERNATIONAL DEVELOPMENT AGENCY (DANIDA). WHEREAS (A) the Recipient has requested the assistance of the International Development Association (the Association) and DANIDA in the financing of the Forest Resource Management Project (the Project) described in Schedule 2 to Development Credit Agreement Number 1976 GH, dated February 16, 1989, between the Recipient and the Association (the Development Credit Agreement); (B) the Association has granted a Credit for this purpose on the terms and conditions set forth in the Development Credit Agreement; (C) DANIDA wishes to make available to the Recipient a grant in an amount equivalent to eight million three hundred thousand dollars ($8,300,000) (the DANIDA Grant) to assist the Recipient in carrying out part of the Project on the terms and conditions hereinafter set forth; (D) pursuant to arrangements, dated , between DANIDA and the Association, DANIDA has requested the Association, and the Association has accepted, to administer the DANIDA Grant in accordance with the provisions of those arrangements; and (E) the Recipient acknowledges that the financial assistance extended to the Recipient under this DANIDA Grant Agreement shall be considered as part of the bilateral development aid extended by DANIDA to the Recipient; Page 2 NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The "General Conditions Applicable to Development Credit Agreements of the Association", dated January 1, 1985, (the General Conditions), constitute an integral part of this Agreement subject, however, to the following modifications thereof: (a) the term "Association", wherever used in the General Conditions, means the International Development Association, acting as Administrator of the DANIDA Grant, pursuant to the arrangements between DANIDA and the Association referred to in the Preamble to this Agreement, except in the phrase "member of the Association" in Sections 2.01 (5), 4.02 (b) and 6.02 (e); (b) the term "Development Credit Agreement", wherever used in the General Conditions, means this Agreement; (c) the term "Credit", wherever used in the General Conditions, means the DANIDA Grant extended to the Recipient under this Agreement; (d) the term "Credit Account", wherever used in the General Conditions, shall be amended to read "DANIDA Grant Account"; (e) Section 4.01 shall be modified to read: "Withdrawals from the DANIDA Grant Account shall be made in dollars; provided, however, that, if the expenditures to be financed out of the proceeds of the DANIDA Grant have been paid or are payable in another currency, the Administrator shall, at the request of the Recipient and at the time of a withdrawal from the DANIDA Grant Account, purchase such currency with the proceeds of such withdrawal." (f) in Section 6.02, the term "Association" shall also include the International Development Association acting in its own capacity; (g) Section 9.06 (c) shall be modified to read: "(c) Not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Recipient and the Administrator, the Recipient shall prepare and furnish to the Administrator a report, of such scope and in such detail as the Administrator shall reasonably request, on the execution of the Project referred to in the Preamble to the DANIDA Grant Agreement, the performance by the Recipient and the Administrator of their respective obligations under the DANIDA Grant Agreement and the accomplishment of the purposes of the DANIDA Grant"; (h) Sections 3.02, 3.03, 3.04, 3.05, 4.01, 4.03, 4.04, 4.06, 6.05, 7.01, 8.01 (a), 12.02 and 12.05 are deleted; and (i) the term "Borrower", whenever used in the General Conditions, means the Recipient. Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions, in the Preamble to this Agreement and in the Development Credit Agreement have the respective meanings therein set forth. ARTICLE II The Grant Section 2.01. The Administrator agrees to extend to the Recipient, on the terms and conditions set forth or referred to herein, a grant in an amount equivalent to eight million three hundred thousand dollars ($8,300,000). Page 3 Section 2.02. (a) The amount of the DANIDA Grant may be withdrawn from the DANIDA Grant 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 Recipient and the Administrator. (b) The Recipient shall open and maintain in dollars in a commercial bank on terms and conditions satisfactory to the Administrator: (i) a special account (Special Account MLNR) for the purposes of Parts B.1 through B.4 of the Project; (ii) a special account (Special Account AFU) for the purposes of Part B.5 of the Project; and (iii) a special account (the Special Account IRNR) for the purposes of Part D of the Project. Deposits into, and payments out of, the Special Accounts shall be made in accordance with the provisions of Schedule 2 to this Agreement. Section 2.03. (a) Except as the Administrator shall otherwise agree, contracts for goods and services to be financed out of the proceeds of the DANIDA Grant shall be procured in accordance with the provisions of Schedule 3 to the Development Credit Agreement. (b) If the Administrator shall have reasonably determined that the procurement of any item is inconsistent with the procedures set forth or referred to in paragraph (a) above, no expenditures for any such item shall be financed out of the proceeds of the DANIDA Grant, and the Administrator may, by notice to the Recipient, without in any way restricting or limiting any other right, power or remedy of the Administrator under this Agreement, cancel such amount of the DANIDA Grant as, in the Administrator's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the DANIDA Grant. Section 2.04. The Closing Date shall be June 30, 1995, or such later date as the Administrator shall establish. The Administrator shall promptly notify the Recipient of such later date. ARTICLE III Execution of the Project Section 3.01. Except as otherwise expressly provided herein, Articles III, IV and V and Schedules 2, 3 and 5 of the Development Credit Agreement are hereby incorporated into this Agreement with the same force and effect as if they were fully set forth herein. All references to the Association in said Articles shall be deemed to be references to the Administrator of the DANIDA Grant under this Agreement, all references to the Credit and the Credit Account shall be deemed to be references to the DANIDA Grant and the DANIDA Grant Account, respectively, and all references to the Borrower shall be deemed to be references to the Recipient. ARTICLE IV Effectiveness; Representation; Transfer of Rights and Obligations Section 4.01. The following event is specified as an additional condition of effectiveness of this Agreement, within the meaning of Section 12.01 (b) of the General Conditions, that all conditions precedent to the effectiveness of the Development Credit Agreement have been fulfilled. Section 4.02. The date ninety (90) days after the date of this Agreement is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 4.03. The PNDC Secretary for Finance and Economic Planning of the Recipient shall be the representative of the Recipient for the purposes of Section 11.03 of the General Conditions. Section 4.04. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Recipient: PNDC Secretary for Finance and Economic Planning Page 4 Ministry of Finance and Economic Planning P.O. Box M40 Accra Republic of Ghana Cable address: Telex: ECONOMICON 2205 MIFAEP GH Accra For the Administrator: 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) Section 4.05. In accordance with the arrangements referred to in the Preamble to this Agreement, the rights and obligations of the Administrator under this Agreement may be transferred to DANIDA. The Recipient accepts and agrees that, upon notice to that effect by the Administrator to the Recipient, DANIDA shall, ipso facto, from the date specified in such notice, be substituted in all rights and obligations of the Administrator under this Agreement as if DANIDA had been an original party to this Agreement, without any further action or formality required on the part of any party and, from such date, the Administrator shall cease to have any rights or obligations as a party under this Agreement. ARTICLE V Termination Section 5.01. This Agreement shall continue in effect until the DANIDA Grant has been fully disbursed, and the parties to this Agreement have fulfilled their obligations hereunder. 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. REPUBLIC OF GHANA By /s/ Kwesi Botchey Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of Grant Funds provided by the DANISH INTERNATIONAL DEVELOPMENT AGENCY By /s/ Edward V.K. Jaycox Regional Vice President Africa SCHEDULE 1 Withdrawal of the Proceeds of the DANIDA Grant Page 5 1. The table below sets forth the Category of items to be financed out of the proceeds of the DANIDA Grant, the allocation of the amounts of the DANIDA Grant to said Category and the percentage of expenditures for items so to be financed in said Category: Amount of the Grant Allocated % of (Expressed in Expenditures CategoryDollar Equivalent) to be Financed Parts B.1 through B.4 of the Project (1) Civil works 670,000 100% of foreign expenditures and 65% of local expenditures (2) Equipment, 570,000 100% of foreign materials and expenditures and vehicles 70% of local expenditures (3) Consultants' 1,335,000 100% services, train- ing and fellow- ships (4) Operating 695,000 80% in FYs 1989 costs and 1990, 75% in FY 1991, 65% in FY 1992, 40% in FY 1993 and 25% in FY 1994 Part B.5 of the Project (5) Civil works 130,000 100% of foreign expenditures and 65% of local expenditures (6) Equipment, 400,000 100% of foreign materials and expenditures and vehicles 70% of local expenditures (7) Consultants' 500,000 100% services, train- ing and fellow- ships (8) Operating 710,000 80% in FYs 1989 costs and 1990, 75% in FY 1991, 65% in FY 1992, 40% in FY 1993 and 25% in FY 1994 Part D of the Project (9) Civil works 710,000 100% of foreign expenditures and 65% of local expenditures (10) Equipment, 310,000 100% of foreign materials and expenditures and vehicles 70% of local Page 6 expenditures (11) Consultants' 900,000 100% services, train- ing and fellow- ships (12) Operating 600,000 80% in FYs 1989 costs and 1990, 75% in FY 1991, 65% in FY 1992, 40% in FY 1993 and 25% in FY 1994 (13) Unallocated 770,000 TOTAL 8,300,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means the expenditures in the currency of any country other than that of the Recipient for goods or services supplied from the territory of any country other than that of the Borrower; (b) the term "local expenditures" means expenditures in the currency of the Recipient or for goods or services supplied from the territory of the Recipient; and (c) the term "operating costs" means the costs normally referred to as recurrent expenditures, excluding salaries and allowances for Project staff, but including: (i) cost of operating and maintaining vehicles, equipment, buildings and houses required for the Project; (ii) office running expenses, cost of stationary and supplies, library acquisition and training materials; (iii) cost of maintaining the seed gardens and the irrigation system; and (iv) such other Project related costs as the Recipient and the Administrator may from time to time determine. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for expenditures prior to the date of this Agreement. SCHEDULE 2 Special Accounts 1. For the purposes of this Schedule: (a) the term "Eligible Categories" means: (i) in the case of Special Account MLNR, Categories (1) through (4); (ii) in the case of Special Account AFU, Categories (5) through (8) ; and (iii) in the case of Special Account IRNR, Categories (9) through (12) as such Categories are set forth in the table in paragraph 1 of Schedule 1 to this Agreement; (b) the term "Eligible Expenditures" means expenditures in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the DANIDA Grant allocated from time to time to the Eligible Categories in accordance with the provisions of Schedule 1 to this Agreement; and (c) the term "Authorized Allocation" means an amount to be withdrawn from the DANIDA Grant Account and deposited into the respective Special Account pursuant to paragraph 3 (a) of this Schedule, equivalent to $200,000 in the case of Special Account MLNR, equivalent to $100,000 in the case of Page 7 Special Account AFU, and equivalent to $150,000 in the case of Special Account IRNR. 2. Payments out of any Special Account shall be made exclusively for Eligible Expenditures in accordance with the provisions of this Schedule. 3. After the Administrator has received evidence satisfactory to it that a Special Account has been duly opened, withdrawals of the corresponding Authorized Allocation and subsequent withdrawals to replenish the respective Special Account shall be made as follows: (a) For withdrawals of any Authorized Allocation, the Recipient shall furnish to the Administrator a request or requests for a deposit or deposits which do not exceed the aggregate amount of the respective Authorized Allocation. On the basis of such request or requests, the Administrator shall, on behalf of the Recipient, withdraw from the DANIDA Grant Account and deposit into said Special Account such amount or amounts as the Recipient shall have requested. (b) (i) For replenishment of any Special Account, the Recipient shall furnish to the Administrator requests for deposits into the Special Account at such intervals as the Administrator shall specify. (ii) Prior to or at the time of each such request, the Recipient shall furnish to the Administrator the documents and other evidence required pursuant to paragraph 4 of this Schedule for the payment or payments in respect of which replenishment is requested. On the basis of each such request, the Administrator shall, on behalf of the Recipient, withdraw from the DANIDA Grant Account and deposit into the Special Account such amount as the Recipient shall have requested and as shall have been shown by said documents and other evidence to have been made out of the Special Account for Eligible Expenditures. All such deposits shall be withdrawn by the Administrator from the DANIDA Grant Account under the respective Eligible Categories, and in the respective equivalent amounts, as shall have been justified by said documents and other evidence. 4. For each payment made out of any Special Account, the Recipient shall, at such time as the Administrator shall reasonably request, furnish to the Administrator such documents and other evidence showing that such payment was made exclusively for Eligible Expenditures. 5. Notwithstanding the provisions of paragraph 3 of this Schedule, the Administrator shall not be required to make further deposits into any Special Account: (a) if, at any time, the Administrator shall have determined that all further withdrawals should be made by the Recipient directly from the DANIDA Grant Account in accordance with the provisions of Article V of the General Conditions and paragraph (a) of Section 2.02 of this Agreement; or (b) once the total unwithdrawn amount of the DANIDA Grant allocated to the Eligible Categories, less the amount of any outstanding special commitment entered into by the Administrator pursuant to Section 5.02 of the General Conditions with respect to the Project, shall equal the equivalent of twice the amount of the Authorized Allocation. Thereafter, withdrawal from the DANIDA Grant Account of the remaining unwithdrawn amount of the DANIDA Grant allocated to the Eligible Categories shall follow such procedures as the Administrator shall specify by notice to the Recipient. Such further withdrawals shall be made only after and to the extent that the Administrator shall have been satisfied that all such amounts remaining on deposit in any Special Account as of the date of such notice will be utilized in making payments for Eligible Expenditures. 6. (a) If the Administrator shall have determined at any time that any payment out of any Special Account: (i) was made for an expenditure or in an amount not eligible pursuant to paragraph 2 of this Schedule; or (ii) was Page 8 not justified by the evidence furnished to the Administrator, the Recipient shall, promptly upon notice from the Administrator: (A) provide such additional evidence as the Administrator may request; or (B) deposit into the Special Account (or, if the Administrator shall so request, refund to the Administrator) an amount equal to the amount of such payment or the portion thereof not so eligible or justified. Unless the Administrator shall otherwise agree, no further deposit by the Administrator into any Special Account shall be made until the Recipient has provided such evidence or made such deposit or refund, as the case may be. (b) If the Administrator shall have determined at any time that any amount outstanding in any Special Account will not be required to cover further payments for Eligible Expenditures, the Recipient shall, promptly upon notice from the Administrator, refund to the Administrator such outstanding amount. (c) The Recipient may, upon notice to the Administrator, refund to the Administrator all or any portion of the funds on deposit in any Special Account. (d) Refunds to the Administrator made pursuant to paragraphs 6 (a) , (b) and (c) of this Schedule shall be credited to the DANIDA Grant Account for subsequent withdrawal or for cancellation in accordance with the relevant provisions of this Agreement, including the General Conditions.