Conformed Copy - C2091 - North China Earthquake Reconstruction Project - Project Agreement

Page 1 CONFORMED COPY CREDIT NUMBER 2091-CHA Project Agreement (North China Earthquake Reconstruction Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and SHANXI PROVINCE and HEBEI PROVINCE Dated March 2, 1990 CREDIT NUMBER 2091-CHA PROJECT AGREEMENT AGREEMENT, dated March 2, 1990, between INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association) and SHANXI PROVINCE and HEBEI PROVINCE (the Provinces). WHEREAS by the Development Credit Agreement of even date herewith between People's Republic of China (the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to twenty three million four hundred thousand Special Drawing Rights (SDR 23,400,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that the Provinces agree to undertake such obligations toward the Association as are set forth in this Agreement; and WHEREAS the Provinces, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations set forth in this Agreement; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Page 2 Section 1.01. Unless the context otherwise requires, the several terms defined in the Development Credit Agreement, the Preamble to this Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) Each of the Provinces declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Development Credit Agreement, and, to this end (i) Shanxi shall carry out Part A of the Project, and (ii) Hebei shall carry out Part B of the Project, both with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Each of these Provinces shall make available to the Beneficiaries, in accordance with arrangements satisfactory to the Association, the proceeds of the Credit made available to the Provinces by the Borrower under Sections 3.01 (c) and 3.01 (d) of the Development Credit Agreement. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods, works and consultants' services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to the Development Credit Agreement. Section 2.03. Each of the Provinces shall carry out the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project Agreement and its part of the Project. Section 2.04. (a) Each of the provinces shall, at the request of the Association, exchange views with the Association with regard to the progress of its part of the Project, the performance of its obligations under this Agreement and other matters relating to the purposes of the Credit. (b) Each of the Provinces shall promptly inform the Association of any condition which interferes or threatens to interfere with the progress of its part of the Project, the accomplishment of the purposes of the Credit, or the performance by such Province of its obligations under this Agreement. Section 2.05. Each of the Provinces shall carry out the reconstruction and repairs under the Project in accordance with planning, design and standards, and in accordance with a time table agreed with the Association. ARTICLE III Financial Covenants Section 3.01. (a) Each of the Provinces shall maintain records and accounts adequate to reflect in accordance with sound accounting practices its operations and financial condition in respect of the activities related to its part of the Project. (b) Each of the Provinces shall: (i) have the accounts referred to in paragraph (a) of this Section, including the Special Account, for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later than six months after the end of each such year: (A) certified copies of its financial statements for such year as so audited, and (B) the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably Page 3 requested; and (iii) furnish to the Association such other information concerning said records, accounts and financial statements as well as the audit thereof, as the Association shall from time to time reasonably request. ARTICLE IV Effective Date; Termination; Cancellation and Suspension Section 4.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. Section 4.02. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. ARTICLE V Miscellaneous Provisions Section 5.01. 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 Shanxi Province: Finance Bureau No. 37 Yinzie Av. Taiyuan Shanxi Province People's Republic of China For Hebei Province: Finance Department Fu 1 9 Kang Le Street Shijiazhuang Hebei Province People's Republic of China Section 5.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of either of the Provinces, or by either of the Provinces on behalf of the Borrower under the Development Credit Agreement, may be taken or executed by the Governor of such Page 4 Province or such other person or persons as the Governor shall designate in writing and the Governor shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 5.03. 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 duly authorized representatives, have caused this Agreement to be signed in their respective names in the District of Columbia, United States of America, as of the date and year first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ A. Karaosmanoglu Regional Vice President Asia SHANXI PROVINCE HEBI PROVINCE By /s/ Zhu Qizhen Authorized Representative