Conformed Copy - C2391 - Ship Waste Disposal Project - Project Agreement

Page 1 CONFORMED COPY CREDIT NUMBER 2391 CHA GET GRANT NUMBER TF28613 CHA (Ship Waste Disposal Project) among INTERNATIONAL DEVELOPMENT ASSOCIATION and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Acting as Trustee of the Global Environement Trust Fund and DALIAN PORT AUTHORITY GUANGZHOU PORT AUTHORITY NINGBO PORT AUTHORITY SHANGHAI PORT AUTHORITY TIANJIN PORT AUTHORITY XIAMEN PORT AUTHORITY Dated July 2, 1992 CREDIT NUMBER 2391 CHA GET GRANT NUMBER TF28613 CHA PROJECT AGREEMENT AGREEMENT, dated July 2, 1992, among INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association), INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT acting as Trustee of the Global Environment Trust Fund (the Trustee) and DALIAN PORT AUTHORITY (DPA), GUANGZHOU PORT AUTHORITY (GPA), NINGBO PORT AUTHORITY (NPA), SHANGHAI PORT AUTHORITY (SPA), TIANJIN PORT AUTHORITY (TPA), and XIAMEN PORT AUTHORITY (XPA) (the Port Authorities). WHEREAS (A) by the Development Credit Agreement of even date herewith between Page 2 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 eleven million Special Drawing Rights (SDR 11,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that the Port Authorities agree to undertake such obligations toward the Association as are set forth in this Agreement; (B) by subsidiary loan agreements to be entered into between the Borrower and each of the Port Authorities, a part of the proceeds of the credit provided for under the Development Credit Agreement will be relent to the Port Authorities on the terms and conditions set forth in said Subsidiary Loan Agreements; (C) by the Global Environment Trust Fund Grant Agreement (GET Grant Agreement) of even date herewith between People's Republic of China (the Recipient) and the International Bank for Reconstruction and Development acting as Trustee of the Global Environment Trust Fund (the Trustee), the Trustee has agreed to make available to the Recipient an amount in various currencies equivalent to twenty two million Special Drawing Rights (SDR 22,000,000) (the GET Grant) on the terms and conditions set forth in the GET Grant Agreement; (D) by grant agreements to be entered into between the Recipient and each of the Port Authorities, a part of the proceeds of the GET Grant will be made available to the Port Authorities on the terms and conditions set forth in said Grant Agreements; and WHEREAS the Port Authorities, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, and the Trustee entering into the GET Grant Agreement with the Recipient, have agreed to undertake the obligations set forth in this Agreement. NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Unless the context otherwise requires, the several terms defined in the Development Credit Agreement, the GET Grant Agreement, the Preamble to this Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth an the following additional term has the following meaning: (a) "Grant Agreement" and "Grant Agreements" means singularly a grant agreement and collectively the grant agreements to be entered into between the Recipient and each of the Port Authorities, pursuant to Section 3.02 (a) of the GET Grant Agreement, as the same may be amended from time to time, and such term includes any schedules to the Grant Agreement(s). ARTICLE II Execution of the Project Section 2.01. (a) Each of the Port Authorities declares its commitment to the objective of the Project as set forth in Schedule 2 to the Development Credit Agreement, and, to this end, shall carry out Part B of the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and environmental practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Association, the Trustee and the Port Authorities shall otherwise agree, each of the Port Authorities shall carry out its part of the Project in accordance with the Implementation Program set forth in the Schedule to this Agreement. Page 3 Section 2.02. Except as the Association and the Trustee 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 and the GET Grant shall be governed by the provisions of Schedule 3 to the Development Credit Agreement. Section 2.03. Each of the Port Authorities 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 applicable to the Development Credit Agreements, and in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions applicable to the Loan and Guarantee Agreements (relating respectively to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project Agreement. Section 2.04. Each of the Port Authorities shall duly perform all its obligations under its respective Subsidiary Loan Agreement and Grant Agreement. Except as the Association shall otherwise agree, none of the Port Authorities shall take or concur in any action which would have the effect of amending, abrogating, assigning or waiving its Subsidiary Loan Agreement or Grant Agreement or any provision thereof. Section 2.05. (a) Each of the Port Authorities shall, at the request of the Association and the Trustee, exchange views with the Association and the Trustee with regard to the progress of its part of the Project, the performance of its obligations under this Agreement and under its Subsidiary Loan Agreement and Grant Agreement, and other matters relating to the purposes of the Credit and the GET Grant. (b) Each of the Port Authorities shall promptly inform the Association and the Trustee 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 and the GET Grant, or the performance by such Port Authority of its obligations under this Agreement and under its Subsidiary Loan Agreement or Grant Agreement. ARTICLE III Management and Operations of Each of the Port Authorities Section 3.01. Each of the Port Authorities shall carry on its operations and conduct its affairs in accordance with sound administrative, financial, engineering and environmental practices under the supervision of qualified and experienced management assisted by qualified staff in adequate numbers. Section 3.02. Each of the Port Authorities 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 environmental practices. Section 3.03. Each of the Port Authorities shall take out and maintain with responsible insurers, or make other provision satisfactory to the Association and the Trustee for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. ARTICLE IV Financial Covenants Section 4.01. (a) Each of the Port Authorities shall maintain records and accounts adequate to reflect in accordance with sound accounting practices its operations and financial condition. (b) Each of the Port Authorities shall: (i) have its records, accounts and financial statements (balance sheets, statements of income and expenses and related Page 4 statements) for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association and the Trustee; (ii) furnish to the Association and the Trustee 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 and the Trustee shall have reasonably requested; and (iii) furnish to the Association and the Trustee such other information concerning said records, accounts and financial statements as well as the audit thereof, as the Association and the Trustee shall from time to time reasonably request. 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 GET Grant Agreement become effective. Section 5.02. (a) This Agreement and all obligations of the Association and the Trustee and of the Port Authorities thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement and the GET Grant Agreement shall terminate in accordance with their terms; or (ii) the date twenty years after the date of this Agreement. (b) If the Development Credit Agreement or the GET Grant Agreement terminates in accordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association and the Trustee shall promptly notify the Port Authorities of this event. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. 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 248423 (RCA) Washington, D.C. 82987 (FTCC) 64145 (WUI) or Page 5 197688 (TRT) For the Trustee: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAFRAD 248423 (RCA) Washington, D.C. 82987 (FTCC) 64145 (WUI) or 197688 (TRT) For DPA: Dalian Port Authority 1 Gangwan Street Zhongshan District Dalian People's Republic of China Cable address: Telex: 3155 86246 DHAB CN For GPA: Guangzhou Port Authority 39 Gang Qian Lu Port of Huangpu Guangzhou People's Republic of China Cable address: 5300 Guangzhou For NPA: Ningbo Port Authority Ningbo, Zhejiang People's Republic of China Cable address: Telex: 333 37046 NBP CN Ningbo For SPA: Shanghai Port Authority 13 Zhongshan Road (E.1) Shanghai People's Republic of China Cable address: Telex: 3966 33023 SHACO CN For TPA: Tianjin Port Authority Xingang Page 6 Tanggu, Tianjin People's Republic of China Telex: 23107 PORT CN For XPA: Xiamen Port Authority Harbor Building Dongdu Road Xiamen People's Republic of China Cable address: Telex: 3099 93018 PENXN CN Xiamen 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 any of the Port Authorities may be taken or executed by Director of such Port Authority or such other person or persons as the Director shall designate in writing, and each of the Port Authorities shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 6.03. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. Section 6.04. As long as the Trustee has not given notice to the contrary to the Port Authorities and so long as the Development Credit Agreement shall not have terminated prior to the termination of the Agreement: (a) the obligations of the Port Authorities to consult with, and to furnish information, documents, plans, reports, records and statements to, the Trustee shall be satisfied to the extent performance in respect of such obligations is rendered to the Association; (b) the obligations of the Port Authorities to consult with, and to furnish information to, the Trustee shall be satisfied to the extent such obligations are satisfied by the Association; and (c) all actions taken (including the giving of approvals or granting of waivers) by the Association pursuant to the Development Credit Agreement shall be deemed to be taken pursuant to both the Development Credit Agreement and the GET Grant Agreement, and in the name and on behalf of both the Association and the Trustee. 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 day and year first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Acting as Trustee of the Global Environment Trust Fund By /s/ Gautam S. Kaji Regional Vice President East Asia and Pacific Page 7 DALIAN PORT AUTHORITY GUANGZHOU PORT AUTHORITY NINGBO PORT AUTHORITY SHANGHAI PORT AUTHORITY TIANJIN PORT AUTHORITY XIAMEN PORT AUTHORITY By /s/ Zhu Qizhen Authorized Representative SCHEDULE Implementation Program for Part B of the Project 1. Each of the Port Authorities shall cooperate with the Borrower for the establishment, by December 31, 1992, of a coordinating team with functions and responsibilities and comprising members from such departments and agencies of the Borrower and the relevant Port Authority as agreed by the Association and the Trustee, for the purpose of monitoring activities under the Project. 2. Each of the Port Authorities shall: (a) by December 31, 1992, prepare and furnish to the Association and the Trustee, for their review and comments, a garbage and solid waste management plan; and (b) by December 31, 1994, adopt and implement such plan taking into account the comments of the Association and the Trustee. 3. Each of the Port Authorities shall, by July 31, 1994, adopt an oil spillage contingency plan developed in accordance with terms of reference agreed by the Association and the Trustee. 4. Each of the Port Authorities shall assist the Borrower in the preparation and implementation of the costing and tariff system for waste reception and disposal services referred to in paragraph 4 of Schedule 4 to the Development Credit Agreement. 5. XPA shall establish, by June 30, 1993, an Environmental Protection Bureau, with qualified staff in adequate numbers and functions and powers acceptable to the Association and the Trustee, to supervise and operate the ships' waste disposal facilities to be provided under the Project. 6. GPA shall enter into arrangements with BOMTA, satisfactory to the Association and the Trustee, for the handling of the oily ballast and bilge waters for all port users at BOMTA facility at Xin Zhao.