Conformed Copy - C2813 - Second Structural Adjustment Credit - Agreement Amending Development Credit Agreement

Page 1 CONFORMED COPY CREDIT NUMBER 2813-1 CM (Amendment) Agreement Amending Development Credit Agreement (Second Structural Adjustment Credit) between REPUBLIC OF CAMEROON and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated April 3, 1996 CREDIT NUMBER 2813-1 CM (Amendment) AGREEMENT AMENDING DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated April 3, 1996, between REPUBLIC OF CAMEROON (the "Borrower") and INTERNATIONAL DEVELOPMENT ASSOCIATION (the "Association"). WHEREAS (A) the Borrower and the Association have entered into a Development Credit Agreement (Second Structural Adjustment Credit) dated February 14, 1996 (the "Development Credit Agreement"), for the purpose of assisting the Borrower in the financing of its structural adjustment program as described in recital (A) of the Development Credit Agreement (the "Program"); (B) the Borrower has requested the Association to provide further additional assistance towards the financing of the Program by increasing the amount made available under the Development Credit Agreement by an amount in various currencies equivalent to twenty million four hundred thousand Special Drawing Rights (SDR 20,400,000); (C) the Borrower and the Association wish to simplify the procedures for the disbursement of the proceeds of the credit provided for in the Development Credit Agreement (the "Credit") and for the purpose to amend the Development Credit Agreement as herein provided; and WHEREAS the Association has agreed, on the basis, inter alia, of the foregoing, Page 2 to provide such additional assistance to the Borrower upon the terms and conditions set forth in this Agreement; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Amendments of the Development Credit Agreement Section 1.01. Paragraphs (a), (b), (c) and (d) of Section 1.01 of the Development Credit Agreement are deleted in their entirety and the following paragraphs are substituted therefor: "(a) Section 2.01, paragraph 9, is modified to read: "'Project' means the program referred to in the Preamble to the Development Credit Agreement in support of which the Credit is made."; (b) The last sentence of Section 3.02 is deleted; (c) Section 4.01 is modified to read: "Except as the Association and the Borrower shall otherwise agree, withdrawals from the Credit Account shall be made in the currency of the deposit account specified in Section 2.02 (b) of the Development Credit Agreement."; (d) Section 5.01 is modified to read: "The Borrower shall be entitled to withdraw the proceeds of the Credit from the Credit Account in accordance with the provisions of the Development Credit Agreement and of these General Conditions. Except as the Association and the Borrower shall otherwise agree, no withdrawals shall be made: (a) on account of expenditures in the territories of any country which is not a member of the Bank or for goods produced in, or services provided from, any such territory; or (b) for the purpose of any payment to persons or entities, or any import of goods, if such payment or import, to the knowledge of the Association, is prohibited by a decision of the United Nations Security Council taken under Chapter VII of the Charter of the United Nations."; (e) The last sentence of Section 5.03 is deleted; (f) Section 9.04 is deleted, and Sections 9.05, 9.06, 9.07 and 9.08 are renumbered, respectively, Sections 9.04, 9.05, 9.06 and 9.07; and (g) Section 9.05 (c), as so renumbered, is 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 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 execution of the Program referred to in the Preamble to the Development Credit Agreement, the performance by the Borrower and the Association of their respective obligations under the Development Credit Agreement and the accomplishment of the purposes of the Credit.". Section 1.02. Section 1.02 of the Development Credit Agreement is amended by deleting the word "and" at the end of paragraph (v) and by inserting at the end of said Section a new paragraph as follows: "and; (x) 'Amending Agreement' means the Agreement Amending the Development Credit Agreement". Section 1.03. Section 2.01 of the Development Credit Agreement is modified to read: Page 3 "Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions set forth or referred to in the Development Credit Agreement, an amount in various currencies equivalent to one hundred and twenty one million one hundred thousand Special Drawing Rights (SDR 121,100,000) (the "Credit"), which includes: (a) an original amount in various currencies equivalent to one hundred million seven hundred thousand Special Drawing Rights (SDR 100,700,000) (the "Initial Financing"); and (b) an additional amount in various currencies equivalent to twenty million four hundred thousand Special Drawing Rights (SDR 20,400,000) (the "Additional Financing).". Section 1.04. Section 2.02 of the Development Credit Agreement is modified to read: "(a) Subject to the provisions of paragraphs (b), (c) and (d) of this Section, the Borrower shall be entitled to withdraw the proceeds of the Credit from the Credit Account in support of the Program. (b) The Borrower shall open, prior to furnishing to the Association the first request for withdrawal from the Credit Account, and thereafter maintain in BEAC, a deposit account in CFA Francs on terms and conditions satisfactory to the Association. All withdrawals from the Credit Account shall be deposited by the Association into such deposit account. (c) The Borrower undertakes that the proceeds of the Credit shall not be used to finance expenditures excluded pursuant to the provisions of Schedule 1 to this Agreement. If the Association shall have determined at any time that any proceeds of the Credit shall have been used to make a payment for an expenditure excluded pursuant to the provisions of said Schedule 1, the Borrower shall, promptly upon notice from the Association: (i) deposit into the deposit account referred to in paragraph (b) of this Section an amount equal to the amount of said payment; or (ii) if the Association shall so request, refund such amount to the Association. Amounts refunded to the Association upon such request shall be credited to the Credit Account for cancellation.". Section 1.05. Paragraph (b) (i) of Section 2.04 of the Development Credit Agreement is amended by adding after the term "canceled" the following proviso: "and that any commitment charge on the Additional Financing shall accrue from a date sixty days after the date of the Amending Agreement.". Section 1.06. Paragraph (b) of Section 2.09 of the Development Credit Agreement is modified to read: "(b) Without limitation or restriction to the foregoing, the Borrower hereby entrusts the Director General of CAA with responsibility for the preparation of withdrawal applications under the Credit". Section 1.07. Paragraphs (a) and (c) of Section 3.01 of the Development Credit Agreement are amended by substituting the words "Schedule 3" by the words "Schedule 2". Section 1.08. Section 3.02 of the Development Credit Agreement is modified to read: "Section 3.02. Upon the request of the Association, the Borrower shall: (a) have the deposit account referred to in Section 2.02 (b) of this Agreement audited in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (b) furnish to the Association as soon as possible but in any case not later than four months after the date of the Association's request for such audit, a certified copy of the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably Page 4 requested; and (c) furnish to the Association such other information concerning said deposit account and the audit thereof as the Association shall have reasonably requested". Section 1.09. Paragraph (b) of Section 3.03 of the Development Credit Agreement is amended by deleting the words "including those of the Special Account" after the word "Section". Section 1.10. Paragraph (c) of Section 3.03 of the Development Credit Agreement is deleted in its entirety. Section 1.11. Paragraphs 1, 2 and 3 of Schedule 1 to the Development Credit Agreement are modified to read: "For purposes of Section 2.02 (c) of this Agreement, the proceeds of the Credit shall not be used to finance any of the following expenditures: (a) expenditures in the currency of the Borrower or for goods or services supplied from the territory of the Borrower; (b) expenditures for goods or services supplied under a contract which any national or international financing institution or agency other than the Bank or the Association shall have financed or agreed to finance, or which the Bank or the Association shall have financed or agreed to finance under another credit or a loan; (c) expenditures for goods included in the following groups or sub-groups of the Standard International Trade Classification, Revision 3 (SITC, Rev. 3), published by the United Nations in Statistical Papers, Series M, No. 34/Rev.3 (1986) (the SITC), or any successor groups or sub-groups under future revisions to the SITC, as designated by the Bank by notice to the Borrower: Group Sub-group Description of Items 112 - Alcoholic beverages 121 - Tobacco, unmanufactured, tobacco refuse 122 - Tobacco, manufactured (whether or not containing tobacco substitutes) 525 - Radioactive and associated materials 667 - Pearls, precious and semi-precious stones, unworked or worked 718 718.7 Nuclear reactors, and parts thereof; fuel elements (cartridges), non-irradiated, for nuclear reactors 728.43 - Tobacco processing machinery 897 897.3 Jewelry of gold, silver or platinum group metals (except watches and watch cases) and goldsmiths' or silversmiths' wares (including set gems) 971 - Gold, non-monetary (excluding gold ores and concentrates); (d) expenditures for goods intended for a military or para-military purpose or for luxury consumption; (e) expenditures for Environmentally Hazardous Goods ; and Page 5 (f) in furtherance of the purposes of Section 5.01 of the General Conditions, expenditures: (i) in the territories of any country which is not a member of the Bank or for goods procured in, or services supplied from, such territories; or (ii) on account of any payment to persons or entities, or any import of goods, if such payment or import is prohibited by a decision of the United Nations Security Council taken under Chapter VII of the Charter of the United Nations". Section 1.12. Paragraph 4 of Schedule 1 to the Development Credit Agreement is renamed (g) and amended by substituting "SDR 33,600,000" by "SDR 54,000,000" in its first subparagraph and by renaming subparagraphs (a), (b) and (c) as (i), (ii) and (iii) respectively. Section 1.13. The new sub paragraph (g) (iii) of Schedule 1 to the Development Credit Agreement is amended by substituting "paragraph 5" by "paragraph (h)" and, in the last two lines, "Schedule 3" with "Schedule 2". Section 1.14. Paragraph 5 of Schedule 1 to the Development Credit Agreement is renamed (h) and amended by substituting "SDR 67,200,000" by "SDR 87,600,000" in its first subparagraph and by renaming subparagraphs (a), (b) and (c) as (i), (ii) and (iii) respectively. Section 1.15. The new subparagraph (h) (iii) of Schedule 1 to the Development Credit Agreement is amended by substituting "paragraph 4 (c)" by "paragraph (g) (iii)". Section 1.16. Paragraph 6 of Schedule 1 to the Development Credit Agreement is renamed (i) and amended by substituting "paragraphs 4 and 5" with "paragraphs (h) and (g)". Section 1.17. The word "and" is added at the end of the new subparagraph (i) of Schedule 1 and a new paragraph (j) is inserted to read: "(j) after a date twelve months from the date of the Amending Agreement, no withdrawal shall be made and no commitment shall be entered into to pay amounts to or on the order of the Borrower in respect of expenditures to be financed out of the proceeds of the Additional Financing. At any time after such date, the Association may, by notice to the Borrower, cancel the unwithdrawn amount of the Additional Financing from the Credit Account or any part thereof.". Section 1.18. Schedule 2 to the Development Credit Agreement, is deleted in its entirety and Schedule 3 is renumbered as Schedule 2. ARTICLE II Effective Date; Termination Section 2.01. This Amending Agreement shall not become effective until evidence satisfactory to the Association shall have been furnished to the Association that the execution and delivery of this Amending Agreement on behalf of the Borrower have been duly authorized or ratified by all necessary governmental action. Section 2.02. As part of the evidence to be furnished pursuant to Section 2.01 of this Amending Agreement, there shall be furnished to the Association an opinion or opinions satisfactory to the Association of counsel acceptable to the Association showing, on behalf of the Borrower, that this Amending Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, the Borrower and is legally binding upon the Borrower in accordance with its terms. Section 2.03. This Amending Agreement shall come into force and effect on the date upon which the Association shall dispatch to the Borrower notice of its acceptance of the evidence required by Section 2.01 of this Amending Agreement. Section 2.04. If this Amending Agreement shall not have come into force and effect by a date ninety (90) days after the date of this Amending Agreement, this Amending Agreement and all obligations of the parties hereunder shall terminate, Page 6 unless the Association establishes a later date for the purposes of this Section. If this Amending Agreement shall terminate under the provisions of this Section, the Development Credit Agreement shall continue in full force and effect, as if this Amending Agreement had not been executed. IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized representatives, have caused this Amending 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 CAMEROON By /s/ Jerome Mendouga Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Jean-Louis Sarbib Regional Vice President Africa