Conformed Copy - L7075 - Structural Adjustment Loan - Supplemental Letter

Page 1 ARGENTINE REPUBLIC September 5, 2001 International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 Re: Argentine Republic: Loan No. 7075-AR (Structural Adjustment Loan) State Modernization Letter Dear Sirs: Please refer to the Loan Agreement (Structural Adjustment Loan) of even date herewith entered into by and between Argentine Republic (the Borrower) and International Bank for Reconstruction and Development (the Bank). This letter is the State Modernization Letter referred to in Section 1.02 (m) of the Loan Agreement. With respect to: (a) paragraph 13 of Schedule 3 to the Loan Agreement, annex 1 sets forth the target referred to in said paragraph; (b) paragraph 17 of Schedule 3 to the Loan Agreement, annex 2 sets forth the target referred to in said paragraph; (c) paragraph 19 (a) of Schedule 3 to the Loan Agreement, annex 3 sets forth the applicable target referred to in said paragraph; (d) paragraph 20 of Schedule 3 to the Loan Agreement, annex 4 sets forth the target referred to in said paragraph; (e) paragraph 23 of Schedule 3 to the Loan Agreement, annex 5 sets forth the applicable target referred to in said paragraph; (f) paragraph 25 of Schedule 3 to the Loan Agreement, annex 6 sets forth the applicable target referred to in said paragraph; (g) paragraph 26 of Schedule 3 to the Loan Agreement, annex 7 sets forth the applicable target referred to in said paragraph; (h) paragraph 28 of Schedule 3 to the Loan Agreement, annex 8 sets forth the applicable target referred to in said paragraph; (i) paragraph 29 of Schedule 3 to the Loan Agreement, annex 9 sets forth the applicable target referred to in said paragraph; and (j) paragraph 30 of Schedule 3 to the Loan Agreement, annex 10 sets forth the applicable target referred to in said paragraph. Please confirm your agreement with the above and with the annexes by signing this letter in the space provided below. Very truly yours, ARGENTINE REPUBLIC By /s/ Domingo F. Cavallo Authorized Representative AGREED AND CONFIRMED: Page 2 INTERNATIONAL BANK FOR RECONSTRUCTION  AND DEVELOPMENT By /s/ Myrna L. Alexander Authorized Representative Date: September 5, 2001 Annex 1 If Second Tranche Release Date falls within: Target: September 2001 or later Employment of Program Managers in at least 5 agencies or entities within the Borrower’s non-financial public sector Annex 2 If Second Tranche Release Date falls within: Target: September 2001 or later Tax payment information on all federal taxpayers (excluding those taxpayers enrolled in the unified tax system established pursuant to Law No. 24.977 of June 3, 1998, and those self-employed service sector workers, defined under law 24.241 of October 13, 1993, who are registered federal taxpayers solely for social security contributions purposes), domiciled within: (a) the jurisdiction of the Government of the Autonomous City of Buenos Aires; and (b) each of the jurisdictions of all Provinces, to be included in the Borrower’s federal tax payment information system Annex 3 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 completion of at least 62,000 federal tax audits October 16, 2001 or later completion of at least 70,000 federal tax audits in the aggregate Annex 4 If Second Tranche Release Date falls within: Target: September 2001 or later System being implemented Annex 5 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 completion of at least 121 inspections of importers (after Page 3 the merchandise has been released to said importers) October 16, 2001 or later completion of at least 133 inspections of importers (after merchandise has been released to said importers) in the aggregate Annex 6 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 Reduction of total amount of fees paid by ANSES during the year 2000 by at least 10% October 16, 2001 or later Reduction of total amount of fees paid by ANSES during the year 2000 by at least 15% Annex 7 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 Final resolution of pending pension applications of at least 30% of 85,000 pending pension applications October 16, 2001 or later Final resolution of pending pension applications of at least 50% of 85,000 pending pension applications Annex 8 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 Database has incorporated information on at least 20% of the families under the program referred to in paragraph 27 of Schedule 3 to the Loan Agreement October 16, 2001 or later Database has incorporated information on at least 40% of the families under the program referred to in paragraph 27 of Schedule 3 to the Loan Agreement Payments made to at least 20% of the families under the program referred to in paragraph 27 of Schedule 3 to the Loan Agreement through the system referred to in said paragraph Annex 9 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 Incorporation of information concerning ineligible beneficiaries (deceased beneficiaries) from at least 7 Provinces October 16, 2001 or later Incorporation of information concerning ineligible beneficiaries (deceased beneficiaries) from at least Page 4 12 Provinces Annex 10 If Second Tranche Release Date falls within: Targets: September 1, through October 15, 2001 Procedure to cease payment to ineligible beneficiaries (deceased beneficiaries) has been initiated in at least 7 Provinces October 16, 2001 or later Procedure to cease payment to ineligible beneficiaries (deceased beneficiaries) has been initiated in at least 12 Provinces