Somalia - Trans-Juba Livestock Project : Credit 0462 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 462 SO Project Agreement (Trans-Juba Livestock Project) BETWEEN INTERNATIONAL DEVELOPMENT ASSOCIATION AND LIVESTOCK DEVELOPMENT AGENCY DATED FEBRUARY 20, 1974 CONFORMED COPY CREDIT NUMBER 462 SO Project Agreement (Trans-Juba Livestock Project) BETWEEN INTERNATIONAL DEVELOPMENT ASSOCIATION AND LIVESTOCK DEVELOPMENT AGENCY DATED FEBRUARY 20, 1974 PROJECT AGREEMENT AGREEMENT, dated February 20, 1974, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and LIVESTOCK DEVELOPMENT AGENCY (hereinafter called LDA). WHEREAS by the Development Credit Agreement of even date herewith between Somali Democratic Republic (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to ten million dollars ($10,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that LDA agrees to undertake such obligations toward the Association as hereinafter set forth; WHEREAS by a subsidiary loan agreement to be entered into between the Borrower and LDA, part of the proceeds of the credit provided for under the Development Credit Agreement will be made available to LDA on the terms and conditions therein set forth; and WHEREAS LDA, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Development Credit Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.0 1. LDA shall carry out Parts A, B, C and E of the Project described in Schedule 2 to the Development Credit Agreement with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices. 4 Section 2.02. In order to assist LDA in the preparation of bidding documents and the engineering aspects of Part C of the Project, LDA shall, not later than four months from the date on which this Credit becomes effective or such other date as may be agreed upon between the Borrower, LDA and the Association, employ a firm of engineering consultants acceptable to the Association upon terms and conditions satisfactory to the Association. Section 2.03. LDA shall (i) establish a Project Development and Training Unit (hereinafter called PDTU) as a separate department for the management, coordination, execution and supervision of the Project including training of LDA staff: (ii) provide PDTU with a qualified Project Director and other Project staff specified in Schedule 2 of this Agreement on the terms and conditions mutually acceptable to the Borrower, LDA and the Association, and with all supporting staff, facilities and other resources as shall be required for its efficient operation; and (iii) establish within PDTU a Project Construction and Maintenance Unit with such staff, powers, duties and responsibilities as are specified in Schedule 2 to this Agreement. Section 2.04. In carrying out the construction works under Parts A(ii) and C of the Project, LDA shall employ contractors acceptable to the Association upon terms and conditions satisfactory to the Association. Section 2.05. Except as the Association shall otherwise agree, the goods and services (other than services of consultants) required for the Project and to be financed out of the proceeds of the Credit, shall be procured on the basis of international competition under procedures consistent with the Guidelines for Procurement as revised in October 1972 and in accordance with, and subject to, the provisions set forth in Schedule 1 to this Agreement. Section 2.06. (a) LDA undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit relent to it by the Borrower against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by LDA to replace or repair such goods. (b) Except as the Association may otherwise agree, LDA shall cause all goods and services financed out of the proceeds of the Credit relent to it by the Borrower to be used exclusively for the Project until its completion. Section 2.07. (a) LDA shall furnish to the Association promptly upon their preparation, the plans, specifications, reports, contract documents and construction 5 and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) LDA: (i) shall maintain records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit relent to it by the Borrower, and to disclose the use thereof in the Project; (ii) shall, without limitation upon the provisions of Section 5.03 of this Agreement, enable the Association's representatives to examine the Project, the goods financed out of such proceeds and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit so relent to it and the goods and services financed out of such proceeds. Section 2.08. LDA shall duly perform all its obligations under the Subsidiary Loan Agreement. Except as the Association shall otherwise agree, LDA shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or any provision thereof. Section 2.09. LDA shall take out and maintain with responsible insurers, or make other provisions satisfactory to the Association for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. ARTICLE III Financial Covenants Section 3.01. LDA shall maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial position. Section 3.02. LDA shall: (i) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with sound 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 requested; and (iii) furnish to the Association such other information concerning the accounts and financial statements of LDA and the audit thereof as the Association shall from time to time reasonably request. 6 ARTICLE IV Consultation, Information and Inspection Section 4.0 1. The Association and LDA shall cooperate fully to assure that the purposes of the Credit will be accomplished. To that end, the Association and LDA shall from time to time, at the request of either party, exchange views through their representatives with regard to the performance of their respective obligations under this Agreement, the administration, operations and financial condition of LDA and other matters relating to the purpose of the Credit. Section 4.02. The Association and LDA shall promptly inform each other of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Credit, or the performance by either of them of its obligations under this Agreement or the performance by the Borrower and LDA of their respective obligations under the Subsidiary Loan Agreement. Section 4.03. LDA shall enable the Association's representatives to examine all plants, sites, works, properties and equipment of LDA and any relevant records and documents. 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 becomes effective. Section 5.02. (a) This Agreement and all obligations of the Association and of LDA thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) a date twenty years after the date of this Agreement. (b) If the Development Credit Agreement terminates in accordance with its terms before the date specified in paragraph (a)(ii) of this Section, the Association shall promptly notify LDA of this event. 7 Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the Development Credit Agreement. 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 ol 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: INDEVAS Washington, D.C. For LDA: Livestock Development Agency P.O. Box 929 Mogadiscio Somali Democratic Republic Cable address: WAAHORUMAR Mogadiscio 8 Section 6.02. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of LDA may be taken or executed by the General Manager or such other person or persons as he shall designate in writing. Section 6.03. LDA shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of LDA, take any action or execute any documents required or permitted to be taken or executed by LDA pursuant to any of the provisions of this Agreement. Section 6.04. 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 representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names and delivered in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION 0 By /s/ Bernard R. Bell Regional Vice President Eastern Africa LIVESTOCK DEVELOPMENT AGENCY By /s/ Abdullahi Ahmed AddoU Authorized Representative 9 SCHEDULE 1 Procurement A. Contracts Governed by Guidelines 1. With respect to any contract for civil works, vehicles and equipment estimated to cost the equivalent of $30,000 or more: (a) If bidders are required to prequalify, LDA shall, before qualification is invited, inform the Association in detail of the procedure to be followed and shall introduce such modifications in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and of the reasons for the exclusion of any applicant for prequalification, shall be furnished by LDA to the Association for its comments before the applicants are notified and LDA shall make such additions to or deletions from the said list as the Association shall reasonably request. (b) Before bids are invited, LDA shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modificatior . in the said documents or procedure as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (c) After bids have been received and evaluated, LDA shall, before a final decision on the award is made, inform the Association of the name of the bidder to whom it intend. to award the contract and shall furnish to the Association, in sufficient time for its review, a detailed report, by the consultants referred to in Section 2.02 of this Agreement, on the evaluation and comparison of the bids received, together with the recommendations for award of the said consultants, and the reasons for the intended award. The Association shall, if it determines that the intended award would be inconsistent with the procedures set forth or referred to in Section 2.04 of this Agreement, promptly inform LDA and the Borrower, and state the reasons for such determination and advise LDA and the Borrower of any cancellation pursuant to the provisions of paragraph 4(c) of Schedule I to the Development Credit Agreement. (d) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked. 10 (e) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the delivery to the Association of the first application for withdrawal of funds from the Credit Account in respect of any such contract. 2. With respect to any other contract for civil works and equipment, LDA shall furnish to the Association, promptly after its execution and prior to the delivery to the Association of the first application for withdrawal of funds from the Credit Account in respect of any such contract, two conformed copies of such contract, together with the analysis of bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract is not consistent with the procedures set forth or referred to in Section 2.04 of this Agreement, promptly inform LDA and the Borrower, and state the reasons for such determination and advise LDA and the Borrower of any cancellation pursuant to the provisions of paragraph 4(c) of Schedule I to the Development Credit Agreement. 3. Notwithstanding the provisions referred to in Section 2.05 of this Agreement or included in the foregoing sub-paragraphs of this Schedule, the Association may accept (i) that off-shelf items costing less than $5,000 equivalent each may be procured in accordance with the Borrower's usual procurement procedures provided, however, that the aggregate cost of such items does not exceed $500,000 equivalent; and (ii) that, pursuant to the provisions of paragraph 1.2 of the Guidelines for Procurement, the constr-Liction of facilities under Parts A, B and D of the Project may be carried out by the Construction and Maintenance Unit of LDA. 4. Expenditures under Categories 11 and IV to Schedule I of the Development Credit Agreement are hereby exempted from the requirements for international competition specified in Section 2.05 to this Agreement. B. Supplemental Rules on Bid Evaluation and Comparison I. For the purpose of evaluation and comparison of bids, customs duties and other import taxes on imported goods, and sales and similar taxes on locally supplied goods, shall be excluded, except to the extent hereinafter provided. Bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for locally manufactured goods. The cost to the Borrower of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be taken into account in the evaluation of bids in accordance with paragraph 4.7 of the Guidelines for Procurement. 0 2. For goods included in the table set forth in paragraph 1 of Schedule 1 to the Development Credit Agreement, the Borrower may grant a margin of preference to goods manufactured in Somalia in accordance with, and subject to, the following provisions: (a) After evaluation, responsive bids will be classified in one of the following groups: (1) Group A: bids offering goods manufactured in Somalia if the bidder shall have established to the satisfaction of the Borrower and the Association that the manufacturing cost of such goods includes a value added in Somalia equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: bids offering goods manufactured in Somalia other than bids classified in Group A. (3) Group C: bids offering any other goods. (b) All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied locally, to determine the lowest evaluated bid of each group. The lowest evaluated bids of each group shall then be compared with each other and if, as a result of this comparison, a bid from Group A or Group B is the lowest, it shall be selected for purposes of award. (c) If, as a result of the comparison under paragraph (b) above, the lowest bid is a bid from Group C, all Group C bids shall be further compared with the lowest bid from Group A, as determined under paragraph (b) above, after adding to the c.i.f. bid price of goods to be imported offered in each Group C bid, for the purpose of this further comparison only, an amount equal to the smaller of (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of goods offered in such Group C bid, or (ii) 15% of the c.i.f. bid price of such goods. If the Group A bid in such further comparison is the lowest, it shall be selected for purposes of award; if not, the lowest bid from Group C, as determined under paragraph (b) above, shall be selected for purposes of award. 3. The bidding documents shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the methods and stages that will be followed in the evaluation and comparison of bids to give effect to such preference. 12 SCHEDULE 2 The Project Development and Training Unit 1. Staff LDA shall establish PDTU which shall consist of, inter alia, the following staff with duties and responsibilities described below: (a) Project Director: overall coordination, management and supervision of the Project; (b) Senior Grazing Ranch Manager: establishment and initial operation of the grazing ranches including the training of Somali ranch managers and field trials on range improvement; (c) Irrigated Fodder Farm and Feedlot Manager: operation of the irrigated fodder farm including forage production and feedlot operation, use of machinery, and selection and training of Somali technicians; (d) Irrigation Specialist: the irrigation operation of the irrigated fodder farm and coordination between irrigation and feed production; (e) Project Finance Officer: all financial aspects of the Project including management of funds, procurement and disbursement procedures, and assistance to LDA's finance direction in strengthening its Finance Department; and (f) Master Mechanic: the overall management and repair of machinery, plant and tractors including the establishment and operation of the repair shop and spare parts section. 2. Project Construction and Maintenance Unit The Project Construction and Maintenance Unit shall carry out construction and maintenance of facilities provided under Parts A, B, D and E of the Project except for the major facilities for the Afmadu Holding Ground. The Unit shall be headed by a construction officer and staffed with two field construction officers, a surveyor, draftsmen, mechanics, drivers, and construction workers.