Burundi - Second Highway Project : Credit 0773 - Development Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 773 BU Development Credit Agreement (Second Highway Project) between REPUBLIC OF BURUNDI and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated March 29, 1978 CREDIT NUMBER 773 BU DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated March 29, 1978, between REPUBLIC OF BURUNDI (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) the Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; (B) the Borrower intends to borrow from Banque Arabe pour le Developpement Economique en Afrique (BADEA) six million one hundred thousand dollars ($6,100,000) equivalent to assist in financing Parts A and C.1 of the Project on the terms and condi- tions set forth in an agreement to be entered into between the Borrower and BADEA (hereinafter called the BADEA Loan Agreement); and (C) the Federal Republic of Germany and the United Nations Development Programme have agreed to provide to the Borrower part of the technical assistance included in Part D of the Project; and WHEREAS the Association has agreed to extend the Credit to the Borrower upon the terms. and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the Gen- eral Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions and in the Preamble to this Agreement have the respective meanings therein set forth and the term "MTP" means -2- the Ministere des Travaux Publics, de 1'Equipement et du Logement of the Borrower. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equiv- alent to fourteen million dollars ($14,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Associ- ation, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, contracts for the purchase of goods or for civil works to be financed out of the proceeds of the Credit, shall be procured in accordance with the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be June 30, 1982 or such later date as the Association shall establish. The Associa- tion shall promptly notify the Borrower of such later date. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on March 15 and September 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each March 15 and September 15 commencing March 15, 1988, and ending Septem- ber 15, 2027, each installment to and including the install- ment payable on September 15, 1997, to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment there- after to be one and one-half per cent (1-1/2%) of such principal amount. -3- Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project through MTP with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering prac- tices, and shall provide, promptly as needed, the funds, facil- ities, services and other resources required for the purpose. Section 3.02. In order to assist the Borrower in carrying out Parts C, D and F.1 of the Project, the Borrower shall employ consultants whose qualifications, experience and terms and condi- tions of employment shall be satisfactory to the Association. The Borrower shall appoint adequate local counterpart staff to the consultants employed for purposes of carrying out Parts D and F.1 of the Project. Section 3.03. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit 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 the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, all goods and services financed out of the proceeds of the Credit shall be used exclusively for the Project until its completion. Section 3.04. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borrower: (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, and to disclose the use thereof in the -4- Project; (ii) shall enable the Association's accredited represen- tatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit 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 and the goods and services financed out of such proceeds. Section 3.05. Promptly after completion of the Project, but in any event 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 exe- cution and initial operation of the Project, its cost and the benefits derived or to be derived from it, the performance by the Borrower and the Association of their respective obligations under this Agreement and the accomplishment of the purposes of the Credit. ARTICLE IV Other Covenants Section 4.01. The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with con- sistently maintained appropriate accounting practices the opera- tions, resources and expenditures, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out the Project or any part thereof. Section 4.02. The Borrower shall: (a) not later than April 30, 1978, prepare and furnish to the Association a road investment program for at least five years and exchange views with the Association thereon; and (b) thereafter adopt such program, give the Association a reason-ble opportunity to comment on any proposed changes thereto and, from time to time, review its execution with the Association. Section 4.03. The Borrower shall: (a) not later than June 30, 1978, prepare and furnish to the Association a plan of action satisfactory to the Association to assign gradually to two dif- ferent departments within MTP, the responsibility for the con- struction and maintenance of roads in Bujumbura and in the rest -7- Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministere des Travaux Publics, de l'Equipement et du Logement B.P. 1860 Bujumbura Burundi Cable address: Telex: MINITRABLICS MINAFFEXT 65 BUJUMBURA Bujumbura 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) IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, 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. REPUBLIC OF BURUNDI By /s/ Laurent Nzeyimana Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Andre Gue Acting Regional Vice President Eastern Africa -8- SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Civil works 5,540,000 45% (Part A of the Project) (2) Civil works 3,100,000 80% (Parts B and F.3 of the Project) (3) Road maintenance 1,500,000 100% of foreign and laboratory expenditures and equipment (Parts 80% of local E and F.2 of the expenditures Project) (4) Consultants' 270,000 100% of foreign services (Part expenditures and C.1 of the 65% of local Project) expenditures (5) Consultants' 1,280,000 100% of foreign services (Parts expenditures and C.2, D and F.1 65% of local of the Project) expenditures (6) Unallocated 2,310,000 TOTAL 14,000,000 -5- of the territory of the Borrower; and (b) thereafter, carry out such plan. Section 4.04. The Borrower shall: (a) at all times maintain the position of coordinator of the Borrower's road investment program; and (b) employ for such position a competent and experi- enced person. Section 4.05. The Borrower shall: (a) adequately maintain its national road network in accordance with sound engineering and financial practices; (b) adequately maintain all of its highway maintenance equipment and make all necessary repairs and renewals thereof, all in accordance with sound engineering prac- tices; (c) establish and maintain workshops and inventories of spare; parts as required for the foregoing; (d) provide, promptly as needed, the funds, facilities, services and other resources required for the foregoing, including not less than 2,500,000 dollars equivalent every calendar year during the execution of the Project starting January 1, 1978; and (e) by October 31 in each year during the execution of the Project and starting in 1978, exchange views with the Association on the adequacy of such amount taking into account such factors as inflation, price variations, and changes in traffic patterns and volume. Section 4.06. The Borrower shall take all measures reasonably required to ensure that the dimensions and axle--loads of vehicles using its nationail highway network shall not exceed limits con- sistent with the design standards of such roads. ARTICLE V Remedies of the Association Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified pursuant to paragraph (h) thereof: (i) Subject to subparagraph (ii) of this paragraph: (A) the right of the Borrower to withdraw the proceeds of a loan made to the Borrower for the financing of Parts A and C.1 of the Project shall have been suspended, cancelled or terminated in whole or in part, pursuant to the terms of the agreement providing therefor, or -6- (B) any such loan shall have become due and payable prior to the agreed maturity thereof. (ii) Subparagraph (i) of this paragraph shall not apply if the Borrower establishes to the satisfaction of the Association that: (A) such suspension, cancellation, termination or prematuring is not caused by the failure of the Borrower to perform any of its obligations under such agreement, and (B) adequate funds for the Project are available to the Borrower from other sources on terms and conditions consistent with the obligations of the Borrower under this Agreement. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional event is specified pursuant to paragraph (d) thereof, namely, that the event spe- cified in paragraph (i) (B) of Section 5.01 of this Agreement shall occur. ARTICLE VI Termination Section 6.01. The date June 29, 1978, is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 6.02. The obligations of the Borrower under Sections 4.04, 4.05 and 4.06 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date twenty years after the date of this Agreement, whichever shall be the earlier. ARTICLE VII Representatives of the Borrower; Addresses Section 7.01. The Ministre des Travaux Publics, de 1'Equipement et du Logement of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. - 9 - 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in cum- pliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 4. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for: (a) expenditures prior to the date of this Agreement; (b) expenditures under Categories (1) and (4) unless the BADEA Loan Agreement has been executed and delivered and all conditions precedent to its effectiveness or to the right to make withdrawals thereunder have been fulfilled. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in paragraph 1 above, if the Association has reasonably estimated that the amount of the Association then allocated to any Category will be insuffi- cient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allo- cated to another Category and which in the opinion of the Associ- ation are not needed to meet other expenditures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. - 10 - 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way re- stricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as, in the Associa- tion's reasonable opinion, represents the amount of such expendi- tures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 11 - SCHEDULE 2 Description of the Project The purpose of the Project is to: (a) reconstruct the Bujumbura - Rugombo road, (b) improve the Borrower's classified road network, and (c) continue the road maintenance program partly financed under Credit No. 467-BU of the Association. The Project consists of the following Parts: Part A: Reconstruction of the Bujumbura - Rugombo road (about 65 kilometers). Part B: Improvement of the classified road network of the Borrower by: 1. replacing selected obsolete wooden bridges; 2. stabilizing selected steep road sections; 3. upgrading about 57 kilometers of dirt roads to low standard gravel roads; and 4. improving the drainage facilities and road surface of about 370 kilometers of dirt roads. Part C: 1. Supervision of construction of the roads included in Part A hereof. 2. Detailed engineering for, and supervision of, the improvement of the network included in Part B hereof. Part D: Technical assistance to improve the road maintenance operations of the Borrower. Part E: Acquisition of road maintenance equipment and its utilization during the carrying out of the Project. Part F: Improvement of the Borrower's soils and materials laboratory by: 1. training laboratory personnel; - 12 - 2. acquiring and utilizing laboratory equipment and vehicles; and 3. reconstructing the laboratory building. The roads included in Parts A and B.3 of the Project will be reconstructed or upgraded in accordance with the design standards set forth in the Exhibit to this Schedule. The Project is expected to be completed by December 31, 1981. - 13 - EXHIBIT TO SCHEDULE 2 Road Design Standards Bujumbura-Rugombo (Part A of the Project) Design speed 80 km/h Horizontal Curve: minimum radius 200 m Vertical Curve: minimum radius, crest 3,500 m minimum radius, sag 2,500 m Maximum grade 7% Road width 8.50 m Pavement width 5.50 m Shoulder width 1.50 m Pavement type: sub-base Selected granular soil base Cement stabilized granular soil surface course Double bituminous surface treatment Pavement design load AASHO Bridges: width of carriageway 5.50 m width of sidewalks 1.10 m loading 30 t vehicle combination or 13 t single axle. (According to French norms Fascicule 61) Low Standard Gravel Roads (Part B.3 of the Project) Terrain Flat Rolling Mountainous Design Speed km/h 60 40 30 Minimum Radius m 120 40 20 - 14 - Terrain Flat Rolling Mountainous Maximum Grade % 6 7 10 Minimum Radius Crest m 2,200 1,500 750 Minimum Radius Sag m 1,600 500 300 Road Width m 8.0 8.0 7.0 Pavement Width m 5.0 5.0 5.0 Shoulder Width m 1.50 1.50 1.00 Pavement type Selected granular material - 15 - SCHEDULE 3 Procurement A. International Competitive Bidding 1. Contracts for the purchase of goods or for civil works for Parts A, B.2, B.3, E and F.2 of the Project shall be procured in accordance with procedures consistent with those set forth in Part A of the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1977 (hereinafter called the Guidelines) including the pertinent provisions of the General Introduction thereto, on the basis of international competitive bidding. 2. For goods and works to be procured on the basis of inter- national competitive bidding under the Project, the Borrower shall prepare and forward to the Association as soon as possible, and in any event not later than 60 days prior to the proposed date of availability to the public of the first tender or prequalification documents relating thereto, as the case may be, a general pro- curement notice, in such form and detail and containing such information as the Association shall reasonably request; the Association will arrange for the publication of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international competitive bidding. B. Procurement Without Contracting Civil works for Parts B.1, B.4 and F.3 of the Project may be carried out by force account. C. Review of Procurement Decisions by the Association 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts estimated to cost the equiva- lent of $100,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations to - 16 - 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 modifications in the said documents or procedures 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. (b) After bids have been received and evaluated, the Bor- rower shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and shall furnish to the Association, in sufficient time for its review, a detailed report on the evalu- ation and comparison of the bids received, and such other infor- mation as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (d) Two confirmed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 2. With respect to each contract to be financed out of the proceeds of the Credit and not governed by the preceding para- graph, the Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respective 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 was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination.