Ghana - Second Reconstruction Imports Credit Project : Credit 1573 - Project Agreement - 1 - Conformed

CREDIT NUMBER 1573 GH OFFICIAL DOCU ME NTS] Project Agreement (Second Reconstruction Imports Credit Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and BANK OF GHANA Dated , 1985 CREDIT NUMBER 1573 CH PROJECT AGREEMENT AGREEMENT, dated , 1985, between INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association) and BANK OF GHANA. WHEREAS (A) by the Development Credit Agreement of even date herewith between the Republic of Ghana (the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to sixty-one million six hundred thousand Special Drawing Rights (SDR 61,600,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that the Bank of Ghana agree to undertake such obligations toward the Association as are set forth in this Agreement; (B) by a subsidiary agreement to be entered into between the Borrower and the Bank of Ghana, the proceeds of the Credit pr:)vided for under the Development Credit Agreement will be made ilailable to the Bank of Ghana on the terms and conditions set forth in said Subsidiary Agreement; and WHEREAS the Bank of Ghana, in consideration of the Associa- tion's entering into the Development Credit Agreement with the Borrower, has 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 and in the Gentral Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) The Bank of Ghana declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Development Credit Agreement and, to this end, shall carry -2- out the Project with due diligence and efficiency and in conformity with appropriate administrative and financial practices. (b) Without limitation upon the provisions of paragraph (a) of this Section, the Bank of Ghana shall carry out the Project in accordance with the Implementation Program set forth in Sched- ule 2 to this Agreement, as such Schedule may be amended from time to time by agreement between the Association and the Bank of Ghana. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods and consultants' services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to this Agreement. Section 2.03. The Bank of Ghana shall carry out the obliga- tions set forth in Sections 9.03, 9.04, 9.05, 9.06 and 9.07 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, and main- tenance, respectively). Section 2.04. The Bank of Ghana shall duly perform all its obligations under the Subsidiary Agreement. Except as the Asso- ciation shall otherwise agree, the Bank of Ghana shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Agreement or any provision thereof. Section 2.05. The Bank of Ghana shall: (i) expand the mem- bership of the Project Unit with additional staff in numbers and with qualifications acceptable to the Association; and (ii) main- tain such Unit to assist the Technical Committee in the coordina- tion, monitoring and supervision of all Project activities. Section 2.06. (a) The Bank of Ghana shall, at the request of the Association, exchange views with the Association with regard to the progress of the Project, the performance of its obliga- tions under this Agreement and under the Subsidiary Agreement, and other matters relating to the purposes of the Credit. (b) The Bank of Ghana shall promptly inform the Association of any condition which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of the Credit, or the performance by the Bank of Ghana of its -3- obligations under this Agreement -nd under the Subsidiary Ag-:ee- ment. ARTICLE III Financial Covenants Section 3.01. (a) The Bank of Ghana shall maintain separate records and accounts adequate to reflect in accordance with sound accounting practices its operations, resources and expenditures in respect of the Project. (b) The Bank of Ghana shall: (i) have the accounts referred to in paragraph (a) of this Section and the Special Account for each fiscal year audited, in accordance with appro- priate auditing principles consistently applied, by independent auditors acceptable to the Associa- tion; (ii) furnish to the Association as soon as available, but in any case not later than four months after the end of each such year, 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 requested; and (iii) furnish to the Association such other information concerning the said accounts and the audit thereof and said records, as the Association shall from time to time reasonably request. ARTICLE IV Effective Date; Termination; Cancellation and Suspension Section 4.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. -4- Section 4.02. (a) This Agreement and all obligations of the Association and of the Bank of Ghana 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) the date 10 years after the date of this Agree- ment. (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 the Bank of Ghana of this event. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. ARTICLE V Miscellaneous Provisions Section 5.01. 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 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) -5- For the Bank of Ghana: Bank of Ghana P.O. Box 2674 Accra, Ghana Cable address: GHANABANK Section 5.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of the Bank of Ghana, or by the Bank of Ghana on behalf of the Borrower under the Development Credit Agree- ment, may be taken or executed by the Governor of the Bank of Ghana or such other person or persons as he shall designate in writing, and the Bank of Ghana shall furnish to the Association sufficient evidence of the authority and the authenticated speci- men signature of each such person. Section 5.03. 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 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 ByI62 A/7 7 && 4 Regi nal Vice President Western Africa BANK OF GHANA By Authorized Rpsti Authorized Representative SCHEDULE 1 Procurement and Consultants' Services Section I. Procurement of Goods and Works A. International Competitive Bidding Except as provided in Part B hereof, goods and works shall be procured under contracts awarded in accordance with procedures consistent with those set forth in Sections I and II of the "Guidelines for Procurement under IBRD Loans and IDA Credits" published by the Bank in August 1984 (the Guidelines). B. Other Procurement Procedures 1. Goods to be procured for the public sector, other than the mining sector, under contracts estimated to cost the equivalent of less than $300,000 may be awarded following the solicitation and evaluation of quotations from not less than three inter- nationally reputable suppliers. 2. Goods to be procured for the private sector and the mining sector under contracts estimated to cost the equivalent of less than $1,000,000 may be purchased through normal commercial channels. 3. Goods to be procured under contracts estimated to cost the equivalent of less than $100,000 may be purchased directly from suppliers when a demonstrated urgency so requires. 4. Goods of a proprietary nature may be purchased directly from the suppliers of such goods. C. Review by the Association of Procurement Decisions 1. Review of invitations to bid and of proposed awards and final contracts: (a) With respect to each contract estimated to cost the equivalent of $5,000,000 or more, the procedures set forth in paragraphs 2 and 4 of Appendix 1 to the Guidelines shall apply. Where payments for such contract are to be made out of the Special Account, such procedures shall be modified to ensure that the two conformed copies of the contract required to be furnished -7- to the Asseeiation pursuant to said paragraph 2 (d) shall be furnished to the Association prior to the making of the first payment out of the Special Account in respect of such contract. (b) With respect to each contract not governed by the pre- ceding paragraph, the procedures set forth in paragraphs 3 and 4 of Appendix 1 to the Guidelines shall apply. Where payments for such contract are to be made out of the Special Account, such procedures shall be modified to ensure that the two conformed copies of the contract together with the other information required to be furnished to the Association pursuant to said paragraph 3 shall be furnished to the Association as part of the evidence to be furnished pursuant to paragraph 4 of Schedule 3 (the Special Account Schedule) to the Development Credit Agree- ment. 2. The figure of 10% is hereby specified for purposes of para- graph 4 of Appendix 1 to the Guidelines. Section II. Employment of Consultants In order to assist the Borrower in the procurement of goods under the Project and in carrying out its obligations under Sec- tion 4.03 of the Credit Agreement, the Borrower shall employ procurement agents and other consultants whose qualifications, experience and terms and conditions of employment shall be satis- factory to the Association. Such consultants shall be selected in accordance with principles and procedures satisfactory to the Association on the basis of the "Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency" published by the Bank in August 1981. -8- SCHEDULE 2 Implementation Program Project Responsibility 1. The overall responsibility for the execution and administra- tion of the Project will rest with the Bank of Ghana. 2. The Interministerial Committee referred to in Section 3.04 of the Development Credit Agreement will provide interministerial coordination and guidance. 3. The Technical Committee referred to in Section 3.05 of the Development Credit Agreement, supported by the Project Unit referred to in Section 2.05 of this Agreement, will coordinate, monitor and supervise all Project activities. Import Procedures 1. The import process will start with all importers (Ministry of Agriculture, Ghana Cocoa Marketing Board, Motoring Trading Companies, etc.) submitting import applications to the Technical Committee. The import applications will include standardized lists of goods to be imported. 2. The Technical Committee will review the import applications to ensure that they are eligible for financing under the Credit and that they are in line with the Credit allocation to sectors. The Technical Committee will act upon such applications within eight working days of their submission and, upon approval, issue an import agreement. 3. The import agreement will constitute a commitment of the Bank of Ghana to finance the estimated foreign exchange costs of specified goods. 4. The Ministry of Trade will issue the import licenses within five working days of receipt of a copy of the import agreement. 5. The procurement agents to be employed by the Bank of Ghana will be authorized by the Bank of Ghana to handle all public sector procurement, except as otherwise agreed between the Association and the Bank of Ghana. The project coordinator of the Project Unit will act as a liaison person between the Bank of Ghana and the procurement agents. -9- 6. The procurement procedures applied will be in accordance with Schedule 1 to this Agreement. The Technical Committee will ensure that, to the extent possible and within the limits of local distribution capabilities, orders are bulked across sectors and importers. INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Development Association. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the day of , 198-9 FOR SECRETARY