Djibouti - Educational Project : Credit 1543 - Credit Agreement - Conformed

OFFIC IAL CREDIT NUMBER 1543-0 DJI DOCUMNTSJ Development Credit Agreement (Education Project) between REPUBLIC OF DJIBOUTI and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated cA ,1985 CREDIT NUMBER 1543-0 DJI DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated k 0LAC J, al,\ , 1985, between REPUBLIC OF DJIBOUTI (hereinafter called the Borrower or Djibouti) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). 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 June 30, 1980, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agree- ments of the Association being hereinafter called the General 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 "Special Account" means the account referred to in Section 2.02 (b) hereof. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Bor- rower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various cur- rencies equivalent to five million one hundred thousand Special Drawing Rights (SDR 5,100,000). Section 2.02. (a) The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement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 Asso- ciation, 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. -2- (b) The Borrower shall, for the purposes of the Project, open and thereafter maintain in the currency of the United States of America a Special Account at the Borrower's Treasury, on terms and conditions satisfactory to the Association. Deposits into, and payments out of, the Special Account shall be made in accord- ance with the provisions of Schedule 4 to this Agreement. Section 2.03, Except as the Association shall otherwise agree, procurement of the goods and civil works required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be June 30, 1989 or such later date as the Association shall establish. The Associa- tion shall promptly notify the Borrower of such later date. Section 2.05. (a) The Borrower shall pay to the Association a commitment charge at the rate of one-half of one per cent (1/2 of 1%) per annum on the principal amount of the Credit not with- drawn from time to time. The commitment charge shall accrue from a date sixty days after the date of the Development Credit Agree- ment to the respective dates on which amounts shall be withdrawn by the Borrower from the Credit Account or shall be cancelled. (b) The commitment charge shall be paid: (i) at such places as the Association shall reasonably request; (ii) without restrictions of any kind imposed by, or in the territory of, the Borrower; and (iii) in the currency specified in this Agreement for the purposes of Section 4.02 of the General Conditions or in such other eligible currency or currencies as may from time to time be designated or selected pursuant to the provisions of that Section. Section 2.06. 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 2.07. Commitment charges and service charges shall be payable semiannually on April 15 and October 15 in each year. Section 2.08. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each April 15 and October 15 commencing April 15, 1995, and ending October 15, -3- 2034 each installment to and including the installment payable on October 15, 2004 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.09. 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. (a) The Borrower declares its commitment to the objectives of the Project as set forth in Schedule 2 to this Agreement, and, to this end, shall carry out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and educational practices and under terms and conditions acceptable to the Association, and shall provide, promptly as needed, the funds, facilities, ser- vices and other resources required for the purpose. (b) The Borrower shall take all appropriate steps to ensure that the schools included in Part B of the Project shall be pro- vided with a timely and adequate supply of goods and services (in particular the supply of food) to ensure adequate living condi- tions for staff and students in rural areas. (c) The Borrower shall ensure that the specialists to be employed under Part C of the Project shall be placed under the dir,ct authority of t'ie minister responsible for education in the capacity of advisors. (d) (i) The Borrower shall ensure that the recommendations emanating from the master plan for the development of the education and training sector and from the country-wide school mapping exercise (both to be carried out by the specialists to be employed under Part C of the Project) shall be prepared and submitted to the Association for its review and comments by December 31, 1986. (ii) Promptly upon receipt of the Association's comments, the Borrower shall take all appropriate steps to implement such recommendations with due diligence, taking into account the Association's comments. Section 3.02. In order to assist the Borrower in carrying out the Project, the Borrower shall, as and when needed, employ, -4- or cause to be employed, specialists whose qualifications, experience and terms and conditions of employment shall be satis- factory to the Association, such consultants to be selected in accordance with principles and procedures satisfactory to the Association on the basis of the "Guidelines for the Use of Con- sultants by World Bank Borrowers and by the World Bank as Executing Agency" published by the Bank in August 1981. 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 inci- dent 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) The Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the purposes of the Project. Section 3.04. (a) The Borrower shall furnish, or cause to be furnished, to the Association, promptly upon their preparation, the plans, specifications, reports, contract documents and con- struction 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 shall: (i) maintain, or cause to be main- tained, records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the services financed out of the proceeds of the Credit, and to disclose their use in the Project; (ii) enable the Association's representatives to visit the facilities and construction sites included in the Project and to examine any relevant records and documents; and (iii) furnish, or cause to be furnished, to the Association at regular intervals all such information (including semi-annual reports to be pre- pared according to a format acceptable to the Association and using performance indicators acceptable to the Association, such reports to be submitted to the Association on each June 30 and December 31 after June 30, 1985) as the Association shall reason- ably request concerning the Project, the issues arising during its implementation and the ways and means of addressing such issues, the cost of the Project, and, where appropriate, the benefits to be derived from it, the expenditure of the proceeds of the Credit and the services financed out of such proceeds. (c) Upon the award by the Borrower of any contract for goods or services to be financed out of the proceeds of the Credit, the Association may publish a description thereof, the name and nationality of the party to whom the contract was awarded and the contract price. (d) 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 execution and ini- tial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Association of their respective obligations under the Devel- opment Credit Agreement and the accomplishment of the purposes of the Credit. Section 3.05. The Borrower shall take, or cause to be taken, all such action as shall be necessary to acquire, as and when needed and under terms and conditions acceptable to the Associa- tion, all such land and rights in respect of land as shall be required for carrying out the Project and shall furnish to the Association promptly after such acquisition, evidence satisfac- tory to the Association that such land and rights in respect of land are available for purposes related to the Project. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall maintain or cause to be maintained records (including separate accounts) adequate to reflect in accordance with consistently maintained appropriate accounting practices the operations, 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. (b) Without limitation to the foregoing, the Borrower shall: (i) maintain or cause to be maintained separate accounts reflecting all expenditures on account of which withdrawals are requested from the Credit Account on the basis of statements of expenditure; (ii) retain, until one year after the Closing Date, all records (contracts, orders, invoices, bills, receipts and -6- other documents) evidencing the expenditures on account of which withdrawals are requested from the Credit Account on the basis of statements of expenditure; and (iii) enable the Association's representatives to examine such records. (c) The Borrower shall: (i) have the accounts referred to in paragraphs (a) and (b) of this Section and the Special Account for each fiscal year audited, in accordance with appropriate 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 copy of the report of such audit by such auditors, of such scope and in such detail as the Association shall have reasonably requested, including without limitation to the foregoing, a separate opinion by said auditors in respect of the expenditures and records referred to in paragraph (b) of this Section as to whether the proceeds of the Credit withdrawn from the Credit Account on the basis of statements of expenditure have been used for the purpose for which they were provided; and (iii) furnish to the Association such other information concerning said accounts, records and expenditures and the audit thereof as the Association shall from time to time reasonably request. Section 4.02. The Borrower shall adequately maintain, or cause to be maintained adequately, the installations and facili- ties constructed, improved, equipped or otherwise assisted under the Project in accordance with appropriate administrative, tech- nical, financial and educational practices, and provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. ARTICLE V Remedies of the Association Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional event is specified pursuant to paragraph (h) thereof, namely, that D&cision Pr6sidentielle No. 84-0886 dated June 7, 1984 of the Borrower shall have been amended, suspended, abrogated, repealed or waived so as to affect materially and adversely the carrying out of the Project. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified pursuant to paragraph (d) thereof, namely, that the event speci- fied in Section 5.01 of this Agreement shall occur. ARTICLE VI Effective Date; Termination Section 6.01. The following event is specified as an addi- tional condition to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions, namely, that the Special Account has been opened, as provided hereunder. Section 6.02. The date ) , is hereby specified for the purposes of Section 12.04 of the General Condi- tions. Section 6.03. The obligations of the Borrower under Arti- cle IV of this Agreement and the provisions of Section 5.02 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date twenty (20) years after the date of this Agreement, whichever shall be the earlier. ARTICLE VII Representatives of the Borrower; Addresses Section 7.01. The Minister of Finance and Nationa Economy of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministry of Finance and National Economy Djibouti Republic of Djibouti Telex: 5871 DJ -8- 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 DJIBOUTI By Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By Regional Vice President Eastern and Southern Africa 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 SDR Equivalent) to be Financed (1) Works (including 2,000,000 85% the transportation of personnel and the remuneration of the personnel especially employed for the Project) (2) Goods 100% of foreign expenditures and (a) Construction 1,680,000 85% of local ex- materials (in- penditures cluding tr:.ns- portation thereof) (b) Other goods 300,000 (3) Specialists 100,000 100% of foreign expenditures and 80% of local ex- penditures (4) Costs of Project 10,000 80% administration (excluding salaries) (5) Special Account 510,000 Amounts to be deposited pur- suant to Sec- tion 2.02 (b) of this Agreement - 10 - Amount of the Credit Allocated % of (Expressed in Expenditures Category SDR Equivalent) to be Financed (6) Unallocated 500,000 TOTAL 5,100,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than that of the Borrower for goods or services supplied from the territory of any country other than that of the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower or for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Association that the proceeds of the Credit shall not 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, procurement or supply thereof; on this basis, if the amount of any such taxes levied on or in respect of items in any Category decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such Category 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 expenditures prior to the date of this Agreement, except that withdrawals, in an aggregate amount not exceeding the equivalent of SDR 250,000, may be made in respect of Categories (1) through (4) on account of payments made for expenditures before that date but after July 1, 1984. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in para- graph 1 above, if the Association has reasonably estimated that - 11 - the amount of the Credit then allocated to any Category will be insufficient 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 allocated to another Category and which in the opitiion of the Association 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 expen- ditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 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,expen- diture for such item shall be financed out of the proceeds of -the Credit, and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Bor- rower, cancel such amount of the Credit as, in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 12 - SCHEDULE 2 Description of the Project The objectives of the Project are to assist the Borrower in: (i) expanding and improving primary education in underprivileged areas, (ii) improving the management of the. education system through' educational planning, and (iii) monitoring and assessing the ongoing cost -efficiency and quality improvement process of that system. To that end, the Project consists of the following Parts: Part A: Urban Primary Schools Construction and equipping of two new double-stream schools (with twelve classrooms each and about 50 student places per classroom) to be located in the Balbala and Gabode settlements of Djibouti City; it being specified that staff housing will be provided for the headmasters who would ensure, inter alia, the security of the schools. Part B: Rural Primary Schools Construction, or extension, of facilities for eight rural schools (including staff housing units for 20 teachers and students' accommodations for about 650 students) as follows: (i) cont-rurtion and equipping of four new schools at Bondara, Kontali, Khor Angar and Ardo Bankouale, and (ii) extension and equipping of four existing scl ols at Dammerjog, Ali Adde, Mouloud and Dorra. Part C: Technical Assistance Provision of specialists' services to organize educational planning and evaluation and of fellowships to upgrade the skills of the specialists' national counterparts. The Project is expected to be completed by December 31, 1988. - 13 - SC: ULE 3 : Procurement A. International Competitive Bidding 1. Except' as ptovided in Part D -hereof, goods and Vworks shall b r6iuredMunder editt-acdtd awarded in accordance. vllth' procedures coniiistdatt Nith-thd!e :det ,forth in Sections I, and .7ll of the "Guidelines for Procurement under IBRD Loans and IDA Credits" published by the Bank in August 1984 (the Guidelines). 2. Contracts for goods and works will be grouped, to the extent possible, to permit bulk procurement and to foster competitive bidding. B. Preference for Domestic Manufacturers In the procurement of goods in accordance with. the proce- dures described in Part A.1 of this Schedule, goods manufactured in Djibouti may be granted a margin of preference in accordance with, and subject to, the provisions of paragraphs 2.55 and 2.56 of the Guidelines and paragraphs 1 through 4 of Appendix 2 thereto. C. Preference for Domestic Contractors In the procurement of works in accordance with the pro- cedures described in Part A.1 of this Schedule, the Borrower, may grant a margin of preference to domestic contractors 'in accord- ance with, and subject to, the provisions of paragraphs 2.55 and 2.56 of the Guidelines and paragraph 5 of Appendix 2 thereto. D. Other Procurement Procedures 1. Contracts for furniture, equipment and vehicles whose esti- mated individual cost is less than $20,000 equivalent, and con- tracts for the construction materials required for the works which may be carried out under force account as provided below, may be awarded on the basis of local procedures acceptable' to the Association; it being understood that the contracts for furniture, equipment and vehicles so awarded shall not exceed $70,000 equivalent in the aggregate. - 14 - 2. Works under Part B of the Project may be carried out under force account. E. 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 for goods and civil works estimated to cost the equivalent of $50,000 and $100,000, or more, respectively, the procedures set forth in paragraphs 2 and 4 of Appendix 1 to the Guidelines shall apply; provided, however, that where payments for such contract are to be made out of the proceeds of the Special Account, the two conformed copies of the contract required to be furnished to the Association, pursuant to paragraph 2 (d) of Appendix 1 to the Guidelines, shall be fur- nished to the Association prior to the making of the first pay- ment 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; provided, however, that where payments for such contract are to be made out of the proceeds of the Special Account, the two conformed copies of the contract required to be furnished to the Association, pursuant to paragraph 3 of Appendix 1 to the Guidelines together with the other information specified therein, shall be furnished to the Association as part of the evidence to be furnished pursuant to pare.g. :n 4 of Schedule 4 (the Sp.cial Account Schedule) to this Agren t i:. (c) The provisions of the preceding subparagraphs (a) and (b) shall not apply to contracts on account of which the Associa- tion has authorized withdrawals from the Credit Account on the basis of statements of expenditure. 2. The figure of 10% is hereby specified for purposes of para- graph 4 of Appendix 1 to the Guidelines. - 15 - SCHEDULE 4 Special Account 1. For the purposes of this Schedule: (a) the term "Category" means a category of items to be financed out of the proceeds of the Credit as set forth in the table'in paragraph 1 of Schedule 1 to this Agreement; (b) the term "eligible expenditures" means expenditures 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 allocated from time to time to Categories (1) through (4) in accordance with the provisions of Schedule 1 to this Agreement; and (c) the term "Authorized Allocation" means an amount in the currency of the United States of America equivalent to the amount allocated to Category (5) which is to be withdrawn from the Credit Account and deposited in the Special Account pursuant to paragraph 3 (a) of this Schedule. 2. Payments out of the Special Account shall be made exclu- sively for eligible expenditures in accordance with the provi- sions of this Schedule. 3. (a) For purposes of withdrawal of the Authorized Alloca- tion, the Association shall, on the basis of a request or requests by the Borrower and evidence satisfactory to the Asso- ciation that the Special Account has been duly opened, withdraw on behalf of the Borrower from the Credit Account and deposit in the Special Account such amount or amounts of the Authorized Allocation as the Borrower shall have requested, up to the total of the Authorized Allocation. (b) For purposes of withdrawal of proceeds of the Credit to replenish the Special Account, the Association shall, on the basis of requests by the Borrower furnished to the Association at such intervals as the Association shall specify, withdraw from the Credit Account and deposit into the Special Account such amounts as shall be required to replenish the Special Account with amounts not exceeding the amount of payments made out of the Special Account for eligible expenditures. Except as the Association may otherwise agree, each such deposit shall be - 16 - withdrawn by the Association from the Credit Account under the respective Categories (1) through (4), and in the respective equivalent amounts, as shall have been justified by the evidence supporting the request for such deposit furnished pursuant to paragraph 4 of this Schedule. 4. Prior to or at the time of each request by the Borrower for a deposit by the Association into the Special Account pursuant to paragraph 3 (b) of this Schedule, the Borrower shall furnish to the Association in respect of each payment made by the Borrower out of the Special Account such documents and other evidence as the Association shall reasonably request, showing that such payment was made for eligible expenditures. 5. Notwithstanding the provisions of paragraph 3 of this Sched- ule, no further deposit into the Special Account shall be made by the Association (a) when the Association shall have determined at any time that all further withdrawals can be made directly by the Borrower from the Credit Account in accordance with the provi- sions of paragraph (a) of Section 2.02 of this Agreement, or (b) unless otherwise agreed by the Association, when the total un- withdrawn amount of the Credit allocated to Categories (1) through (4) for the Project, minus the amount of any qualified agreement to reimburse made by the Association and of any special commitment entered into by the Association pursuant to Sec- tion 5.02 of the General Conditions with respect to the Project, shall be equal to the equivalent of twice the amount of the Author.:: :d Allocation, wLichever 6'-all be sooner. Withdrawal from the CrEiit Account of the remaining unwithdrawn amount of the Credit allocated to Categories (1) through (4) for the Project shall follow such procedures as the Association shall specify by notice to the Borrower and shall, except as the Association shall otherwise agree, be made only after and to the extent the Asso- ciation shall have been satisfied that all such amounts remaining on deposit in the Special Account as of the date of such notice have been or will be utilized in making payments for eligible expenditures. 6. If the Association shall have determined at any time that: (a) any payment out of the Special Account (i) was made for any expenditure or in any amount not eligible pursuant to paragraph 2 of this Schedule, or (ii) was not justified by the evidence furnished pursuant to paragraph 4 of this Schedule, the Borrower shall, promptly upon notice from the Association, and, - 17 - unless otherwise agreed by the Association, prior to any further deposit into the Special Account by the Association, deposit into the Special Account or, if the Association shall so request, refund to the Association an amount equal to the amount of such payment or the portion thereof not so eligible or justified; or (b) any amount outstanding in the Special Account will not be required to cover further payments for eligible expenditures, the Borrower shall, promptly upon notice from the Association, and unless otherwise agreed by the Association, refund to the Association such amount then outstanding in the Special Account. 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 FOR SECRETARY