China - Rural Health And Preventive Medicine Project : Credit 1713 - Project Agreement - 2 - Conformed

CREDIT NUMBER 1713 CHA Project Agreement (Rural Health and Preventive Medicine Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and GANSU PROVINCE HEILONGJIANG PROVINCE HUBEI PROVINCE JIANGXI PROVINCE JILIN PROVINCE SHANDONG PROVINCE SICHUAN PROVINCE and NINGXIA HUI AUTONOMOUS REGION Dated 1987 CREDIT NUMBER 1713 CHA PROJECT AGREEMENT AGREEMENT, dated _J %5 , 1987, between INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association) and GANSU PROVINCE, HEILONGJIANG PROVINCE, HUBEI PROVINCE, JIANGXI PROVINCE, JILIN PROVINCE, SHANDONG PROVINCE, SICHUAN PROVINCE and NINGXIA HUI AUTONOMOUS REGION (hereinafter collectively called the Local Entities). WHEREAS by the Development Credit Agreement of even date herewith between the People's Republic of China (the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to fifty-seven million two hundred thousand Special Drawing Rights (SDR 57,200,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that the Local Entities agree to undertake such obligations toward tL3 Association as are set forth in this Agreement; and WHEREAS the Local Entities, in consideration of the Associa- tion's entering into the Development Credit Agreement with the Borrower, have 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, the Preamble to this Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) Each of the Local Entities declares its commitment tc the objectives of the Project as set forth in Sche- dule 2 to the Development Credit Agreement, and, to this end, shall carry out its respective part of Part A of the Project with due diligence and efficiency and in conformity with appropriate -2- administrative, financial, eng:Lneering, public health and educa- tional practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) With respect to that part of the Project for which each of the Local Entities is financially responsible, such Local Entity shall make adequate and timely budgeting provisions for the implementation of such part. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods and services required for Part A of the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to the Development Credit Agreement. Section 2.03. Each of the Local Entities shall carry out the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project Agreement and Part A of the Project. Section 2.04. (a) Each of the Local Entities shall, at the request of the Association, exchange views with the Association with regard to the progress of Part A of the Project, the perfor- mance of its obligations under this Agreement and other matters relating to the purposes of the Credit. (b) Each of the Local Entities shall promptly inform the Association of any condition which interferes or threatens to interfere with the progress of Part A of the Project, the accom- plishment of the purposes of the Creaie, or the performance by such Local Entity of its obligations under this Agreement. Section 2.05. Each of the Local Entities shall maintain its World Bank. Loan Office within its provincial Health Bureau with appropriate functions and staffing. ARTICLE III Financial Covenants Section 3.01. (a) Each of the Local Entities shall maintain records and accounts adequate to reflect in accordance with sound -3- accounting practices its operations and financial condition in respect of activities related to Part A of the Project. (b) Each of the Local Entities shall, in respect of activi- ties related to Part A of the Project: (i) have the accounts referred to in paragraph (a) of this Section, including 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 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 Ghall have reasonably requested; and (iii) furnish to the Association such other information concerning said accounts and financial statements as well as the audit thereof and said records, as the Association shall from time to time reasonably request. (c) For all expenditures with respect to which withdrawals from the Credit Account were made on the basis of statements of expenditure, each of the Local Entities shall: (i) maintain, in accordance with paragraph (a) of this Section, separate records and accounts reflecting such expenditures; (ii) retain, until at least one year after the Associa- tion has received the audit report for the fiscal year in which the last withdrawal from the Credit Account was made, all records (contracts, orders, invoices, bills, receipts and other documents) evidencing such expenditures; (iii) enable the Association's representatives to examine such records; and -4- (iv) ensure that such separate accounts are included in the annual audit referred to in paragraph (b) of this Section and that the report thereof contains, in respect of such separate accounts, a separate opinion by said auditors as to whether the pro- ceeds of the Credit withdrawn in respect of such expenditures were used for the purposes for which they were provided. 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 the Local Entities 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 twenty-five 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 the Local Entities of this event. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. ARTICLE 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 -5- 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) For Gansu Province: Provincial Bureau of Health Lanzhou, Gansu Province People's Republic of China For Heilongjiang Province Provincial Bureau of Health Harbin, Heilongjiang Province People's Republic of China For Hubei Province: Provincial Bureau of Health Wuhan, Hubei Province People's Republic of China For Jiangxi Province: Provincial Bureau of Health Nanchang, Jiangxi Province People's Republic of China -6- For Jilin Province: Provincial Bureau of Health Changchun, Jilin Province People's Republic of China For Shandong Province Provincial Bureau of Health Jinan, Shandong Province People's Republic of China For Sichuan Province: Provincial Bureau of Health Chengdu, Sichuan Province People's Republic of China For Ningxia Hui Autonomous Region: Regional Bureau of Heaith Yinchuan, Ningxia Hui Autonomous Region People's Republic ol China Section 6.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of any of the Local Entities, may be taken or executed by a Vice Governor of such Local Entity or such other person or persons as such Vice Governor shall designate in writ- ing, and each of the Local Entities shall furnish to the Associa- tion sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 6.03. This Agreement may be executed in several counterparts, each of which shall be an original, and all col- lectLIvely but one instrument. -7- 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 By(t 0001 Q ae t\ee( Ad-d Regional Vice President East Asia and Pacific GANSU PROVINCE HEILONGJIANG PROVINCE HUBEI PROVINCE JIANGXI PROVINCE JILIN PROVINCE SHANDONG PROVINCE SICHUAN PROVINCE NINGXIA HUI AUTONOMOUS REGION Authorized Representative