Conformed Copy - C1941 - Public Sector Adjustment Credit - Norwegian Grant Agreement

Page 1 NORWEGIAN GRANT RELATED TO CREDIT NUMBER 1941 MAG Norwegian Grant Agreement (Public Sector Adjustment) between DEMOCRATIC REPUBLIC OF MADAGASCAR and INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of development aid funds provided by The Kingdom of Norway Dated May 31, 1989 NORWEGIAN GRANT RELATED TO CREDIT NUMBER 1941 MAG NORWEGIAN GRANT AGREEMENT AGREEMENT, dated May 31, 1989, between DEMOCRATIC REPUBLIC OF MADAGASCAR (Madagascar) and INTERNATIONAL DEVELOPMENT ASSOCIATION acting as Administrator (the Administrator) of the Grant (as hereinafter defined) provided by The Kingdom of Norway (Norway). WHEREAS Madagascar has requested the assistance of the International Development Association (the Association) and Norway in the financing of the imports needed during the execution of the program of actions, objectives, and policies designed to improve the efficiency of the public and financial sector (the Program) referred to in the Development Credit Agreement (Credit No. 1941 MAG) dated July 18, 1988, between the Democratic Republic of Madagascar and the Association; WHEREAS the Association has extended a Credit for the Project on the terms and conditions set forth in the above-mentioned Development Credit Agreement, and Norway has authorized the Administrator to extend to Madagascar for the same purpose a grant out of Norway's development aid funds (the Grant) to assist Madagascar on the terms and conditions hereinafter set forth; WHEREAS by an agreement, dated December 15, 1988, between Norway and the Association (the Administration Agreement), Norway has requested the Association, and the Association has accepted, to administer the Grant in Page 2 accordance with the provisions of that agreement; WHEREAS Madagascar acknowledges that the financial assistance extended to Madagascar under this Agreement shall be considered as part of the bilateral development aid extended by Norway to Madagascar; and WHEREAS the Administrator has agreed, on the basis, inter alia, of the foregoing, to extend the Grant to Madagascar in support of the Project, upon the terms and conditions set forth in this Agreement; NOW THEREFORE the parties hereto hereby agree as follows. ARTICLE I General Conditions; Definitions Section 1.01. The General Conditions Applicable to Development Credit Agreements of the Association, dated January 1, 1985, with the modifications set forth below (the General Conditions) constitute an integral part of this Agreement: (a) the term "Association", whenever used in the General Conditions, means the International Development Association acting as Administrator of the Grant pursuant to the Administration Agreement, except in the provisions "member(s) of the Association" occurring in Sections 2.01 (5), 4.02 (b) and 6.02 (e); (b) the term "Borrower", whenever used in the General Conditions, means Madagascar; (c) the term 'Development Credit Agreement", whenever used in the General Conditions, means this Agreement; (d) the term "Credit", whenever used in the General Conditions, means the Grant extended to Madagascar under this Agreement; (e) the term "Credit Account", whenever used in the General Conditions, means the T-Account opened by the Administrator in its books in the name of Madagascar to which the amount of the Norwegian Grant is credited; (f) Section 2.01, paragraph 9, shall be modified to read: "'Project' means the imports and other activities that may be financed out of the proceeds of the Credit pursuant to the provisions of Schedule 1 to the Development Credit Agreement."; (g) in Section 6.02 the term "Association" shall also include the International Development Association acting in its own capacity; (h) Section 9.06 (c) shall be modified to read: "(c) 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 of the Program referred to in the Preamble to the Development Credit Agreement, the performance by the Borrower and the Page 3 Association of their respective obligations under the Development Credit Agreement and the accomplishment of the purposes of the Credit."; (i) in Section 9.06 (c) the term "Closing Date" means the closing date set forth in Section 2.03 of the Development Credit Agreement; and (j) Sections 3,02, 3.03, 3.04, 3.05, 4.01, 4.02, 4.03, 4.04, 4.06, 6.05, 7.01, 8.01 (a), 12.02, and 12.05 are deleted. Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions, in the Preamble to this Agreement and in the Development Credit Agreement have the respective meanings therein set forth and the following additional terms have the following meanings:. (a) "Development Credit Agreement" means the agreement, dated July 18, 1988, between the Democratic Republic of Madagascar and the Association for the Project, as such agreement may be amended from time to time; and such term includes the "General Conditions Applicable to Development Credit Agreements" of the Association, dated January 1, 1985, as applied to such agreement, and all schedules and agreements supplemental to the Development Credit Agreement; and (b) "Norwegian Kroner" and "NOK" mean the currency of Norway. Section 1.03. In all Articles and Sections of the Development Credit Agreement explicitly incorporated into this Agreement, the references to the "Borrower", the "Association", the "Credit", the "Credit Account", and the "Special Account" shall be deemed to be references to Madagascar, the Administrator, the Grant, and the T- Account. ARTICLE II The Grant Section 2.01. The Administrator agrees to extend to Madagascar, on the terms and conditions herein set forth or referred to, a grant in an amount of twenty million Norwegian Kroner (NOK 20,000,000), or such other amount as shall have been made available by Norway to the Administrator for this purpose pursuant to the Administration Agreement. Section 2.02. The amount of the Grant may be withdrawn from the T-Account for expenditures made (or if the Administrator shall so agree, to be made) in respect of the reasonable cost of the services required for the Project in accordance with the provisions of Schedule 1 of the Development Credit Agreement, provided however that paragraphs 2 (h) and 3 of Schedule 1 of the Development Credit Agreement shall not apply and that no withdrawals shall be made in respect of foodstuffs and petroleum products. ARTICLE III Execution of the Project; Other Covenants Section 3.01. Article III and Section 4.01 of the Development Credit Agreement are hereby incorporated into this Agreement with the same force and effect as if they were fully set forth herein. Page 4 ARTICLE IV Effectiveness; Termination; Transfer of Rights and Obligations Section 4.01. This Agreement shall become effective as of the date first above written and shall continue in effect until the Norwegian Grant has been fully disbursed and the parties to this Agreement have fulfilled their obligations under this Agreement. Section 4.02. This Agreement and all obligations of the parties thereunder shall terminate on the date, following the final disbursement under this Agreement, on which Madagascar shall have fulfilled all its obligations under this Agreement. Section 4.03. In accordance with the Administration Agreement, the rights and obligations of the Administrator under this Agreement may be transferred to Norway. Madagascar accepts and agrees that, upon notice by the Administrator to Madagascar to that effect, Norway shall, ipso facto, from the date specified in such notice, be substituted in all rights and obligations of the Administrator under this Agreement as if Norway has been an original party to this Agreement, without any further action or formality required on the part of any party, and from such date the Administrator shall cease to have any rights or obligations as a party under this Agreement. ARTICLE V Representative of Madagascar; Addresses Section 5.01. The Minister of Madagascar responsible for Finance is designated as representative of Madagascar for the purpose of Section 11.03 of the General Conditions. Section 5.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For Madagascar: Ministere aupres de la Presidence de la Republique charge des Finances et de l'Economie Antananarivo Madagascar Cable address: Telex: MINFIN 224889 Antananarivo For the Administrator: 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 Page 5 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. DEMOCRATIC REPUBLIC OF MADAGASCAR By /s/ Jean Rene Tsiangalara Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of development aid funds provided by The Kingdom of Norway By /s/ Paul Isenman Acting Regional Vice President Africa