Conformed Copy - C2163 - Agricultural Sector Project - Project Agreement

Page 1 CONFORMED COPY CREDIT NUMBER 2163 MLI (Agricultural Sector Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and COMPAGNIE MALIENNE POUR LE DEVELOPPEMENT DES TEXTILES Dated July 25, 1990 \0c CREDIT NUMBER 2163 MLI PROJECT AGREEMENT AGREEMENT, dated July 25, 1990, between INTERNATIONAL DEVELOPMENT ASSOCIATION (the "Association") and COMPAGNIE MALIENNE POUR LE DcVELOPPMENT DES TEXTILES ("CMDT"). WHEREAS (A) by the Development Credit Agreement of even date herewith between the Republic of Mali (the "Borrower") and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to forty million seven hundred thousand Special Drawing Rights (SDR 40,700,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that CMDT agree to undertake such obligations toward the Association as are set forth in this Agreement; (B) by a subsidiary grant agreement to be entered into between the Borrower and CMDT, part of the proceeds of the credit provided for under the Development Credit Agreement will be made available to CMDT on the terms and conditions set forth in said Page 2 Subsidiary Grant Agreement; and WHEREAS CMDT, in consideration of the Association'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, the Preamble to this Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth and the term "Fiscal Year" means CMDT's fiscal year which runs from October 1 to September 30. ARTICLE II Execution of the Project Section 2.01. CMDT 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 out Parts A and B of the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and agricultural practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for Parts A and B of the Project. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods, works and consultants' services required for Parts A and B of the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of the Schedule to this Agreement. Section 2.03. CMDT 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 Parts A and B of the Project. Section 2.04. CMDT shall duly perform all its obligations under the Subsidiary Grant Agreement and the CMDT Contract-Plan. Except as the Association shall otherwise agree, CMDT shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Grant Agreement, the CMDT Contract-Plan or any provision thereof. Section 2.05. (a) CMDT shall, at the request of the Association, exchange views with the Association with regard to the progress of the Project, the performance of its obligations under this Agreement and under the Subsidiary Grant Agreement, and other matters relating to the purposes of the Credit. (b) CMDT 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 CMDT of its obligations under this Agreement and under the Subsidiary Grant Agreement. (c) CMDT shall, not later than June 30 of each year the Project is being implemented, furnish the following documentation satisfactory to the Association: (i) the revised five-year rolling Rural Development Program of Mali-Sud; and (ii) the draft budget for Rural Development for the Page 3 next following fiscal year. ARTICLE III Management and Operations of CMDT Section 3.01. CMDT shall carry on its operations and conduct its affairs in accordance with sound administrative, financial and agricultural practices under the supervision of qualified and experienced management assisted by competent staff in adequate numbers. Section 3.02. CMDT shall at all times operate and maintain its plant, machinery, equipment and other property, and from time to time, promptly as needed, make all necessary repairs and renewals thereof, all in accordance with sound engineering, financial and agricultural practices. Section 3.03. CMDT shall take out and maintain with responsible insurers insurance against such risks and in such amounts as shall be consistent with appropriate practice. ARTICLE IV Financial Covenants Section 4.01. (a) CMDT shall maintain records and accounts adequate to reflect in accordance with sound accounting practices its operations and financial condition. (b) CMDT shall: (i) have its records, accounts and financial statements (balance sheets, statements of income and expenses and related statements) 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 shall have reasonably requested; and (iii) furnish to the Association such other information concerning said records, accounts and financial statements as well as the audit thereof, as the Association shall from time to time reasonably request. 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 CMDT 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 (20) years after the date of this Page 4 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 CMDT of this event. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. \0c 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 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 197688 (ITT) Washington, D.C. 248423 (RCA) 64145 (WUI) or 82987 (FTCC) For CMDT: Compagnie Malienne pour le Developpement des Textiles B.P. 487 Bamako, Republic of Mali Cable address: Telex: CIMATEX 972554 Bamako 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 CMDT may be taken or executed by the Board of Directors' Chairman of CMDT or such other person or persons as the Board of Directors' Chairman of CMDT shall designate in writing, and CMDT shall furnish to the Association 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 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 Page 5 By /s/ Edward V.K. Jaycox Regional Vice President Africa COMPAGNIE MALIENNE POUR LE DEVELOPPEMENT DES TEXTILES By /s/ Sekouba Cisse Authorized Representative \0c SCHEDULE Procurement and Consultants' Services Section I: Procurement of Goods and Works for Categories (1), (2), (4) and (5) (b) of paragraph 1 of Schedule 1 to the Development Credit Agreement Part A: International Competitive Bidding 1. Except as provided in Part D 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 May 1985 (the "Guidelines"). 2. To the extent practicable, contracts for goods and works shall be grouped in bid packages estimated to cost the equivalent of $100,000 or more each. Part B: Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A.1 hereof, goods manufactured in the Borrower's territory 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. Part C: Preference for Domestic Contractors In the procurement of works in accordance with the procedures described in Part A.1 hereof, CMDT may grant a margin of preference to domestic contractors in accordance with, and subject to, the provisions of paragraphs 2.55 and 2.56 of the Guidelines and paragraph 5 of Appendix 2 thereto. Part D: Other Procurement Procedures 1. Civil works and items estimated to cost less than the equivalent of $100,000 per contract, up to an aggregate amount not to exceed the equivalent of $200,000, may be procured under contracts awarded on the basis of competitive bidding, advertised locally, in accordance with procedures satisfactory to the Association. 2. Civil works and items estimated to cost less than the equivalent of $20,000 per contract, up to an aggregate amount not to exceed the equivalent of $500,000, may be procured under contracts awarded on the basis of comparison of price quotations solicited from a list of at least three suppliers eligible under the Guidelines, in accordance with procedures acceptable to the Association. Part E: Review by the Association of Procurement Decisions. 1. (a) With respect to each contract estimated to cost the Page 6 equivalent of $100,000 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 to the Association 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 to the Development Credit Agreement. (c) The provisions of the preceding subparagraph (b) shall not apply to contracts on account of which the Bank has authorized withdrawals on the basis of statements of expenditure. 2. The figure of 20% is hereby specified for purposes of para- graph 4 of Appendix 1 to the Guidelines. Section II: Employment of Consultants for Categories (3) and 5 (b) of paragraph 1 of Schedule 1 to the Development Credit Agreement 1. In order to carry out Parts A and B of the Project, CMDT shall employ consultants and experts whose qualifications, experience and terms and conditions of employment shall be satisfactory 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. 2. Without limitation on the generality of paragraph 1 of this Section, in order to implement Parts A.4 and B.6 of the Project, CMDT shall, no later than December 31, 1990, retain consultants to be responsible for the carrying out of rural road studies and for the supervision of rural road civil works.