Conformed Copy - C2281 - Structural Adjustment Credit - Norwegian Grant Agreement

Page 1 CONFORMED COPY AGREEMENT RELATED TO CREDIT NUMBER 2281 BUR Norwegian Grant Agreement (Structural Adjustment Credit) between BURKINA FASO and INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of development aid funds provided by the Royal Ministry of Foreign Affairs of the Kingdom of Norway Dated August 22, 1994 AGREEMENT RELATED TO CREDIT NUMBER 2281 BUR NORWEGIAN GRANT AGREEMENT AGREEMENT, dated August 22, 1994, between BURKINA FASO (the "Grantee") and INTERNATIONAL DEVELOPMENT ASSOCIA-TION (the "Association") acting as Administrator (the "Administra-tor") of the Norwegian Grant (as hereinafter defined) provided by the Royal Ministry of Foreign Affairs of the Kingdom of Norway ("Norway"). WHEREAS: (A) the Grantee and the Association have entered into a Development Credit Agreement, dated July 5, 1991 (the "Develop-ment Credit Agreement"), whereby the Association has agreed to provide a credit to finance parts of the imports required during the execution of the Grantee's Structural Adjustment Program (the "Project"); (B) the Grantee has requested the assistance of Norway in the financing of parts of the Project; (C) Norway has agreed to make available a grant (the "Norwegian Grant") through the Administrator to the Grantee to assist in the financing of the Project, on the terms and conditions hereinafter set forth; (D) by an agreement between Norway and the Association (the "Administration Agreement"), Norway has requested the Association, and the Association has accepted, to administer the Norwegian Grant in accordance with the provisions of the Administration Agreement; (E) the Grantee acknowledges that the financial assistance extended to the Page 2 Grantee under this Agreement (the "Norwegian Grant Agreement") shall be considered as part of the bilateral development aid extended by Norway to the Grantee; and (F) the Administrator has agreed on the basis, inter alia, of the foregoing to extend the Norwegian Grant to the Grantee 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 Develop-ment Credit Agreements" of the Association, dated January 1, 1985 (the "General Conditions") constitute an integral part of this Agreement subject, however, to the following modifications thereof: (a) the term "Association", whenever used in the General Conditions, means the International Development Association acting as Administrator of the Norwegian Grant pursuant to the Cofinancing and Technical Assistance Framework Agreement dated March 9, 1994 (Framework Agreement), except in the phrase "member of the Association" in Sections 2.01 (5), 4.02 (b) and 6.02 (e); (b) the term "Development Credit Agreement", whenever used in the General Conditions, means the Norwegian Grant Agreement; (c) the term "Credit", whenever used in the General Conditions, means the Norwegian Grant; (d) the term "Credit Account", whenever used in the General Conditions, means the trust account opened by the Administrator in its books in the name of the Grantee to which the amount of the Norwegian Grant is credited (the "Trust Account"); (e) in Section 6.02 the term "Association" shall also include the Association acting in its own capacity; (f) 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 Grantee and the Administrator, the Grantee shall prepare and furnish to the Administrator a report of such scope and in such detail as the Administrator shall reasonably request, on the execution of the Project referred to in the Preamble to the Norwegian Grant Agreement, the performance by the Grantee and the Administrator of their respective obligations under the Norwegian Grant Agreement and the accomplishment of the purposes of the Norwegian Grant."; and (g) Sections 3.02, 3.03, 3.04, 3.05, 4.02, 4.03, 4.04, 4.06, 6.05, 7.01, 8.01 (a), and Article XII 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 Framework Agreement, and in the Preamble to this Agreement, have the respective meanings therein set forth, and the following additional terms have the following meanings: (a) "Norwegian Kroner" or "NOK" means the currency of Norway; and (b) "CFA Franc" or "CFAF" means the currency of the Grantee. ARTICLE II The Grant Section 2.01. The Administrator agrees to extend to the Grantee, on the terms and conditions herein set forth or referred to, a grant in an amount of thirteen million Norwegian Kroner (NOK 13,000,000) 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. (a) The amount of the Norwegian Grant may be withdrawn from the Page 3 Trust 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 Grantee and the Administrator for expenditures made (or, if the Administrator shall so agree, to be made) in respect of the reasonable cost of the goods required for the Project. (b) Notwithstanding the provisions of paragraph (a) above, no withdrawals shall be made in respect of payments for taxes levied by, or in the territory of, the Grantee on goods, or in the importation, manufacture, procurement or supply thereof. Section 2.03. (a) Goods to be financed out of the proceeds of the Norwegian Grant shall be procured under contracts awarded in accordance with procedures satisfactory to the Administrator on the basis of the "Guidelines for Procurement under IBRD Loans and IDA Credits" published by the Bank in May 1992, as amended by the provisions of Schedule 2 to the Development Credit Agreement referring to the Guidelines published in May 1985, mutatis mutandis; such Schedule to govern procurement procedures with the exception of the references to the Special Account therein. (b) In the procurement of goods in accordance with the Project, the Borrower shall use the relevant standard bidding documents issued by the Association, with such modifications thereto as the Association shall have agreed to be necessary for the purposes of the Project. Where no relevant standard bidding documents have been issued by the Association, the Borrower shall use bidding documents based on other internationally recognized standard forms agreed with the Association. (c) If the Administrator shall have reasonably determined that the procurement of any item is inconsistent with the procedures set forth or referred to in paragraphs (a) and (b) above, no expenditures for such item shall be financed out of the proceeds of the Norwegian Grant, and the Administrator may, without in any way restricting or limiting any other right, power or remedy of the Administrator under this Agreement, by notice to the Grantee, cancel such amount of the Norwegian Grant as, in the Administrator's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Norwegian Grant. Section 2.04. The Closing Date shall be June 30, 1995 or such later date as the Administrator shall establish. The Administrator shall promptly notify the Grantee of such later date. ARTICLE III Execution of the Project Section 3.01. (a) The Grantee declares its commitment to the objectives of the Project and, to this end, shall carry out the Project through the Ministry of Finance and Planning, with due diligence and efficiency and in conformity with appropriate administrative, financial and environmental practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) BCEAO is designated as a representative of the Grantee for the purposes of taking any action required or permitted to be taken under the provisions of Section 2.02 of this Norwegian Grant Agreement and Article V of the General Conditions. ARTICLE IV Financial Covenants Section 4.01. (a) The Grantee shall maintain or cause to be maintained records and accounts adequate to reflect in accordance with sound accounting practices the operations, resources and expenditures in respect of the Project of the departments or agencies of the Grantee responsible for carrying out the Project or any part thereof. (b) The Grantee shall: (i) have the records and accounts referred to in paragraph (a) of this Section for each fiscal year audited, in accordance with appropriate auditing principles consistently applied by independent auditors acceptable to the Administrator; (ii) furnish to the Administrator 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 said auditors, of Page 4 such scope and in such detail as the Administrator shall have reasonably requested; and (iii) furnish to the Administrator such other information concerning said records, accounts and the audit thereof as the Administrator shall from time to time reasonably request. (c) For all expenditures with respect to which withdrawals from the Trust Account were made on the basis of statements of expenditure, the Grantee shall: (i) maintain or cause to be maintained, in accordance with paragraph (a) of this Section, records and accounts reflecting such expenditures; (ii) retain, until at least one year after the Administrator has received the audit for the fiscal year in which the last withdrawal from the Trust Account was made, all records (contracts, orders, invoices, bills, receipts and other documents) evidencing such expenditures; (iii) enable the Administrator's representatives to examine such records; and (iv) ensure that such records and accounts are included in the annual audit referred to in paragraph (b) of this Section and that the report of such audit contains a separate opinion by said auditors as to whether the statements of expenditure submitted during such fiscal year, together with the procedures and internal controls involved in their preparation, can be relied upon to support the related withdrawals. ARTICLE V Representative; Transfer of Rights and Obligations Section 5.01. The Minister of the Grantee responsible for Finances and Planning shall be the representative of the Grantee for the purposes 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 the Grantee: Minist