Conformed Copy - C2618 - Basic Education Sector Project - Belgian Grant Agreement

Page 1 TF NUMBER 20816 AGREEMENT RELATED TO CREDIT NUMBER 2618 NIR Belgian Grant Agreement (Basic Education Sector Project/Hybrid) between THE REPUBLIC OF NIGER and INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of development aid funds provided by the Royal Ministry of Foreign Affairs, Trade and Development Cooperation of the Kingdom of Belgium Dated July 5, 1996 TF NUMBER 20816 AGREEMENT RELATED TO CREDIT NUMBER 2618 NIR BELGIAN GRANT AGREEMENT AGREEMENT, dated July 5, 1996, between THE REPUBLIC OF NIGER (the Grantee) and INTERNATIONAL DEVELOPMENT ASSOCIATION ( the Association) acting as Administrator (the Administrator) of the Belgian Grant (as hereinafter defined) provided by the Royal Ministry of Foreign Affairs, Trade and Development Cooperation of the Kingdom of Belgium ("Belgium"). WHEREAS (A) the Grantee has requested the assistance of the Association and Belgium in the financing of its Basic Education Sector Project/Hybrid as fully described in Schedule 2 to the Development Credit Agreement dated July 11, 1994, between the Grantee and the Association (the Development Credit Agreement), (the "Project"); (B) Belgium has agreed to make available a grant (the "Belgian Grant") through the Administrator to the Grantee to assist in the financing part of the Project, as described in Part A.(a) of Schedule 2 to the Development Credit Agreement, on the terms and conditions hereinafter set forth; (C) by a letter agreement, dated October 13, 1995, (the Agreement) between Belgium and the Association, the Association has agreed to administer the Belgian Grant in accordance with the provisions of said Agreement; (D) the Grantee acknowledges that the financial assistance extended to the Grantee under this agreement (the "Belgian Grant Agreement") shall be considered as part of the bilateral development aid extended by Belgium to the Grantee; and (E) the Administrator has agreed on the basis, inter alia, of the foregoing to extend the Belgian Grant to the Grantee upon the terms and Page 2 conditions set forth in this Agreement. NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. (a) The following provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated January 1, 1985, (the General Conditions) with the modifications set forth below, 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 Belgian Grant, except in the phrase "member of the Association" in Section 2.01 (5), 4.02 (b) and 6.02 (e) thereof; (b) the terms "Development Credit Agreement", and "Credit", whenever used in the General Conditions, mean "Belgian Grant Agreement", and "Belgian Grant" respectively; (c) 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 Belgian Grant is credited (the "Trust Account"); (d) Sections 3.02, 3.03, 3.04, 3.05, 4.02, 4.03, 4.06, 6.05, 7.01, 8.01 (a), the second sentence of Section 5.01 and Article XII are deleted; (e) in Section 6.02, the term "Association" shall also include the International Development 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, the performance by the Grantee and the Administrator of their respective obligations under the Belgian Grant Agreement and the accomplishment of the purposes of the Belgian Grant."; Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions, in the 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) the term "CFAF" means the currency of the Grantee; (b) the term "Belgian Franc" means the currency of Belgium; and (c) the term "Special Account" means the account referred to in Section 2.02 (c) of this Agreement. ARTICLE II The Grant Section 2.01. The Administrator agrees to make available to the Grantee, on the terms and conditions set forth or referred to in this Agreement, an amount in various currencies equivalent to one hundred million Belgian Francs (BF 100,000,000) or such other amount as shall have been made available by Belgium to the Administrator for this purpose, pursuant to the Agreement. Section 2.02. (a) The amount of the Belgian Grant may be withdrawn from the Trust Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by Page 3 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 and services 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 and services or in the importation, manufacture, procurement or supply thereof. (c) The Grantee shall, for the purposes of the Project, open and maintain in CFA Francs a special account (the "Special Account") in a commercial bank on terms and conditions satisfactory to the Administrator. Deposits into, and payments out of, the Special Account shall be made in accordance with the provisions of Schedule 2 to this Agreement. Section 2.03. (a) Consultants and experts acceptable to the Administrator shall be employed by the Grantee on terms and conditions satisfactory to the Administrator for the provision of services to be financed out of the proceeds of the Belgian Grant. Such consultants and experts shall be selected in accordance with the same procedures as those described in Schedule 3, Section II to the Development Credit Agreement. No substitution of such consultants and experts or modifi- cation of the terms and conditions of their employment shall be made, except with the prior consent of the Administrator. (b) Except as the Administrator shall otherwise agree, goods and works required for the project, and to be financed out of the proceeds of the Belgian Grant shall be procured under contracts awarded in accordance with the same procedures mentioned in the preceding para- graph; it being understood that the references in said Schedule to the Association and the Credit Account shall be deemed to be references to the Administrator of the Belgian Grant and the Belgian Grant Account respectively. (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 Belgian 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 Belgian 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 Belgian Grant. Section 2.04. The Closing Date shall be December 31, 2000, 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 Part A.(a) of the Project, with due diligence and efficiency, and in conformity with appropriate administrative, financial, public works and environmental practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for this part of the Project. (b) The Administrator may at any time suspend the right of the Grantee to receive funds from the Belgium Grant account if the Asso- ciation shall have suspended in whole or in part the right of the Grantee to make withdrawals under the Development Credit Agreement, or if the Grantee shall have failed to perform any of its obligations under the Agreement. ARTICLE IV Financial Covenants Section 4.01. (a) The Grantee shall maintain, or cause to be Page 4 maintained, records and accounts adequate to reflect, in accordance with consistently maintained sound accounting practices, the expendi- tures financed out of the proceeds of the Belgian Grant. (b) The Grantee shall: (i) have the records and accounts referred to in paragraph (a) of this Section, including those for the Special Account, audited for each fiscal year, 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, the report, or a certified copy of the report, of such audit by said auditors, of 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 report 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 including 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 Effective Date; Termination; Representative Section 5.01. This Agreement shall become effective as of the date first above written or the date of the Agreement, whichever is the later, and shall continue in effect until the Belgian Grant has been fully disbursed and the parties to this Agreement have fulfilled their obli- gations under this Agreement. Section 5.02. This Agreement and all obligations of the Grantee and the Administrator hereunder shall terminate on the date of which the Development Credit Agreement shall terminate in accordance with its terms. Section 5.03. The representative designated in Section 7.01 of the Development Credit Agreement shall be the representative of the Grantee for the purposes of section 11.03 of the General Conditions. Section 5.04. The addresses specified in section 7.02 of the Development Credit Agreement shall be the addresses specified for the' purpose of section 11.01 of the General Conditions. Page 5 Section 5.05. In the event that Belgium or the Association decide to terminate the functions of the Association as Administrator pursuant to the Agreement, the Administrator shall notify the Grantee promptly of the date on which Belgium shall assume the rights and obligations of the Administrator under this Agreement. ARTICLE VI Transfer of Rights and Obligations Section 6.01. In accordance with the provisions of the Agreement, the rights and obligations of the Administrator under this Agreement may be transferred to Belgium. The Grantee accepts and agrees that, upon notice by the Administrator to the Grantee to that effect, Belgium 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 Belgium had 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. 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. REPUBLIC OF NIGER By /s/ Amadou Seidou Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator of the Belgian Grant By /s/ Callisto E. Madavo Regional Vice President Africa SCHEDULE 1 Withdrawal of the Proceeds of the Grant 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Grant, the allocation of the amounts of the Grant to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the % of Grant Allocated Expenditures Category (Expressed in BF) to be financed (1) Civil works 82,800,000 100% (2) Equipment and Furniture 17,200,000 100% ___________ 100,000,000 =========== SCHEDULE 2 Page 6 Special Account 1. For the purposes of this Schedule: (a) the term "Category" means Categories (1) and (2) 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 to be financed out of the proceeds of the Grant; and (c) the term "Authorized Allocation" means an amount equivalent to FCFA 100,000,000 to be withdrawn from the Trust Account and deposited into the Special Account pursuant to paragraph 3 (a) of this Schedule. 2. Except as the Administrator shall otherwise agree, payments out of the Special Account shall be made exclusively for Eligible Expenditures in accordance with the provisions of this Schedule. 3. After the Administrator has received evidence satisfactory to the Administrator that the Special Account has been duly opened, withdrawals of the Authorized Allocation and subsequent withdrawals to replenish the Special Account may be made as follows: (a) On the basis of a request or requests by the Grantee for a deposit or deposits which add up to the aggregate amount of the Authorized Allocation, the Administrator shall, on behalf of the Grantee, deposit into the Special Account such amount or amounts out of the proceeds of the Grant as the Grantee shall have requested. (b) The Grantee shall furnish to the Administrator requests for replenishment of the Special Account at such intervals as the Administrator shall specify. On the basis of such requests, the Administrator shall deposit into the Special Account such amounts out of the proceeds of the Grant 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. Each such deposit shall be made by the Administrator in the respective equivalent amount, as shall have been justified by the evidence supporting the request for such deposit furnished pursuant to paragraph 4 of this Schedule. 4. For each payment made by the Grantee out of the Special Account for which the Grantee requests replenishment pursuant to paragraph 3 (b) of this Schedule, the Grantee shall furnish to the Administrator, prior to or at the time of such request, such documents and other evidence as the Administrator shall reasonably request, showing that such payment was made for Eligible Expenditures. 5. (a) Notwithstanding the provisions of paragraph 3 of this Schedule, no further deposit into the Special Account shall be made by the Administrator when either of the following situations first arises: (i) the Administrator shall have determined that all further withdrawals of the Grant proceeds should be made directly to the Grantee; or (ii) the total unwithdrawn amount of the Grant shall be equal to the equivalent of twice the amount of the Authorized Allocation. (b) Thereafter, withdrawals of the Grant proceeds remaining unwith- drawn shall follow such procedures as the Administrator shall specify by notice to the Grantee. Such further withdrawals shall be made only after and to the extent that the Administrator 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 Administrator shall have determined at any time that 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 Page 7 4 of this Schedule, the Grantee shall, promptly upon notice from the Administrator, deposit into the Special Account (or, if the Administrator shall so request, refund to the Administrator) an amount equal to the amount of such payment or the portion thereof not so eligible or justified. No further deposit by the Administrator into the Special Account shall be made until the Grantee has made such deposit or refund. 7. If the Administrator shall have determined at any time that any amount outstanding in the Special Account will not be required to cover further payments for Eligible Expenditures, the Grantee shall, promptly upon notice from the Administrator, refund to the Administrator such outstanding amount which will be added to the unwithdrawn amount of the Grant.