Conformed Copy - L3250 - Rural Development Investment Project - Amendment

Page 1 August 8, 1996 Mr. Jose Antonio Ocampo Minister of Finance and Public Credit Ministry of Finance and Public Credit Carrera 7A, No. 645 Santafe de Bogota, Colombia Re: COLOMBIA: Loan 3250-CO (Rural Development Investment Project) Amendment to the Loan Agreement This is in connection with the Loan Agreement for the above Project between Republic of Colombia (the Borrower) and the Bank, and the Project Agreement, also for the above, between the Bank and Fondo DRI, both dated September 14, 1990 and as amended up to the date herewith. More specifically, we are responding to the letter from Fondo DRI's Director General dated July 5, 1996. We are pleased to tell you that we agree to said Director General's requests, as follows: Firstly, and relying upon the statements and representations made by said Director General in the aforesaid letter, particularly in respect of the Eligible Subprojects (for each of which a Contrato de Cofinancion will eventually be entered into) listed in Annex 4 to said letter and in respect of the information contained in Annex 5 to said letter, the condition stated in our telex dated December 22, 1995 in connection with disbursements of Loan proceeds under Category 1 of the table in paragraph 1 of Schedule 1 to the Loan Agreement, is hereby modified as follows: the Bank will honor new commitments under the said Category for any such Contrato, only if the Contrato in question has been signed on or before December 31, 1995 or if the Contrato in question, having been signed thereafter, is for one of the 587 Eligible Subprojects listed in the aforesaid Annex 4 to the July 5, 1996 letter. Secondly, and in order to make possible the full disbursement of the Loan proceeds by the Closing Date, or close thereto, the following amendments are made in the table set forth in paragraph 1 of Schedule 1 to the Loan Agreement (the Disbursement Table): (i) the disbursement percentage for Category 2 of said table is hereby increased from 70 to 95 in respect of payments made for local expenditures after June 1, 1996; and (ii) (A) the amount in Category 3, Unallocated, is hereby reallocated to Category 1; (B) the amount of Loan proceeds allocated to Category 2 (a) is reduced to $70,397.00; and (C) the corresponding amount for Category 1 is hereby increased to $67,929,603.00. Please date and sign, on behalf of the Borrower, the form of agreement hereto attached and return it to the Bank's office in Bogota. This letter will become effective on the date herewith, except for its portion related to the amendment of the Disbursement Table which shall become effective, retroactively to June 1, 1996, upon receipt of your notice informing the Bank of the signing and delivery to the said Bank office of the aforesaid form of agreement. In view of his interest in this matter we are also sending a copy of this letter to the Director General of Fondo DRI. Very truly yours, By /s/ Peter Ludwig Acting Director Country Department III Page 2 Latin America and the Caribbean Region AGREED: REPUBLIC OF COLOMBIA By /s/ Jose Antonio Oacmpo Gaviria Authorized Representative Date: September 19, 1996