Conformed Copy - L4254 - Rural Water Supply and Sanitation Project - Supplemental Letter 1

Page 1 KINGDOM OF MOROCCO October 5, 1998 International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, DC 20433 United States of America Re: Loan No. 4254-MOR (Rural Water Supply and Sanitation Project) Performance Indicators (Schedule 5 of the Loan Agreement) Dear Sirs and Mesdames: We refer to the Implementation Program contained in Schedule 5 of the Loan Agreement of even date between International Bank for Reconstruction and Development (The Bank) and the Borrower to measure the degree to which the Project objectives are being achieved. We hereby confirm that the key performance indicators shall consist of the following: 1. Implementation of key social and development programs such as the national water program (PAGER) shall be accelerated to achieve at least a coverage of: - 200,000 rural inhabitants, after 1 year of Project execution; and - 350,000 rural inhabitants, 1 year after the second year of Project execution. 2. It is planned that upon its completion, the Project will contribute to significantly reduce the risks of hydric diseases in the Project area. 3. The Government is committed to extend the global reach of potable rural water supply to at least 50% of the rural population by mid-2007. Very truly yours, KINGDOM OF MOROCCO By /s/ Fathallah Oualalou Authorized Representative CONFIRMED AND AGREED INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s/ Kemal Dervis Regional Vice President Middle East and North Africa Page 2