Conformed Copy - L4350 - Hunan Power Development Project - Amendment 1

Page 1 April 3, 2001 Ms Zou Jiayi Acting Director-General International Department Ministry of Finance San Li He Beijing 100820 People's Republic of China Dear Ms. Zou: Re: Loan No. 4350-CHA (Hunan Power Development Project) Cancellation and Amendment to the Loan Agreement I refer to the Loan Agreement between the People's Republic of China (the Borrower) and International Bank for Reconstruction and Development (the Bank), dated June 7, 1999 (the Loan Agreement). Pursuant to your communication dated February 21, 2001, and in accordance with Section 6.01 of the General Conditions, the Bank hereby cancels, as of February 21, 2001, the amount of $100,000,000 from the Loan. The commitment charges on such amount cease to accrue from February 21, 2001. Enclosed herewith is a revised schedule which indicates the amounts now allocated to each of the categories set forth in the table in paragraph 1 of Schedule 1 to the Loan Agreement. Schedule 3 to the Loan Agreement, the amortization schedule, is being revised by the Bank as a result of the cancellation and the revised figures will be sent to you shortly. Moreover, to reflect the above cancellation, paragraph 1(c) of Schedule 4 to the Loan Agreement is hereby amended as follows: "(c) the term 'Authorized Allocation' means an amount equivalent to $14,000,000 to be withdrawn from the Loan Account and deposited into the Special Account pursuant to paragraph 3 (a) of this Schedule, provided, however, that unless the Bank shall otherwise agree, the Authorized Allocation shall be limited to an amount equivalent to $8,000,000 until the aggregate amount of withdrawals from the Loan Account plus the total amount of all outstanding special commitments entered into by the Bank pursuant to Section 5.02 of the General Conditions shall be equal to or exceed the equivalent of $80,000,000." Except as specifically amended hereby, all other provisions of the Loan Agreement otherwise remain in full force and effect. Please confirm the agreement of the Borrower to the amendment set forth in the paragraph above by countersigning and dating the corresponding form of confirmation set forth below, and returning one fully signed original of this letter of amendment to us. One fully signed original should be retained by the Borrower. Upon receipt by the Bank of the copy of this letter of amendment duly countersigned by the authorized representative of the Borrower, the above amendment shall become effective as of the date of countersignature of this letter of amendment. Sincerely, By /s/ Yukon Huang Country Director, China East Asia and Pacific Region CONFIRMED Page 2 PEOPLE'S REPUBLIC OF CHINA By /s/ Zou Jiayi Authorized Representative Acting Director-General, International Department, Ministry of Finance Date: April 25, 2001