Conformed Copy - TF022095 - Social Protection and Social Housing Reform - ASEM Trust Fund Grant

Page 1 March 22, 1999 Mr. Edgardo Espiritu Secretary Department of Finance Manila Republic of the Philippines Re: ASEM Trust Fund Grant for Social Protection and Social Housing Reform Grant TF022095 Dear Sir: I am writing on behalf of the International Bank for Reconstruction and Development (the Bank) to indicate the Bank's agreement. as administrator of grant funds provided from the ASEM-EU Asian Financial Crisis Response Fund, to make a grant in an amount not exceeding nine hundred eighty thousand dollars ($980,000) (the Grant) to the Republic of the Philippines (the Recipient). The Grant is made in response to the Recipients request for financial assistance and for the purposes and on the terms and conditions set forth in the Annex to this Letter Agreement. The Recipient represents, by confirming its agreement below, that, it is authorized to contract and withdraw the Grant for the said purposes and on the said terms and conditions. Please confirm your agreement with the foregoing, on behalf of the Recipient, by signing, dating, and returning to us the enclosed copy of this Letter Agreement. Upon receipt by the Bank of the copy of this Letter Agreement countersigned by you, this Letter Agreement will become effective as of the date of the countersignature Very truly yours, INTERNATIONAL BANK FOR RE NSTRUCTION AND DEVELOPMENT By /s/ David Howarth Acting Country Director, Philippines East Asia and Pacific Region AGREED: REPUBLIC OF THE PHILIPPINES By /s/ Edgardo B. Espiritu Secretary of Finance Date: April 6, 1999 ANNEX Purposes, Terms, and Conditions of the Grant 1. Purposes and Activities. 1.1. 1.1. The purpose of the Grant is to assist the Recipient in designing reforms in selected areas of the pension system and the low-income housing sector. The activities (the Activities) for which the Grant is given are as follows: (a) Provision of advisory services concerning the reform of the retirement income system on: (i) the development of a framework for reforming the Recipient's retirement income system; (ii) the reform of defined-benefit pension plans for the Social Security System (SSS) and the Government Service Insurance System (GSIS}; and (iii) the formulation of mechanisms to improve the financial situations of the current SSS and GSIS pension plans; and Page 2 (b) Provision of advisory services on the design of tow-income housing programs including: (i) a pre-feasibility study for a home-ownership assistance program; (ii) a study on beneficiary-led housing system; and (iii) a study on rental housing. 2. Implementation Generally 2.1. The Recipient shall: (a) carry out the Activities with due diligence and efficiency; (b) promptly provide the funds, facilities, services and other resources required for that purpose; (e) furnish a!1 information covering the Activities and the use of the proceeds of the Grant as the Bank shall reasonably request; (d) from time to time exchange views with the Bank's representatives on the progress and results of the Activities; and (e) take all necessary measures required to enable the Bank to visit the territory of the Recipient for purposes related to the Grant. Without limitation on the foregoing, the Recipient shall, if the Bank shall so request, prepare and furnish to the Bank promptly upon completion of the Activities a report, in form and substance satisfactory to the Bank,- on the results and impact of the Activities 3. Procurement 3.1. Except as the Bank shall otherwise agree, procurement of the consultants' services required for the carrying out of the Activities and to be financed out of the proceeds of the Grant shall be governed by the provisions of Attachment I to this Annex. 4. Withdrawal of Grant Proceeds 4.1. The amount of the Grant shall be credited to an account opened by the Bank on its books in the name of the Recipient (the Grant Account), and may be withdrawn therefrom by the Recipient in accordance with the provisions of this Section 4, for expenditures in respect of the reasonable cost of services required for the Activities and to be financed out of the proceeds of the Grant. 4.2. The expenditures for the following items may be financed out of the proceeds of the Grant and shall be used exclusively in the carrying out of the Activities: Amount of the Grant Allocated % of (in United States Expenditures Item Dollars) be Financed (1) Consultants