Niger - Agricultural Credit Project : Credit 0207 - Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 207 NIR Development Credit Agreement (Agricultural Credit Project) BETWEEN REPUBLIC OF NIGER AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JUNE 29, 1970 CONFORMED COPY CREDIT NUMBER 207 NIR Development Credit Agreement (Agricultural Credit Project) BETWEEN REPUBLIC OF NIGER AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JUNE 29, 1970 AGREEMENT, dated June 29, 1970 between the REPUBLIC OF NIGER (hereinafter called the Borrower) and INTERNA- TIONAL DEVELOPMENT AsSocIATON (hereinafter called the Association). WHEREAS the Borrower has requested the Association to assist in the financing of a program for the improvement of agricultural productivity; WHEREAS the Caisse Nationale de Credit Agricole (here- inafter called CNCA) and the Union Nigerienne de Credit et de Cooperation (hereinafter called UNCC) will carry out parts of the Project described in Schedule 1 to this Agree- ment, as hereinafter set forth, and the Borrower will make available to CNCA and to UNCC, for the purposes of carrying out such parts of the Project, parts of the pro- ceeds of the development credit provided for herein; and WHEREAS the Association is willing to make a develop- ment credit available to the Borrower inter alia on the terms and conditions provided herein and in a project agreement of even date herewith among the Association, CNCA and UNCC; Now THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions SECTION 1.01. The Borrower and the Association accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated January 31, 1969, with the same force and effect as if they were fully set forth herein, subject, however, to the follow- ing modifications thereof (said General Conditions Appli- 4 cable to Development Credit Agreements of the Associa- tion, as so modified, being hereinafter called the General Conditions) : Sections 6.06 and 8.02 of the General Conditions are amended by inserting the words ", the Project Agree- ment" after the words "the Development Credit Agreement". SECTION 1.02. Wherever used in the Development Credit Agreement, unless the context otherwise requires, the sev- eral terms defined in the General Conditions have the re- spective meanings therein set forth and the following addi- tional terms have the following meanings: (a) "CNCA" means the Caisse Nationale de Credit Agricole of Niger, an etablissement public a caractere in- dustriel et commercial of the Borrower, established by Law No. 67-32 dated September 20, 1967, whose Statuts are set out in Decree No. 68-57 dated April 8, 1968. (b) "UNCC" means the Union Nig'rienne de Credit et de Cooperation, an 6tablissement public a caractere ad- ministratif of the Borrower, established by Law No. 67-32 dated September 20, 1967, whose Statuts are set out in Decree No. 68-56 dated April 8, 1968. (c) "Project Agreement" means the agreement of even date herewith among the Association, CNCA and UNCC, providing inter alia for the carrying out of Parts I and III of the Project by CNCA and of Part II of the Project by UNCC, and shall include any amendments thereof or sup- plements thereto agreed from time to time among the Bor- rower, the Association, CNCA and UNCC. (d) "Project Coordinating Committee" means the com- mittee referred to in Section 4.05 of this Agreement. (e) "CFDT1" means the Compagnie Frangaise pour le Developpement des Fibres Textiles, a societe frangaise a but non lucratif. 5 (f) "GMV" means Groupenent Mutualiste Villageois, one of the groupements mutualistes villageois of Niger, local associations of heads of rural families created to undertake common development activities and able to take part in the development cooperatives. (g) "IRAT" means the Institut de Recherches Agro- nomiques Tropicales et de Cultures Vivri'res, a bureau d'etudes frangaise a but non lucratif. (h) "Short-term loans" means loans or credits with maturities of not more than one year. (i) "Medium-term loans" means loans or credits with maturities in excess of one year, but does not include loans or credits with maturities of more than five years. ARTICLE II The Credit SECTION 2.01. The Association agrees to lend to the Bor- rower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equivalent to five hundred and eighty- four thousand dollars ($584,000). SECTION 2.02. (a) The Association shall open a Credit Account on its books in the name of the Borrower and shall credit to such account the amount of the Credit. (b) The amount of the Credit may be withdrawn from the Credit Account as provided in, and subject to the rights of cancellation and suspension set forth in, the Develop- ment Credit Agreement and in accordance with the allo- cation of the proceeds of the Credit set forth in Schedule 2 to this Agreement, as such allocation shall be modified from time to time pursuant to the provisions of such Sched- ule or by further agreement between the Borrower and the Association. SECTION 2.03. The Borrower shall be entitled to with- draw from the Credit Account such amounts as shall have 6 been paid (or, if the Association shall so agree, as shall be required to meet payments to be made) in respect of the reasonable cost of goods or services required for the Project and to be financed under the Development Credit Agreement. SECTION 2.04. No withdrawals from the Credit Account shall be made: (i) under Categories I, II and IV of the allocation of the proceeds of the Credit referred to in Section 2.02 of this Agreement on account of payments for goods produced in, or services supplied from, the territory of the Borrower; or (ii) on account of payments for taxes imposed by the Borrower or any of its political subdivisions on, or in connection with the importation or supply of, goods or services for the Project. SECTION 2.05. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. SECTION 2.06. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one percent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. SECTION 2.07. Service charges shall be payable semi- annually on January 15 and July 15 in each year. SECTION 2.08. The Borrower shall repay the principal amount of the Credit withdrawn from the Credit Account in semi-annual installments payable on each January 15 and July 15 commencing July 15, 1980 and ending January 15, 2020, each installment to and including the installment payable on January 15, 1990 to be one-half of one percent (1/2 of 1%) of such principal amount, and each installment 7 thereafter to be one and one-half percent (11/ %) of such principal amount. ARTICLE III Use of Proceeds of the Credit SECTION 3.01. The Borrower shall cause the proceeds of the Credit to be applied in accordance with the provisions of the Development Credit Agreement and of the Project Agreement to expenditures on the Project, described in Schedule 1 to this Agreement. SECTION 3.02. Except as the Association shall otherwise agree, (i) the goods and services included in Categories I and II of the allocation of the proceeds of the Credit re- ferred to in Section 2.02 of this Agreement shall be pro- cured on the basis of international competitive bidding in accordance with the Guidelines for Procurement under World Bank Loans and IDA Credits, published by the Bank in February 1968, and in accordance with such other pro- cedures supplementary thereto as are set forth or referred to in Section 3.06 of the Project Agreement, or as shall be agreed upon among the Borrower, the Association, CNCA and UNCC; (ii) contracts for the procurement of such goods and services, as well as contracts for the procurement of services included in Category IV of said allocation of the proceeds of the Credit, shall be subject to the prior approval of the Association, and (iii) whenever a contract for the procurement of any goods or services to be financed in whole or in part out of the proceeds of the Credit is awarded to a supplier or consultant not registered in the territory of the Borrower, the Borrower shall facilitate the accomplishment by such supplier or consultant of all regu- latory formalities which may be required to enable it to carry out such contract. SECTIoN 3.03. Except as the Association may otherwise agree, the Borrower shall cause all goods and services 8 financed out of the proceeds of the Credit to be used exclu- sively in carrying out the Project. SECTION 3.04. Except as the Association shall otherwise agree, the Borrower shall make available to CNCA in the currency of the Borrower: (a) the amounts of the Credit which may be withdrawn from the Credit Account under Categories I and II of the allocation of the proceeds of the Credit referred to in Sec- tion 2.02 of this Agreement, or the equivalent thereof, in the form of equity capital of CNCA to be held by, or in the name of, the Borrower; and (b) in the form of a grant to CNCA, the amounts of the Credit which may be withdrawn from the Credit Account under Category IV of the said allocation of the proceeds of the Credit. SECTION 3.05. Except as the Association shall otherwise agree, the Borrower shall make available to UNCC, in the form of a grant, and in the currency of the Borrower, the amounts of the Credit which may be withdrawn from the Credit Account under Category III of the allocation of the proceeds of the Credit referred to in Section 2.02 of this Agreement. ARTICLE IV Particular Covenants SECTION 4.01. The Borrower shall cause CNCA to carry out Parts I and III of the Project, and shall cause UNCC to carry out Part II of the Project, all with due diligence and efficiency and in conformity with sound administra- tive, agricultural and financial practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. 9 SECTION 4.02. (a) The Borrower shall take all action which shall be necessary on its part to enable CNCA and UNCC to perform all of their respective obligations under the Project Agreement, and shall not take any action which would interfere with the performance by CNCA or UNOC, respectively, of such obligations. (b) Without limitation or restriction upon any of the provisions set forth in paragraph (a) of this Section, the Borrower shall at all times take all such action as will be necessary or appropriate to enable CNCA to earn, and shall not take any action which would prevent CNCA from earning, such revenues as will be sufficient for CNCA: (i) to cover all of CNCA's operating expenses (includ- ing taxes, if any); (ii) to meet all interest and other charges due by CNCA in respect of debts incurred by CNCA; (iii) to maintain adequate reserves for bad and doubtful debts; and (iv) to maintain adequate general reserves. SECTION 4.03. (a) The Borrower and the Association shall cooperate fully to assure that the purposes of the Credit will be accomplished. To that end, each of them shall furnish to the other all such information as it shall reason- ably request with regard to the general status of the Credit. On the part of the Borrower, such information shall include information with respect to financial and economic condi- tions in the territory of the Borrower and the international balance of payments position of the Borrower. (b) The Borrower and the Association shall from time to time, at the request of either party, exchange views through their representatives with regard to matters relat- ing to the purposes of the Credit, the maintenance of the service thereof, the performance by the Borrower of its obligations under the Development Credit Agreement. and 10 the performance by CNCA and by UNCC of their respec- tive obligations under the Project Agreement. (c) The Borrower shall promptly inform the Association of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Credit, the maintenance of the service thereof, the per- formance by the Borrower of its obligations under the Development Credit Agreement and the performance by CNCA and by UNCC of their respective obligations under the Project Agreement. (d) The Borrower shall afford all reasonable opportu- nity for accredited representatives of the Association to visit any part of the territory of the Borrower for purposes related to the Credit. SECTION 4.04. (a) The Borrower shall (i) maintain or cause to be maintained records adequate to identify the goods and services financed out of the proceeds of the Credit, to disclose the use thereof in the Project, to record the progress of the Project (including the cost thereof), and to reflect, in accordance with consistently maintained sound accounting practices the operations and financial con- dition of the agency or agencies of tile Borrower responsible for carrying out the Project or any part thereof; (ii) enable the Association's representatives to inspect the Project, the goods to be financed out of the proceeds of the Credit and any relevant records and documents; and (iii) furnish or cause to be furnished to the Association all such informa- tion as the Association shall reasonably request concerning the expenditure of the proceeds of the Credit, the Project, the goods and services to be financed out of the proceeds of the Credit, and the administration, operations and finan- cial condition of the agency or agencies of the Borrower responsible for carrying out the Project or any part thereof. (b) The Borrower shall furnish or cause to be furnished to the Association, promptly upon their preparation, the 11 reports, plans, specifications, contract documents and pro- curement schedules for the Project and any material modi- fications subsequently made therein, in such detail as the Association shall reasonably request. SECTION 4.05. (a) The Borrower shall establish, and thereafter maintain until completion of the Project, a proj- ect coordinating committee which shall (i) coordinate all aspects of the Project with the Borrower, CNCA, UNCC and all relevant ministries, agencies or instrumentalities of the Borrower, and (ii) seek close cooperation between the Borrower, CNCA, UNCC and all relevant ministries, agen- cies and instrumentalities of the Borrower on all matters related to the Project. (b) The Borrower shall appoint as members of the Project Coordinating Committee senior officials represent- ing its Ministries of Commerce and Industry, Finance, and Rural Economics, its Commissariat General au Developpe- ment, the Caisse de Stabilisation des Prix des Produits du Niger (CSPPN), the Societe Nigerienne de Comnercialisa- tion de l'Arachide (SONARA), the Directeur of CNCA, the Directeur of UNCC, as well as one member selected by CFDT. The Borrower shall appoint a chairman of the Project Coordinating Committee who shall have been ap- proved by the Association, and the Directeur of UNCC shall serve as secretary to such Committee. (c) Without limitation or restriction upon any of the provisions set forth in Sections 4.01 or 4.05(a) of this Agreement, the Borrower shall make available to the Proj- ect Coordinating Committee all funds, facilities, services and other resources which shall be necessary to enable such Committee to carry out its functions. SECTION 4.06. Except as the Association shall otherwise agree, the Borrower shall: 12 (a) cause IRAT to initiate soil inoculation tests with nitrogen-fixing bacteria during the 1971 groundnut crop season and thereafter to continue such soil inoculation tests; (b) cause cotton fertilizer trials to be continued under the supervision of IRAT; (c) take such measures as are necessary on its part to ensure that agreement No. 10/68/MER/UNCC of October 1968 between it and CFDT, providing for extension services for cotton growers, shall be re- newed at least until June 30, 1974; (d) progressively eliminate all subsidies to rice farmers in respect of nitrogen fertilizers, and shall discon- tinue all payments and benefits arising from such subsidies not later than July 1, 1974; and (e) periodically review the support policies for rice paddy prices and shall gradually cause such prices to be reduced in a manner adequate to develop the potential domestic market. SECTION 4.07. Without limitation or restriction upon any of the provisions set forth in Section 4.01 of this Agree- ment and unless the Association shall otherwise agree, the Borrower shall provide or cause to be provided to UNCC such funds as are reasonably required to enable UNCC to carry on its operations on a sound administrative and financial basis. SECTION 4.08. The Borrower shall pay to CNCA ade- quate compensation for all services rendered by CNCA in respect of all social and relief operations, and for any losses resulting therefrom. SECTION 4.09. The principal of, and service charges on, the Credit shall be paid without deduction for, and free 13 from, any taxes imposed under the laws of the Borrower or laws in effect in its territory, and shall be free from all restrictions imposed under any such laws. SECTION 4.10. The Development Credit Agreement and the Project Agreement shall be free from any taxes that shall be imposed under the laws of the Borrower or laws in effect in its territory on or in connection with the execu- tion, delivery or registration thereof. ARTICLE V Remedies of the Association SECTION 5.01. If any event specified in Section 7.01 of the General Conditions or in Section 5.02 of this Agreement shall occur and shall continue for the period, if any, therein set forth, then at any subsequent time during the con- tinuance thereof, the Association, at its option, may, by notice to the Borrower, declare the principal of the Credit then outstanding to be due and payable immediately to- gether with the service charges thereon and upon any such declaration such principal, together with such charges, shall become due and payable immediately, anything in the Devel- opment Credit Agreement to the contrary notwithstanding. SECTION 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified: (a) CNCA shall have failed to perform any of its cove- nants or agreements under the Project Agreement, and such failure shall have continued for a period of sixty days after notice thereof shall have been given by the Association to the Borrower; (b) UNCC shall have failed to perform any of its cove- nants or agreements under the Project Agreement, and such failure shall have continued for a period 14 of sixty days after notice thereof shall have been given by the Association to the Borrower; (c) Law No. 67-32 dated September 20, 1967, relating to the establishment of CNCA and of UNCC, or any other law or regulation of the Borrower relating to the organization, powers or financial structure of CNCA or of UNCC, to the powers, duties, functions, responsibilities and credit policies of CNCA, or to the powers, duties, functions and responsibilities of UNCC, shall have been amended, suspended, abro- gated or waived without the agreement of the Asso- ciation in such a way as to materially and adversely affect the ability of CNCA or of UNCC to carry out the covenants and agreements set forth in the Project Agreement; (d) any legislation or regulation of the Borrower relat- ing to agricultural development or to agricultural credit in the territory of the Borrower shall have been amended, suspended, abrogated or waived with- out the agreement of the Association in such a way as to materially and adversely affect the Project; (e) the Statuts of CNCA or any provision thereof shall have been materially amended, suspended, abrogated or waived without the agreement of the Association; and (f) the Statuts of UNCC or any provision thereof shall have been materially amended, suspended, abrogated or waived without the agreement of the Association. ARTICLE VI Effective Date; Termination SECTION 6.01. The following events are specified as addi- tional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 10.01(b) of the General Conditions: 0 15 (a) the execution and delivery of the Project Agreement on behalf of CNCA shall have been duly authorized or ratified by all necessary corporate and governmental action; (b) the execution and delivery of the Project Agreement on behalf of UNCC shall have been duly authorized or rati- fied by all necessary corporate and governmental action; (c) the Project Coordinating Committee shall have been established, and its chairman, secretary and members ap- pointed in accordance with the provisions of Section 4.05 of this Agreement; and (d) the auditor or auditors referred to in Section 2.05(b) of the Project Agreement shall have been appointed. SECTION 6.02. The following are specified as additional matters, within the meaning of Section 10.02(b) of the Gen- eral Conditions, to be included in the opinion or opinions to be furnished to the Association: (a) that the Project Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, CNCA and constitutes a valid and binding obligation of CNCA in accordance with its terms; and (b) that the Project Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, UNCC and constitutes a valid and binding obligation of UNCC in accordance with its terms. SECTION 6.03. The date September 29, 1970 is hereby specified for the purposes of Section 10.04 of the General Conditions. SECTION 6.04. The obligations of the Borrower under Sections 4.02 (b), 4.06 (a), (b), and (e), and 4.07, of this Agreement shall terminate on the date on which the Devel- opment Credit Agreement shall terminate or on a date 16 twenty years after the date of the Development Credit Agreement, whichever shall be the earlier. ARTICLE VII Miscellaneous SECTION 7.01. The Closing Date shall be December 31, 1974 or such other date as shall be agreed between the Borrower and the Association. SECTION 7.02. The Minister of Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 9.03 of the General Conditions. SECTION 7.03. The following addresses are specified for the purposes of Section 9.01 of the General Conditions: For the Borrower: Ministere 'des Finances Niamey, Niger Cable address: Minifinances Niamey For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Indevas Washington, D.C. IN WITNESS WHEREOF the parties hereto, acting through their representatives thereunto duly authorized, have 17 caused the Development Credit Agreement to be signed in their respective names and to be delivered in the District of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF NIGER By /s/ GEORGES CONDAT Authorized Representative INTERNATIONAL DEVELOPMENT AssoCIATION By /s/ J. BURKE KNAPP Vice President 18 SCHEDULE 1 Description of the Project The Project is part of the Borrower's program for the improvement of agricultural productivity and consists of the following parts: I. A program of loans to be made by CNCA to farmers and to GMVs for: a. Medium-term loans for: (i) oxen, ox-drawn farm implements, carts and spares; and (ii) scales for the cooperative marketing of ground- nut, rice and cotton; b. Short-term loans for the supply of seeds, fertilizer and pesticides, including spray costs. II. The expansion and strengthening of cotton and ground- nut extension services by the addition of approxi- mately 100 persons to the extension personnel of UNCC. III. Technical assistance to CNCA for the training of local personnel and to assist CNCA in bank management. The Project is expected to be completed by June 30, 1974. 19 SCHEDULE 2 Allocation of the Proceeds of the Credit Amounts Expressed Category in Dollar Equivalent I. Implements, carts, spares and scales for Part I(a) of the Project 260,000 II. For Part I(b) of the Project (a) fertilizer 35,000 (b) pesticides 65,000 III. Extension services under Part II of the Project 160,000 IV. Technical Assistance under Part III of the Project 64,000 Total 584,000 Reallocation upon Change in Cost Estimates If the estimate of the cost of the items included in any of the Categories I to IV shall decrease, the amount of the Credit then allocated to, and no longer required for, such Category will at the request of the Borrower, be re- allocated by the Association to any of the other Categories if the estimate of the cost of items included in such other Category shall have increased.