Mauritania - Third Highway Project : Credit 0519 - Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 519 MAU Development Credit Agreement (Third Highway Project) BETWEEN ISLAMIC REPUBLIC OF MAURITANIA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED DECEMBER 11, 1974 CONFORMED COPY CREDIT NUMBER 519 MAU Development Credit Agreement (Third Highway Project) BETWEEN ISLAMIC REPUBLIC OF MAURITANIA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED DECEMBER 11, 1974 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated December 11, 1974, between THE ISLAMIC REPUBLIC OF MAURITANIA (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) The Borrower has requested the Government of Canada (hereinafter called Canada), the Kuwait Fund for Arab Economic Development (hereinafter called the Kuwait Fund) and the Association to assist in the financing of the Project described in Schedule 2 to this Agreement; (B) By agreements to be entered into between Canada and the Borrower (hereinafter called the Canadian Loan Agreement and Grant Agreement, respectively), Canada intends to make available through the Canadian International Development Agency to the Borrower for Part C of the Project a loan (hereinafter called the Canadian Loan) in an amount equivalent to four million two hundred thousand dollars and a grant (hereinafter called the Canadian Grant); (C) By an agreement to be entered into between the Kuwait Fund and the Borrower (hereinafter called the Kuwait Fund Loan Agreement), the Kuwait Fund intends to assist the Borrower in financing Parts A, B, D and E of the Project by making to the Borrower a loan (hereinafter called the Kuwait Fund Loan) in an amount equivalent to three million eight hundred thousand dollars. WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). 4 Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equivalent to three million dollars ($3,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for Parts A, B, D and E of the Project and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, the goods, works and services (other than consultants' services) for the Project to be financed out of the proceeds of the Credit, shall be procured in accordance with the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be June 30, 1980 or such other date as shall be agreed between the Borrower and the Association. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdiawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on January 1 and July 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each January I and July 1 commencing January 1, 1985, and ending July 1, 2024, each installment to and including the installment payable on July 1, 1994 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. 5 ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. (a) In carrying out Part A and in order to assist the Borrower in carrying out Part E of the Project, the Borrower shall employ experts and consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association. (b) The Borrower shall prepare and furnish to the Association not later than a date four months after the effective date of this Agreement or such other date as the Association shall agree for its approval a detailed program for the training components of Part A of the Project. Section 3.03. (a) Contractors employed by the Borrower in carrying out Parts B(ii) and D of the Project shall be acceptable to the Association and shall be employed upon terms and conditions satisfactory to the Association. (b) Except as the Association shall otherwise agree, the design standards for the civil works included in the Project shall be those agreed between the Borrower and the Association. Section 3.04. Except as the Association shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 3.05. (a) The Borrower shall furnish to the Association, promptly upon their preparation, the specifications, reports, contract documents and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borrower: (i) shall maintain records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit, the Kuwait Fund Loan and the Canadian Loan and Grant, and to disclose the use thereof in the Project; (ii) shall enable the Association's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit, the Kuwait Fund Loan and the Canadian Loan 6 and Grant and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit, the Kuwait Fund Loan and the Canadian Loan and Grant and the goods and services financed out of such proceeds. (c) With respect to Part D of the Project, the Borrower shall establish, within the Infrastructure Department of its Ministry of Equipment, an accounting system with separate bookkeeping arrangements, and every item of the accounting books will be supported by relevant evidence certified by the Director of the Infrastructure. Section 3.06. The Borrower shall take or cause to be taken all such action as shall be necessary to acquire as and when needed all such land and rights in respect of land as shall be required for carrying out the Project. ARTICLE IV Other Covenants Section 4.01. The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with consistently maintained appropriate accour .ing practices the operations, resources and expenditures, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out the Project or any part thereof. Section 4.02. (a) The Borrower shall, for the purpose of the Project, open a special account at the Tr6sor and shall maintain in it funds in an amount equivalent to the estimated expenditures under the Project during the following three months. The Borrower shall also credit in said account the proceeds of the Credit withdrawn from the Credit Account which the Association shall not have paid directly to suppliers of goods or services at the Borrower's request and on its behalf. (b) The Borrower shall open another account (caisse d'avance) in a bank at Nouakchott, and shall credit it with funds withdrawn from the special account referred to in paragraph (a) hereof, in such amounts as shall be needed to cover ordinary, small expenditures under the Project. Section 4.03. (a) The Borrower shall cause all its equipment for road maintenance to be adequately maintained and repaired and shall maintain sufficient and adequate workshops in suitable places for the purpose. 7 (b) The Borrower shall cau.e the primary highways included in its highway system to be adequately maintained in accordance with sound engineering practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. (c) Starting from September 15, 1975, the Borrower shall furnish to the Association, not later than September 15 in each year, its proposed highway maintenance program and recurrent expenditures budget for highways for the next fiscal year for the Association's comments up to and including the fiscal year in which the Closing Date shall occur. (d) Before the Borrower undertakes the construction of any new major highway or any section thereof, if any such steps are taken before the Closing Date, the Borrower shall review with the Association the estimated cost of such new highway including its estimated maintenance requirements and the projected budgetary allocations therefor. Section 4.04. The Borrower shall: (a) designate the most promising engineers and technicians within its Ministry of Equipment to work together with and as counterparts to the technical assistance consultants mentioned in Section 3.02 of this Agreement; and (b) after consultation with the Association, select, by preference among the counterparts referred to in paragraph (a) of this Section, those to whom fellowships should be awarded under Part A(ii) of the Project. Section 4.05. The Borrower shall establish and maintain facilities adequate to collect and record, in accordance with appropriate statistical methods and procedures, such information concerning road traffic, road construction and maintenance costs as shall be reasonably required for proper planning of maintenance, improvements and extension of its highway system. Section 4.06. The Borrower shall take all such measures as shall be necessary to ensure at all times that the dimensions and axle loads of vehicles using its improved highways do not exceed limits consistent with the design standards of such highways. ARTICLE V Remedies of the Association Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified: 8 (a) the right of the Borrower to withdraw the proceeds of the Kuwait Fund Loan or of the Canadian Loan and Grant shall have been suspended, in whole or in part, and the Borrower shall have failed to demonstrate to the satisfaction of the Association that alternative funds are available to the Borrower for the Project; and (b) the Kuwait Fund Loan or the Canadian Loan shall have become due and payable prior to the agreed maturity thereof pursuant to the provisions of the Kuwait Fund Loan Agreement and of the Canadian Loan Agreement respectively providing for such remedy in case of default by the Borrower. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following events are specified: (a) the event specified in paragraph (a) of Section 5.01 of this Agreement shall occur and shall continue for a period of thirty days after notice thereof shall have been given by the Association to the Borrower; and (b) the event specified in paragraph (b) of Section 5.01 of this Agreement shall occur. ARTICLE VI Effective Date; Termination Section 6.01. The following events are specified as additional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01(b) of the General Conditions: (a) the contract of employment of the consultants to be assigned to the Ministry of Equipment under Part A(i) of the Project has been signed; and (b) the Canadian Loan Agreement and Grant Agreement and the Kuwait Fund Loan Agreement have been duly signed and have become fully effective, and conditions precedent to initial disbursements, if any, under such agreements, save for the effectiveness of this Agreement, have been fulfilled. Section 6.02. The date June 9, 1975, is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 6.03. The obligations of the Borrower under Section 4.01 and paragraphs (a) and (b) of Section 4.03 shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date ten years after the date of this Agreement, whichever shall be the earlier. 9 ARTICLE VII Representative of the Borrower; Addresses Section 7.01. The Minister responsible for Planning of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministbre de la Planification et du D6veloppement Industriel Nouakchott Mauritanie Cable address: MINIPLAN Nouakchott 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 caused this Agreement to be signed 10 in their respective names in the District of Columbia, United States of America, as of the day and year first above written. ISLAMIC REPUBLIC OF MAURITANIA By /s/ A. Ould Abdallah Authorized Representathe INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ R. Chaufournier Regional V1ice President Western Afticv 11 SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amounts of the Credit to such Categories and the percentage of expenditures for items so to be financed in such Categories: Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Technical 800,000 44% assistance (2) Fellowships 20,000 44% (3) Feasibility 320,000 44% studies and detailed engineering (4) Didactic 70,000 44% material, office equip- ment and fur- niture and vehicles under Part B of the Project (5) Civil works: (a) under Part 30,000 26% B(ii) of the Project (b) under Part 1,070,000 26% D of the Project (6) Unallocated 690,000 TOTAL 3,0000 12 2. The disbursement percentages have been calculated in compliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if any event occurs which shall affect the amount of any such taxes included in the cost of any item to be financed out of the proceeds of the Credit, the Association may, by notice to the Borrower, correspondingly adjust the disbursement percentage then applicable to such item. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of expenditures prior to the date of this Agreement. 4. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in paragraph I above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category to the extent required to meet the estimated shortfall proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expenditures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursements percentages then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 5. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. 13 SCHEDULE 2 Description of the Project The Project consists of the following parts: Part A. (i) The utilization of about 350 man-months of technical assistance for the Borrower's Ministry of Equipment, Ministry of Planning and Ministry of Trade and Transportation, to continue to improve the said Ministries' road maintenance service, transport organization and planning, and staff training. Such technical assistance shall be as set forth in the Exhibit to this Schedule, as such exhibit may be amended from time to time by agreement between the Borrower and the Association; (ii) The provision of fellowships for the training of highway personnel. Part B. (i) The purchase of didactic material for the training of highway personnel in Mauritania; (ii) The construction, equipment and furnishing of offices for the technical assistance experts assigned to the Ministry of Equipment. (iii) The acquisition of vehicles by the technical assistance experts referred to in Part A(i) above. Part C. Procurement of highway equipment and spare parts for maintenance and betterment works. Part D. Execution of a betterment program on about 365 km of the following roads: (i) the road from Atar to Choum (about 125 km); (ii) a section of the road from Akjoujt to Atar (about 40 km); (iii) the road from Boghe to Kaedi (about 100 km); and 14 (iv) two sections of the road from Kaedi to Kiffa (totalling about 100 km). Part E. Feasibility Study and detailed engineering for construction of the Rosso-Boghe road (about 200 km). The Project is expected to be completed by December 31, 1979. 15 EXHIBIT TO SCHEDULE 2 Technical Assistance TO THE INFRASTRUCTURE DEPARTMENT OF THE MINISTRY OF EQUIPMENT 1) The following mechanical specialists: two workshop mechanics one training expert, and two equipment inspectors shall be assigned to the Equipment Division to: a) assist the Division Chief and Central Workshop Chief; b) control the use of highway equipment and the carrying out of repair operations in the workshops and in the field; and c) train operators and mechanics. 2) The following highway experts: one engineer and two technicians shall be assigned to the Road and Airport Division to assist in: a) reorganizing the field subdivisions for highway maintenance, training their personnel and programming and supervising their activities; b) making the investigations required to prepare draft budgets for highway recurrent expenditures; c) preparing the engineering for the betterment program forming Part D of the Project and supervising the highways bases; and 16 d) setting up an accounting system and a unit to monitor the condition of and the traffic on the highway networks. 3) A senior training specialist on a short-term assignment to prepare a detailed training program together with proposals for an implementation schedule. II - TO THE MINISTRY OF PLANNING A -:ransport economist/planner to assist the Ministry in identifying and evaluating transport investments and to study modes of appropriate domestic transport services. III - TO THE MINISTRY OF TRADE AND TRANSPORTATION A transport expert to assist the Ministry in the organization of road transport and in the assistance furnished by the Ministry to local transport firms. 17 SCHEDULE 3 Procurement Procurement of Didactic Material and Office Equipment and Furniture Didactic material and office equipment and furniture included in Parts B(i) and (ii) of the Project respectively, and to be financed out of the proceeds of the Credit allocated to Category (4) of paragraph I of Schedule 1 to this Development Credit Agreement, shall be procured in accordance with the applicable procurement procedures of the Borrower. In the selection of suppliers, the Borrower may take into account its need to standardize such material with other similar or comparable material already owned by the Borrower. II. Procurement of Civil Works by Contracts A. Except as provided in paragraph D hereunder, contracts for the civil works included in Parts B(ii) and D of the Project shall be let under procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in April 1972, as revised in October 1972 (hereinafter called the Guidelines), on the basis of international competitive bidding. B. Bidders for the works included in Parts B(ii) and D of the Project shall be prequalified as described in part 2.2 of the Guidelines. C. Evaluation and Comparison of Bids for Civil Works; Preferences for Domestic Contractors. With respect to any contract for civil works included under Category (5) of paragraph I of Schedule 1 to the Credit Agreement, the Borrower may grant a margin of preference of 7-1/2% to domestic contractors, in accordance with, and subject to, the following provisions: (a) Contractors shall be required to prequalify as provided in paragraph B of Part II of this Schedule and applicants for qualification applying also for such preference shall be asked to provide, as part of the information for qualification, such information, including details of ownership, as shall be required to determine whether, according to the classification established by the Borrower and accepted by the 18 Association, a particular firm or group of firms qualifies for a domestic preference. The bidding documents shall clearly indicate the preference and the method that will be followed in the evaluation and comparison of bids to give effect to such preference. (b) After bids have been received and reviewed by the Borrower, responsive bids will be classified into the following groups: (i) bids offered by domestic contractors eligible for preference; and (ii) bids offered by other contractors. For the purpose of evaluation and cnmparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above. D. With respect to any contract for the civil works included in Parts B(ii) and D of the Project and estimated to cost less than $100,000 equivalent, the Borrower may, after advertising in at least one local newspaper, award such contracts on a competitive basis in accordance with the applicable procurement procedures of the Borrower, provided, however, that the aggregate amount of contracts to be awarded in accordance with this procedure and to be financed out of the proceeds of the Credit shall not exceed $500,000 equivalent. Identical or similar works to be procured shall be grouped together to form economic bid packages for purposes of bidding. 111. Procurement of Betterment Works Without Contracting Notwithstanding the provisions of Part II above: A. All earth works on running sections (platforms and surface courses) will be carried out by force account. B. Construction of river-crossing structures and drainage works may be carried out by force account if, in the opinion of the Borrower and the Association, such works can be more efficiently carried out by force account. IV. Review of Procurement Decisions by Association A. Review of prequalification. The Borrower shall, before qualification is invited, inform the Association in detail of the procedure to be 19 followed and shall introduce such modifications in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and, where applicable, of their eligibility for domestic preference under Part IL.C above and of the reasons for the exclusion of any applicant for prequalification and for such eligibility shall be furnished by the Borrower to the Association for its comments before the applicants are notified, and the Borrower shall rrake such additions to, deletions from, or modifications in, the said list as the Association shall reasonably request. B. Review of invitation to bid and of proposed awards and final contracts: With respect to all contracts for civil works estimated to cost the equivalent of $100,000 or more: (i) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (ii) Promptly after the bids have been received, the Borrower shall inform the Association of the names of the bidders and the respective amounts of the bids. (iii) After bids have been received and evaluated, the Borrower shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and the reasons for the intended award and shall furnish to the Association, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, together with the recommendation for award and such other infonnation as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this 20 Schedule, promptly inform the Borrower and state the reasons for such determination. (iv) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (v) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. C. With respect to each contract to be financed out of the proceeds of the Credit and not governed by the preceding paragraph, the Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination.