Upper Volta - Bougouriba Agricultural Development Project : Credit 0496 - Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 496 UV Development Credit Agreement (Bougouriba Agricultural Development Project) BETWEEN REPUBLIC OF UPPER VOLTA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JULY 19, 1974 CONFORMED COPY CREDIT NUMBER 496 UV Development Credit Agreement (Bougouriba Agricultural Development Project) BETWEEN REPUBLIC OF UPPER VOLTA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JULY 19, 1974 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated July 19, 1974, between REPUBLIC OF UPPER VOLTA (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS the Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; and 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 January 31, 1969, with the same force and effect as if they were fully set forth herein, subject, however, to the deletion of Sections 5.01 and 6.02(h) thereof and to the renumbering of Section 6.02(i) into 6.02(h) thereof (said General Conditions Applicable to Development Credit Agreements of the Association, as so modified, being hereinafter called the General Conditions). 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 and the following additional terms have the following meanings: (a) "AP" means Association en Participation and includes any successor thereto; (b) "Association en Participation Agreement Upper Volta-CFDT" (hereinafter called AP Agreement) means the Agreement between the Borrower and CFDT dated May 12, 1970, published in the Journal Officiel of the Borrower on June 20, 1970 and amended in agreement with the Association; 4 (c) "BND" means the Banque Nationale de Developpement of the Borrower and includes any successor thereto; (d) "CFDT" means Compagnie FranVaise pour le Dgveloppement des Fibres Textiles; (e) "CSPP" means Caisse de Stabilisation des Prix des Produits, (f) "Ministry" means the Ministry of Planning, Rural Development, Environment and Tourism and "Minister" means the Minister of the Ministry, of the Borrower; (g) "ORD" means Organisme Regional de Developpement of the Borrower; and (h) "Project Area" means the area covered by the Bougouriba ORD. 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 eight million dollars ($8,000,000). 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 shall 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 the Project described in Schedule 2 to this Agreement and to be financed under the Development Credit Agreement; provided, however, that, except as the Association shall otherwise agree, no withdrawal shall be made on account of expenditures in the territories of any country which is not a member of the Bank (other than Switzerland) or for goods produced in, or services supplied from, such territories. Section 2.03. Except as the Association shall otherwise agree, the goods and services (other than services of consultants) required for the Project and to be financed out of the proceeds of the Credit, shall be procured on the basis of international competition under procedures consistent with the Guidelines for Procurement under World Bank Loans and IDA Credits, published by the Bank in April 1972, as revised in October 1972 and in accordance with, and subject to, the provisions set forth in Schedule 3 to this Agreement. 5 Section 2.04. The Closing Date shall be March 31, 1979 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 I%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on April 15 and October 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each April 15 and October 15 commencing October 15, 1984, and ending April 15, 2024, each installment to and including the installment payable on April 15, 1994 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installmncit thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the Republic of France is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE Ill Execution of the Project Section 3.01. The Borrower shall carry out the Project or cause the Project to be carried out with due diligence and efficiency and in conformity with appropriate administrative, agricultural, engineering and financial practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. For the purpose of carrying out the Project, the Borrower shall amend the existing AP Agreement entered into between the Borrower and CFDT in order to provide for the following: (a) subsidization of fertilizer pesticide prices to farmers utilizing the said fertilizer and pesticide in the ORDs where the AP operates by including such subsidy as a recurrent expense of the AP; (b) payment of levies to the Development Fund referred to in Section 3.09 of this Agreement; and (c) changes in the distribution of the profits of the AP between the Borrower and CFDT, in conformity with the provisions of sub-sections (a) and (b) of this Section and Section 3.13 of this Agreement. 6 Section 3.03. The Borrower shall, within six months from the date of this Agreement, establish and maintain within the Ministry an Organization of Coordination and Evaluation to be directly responsible to the Minister with terms of reference as set forth in the Annex I to Schedule 2 to this Agreement. Section 3.04. The Borrower shall: (a) appoint as Director and Deputy Director of the Bougouriba ORD, persons with qualifications acceptable to the Association and with terms of reference as set forth in Annex 2 to Schedule 2 to this Agreement; (b) appoint as Accountant and Heads of Services, persons with qualifications acceptable to the Association; (c) ensure the training of lower and mildle level staff required for the execution of the Project in the Centre Agricole de Matourkou; (d) engage a visiting consultant acceptable to the Association to assist in designing the teaching programs for the Training Center referred to in Part (e) of the Project, and evaluating the results obtained; and (e) consult annually with the Association on the replacement of expatriate staff engaged in the implementation of the Project by Voltaic personnel. Section 3.05. The Borrower shall take all the steps required to ensure the experimentation and multiplication of seeds necessary for the Project Area. Section 3.06. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be pks able in a currency freely usable by the Borrower to replace or repair such goo. , (b) 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 3.07. The Borrower shall: (a) furnish to the Association, promptly upon their preparation, the reports of the Consultants referred to in Section 3.12 of this Agreement in such detail as the Association shall reasonably request; and (b) (i) maintain records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out 7 of the proceeds of the Credit, and to disclose the use thereof in the Project; (ii) enable the Association's accredited representatives to examine the Project, the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. Section 3.08. 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 and shall furnish to the Association, promptly after such acquisition, evidence satisfactory to the Association that such land and rights in respect of land are available for purposes related to the Project. Section 3.09. The Borrower undertakes to establish a Development Fund which will receive as income the product of levies assessed on cotton production, and in which each cotton producing ORD will have an account. The said Fund will provide (a) the Borrower's contribution to projects financed by the Association in cotton producing ORDs, (b) finances to sustain the agricultural development in the same ORDs referred to in (a) of this Section after the Project completion and (c) finances to sustain the agricultural development in ORDs other than those referred to in (a) of this Section. The amount of levies will be subject to annual consultation between the Borrower and the Association. The Borrower further undertakes to cause BND to act as trustee of the said Fund. Section 3.10. The Borrower and the Association shall consult each other annually on the price of cotton to be paid to producers and on the subsidy of price for fertilizer and pesticide. Section 3.11. The Borrower shall cause BND to make sufficient credit available to ORDs whose agricultural development is financed by the Association on the following terms and conditions: (a) the terms of credit extended under the Project will be set by BND in line with the agricultural credit policy of the Borrower, (b) all changes introduced in respect of the policy on interest rates charged on agricultural credit will be the subject of consultation between the Borrower and the Association; (c) the down payment by farmers will not be more than 15% of the total cost of equipment; and (d) only farmers with not less than a pair of oxen will receive credit for equipment. Section 3.12. The Borrower shall employ consultants, on terms acceptable to the Association: (a) to carry out a feasibility study and preliminary engineering work for the construction of a 73 km road between Pa Dano and Djipologo; and (b) to carry out a survey to establish priorities for the improvement and extension 8 of the Bougouriba and Leo district road network. The scope of the studies and the terms of reference of the Consultants shall be mutually acceptable to the Borrower and the Association. Section 3.13. The Borrower shall: (a) confer on the AP the sole responsibility for the marketing of cotton seeds, and (b) ensure that local processors will be charged the world market price less expenses that would have been incurred had the cotton seeds been exported. Section 3.14. The Borrower shall, after Project completion, maintain its budgetary contribution to livestock services at an adequate level to maintain the livestock in good condition. Section 3.15. The Borrower shall, before the termination of the AP Agreement, afford the Association a reasonable opportunity to exchange views with the Borrower on the renewal of the said Agreement or the making of any new agreement in respect thereof that the Borrower may propose. 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 accounting 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. The Borrower shall maintain records including Project accounts for the Bougouriba ORD in accordance with sound accounting principles. Section 4.03. The Borrower shall: (i) have accounts and financial statements for the Project and for the Development Fund and for the AP accounts (balance sheets, statements of income and expenditure and related statements) for each fiscal year audited in accordance with sound auditing principles consistently applied by a firm of independent audit satisfactory to the Association; (ii) furnish to the Association as soon as available, but in any case not later than four months after the end of each such year, (A) certified copies of its financial statements for such year as so audited and (B) the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested. ARTICLE V Consultation, Information and Inspection Section 5.01. The Borrower and the Association shall cooperate fully to assure that the purposes of the Credit will be accomplished. To that end, the 9 Borrower and the Association shall from time to time, at the request of either party: (a) exchange views through their representatives with regard to the performance of their respective obligations under the Development Credit Agreement, the administration, operations and financial condition, of the Project ORD, of BND, of CSPP, of the AP or of any other institutions, departments or agencies of the Borrower responsible for carrying out any part of the Project, and other matters relating to the purposes of the Credit; and (b) furnish to the other all such information as it shall reasonably 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 conditions in the territories of the Borrower, including its balance of payments, and the external debt of the Borrower, of any of its political subdivisions and of any agency of the Borrower or of any such political subdivision. Section 5.02. (a) The Borrower shall furnish or cause to be furnished to * the Association all such information as the Association shall reasonably request concerning the administration, operations and financial condition of the Project ORD, of BND, of CSPP, of the AP or of any other institutions, departments or agencies of the Borrower responsible for carrying out any part of the Project. (b) The Borrower and the Association shall promptly inform each other 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 or the performance by either of them of its obligations under the Development Credit Agreement. Section 5.03. The Borrower shall afford all reasonable opportunity for accredited representatives of the Association to visit any part of the territories of the Borrower for purposes related to the Credit. ARTICLE VI Taxes and Restrictions Section 6.01. The principal of, and service charges on, the Credit shall be paid without deduction for, and free from, any taxes imposed under the laws of the Borrower or laws in effect in its territories. 10 Section 6.02. The Development Credit Agreement shall be free from any taxes on or in connection with the execution, delivery or registration thereof, imposed under the laws of the Borrower or laws in effect in its territories. Section 6.03. The payment of the principal of, and service charges on, the Credit shall be free from all restrictions, regulations controls and moratoria of any nature imposed under the laws of the Borrower or laws in effect in its territories. ARTICLE VII Remedies of the Association Section 7.01. If any event specified in Section 7.01 of the General Conditions or in Section 7.02 of this Agreement shall occur and shall continue for the period, if any, therein set forth, then at any subsequent time during the continuance 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 together with the service charges thereon, and upon any such declaration such principal and service charges shall become due and payable immediately, anything to the contrary in the Development Credit Agreement notwithstanding. Section 7.02. For the purposes of Section 6.02 of the General Conditions, the follom ing additional event is specified, namely that the AP Agreement (as amended pursuant to Section 3.02 of this Agreement) shall have been terminated (other than in accordance with its terms), amended, waived, suspended or repealed without the consent of the Association so as materially and adversely to affect the carrying out of the Project. ARTICLE VIII Effective Date; Termination Section 8.01. The following events are specified as additional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 10.01(b) of the General Conditions: (a) the Development Fund referred to in Section 3.09 of this Agreement shall have been established; (b) the Borrower shall have made an advance payment of CFAF 150 million to the Development Fund; 11 (c) the Deputy Director and the Accountant shall have been appointed, pursuant to Section 3.04(a); and (d) the amended AP Agreement referred to in Section 3.02 of this Agreement shall have become effective. Section 8.02. The following is specified as an additional matter, within the meaning of Section 10.02(b) of the General Conditions, to be included in the opinion or opinions to be furnished to the Association, namely that the amendment envisaged in Section 8.01(d) of this Agreement has been made pursuant to the provisions of the AP Agreement in respect thereof. Section 8.03. The date October 17, 1974 is hereby specified for the purposes of Section 10.04 of the General Conditions. ARTICLE IX Representative of the Borrower; Addresses Section 9.01. 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 9.02. The following addresses are specified for the purposes of Section 9.01 of the General Conditions: For the Borrower: Minist6re des Finances Ouagadougou, Haute-Volta Cable address: MINIFINANCES Ouagadougou For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America 12 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 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 UPPER VOLTA By /s/ T. Yaguibou Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ R. Chaufournier Regional Vice President Western Africa 13 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 amounts of the Credit to each Category and the percentage of eligible expenditures so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed I. Salaries, build- 5,200,000 87% of total ing cost, opera- expenditures tional expenses II. Vehicles, equip- 1,000,000 100% of foreign ment, sprayers expenditures or 87% of total expenditures. III. Veterinary drugs 100,000 100% of foreign expenditures or 87% of total expenditures. IV. Studies, scholar- 300,000 100% of foreign ships, special expenditures staff training V. Unallocated 1,400,000 TOTAL 8,000,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means -expenditures for goods produced in, or services supplied from, the territories, and in the currency, of any country other than the Borrower. 14 (b) the term "local expenditures" means expenditures in the currency of the Borrower for goods produced in, or services supplied from, the territories of the Borrower; and (c) the term "total expenditures" means the aggregate of foreign and local expenditures. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of: (a) expenditures prior to the date of this Agreement; and (b) payments for taxes imposed under the laws of the Borrower or laws in effect in its territories on goods or services, or on the importation, manufacture, procurement or supply thereof. To the extent that the amount represented by the percentage set forth in the third column of the table in paragraph I above in respect of any Category would exceed the amount payable net of all such taxes, such percei,tage shall be reduced to ensure that no proceeds of the Credit will be withdrawn on account of payments for such taxes. 4. Notwithstanding the allocation of an amount of the Credit set forth in the second column of the table in paragraph I above: (a) if the estimate of the expenditures under any Category shall decrease, the amount of the Credit then allocated to such Category and no longer required therefor will be reallocated by the Association by increasing correspondingly the unallocated amount of the Credit; (b) if the estimate of the expenditures under any Category shall increase, the percentage set forth in the third column of the table in paragraph I above in respect of such expenditures shall be applied to the amount of such increase, and a corresponding amount will be allocated by the Association, at the request of the Borrower, to such Category from the unallocated amount of the Credit, subject, however, to the requirements for contingencies, as determined by the Association, in respect of any other expenditures; and (c) 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 Section 2.03 of the Development Credit 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 15 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. 0 0 16 SCHEDULE 2 Description of the Project The Project is an effort to develop the natural and human resources of the Bougouriba ORD and will concentrate on areas presently free of onchocerciasis. The Project consists of the following major components: (a) providing technical assistance to the Ministry; (b) providing the Bourgouriba ORD with the staff, housing, offices, equipment, vehicles and funds necessary to implement a development program; (c) providing about 16,000 farm families with extension and other support services needed to increase their production and income, and to improve their knowledge; (d) providing veterinary services for the ORD, consisting primarily of vaccinations to reduce livestock mortality rate; (e) creating a Training Center with teaching facilities for project staff and farmers; (f) creating an Agricultural Research and Seed Multiplication Centre; (g) improving domestic water supplies through a well digging and rehabilitation program covering about 120 wells; (h) improving about 660 kms of secondary and tertiary roads; (i) establishing a Topographic Unit to map and to prepare plans for the development of land for settlement by migrants; (j) providing participating farmers with seasonal credit for the purchase of insecticides and fertilizer and medium-term credit for farm implements; and (k) studies and surveys needed for the improvement of road network in the Project Area, and in the Leo Area. The Project is expected to be completed by June 30. 1978. 17 ANNEX I to SCHEDULE 2 Project Organization and Responsibilities A. Organization of Coordination and Evaluation The Organization of Coordination and Evaluation will be directly responsible to the Minister and will have powers of supervision and coordination over the ORDs and the Directors of the Technical Departments of the Ministry. This Organization will, inter alia, have the following functions: (i) to implement the reform of ORDs; (ii) to plan and if need be to elaborate short- and long-term agricultural development programs and national and regional projects and the means of carrying them out, to supervise and evaluate ongoing projects or programs and submit to the Minister proposals relative to the improvement thereon; (iii) to provide ORDs with technical assistance when needed; and (iv) to assist the ORDs directors to lay down criteria for project evaluations. B. Senior Technical Assistant within the Ministry The functions of this Senior Technical Assistant will be defined by agreement between the Borrower and the Association. 18 ANNEX 2 TO SCHEDULE 2 Qualifications and Responsibilities of ORD Director and Technical Director A. The ORD Director 1. The Director of the ORD will be directly responsible to the Minister. His functions are defined in the Statutes of the ORD dated July 28, 1965. 2. He should have had university education including graduate work in any of the following disciplines: agriculture, business or public administration, and his experience should include at least 5 years in a senior position with Upper Volta Government administration where he should have shown his human qualities. 3. He will be responsible for all activities to be carried out by the Bougouriba ORD, and for implementation of the Project. He will present to the Minister for his approval yearly program of activities and periodic reports on the results of the Project. B. The ORD - DeputY Director 1. The Deputy Director will be responsible to the ORD Director. 2. He should have done graduate work in general agriculture, agriculture economics, or agricultural research. His experience should include at least five years in a senior management position in an agricultural project if possible in the Sahelian countries. He should be familiar with problems of agricultural production of the Project Area. He should also have interests in the whole spectrum of rural development and he should have a sense of human relations. 3. His responsibility will cover, inter alia, extension service. 19 SCHEDULE 3 Procurement A. Contracts for Goods to be Awarded under International Competitive Bidding 1. Any contract for equipment for wells and roads, sprayers, vehicles and farm implements estimated to cost the equivalent of $20,000 or more shall be awarded on the basis of international competition under procedures consistent with the guidelines referred to in Section 2.03 of this Agreement, and in accordance with, and subject to, the following provisions: (a) If bidders are required to prequalify, the Association shall be informed in detail, before qualification is invited, of the procedure to be followed and such modifications shall be introduced in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and of the reasons for the exclusion of any applicant for prequalification, shall be furnished to the Association for its comments before the applicants are notified and such additions to or deletions from the said list shall be made as the Association shall reasonably request. (b) Before bids are invited, the Association shall be furnished, for its comments, with the text of the invitations to bid and the qualifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and such modifications in the said documents or procedure shall be made 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. (c) After bids have been received and evaluated, and before a final decision on the award is made, the Association shall be informed of the name of the bidder to whom it is intended to award the contract and the Association shall be furnished, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, together with the reasons for the intended award. The Association shall, if it determines that the intended award would be inconsistent with the procedures set forth or referred to in Section 2.03 of this Agreement, promptly inform the Borrower, stating the reasons for such determination. (d) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked. 20 (e) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the delivery to the Association of the first application for withdrawal of funds from the Credit Account in respect of any such contract. B. Supplemental Rules on Bid Evaluation and Comparison I. For the purpose of evaluation and comparison of bids, customs duties and other import taxes on imported goods, and sales and similar taxes on locally supplied goods, shall be excluded, except to the extent hereinafter provided. Bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for locally manufactured goods. The cost of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be taken into account in the evaluation of bids in accordance with paragraph 4.7 of the Guidelines for Procurement referred to in Section 2.03 of this Agreement. 2. For equipment, materials, vehicles and tractors, a margin of preference may be granted to goods manufactured in Upper Volta in accordance with, and subject to, the following provisions: (a) After evaluation, responsive bids will be classified in one of the following groups: (1) Group A: bids offering goods manufactured in Upper Volta if the bidder shall have established to the satisfaction of the Borrower and the Association that the manufacturing cost of such goods includes a value added in Upper Volta equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: bids offering goods manufactured in Upper Volta, other than bids classified in Group A. (3) Group C: bids offering any other goods. (b) All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes in goods to be imported and any sales or similar taxes on goods to be supplied locally, to determine the lowest evaluated bid of each group. The lowest evaluated bids of each group shall then be compared with each other and if, as a result of this comparison, a bid from Group A or Group B is the lowest, it shall be selected for purposes of award. 21 (c) If, as a result of the comparison under paragraph (b) above, the lowest bid is a bid from Group C, all Group C bids shall be further compared with the lowest bid from Group A, as determined under paragraph (b) above, after adding to the c.i.f. bid price of goods to be imported offered in each Group C bid, for the purpose of this further comparison only, an amount equal to the smaller of (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of goods offered in such Group C bid, or (ii) 15% of the c.i.f. bid price of such goods. If the Group A bid in such further comparison is the lowest, it shall be selected for purposes of award; if not, the lowest bid from Group C, as determined under paragraph (b) above, shall be selected for purposes of award. 3. The bidding documents shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the methods and stages that will be followed in the evaluation and comparison of bids to give effect to such preference. C. Contracts For Goods To Be Awarded Under Other Procurement Procedures Procurement of equipment and other materials estimated to cost the equivalent of less than $20,000 shall be made on the basis of quotations obtained from local suppliers and in accordance with the Borrower's usual procurement procedures. With respect to any contract for goods procured under this paragraph, there shall be furnished to the Association, promptly after its execution and prior to the delivery to the Association of the first application for withdrawal of funds from the Credit Account in respect of any such contract, two conformed copies of such contract, together with such information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract is not consistent with the procedures set forth in this paragraph, promptly inform the Borrower and state the reasons for such determination. D. Evaluation and Comparison of Bids for Civil Works; Preferences for Domestic Contractors 1. With respect to any contract for civil works included under Category I of the table set forth in Schedule I to the Credit Agreement, the Borrower may grant a margin of preference of 7-1/2% to domestic contractors, as determined by the Borrower, in accordance with, and subject to, the following provisions: (a) Contractors shall be required to prequalify as provided in Part A of this Schedule and applicants for qualification applying also for such preference 22 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 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 comparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above.