Burundi - Urban Development Project : Credit 1049 - Project Agreement - Conformed

J~CIIAL 'CREDIT NUMBER 1049 BU Project Agreement (Urban Development Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and MUNICIPALITY OF BUJUMBURA Dated AA - 3, 1980 CREDIT NUMBER 1049 BU PROJECT AGREEMENT AGREEMENT, dated - , 1980, between INTERNATIONAL DEVELOPME A OCIATION (hereinafter called the Association) and MUNICI ALIT OF BUJUMBURA (hereinafter called Bujumbura). WHEREAS (A) by the Development Credit Agreement of even date herewith between Republic of Burundi (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equiva- lent to fifteen million dollars ($15,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that Bujumbura agrees to undertake such obliga- tions toward the Association as are hereinafter set forth; and (B) by a subsidiary loan agreement to be entered into between the Borrower and Bujumbura, a portion of the proceeds of the credit provided for under the Development Credit Agreement will be relent to Bujumbura on the terms and conditions therein set forth; and WHEREAS Bujumbura, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Development Credit Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of Part H of the Project Section 2.01. Bujumbura shall carry out Part H of the Project described in Schedule 2 to the Development Credit Agreement with due diligence and efficiency and in conformity with appro- priate urban development, administrative, financial and engi- neering practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 2.02. (a) Bujumbura undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit relent to it by the Borrower against hazards incident to the acquisition, transportation and delivery thereof to the place of use or instal- lation, and for such insurance any indemnity shall be payable in a currency freely usable by Bujumbura to replace or repair such goods. (b) Except as the Association may otherwise agree, Bujumbura shall cause all goods and services financed out of the proceeds of the Credit relent to it by the Borrower to be used exclusively for the Project. Section 2.03. (a) Bujumbura shall furnish to the Project Unit, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for Part H of the Project, and any material modi- fications thereof or additions thereto, in such detail as the Project Unit shall reasonably request. (b) Bujumbura shall: (i) maintain records and procedures adequate to record and monitor the progress of Part H of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit relent to it by the Borrower, and to disclose the use thereof in the Project; (ii) enable the Associa- tion's and Project Unit's accredited representatives to visit the facilities and construction sites included in Part H of the Project and to examine the goods financed out of the afore- mentioned proceeds of the Credit and any relevant records and documents; (iii) cause a report or reports to be furnished to the Project Unit within thirty calendar days after each calendar quarter, of such scope and in such detail as the Project Unit shall reasonably request on the progress of Part H of the Project during such quarter; and (iv) furnish to the Project Unit at regular intervals all such information as the Project Unit shall reasonably request concerning Part H of the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditures of such proceeds and the goods and services financed out of such proceeds. -3- (c) Promptly after completion of the Project, but in any event not later than five months after the Closing Date or such later date as may be agreed for this purpose between Bujumbura and the Project Unit, Bujumbura shall prepare and furnish to the Association a report, of such scope and in such detail as the Project Unit shall reasonably request, on the execution and initial operation of Part H of the Project, its cost and the benefits derived and to be derived from it, the performance by Bujumbura and the Association of their respective obligations under the Project Agreement and the accomplishment of the purposes of the Credit with respect to Part H of the Project. (d) On the reasonable request of the Association, Bujumbura shall enable the Association's representatives to examine all plants, installations, sites, works, buildings, property and equipment of Bujumbura and any relevant records and documents. Section 2.04. Bujumbura shall duly perform all its obliga- tions under the Subsidiary Loan Agreement. Except as the Associa- tion may otherwise agree, Bujumbura shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or any provi- sion thereof. Section 2.05. (a) Bujumbura shall, at. the request of the Association, exchange views with the Association with regard to the progress of Part H of the Project, the performance of its obligations under this Agreement and under the Subsidiary Loan Agreement, and other matters relating to the purposes of the Credit. (b) Bujumbura shall promptly inform the Association and the Project Unit of any condition which interferes or threatens to interfere with the progress of Part H of the Project, the accom- plishment of the purposes of the Credit, or the performance by Bujumbura of its obligations under this Agreement and under the Subsidiary Loan Agreement. Section 2.06. Except as the Association may otherwise agree, Bujumbura shall, through the Collection Bureau and in accordance with the terms of the Mayoral Decision, levy on and collect from: (a) the beneficiaries of on-site infrastructure development under Parts A and B of the Project, such charges as shall fully -4- recover the cost of such development within a period of twenty- five years following an initial grace period of six months at a rate of interest of 12% per annum; (b) the recipients of artisan credits under Part D of the Project, such monthly payments as are provided for in Annex 2 to Schedule 2 to the Development Credit Agreement; (c) the recipients of building loans under Part E of the Project, such monthly payments as are provided for in Annex 3 to Schedule 2 to the Development Credit Agreement; and (d) the beneficiaries of maintenance, solid waste collection and cost recovery services supplied by Bujumbura (owners of dwelling units within the territory of Bujumbura), such tax as shall fully recover the cost of such services. Section 2.07. Bujumbura shall enter into a loan agreement with each recipient of a building loan under Part E of the Pro- ject, in accordance with terms and conditions, including those with respect to remedies for non-payment, acceptable to the Association. ARTICLE III Management and Operations of Bujumbura Section 3.01. Bujumbura shall take out and maintain with responsible insurers, or make other provisions satisfactory to the Association for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 3.02. Bujumbura shall cause each of the Housing Bureau, the Collection Bureau and the Technical Department to be operated under the supervision of qualified and experienced management assisted by competent staff in adequate numbers, and shall cause their respective buildings, equipment and other facilities to be adequately maintained, and the necessary repairs and renewals thereof to be made, all in accordance with appro- priate administrative, financial and engineering practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. -5- ARTICLE IV Other Covenants Section 4.01. (a) Bujumbura shall maintain or cause to be maintained records adequate to reflect in accordance with consis- tently maintained appropriate accounting practices the operations, resources and expenditures, in respect of Part H of the Project, of the departments or agencies of Bujumbura responsible for carrying out Part H of the Project or any part thereof, in- cluding without limitation to the foregoing, separate accounts refledting all expenditures described in Category (8) of the table in paragraph 1 of Schedule 1 to the Development Credit Agreement on account of which withdrawals are requested from the Credit Account on the basis of certificates of expenditure. (b) Bujumbura shall retain, until one year after the Closing Date, all records (orders, invoices, bills, receipts and other documents) evidencing the expenditures on account of which withdrawals are requested from the Credit Account on the basis of certificates of expenditure and shall enable the Association's accredited representatives to examine such records. (c) Bujumbura shall have the separate accounts referred to in paragraph (a) of this Section for each fiscal year made available to the Project Unit for purposes of audit not more than 45 days after the Project Unit has requested same from Bujumbura. Section 4.02. Bujumbura, through the Technical Department, shall manage and maintain a solid waste disposal site of about four hectares at Buterere in accordance with appropriate prac- tices. Section 4.03. Bujumbura shall pay within the delay specified by the Borrower's Regie des Eaux et d'El'ctricite all dues and charges owed thereto for water and electricity services rendered by it to Bujumbura. ARTICLE V Effective Date; Termination; Cancellation and Suspension Section 5.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. -6- Section 5.02. (a) This Agreement and all obligations of the Association and of Bujumbura thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) a date 20 years after the date of this Agreement. (b) If the Development Credit Agreement terminates in accor- dance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify Bujumbura of this event. Section 5.03. All the provisions of this Agreement shall con- tinue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. ARTICLE VI Miscellaneous Provisions Section 6.01. Any notice or request required or permitted to be given or made under this Agreement and any agreement between the parties contemplated by this Agreement shall be in writing. Such notice or request shall be deemed to have been duly given or made when it shall be delivered by hand or by mail, telegram, cable, telex or radiogram to the party to which it is required or permitted to be given or made at such party's address hereinafter specified or at such other address as such party shall have des- ignated by notice to the party giving such notice or making such request. The addresses so specified are: For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INDEVAS 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) -7- For Bujumbura: Municipality of Bujumbura B.P. 117 Bujumbura Republic of Burundi Cable address: Telex: MINAFFEXT 65 BUJA Bujumbura Section 6.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under. this Agreement on behalf of Bujumbura may be taken or executed by the Mayor of Bujumbura or such other person or persons as the Mayor of Bujumbura shall designate in writing, and Bujumbura shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 6.03. This Agreement may be executed in several coun- terparts, each of which shall be an original, and all collectively but one instrument. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agree- ment to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION By /Yi 4W Regional Vice President Eastern Africa MUNICIPALITY OF BUJUMBURA By A Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Development Association. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the &A day of , 1980. FOR SECRETARY