China - North China Plain Agriculture Project : Credit 1261 - Henan Project Agreement - Conformed

CREDIT NUMBER 1 2 - CHA Henan Project Agreement (North China Plain Agricultural Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and HENAN PROVINCE Dated v Z , 1982 CREDIT NUMBER 1 KA- HENAN PROJECT AGREEMENT AGREEMENT, dated d 3 , 1982, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and HENAN PROVINCE (hereinafter called Henan). WHEREAS by the Development Credit Agreement of even date herewith between the People's Republic of China (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to fifty-four million Special Drawing Rights (SDR 54,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that Henan agree to undertake such obligations toward the Association as are hereinafter set forth; and WHEREAS Henan, 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 the Project Section 2.01.(a) Henan shall carry out and shall cause to be carried out that part of the Project described in Schedule 2 to the Development Credit Agreement located in Henan with due dili- gence and efficiency and in conformity with appropriate admini- strative, financial, agricultural and engineering practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose, including without limitation adequate electrical power or fuel supply for tubewells. -2- (b) With respect to that part of the Project for which Henan is financially responsible, Henan shall: (i) make adequate and timely budgetary provisions for the implementation of such part; and (ii) take appropriate steps for the operation and maintenance of the facilities and equipment provided under the Project. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods and civil works required for the Project and to be financed out of the proceeds of the Credit, shall be governed by the provisions of Schedule 3 to the Development Credit Agreement. Section 2.03 (a) Henan undertakes to insure, or make ade- quate provision for the insurance or replacement of, the imported goods to be financed out of the proceeds of the Credit made available to it by the Borrower 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 payable in a currency freely usable by Henan to replace or repair such goods. (b) Except as the Association may otherwise agree, Henan shall cause all goods ar services financed out of the proceeds of the Credit made available to it by the Borrower to be used exclusively for the Project. Section 2.04. With respect to that part of the Project for which Henan or any of its counties or agencies shall be respon- sible: (a) Henan shall furnish to the Association, promptly upon their preparation, the plans, specifications, reports, contract documents and work and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) Henan: (i) shall maintain records and procedures adequate to record and monitor the progress 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, and to disclose their use 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 and any relevant records and documents; and (iii) shall furnish to the Association at regular intervals all such information as the -3- Association shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be Jerived from it, the expenditures of such proceeds and the goods and services financed out of such proceeds. (c) Henan shall enable the Association's representatives to examine all plants, installations, sites, works, buildings, property and equipment and any relevant records and documents. Section 2.05. (a) Henan shall at the request of the Associa- tion, exchange views with the Association with regard to the pro- gress of the Project, the performance of its obligations under this Agreement and other matters relating to the purposes of the Credit. (b) Henan shall promptly inform the Association of any con- dition which interferes or threatens to interfere with the pro- gress of the Project, the accomplishment of the purposes of the Credit or the performance by Henan of its obligations under this Agreement. ARTICLE III Other Covenants Section 3.01. Henan shall maintain, or cause its agencies and counties to maintain, records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition in respect of activities related to the Project. Section 3.02. Henan shall in respect of activities related to the Project: (i) have its accounts and financial statements for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later than six 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; and (iii) furnish to the Association such other information concern- ing such accounts and financial statements and the audit thereof as the Association shall from time to time reasonably request. -4- Section 3.03. Henan shall at all times operate, maintain, renew and repair, or cause to be operated, maintained, renewed and repaired, in accordance with appropriate agricultural and management practices, the facilities and equipment provided under that portion of the Project located in Henan. ARTICLE IV Effective Date; Termination; Cancellation and Suspension Section 4.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. Section 4.02. (a) This Agreement and all obligations of the Association and of Henan 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 accordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify Henan of this event. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. ARTICLE V Miscellaneous Provisions Section 5.01. 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 - 5 permitted to be given or made at such party's address hereinafter specified or at such other address as such party shall have designated 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) For Henan: Henan Provincial Agricultural Department Chengzhou Municipality China Section 5.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of Henan may be taken or executed by the Director of the Province Project Management Office in Henan Province or such other person or persons as such Director shall designate in writing, and Henan shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 5.03. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. -6- IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement 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 Regional Vice President East Asia and Pacific HENAN PROVINCE By 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 -day of 198 2. FOR SECRETARY