Haiti - Forestry Project : Credit 1257 - Credit Agreement - Conformed

rOFICIAL DIT NUMBER 1257 HA DOCUMENTSE Development Credit Agreement (Forestry Project) between REPUBLIC OF HAITI and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated , 1982 CREDIT NUM"ER 1257 HA DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated , 1982, between the REPUBLIC OF ITI (hereinafter called the Borrower) and the INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). 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 June 30, 1980, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agree- ments of the Association 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 thereia set forth and the following additional terms have the following meanings: (a) "Ministry" means the Borrower's Ministry responsible for forests, at the date of this Agreement, the Ministry of Agriculture, Natural Resources and Rural Development; (b) "Bureau" means the Forestry Bureau of the Division of Natural Resources and Irrigation of the Ministry; and (c) "Special Account" means the account referred to in Section 2.02 (b) of this Agreement. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borro- wer, on the terms and conditions in the Development Credit Agree- ment set forth or referred to, an amount in various currencies equivalent to three million six hundred thousand Special Drawing Rights (SDR 3,600,000). -2- Section 2.02. (a) The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of this Section and of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Association, for expenditures made (or, if the Associa- tion shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. (b) The Borrower shall, for the purposes of the Project, open a Special Account in a commercial bank on terms and condi- tions satisfactory to the Association. Payments out of the Spe- cial Account shall be made exclusively to pay the reasonable costs of goods and services required to carry out the Project and to be financed under this Agreement in accordance with the provi- sions of the table set forth in paragraph 1 of Schedule 1 here- to. (c) The Association shall, as of the Effective Date, with- draw on behalf of the Borrower from the Credit Account and depo- sit in the Special Account an initial amount in the currency of the Borrower equivalent to SDR 50,000, as provided in Category 5 of the table set forth in paragraph 1 of Schedule 1 of this Agreement. Thereafter, at the request of the Borrower, the Asso- ciation on behalf of the Borrower shall further withdraw from the Credit Account and deposit in the Special Account such amounts as shall be required to replenish the Special Account with amounts equal to payments made out of the Special Account for expendi- tures for the Prcject eligible for financing under this Agree- ment, but only to the extent that the amount of any such deposit, together with any amount remaining on deposit in the Special Account as of the date of such request, shall not exceed in the aggregate the equivalent of SDR 50,000. Except as the Association shall otherwise determine, each such deposit after the initial deposit shall be withdrawn from the Credit Account under the same Categories set forth in the table in paragraph 1 of Schedule 1 to this Agreement, and in the same respective amounts, as have been justified by the evidence supporting the request for such depo- sits furnished pursuant to paragraph (d) of this Section. (d) Prior to or at the time of each request by the Borrower for a deposit into the Special Account, the Borrower shall fur- nish to the As.ociation in respect of each payment out of the -3- Special Account such documents and other evidence as the Associa- tion shall reasonably request, showing that such payment was made to pay the reasonable cost of goods or services required for the Project and to be financed out of the proceeds of the Credit in accordance with Schedule 1 to this Agreement. (e) If the Association shall have determined that any pay- ment out of the Special Account: (i) was made for any expenditure or in any amount not eligible for financing by withdrawal from the Credit Account; or (ii) was not justified by the evidence furnished pursuant to paragraph (d) of this Section, the Borrower shall, promptly upon such notice from the Association and, unless otherwise agreed by the Association, prior to any further deposit in the Special Account, deposit in the Special Account or refund to the Association an amount equal to the amount of euch payment or of the portion thereof not so eligible or justified. (f) Notwithstanding the provisions of paragraph (c) of this Section, no further deposit in the Special Account shall be made (i) when the Association shall have determined that all further withdrawals can be made directly by the Borrower from the Credit Account under Section 2.02 (a) of this Agreement, (ii) when the total amount withdrawn from the Credit Account, plus the amount of any qualified agreement to reimburse made by the Association and of any special commitment entered into by the Association pursuant to Section 5.02 of the General Conditions, shall have reached the equivalent of SDR 3,550,000, or (iii) after September 30, 1985 whichever shall be soonest. Withdrawal from the Credit Account of the remaining amounts of the Credit for the Project shall follow such procedures as shall be agreed between the Borrower and the Association and shall be made only to the extent that the Association shall be satisfied by the evidence submitted in support of the applications for such withdrawals that all pay- ments by the Borrower out of the Special Account and out of the proceeds of the Credit were made on account of the reasonable cost of goods or services required for the Project and to be financed out of the proceeds of the Credit in accordance with Schedule 1 to this Agreement. Section 2.03. 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 this Agree- ment. -4- Section 2.04. The Closing Date shall be June 30, 1987 or such later date as the Association shall establish. The Associa- tion shall promptly notify the Borrower of such later date. Section 2.05. (a) The Borrower shall pay to the Association a commitment charge at the rate of one-half of one per cent (1/2 of 1%) per annum on the principal amount of the Credit not with- drawn from time to time. The commitment charge shall accrue from a date sixty days after the date of the Development Credit Agree- ment to the respective dates on which amounts shall be withdrawn by the Borrower from the Credit Account or shall be cancelled. (b) The commitment charge shall be paid: (i) at such places as the Association shall reasonably request; (ii) without re- strictions of any kind imposed by, or in the territory of, the Borrower; and (iii) in the currency specified in this Agreement for the purposes of Section 4.02 of the General Conditions or in such other eligible currency or currencies as may from time to time be designated or selected pursuant to the provisions of that Section. Section 2.06. 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 withdrawn and outstanding from time to time. Section 2.07. Commitment charges and service charges shall be payable semiannually on January 15 and July 15 in each year. Section 2.08. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each Jan- uary 15 and July 15 commencing July 15, 1992, and ending Jan- uary 15, 2032, each installment to and including the installment payable on January 15, 2002, 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 2.09. 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 economic, financial, administrative, agricultural and forestry practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the pur- pose. (b) The Borrower shall select a senior forestry consultant by September 15, 1982 as provided in Section 3.02 below. (c) The Borrower shall, prior to the appointment of any new Chief of the Bureau, exchange views with the Association on the qualifications and experience of the proposed candidate. Section 3.02. In order to assist the Borrower in the opera- tions of the Bureau, in training, in forest management and reforestation and in conducting surveys of soils, the Borrower shall employ consultants and experts, whose selection, qualifi- cations, experience and terms and conditions of employment shall be satisfactory to the Association in accordance with the prin- ciples and procedures described in the "Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency" published by the Bank in August 1981. Section 3.03. (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 ini- dent to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance auy indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) The Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the purposes of the Project. Section 3.04. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement -6- 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 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 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 Association shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expen- diture of the proceeds of the Credit and the goodo and services financed out of such proceeds. (c) Upon the award by the Borrower of any contract for goods, works or services to be financed out of the proceeds of the Credit, the Association may publish a description thereof, the name and nationality of the party to whom the contract was awarded and the contract price. (d) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Association, the Borrower shall prepare and furnish to the Association a report, of such scope and in such detail as the Association shall reasonably request, on the execution and ini- tial operation of the Project, its cost and the benefits derived and to br derived from it, the performance by the Borrow- er and the Association of their respective obligations under the Devel- opment Credit Agreement and the accomplishment of the purposes of the Credit. Section 3.05. Candidates for the fellowships included in Part B of the Project shall be satisfactory to the Association; the Borrower shall employ in the Bureau, for a period of at least double the duration of training under such fellowships, each trainee successfully completing such training. Section 3.06. The Borrower shall ensure that the agricul- tural support services, provided by the Ministry to farmers -7- benefitting from the Project in the pine forest area of La Selle be intensified and in particular by the provision of credits and the appointment of additional extension agents. Section 3.07. As part of the preparation for future projects in forestry development comprising Part F of the Project, the Borrower shall review tl-- existing legislative and regulatory framework applicable to such development, exchange views thereon with the Association prior to the end of the second year of the Project and shall thereafter make such modifications in such framework as iall be necessary or appropriate. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with con- sistently maintained appropriate accounting practices the opera- tions, 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. (b) Without limitation to the foregoing, the Borrower shall: (i) maintain or cause to be maintained separate accounts reflecting all expenditures on account of which withdrawals are requested from the Credit Account on the basis of statements of expenditure; (ii) retain, until one year a 'ter the Closing Date, all records (contracts, 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 statements of expenditure; and (iii) enable the Association's representatives to examine such records. (c) The Borrower shall: (i) have the Special Account and the accounts referred to in paragraph (b) of this Section audited, for each fiscal year, 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 four months after the end of each such year, a certified copy of the report of such audits by such auditors, of such scope and in such detail as the Association shall have reasonably requested, including without limitation to the foregoing, a separate opinion by said auditors in respect of the expenditures and records referred to -8-. in paragraph (b) of this Section as to whether the proceeds of the Credit withdrawn from the Credit Account on the basis of statements of expenditure were used to make payments for goods received, or works or services performed, and that such goods, works and services were eligible for financing under this Agree- ment and were used in the carrying out of the Project; and (iii) furnish to the Association such other information concerning the Special Account and said separate accounts, records and expendi- tures and the audits thereof as the Association shall from time to time reasonably request. Section 4.02. The Borrower shall continue to furnish such funds, land and personnel as shall be required to carry on the fuelwood species trials after the termination of their financing under Part C of the Project. Section 4.03. Until the completion of the Project, the Borrower shall cause the Bureau to collect an appropriate charge for sawtimber commercially harvested in the La Selle-managed forest; such charge shall be initially fixed at at least G 60 per cubic meter and shall be increased periodically, taking into account such elements as changes in the costs of operations and the landed prices of imported lumber. ARTICLE V Effective Date; Termination Section 5.01. The following events are specified as addi- tional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions: (a) the Bureau has appointed a field manager for each of the three areas included in Part C of the Project; (b) the Ministry has designated a senior procurement offi- cer in its administrative section acceptable to the Association to be responsible for procurement under the Project; (c) an area of at least 250 ha of land near Port-au-Prince and areas of 50 ha each at Baie de Henne and at Jean Rabel have been made available by the Borrower to the Bureau for use in the trials included in Part C of the Project; -9- (d) Arrangements satisfactory to the Association have been made by the Borrower for the participation of the Ministry responsible for national education and the Directorate of Energy of the Ministry responsible for energy, respectively, in Parts B and E of the Project; and (e) the Special Account has been opened. Section 5.02. The date ) 2 / is hereby specified for the purposes of Section 12.04 of the General Condi- tions. Section 5.03. The obligations of the Borrower under Article IV of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date fifteen years after the date of this Agreement, whichever shall be the earlier. ARTICLE VI Representatives of the Borrower; Addresses Section 6.01. The Secretary of State responsible for finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 6.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Secretairerie d'Etat des Finances et des Affaires Economiques Palais des Ministeres Port-au-Prince Haiti Cable address: Telex: SECRETAIRERIE D'ETAT DES FINANCES 2030347 ET DES AFFAIRES ECONOMIQUES Port-au-Prince, Haiti - 10 - 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) 64145 (WUI) 89550 (WUD) or 197688 (TRT) 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. REPUBLIC OF HAITI By Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By Regional Vice President Latin America and the Carribbean - 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 each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category SDR Equivalent) to be Financed (1) Civil works 130,000 100% (2) Vehicles, equip- 450,000 100% ment, furniture (3) Field forestry 1,070,000 100% costs, inclu- ding inputs, surveys, seasonal labor support staff and operation costs (4) Consultants' 1,330,000 100% services; fellow- ships (5) Initial deposit 50,000 in Special Account (6) Unallocated 570,000 TOTAL 3,600,000 2. The disbursement percentages have been calculated in compli- ance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied - 12 - 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 the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments for expenditures (a) made prior to the date of this Agreement or (b) under Part E of the Project until the Directorate of Energy Resources of the Borrower's Ministry of Mines and Energy and the Ministry have each appointed a person to carry out surveys of cooking practices affecting stove design, in Port-au-Prince and in rural areas, respectively. 4. Notwithstanding the allocation of an amount of the Credit or the disbursement percentage set forth in the table in paragraph 1 above, if the Association has reasonably estimated that the amount of the Credit than 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 disbursement percentage then applicable to such expen- ditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 5. If the Associa:ion 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 expen- ditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restric- ting or limiting any other right, power or remedy of the Associa- tion under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as, in the Associa- tion's reasonable opinion, represents the amount of such expendi- tures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 13 - SCHEDULE 2 Description of the Project The Project is designed to develop a substantial capability for forest management and reforestation in Haiti, to encourage conservation and to prepare future projects in forestry develop- ment. The Project includes the following: Part A: Strengthening the capabilities of the Bureau through the employment of additional expert staff, the acquisition of vehicles and equipment and the training of field personnel; Part B: Carrying out a program of education and training, including, the granting of 8 fellowships for training outside Haiti at the graduate level and the introduction in grade schools of education in forestry and resource conservation, with the cooperation of the relevant services of the Ministries of Agri- culture and National Education; Part C: Pilot plantings of species of suitable potential on about 250 ha of state land near Port-au-Prince; conducting species elimination trials for planting and direct seeding of exotic and local species at that site and in the Northwest in at least two other ecological zones for at least 100 ha of plant- ings; Part D: Demarcation and survey of the pine forest at La Selle; preparation of a comprehensive management plan for the 20,000 ha of forest on the 30,000 ha area; conducting species trials for exotic pines; Part E: Testing and promotion of improved wood and charcoal- burning cooking stoves by the Directorate of Energy Resources of the Ministry responsible for energy; and Part F: Preparation of a future large-scale project of forestry development with particular emphasis on reforestation. The Project is expected to be completed by December 31, 1986. - 14 - SCHEDULE 3 Procurement A. International Competitive Bidding 1. Except as provided in Part B hereof, goods shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the current edition of the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1977 (hereinafter called the Guidelines), on the basis of international competitive bidding as described in Part A of the Guidelines. 2. For goods and works to be procured on the basis of interna- tional competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Association as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender or prequalification documents relating thereto, as the case may be, a general procurement notice, in such form and detail and containing such information as the Asso- ciation shall reasonably request; the Association will arrange for the publication of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of interna- tional competitive bidding. 3. For the purpose of inviting bids, similar vehicles and equipment shall be grouped in lots. 4. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international com- petitive bidding: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for the imported goods, or the ex-factory price or off-the-shelf price of other goods, offered in such bid; (ii) customs duties and other import taxes levied in connection with the importation, or the sales and simi- lar taxes levied in connection with the sale or delivery, pursu- ant to the bid, of the goods shall not be taken into account in the evaluation of the bids; and (iii) the cost of inland freight and other expenditures incidental to the delivery of the goods to the place of their use or installation shall be included. - 15 - B. Other Procurement Procedures 1. Contracts for civil works or construction may be awarded on the basis of competitive bidding advertised locally. 2. Items other than vehicles which, after grouping, are valued over $25,000 but not over $100,000 may be procured on the basis of competitive bidding advertised locally. 3. Items costing $25,000 or under may be purchased on the basis of the lowest of at least three competing quotations. C. Review of Procurement Decisions by the Association Review of invitations to bid and of proposed awards and final contracts: 1. With respect to all contracts estimated to cost the equiva- lent of $100,000 or more: (a) 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. (b) 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 shall furnish to the Associa- tion, in sufficient time for its review, a detailed report made with the assistance of the consultants referred to in Section 3.02 of this Agreement, on the evaluation and comparison of the bids received, together with the recommendations for award of the said consultants and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. - 16 - (c) 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 was invited. (d) 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 with- drawal of funds from the Credit Account in respect of such con- tract. 2. With respect to each contract not governed by the preceding paragraph 1, 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 the respective bids, recommendations for award and such other infor- mation as the Association shall reasonably request. The Associa- tion 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. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an extension of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cost of the contract by more than 15% of the original price, the Borrower shall inform the Association of the proposed modification, waiver, extension or change order and the reasons therefor. The Association, if it determines that the proposal would be inconsistent with the pro- visions of this Agreement, shall promptly inform the Borrower and state the reasons for its determination. 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 Associaton. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the day of , 198 . FOR SECRETARY