Mauritania - Second Rural Sector Technical Assistance Project : Credit 1414 - Project Agreement - Conformed

DWUMjN-TS CREDIT NU4MBER 1414 MAD Project Agreement (Second Rural Sector Technical Assistance Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and SOCIETE NATIONALE POUR LE DEVELOPPEMENT RURAL Dated , 1983 CREDIT NUMBER 1414 MAD PROJECT AGREEMENT AGREEMENT, dated - w "(9- -2. , 1983, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and SOCIETE NATIONALE POUR LE DEVELOPPEMENT RURAL (hereinafter called SONADER). WHEREAS by the Development Credit Agreement of even date herewith between ISLAMIC REPUBLIC OF MAURITANIA (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to seven million four hundred thousand Special Drawing Rights (SDR 7,400,000), on the terms and conditions set forth in the Development Credit Agreement, but oaly on condition that SONADER agree to undertake such obliga- tions toward the Association as are hereinafter set forth; WHEREAS by a subsidiary agreement to be entered into between the Borrower and SONADER, part of the proceeds of the credit provided for under the Development Credit Agreement will be made available to SONADER on the terms and conditions therein set forth; and WHEREAS SONADER, 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. SONADER shall carry out Parts F, G and H of the Project described in Schedule 2 to the Development Credit Agreement with due diligence and efficiency and in conformity with appropriate administrative and financial practices. -2- Section 2.02. (a) In order to assist SONADER in carrying out Parts F, G and H of the Project, SONADER shall employ consultants and specialists, including a management specialist, a financial analyst, three irrigation engineers, an agricultural engineer, an agricultural economist and a credit specialist, whose selection, qualifications, experience and terms and conditions of employment shall be satisfactory to the Association in accordance with the principles 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. (b) SONADER shall, at all times during execution of the Project, take all necessary measures to permit the consultants and specialists referred to it paragraph (a) of this Section to carry out their obligations and responsibilities in compliance with their respective terms of reference. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods 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 Agree- ment. Section 2.04. (a) SONADER undertakes to insure, or make ade- quate 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 payable in a currency freely usable by SONADER to replace or repair such goods. (b) SONADER 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 2.05 (a) SONADER shall furnish to the Association, promptly upon their preparation, reports and contract documents for Parts F through H of the Project, and any material modifica- tions thereof or additions thereto, in such detail as the Asso- ciation shall reasonably request. (b) SONADER: (i) shall maintain records and procedures adequate to record and monitor the progress of Parts F through H of the Project (including their cost and the benefits to be derived from them), to identify the *goods and services financed -3- out of the proceeds of the Credit made available to it by the Borrower, and to disclose their use in Parts F through H of the Project; (ii) shall enable the Association's representatives to examine the goods financed out of such proceeds 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 Parts F through H of the Project, their cost and, where appropriate, the benefits to be derived from them, the expenditures of such proceeds and the goods and services financed out of them. (c) Upon the award by SONADER of any contract for goods, 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) SONADER shall enable the Association's representatives to examine all plants, installations, sites, works, buildings, property and equipment of SONADER and any relevant records and documents. Section 2.06. SONADER shall duly perform all its obligations under the Subsidiary Agreement. Except as the Association shall otherwise agree, SONADER shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Agreement or any provision thereof. Section 2.07. (a) SONADER shall, at the request of the Asso- ciation, exchange views with the Association with regard to the progress of Parts F through H of the Project, the performance of its obligations under this Agreement and under the Subsidiary Agreement, and other matters relating to the purposes of the Credit. (b) SONADER shall promptly inform the Association of any condition which interferes or threatens to interfere with the progress of Parts F through H of the Project, the accomplishment of the purposes of the Credit, or the performance by SONADER of its obligations under this Agreement and under the Subsidiary Agreement. Section 2.08. By January 1, 1984 or such other date as the Association may agree, SONADER shall employ at least 8 profes- sionals whose qualification shall be acceptable to the Association, to work as counterparts with the consultants and specialists specifically referred to in Section 2.02 (a) of this Agreement during the implementation of Parts F through H of the Project. Section 2.09. By June 30, 1984 or such other date as the Association may agree, SONADER shall furnish to the Association a program acceptable to the Association for the training to be carried out under Part H of the Project. ARTICLE III Management and Operations of SONADER Section 3.01. SONADER shall carry on its operations and conduct its affairs in accordance with sound administrative and financial practices under the supervision of qualified and experienced management assisted by competent staff in adequate numbers. Section 3.02. SONADER shall at all times operate and main- tain its equipment and other property, and from time to time, promptly as needed, make all necessary repairs and renewals thereof, all in accordance with sound engineering and financial practices. Section 3.03. SONADER shall take out and maintain with res- ponsible insurers insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 3.04. By November 1 of each year while the Project is being executed, SONADER shall furnish the Association its budget for the following year. ARTICLE IV Financial Covenants Section 4.01. (a) SONADER shall maintain accounts adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition, including, without limitation to the foregoing, separate accounts reflec"ing all expenditures on account of which withdrawals are -5- requested from the Credit Account on the basis of statements oi expenditure. (b) SONADER shall retain, until one year after 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 shall enable the Associa- tion's representatives to examine such records. Section 4.02. SONADER shall: (a) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (b) furnish to the Association as soon as available, but in any case not later than four months after the end of each such year, (i) certified copies of its financial statements for such year as so audited, and (ii) the report of such audit by said 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 in Section 4.01 (b) of this Agreement, as to whether the proceeds of the Credit relent to it and withdrawn from the Credit Account on the basis of statements of expenditure have been used for the purpose for which they were provided; and (c) furnish to the Association such other information concerning said accounts, financial statements, records and expenditures, as well as the audit thereof, as the Association shall from time to time reasonably request. 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 SONADER 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 15 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 SONADER of this event. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. ARTICLE 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 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) -7- For SONADER: Soci6tg Nationale pour le Dgveloppement Rural B.P. 321 Nouakchott Islamic Republic of Mauritania Cable address: Telex: SONADER 807 MTN Nouakchott 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 SONADER may be taken or executed by its Director General or such other person or persons as the Director General of SONADER shall designate in writing, and SONADER 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 counterparts, 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 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 By4 Regional Vice President Western Africa SOCIETE NATIONALE POUR LE DEVELOPPEMENT RURAL flI 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 3. FOR SECRETARY