Senegal - Second Parapublic Technical Assistance Project : Credit 1398 - Credit Agreement - Conformed

Fc, DIT NUMBER 1398 SE Development Credit Agreement (Second Parapublic Technical Assistance Project) between REPUBLIC OF SENEGAL and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated V 0 0 , 1983 CREDIT NUMBER 1398 SE DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated A I 02 , 1983, between REPUBLIC OF SENEGAL (h reinafter called the Borrower) and 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 Agreements 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 therein set forth and the following additional terms have the following meanings: (a) "Project Preparation Advance" means the project pre- paration advance granted by the Association to the Borrower pursuant to an exchange of letters dated June 24, 1982 and October 15, 1982 between the Borrower and the Association. (b) "CFP" means the Contr8leur Financier de la Presidence, an office established within the General Secretariat of the Presidency of the Republic pursuant to the Borrower's Ordonnance No. 59-043, dated March 31, 1959, and Decree No. 78-085, dated February 1, 1978. (c) "BOM" means Bureau Organisation et Methodes, an office established within the General Secretariat of the Presidency of the Borrower pursuant to the Borrower's Decree No. 70-231, dated February 26, 1970 as modified by Decree No. 82-941, dated November 22, 1982. (d) "COF" means Contr8leur des Operations Financieres, an office established within the Centre des Etablissements Publics of the Borrower's Ministry of Finance whose responsibilities are defined pursuant to Law No. 77-89, dated August 10, 1977 of the Borrower and Decree No. 78-605, dated June 20, 1978. -2- (e) "ACC" means l'Agent Comptable Centrale, an office established within the Centre des Etablissements Publics of the Borrower's Ministry of Finance, whose responsibilities are defined pursuant to the Borrower's Law No. 77-89, dated August 10, 1977 and the Borrower's Decree No. 78-605, dated June 20, 1978. (f) "DTAI" means Direction de Traitement Automatique de l'Information, an office established within the Borrower's Ministry of Finance, whose responsibilities are defined pursuant to the Borrower's Decree No. 80-892, dated November 22, 1980. (g) "CVCCEP" means Commission de Vrification des Comptes et de Contr8le des Etablissements Publics, a para-judicial body related to the Borrower's Supreme Court, whose responsibilities are defined pursuant to the Borrower's Law No. 77-89, dated August 10, 1977 and the Borrower's Decree No. 77-902, dated October 19, 1977. (h) "GESP" means the Groupe d'Etude du Secteur Para- public established pursuant to the Borrower's Arr6t4 Primatorial No. 5155/PM/SGG/EC, dated May 11, 1976 as modified by Arrete No. 1450 dated February 21, 1980. (i) "Project Management Unit" means the unit to be estab- lished by the Borrower pursuant to the provisions of Section 5.01 of this Agreement. V (j) "Parapublic Sector" or "Parapublic Enterprises" means the Borrower's Etablissements Publics, the Soci&t6s Nationales and such Soci6t6s d'Economie Mixte. (k) "Etablissement Public" means any of the Etablissements Publics referred to in Article 3 of the Borrower's Law No. 77-89, dated August 10, 1977. (1) "Socift6 d'Economie Mixte" means the industrial, com- mercial or artisan corporations in which the Borrower or a poli- tical subdivision of the Borrower owns directly or indirectly a portion of the share capital. (m) "Socifte Nationale" means an industrial or commercial corporation established pursuant to the Borrower's Law No. 77-89, dated August 10, 1977, in the form of stock corporations whose capital is wholly subscribed by the Borrower or by other politi- cal subdivisions of the Borrower, if applicable. -3- (n) "Ordre des Experts et Evaluateurs Agre's du S6n6gal" means the Etablissement Public Professionel established pursuant to the Borrower's Law No. 8306, dated January 28, 1983. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Bor- rower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various curren- cies equivalent to ten million two hundred thousand Special Drawing Rights (SDR 10,200,000). Section 2.02. (a) 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 may be amended from time to time by agreement between the Borrower and the Association, 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 and to be financed out of the proceeds of the Credit. (b) Promptly after the Effective Date, the Association shall, on behalf of the Borrower, withdraw from the Credit Account and pay to itself the amount required to repay the prin- cipal amount of the Project Preparation Advance withdrawn and outstanding as of such date and to pay all unpaid charges there- on. The unwithdrawn balance of the authorized amount of the Project Preparation Advance shall thereupon be cancelled. 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 this Agreement. Section 2.04. The Closing Date shall be June 30, 1988 or such later date as the Association shall establish. The Association 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 -4- 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 restrictions 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 March 15 and September 15 in each year. Section 2.08. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each March 15 and September 15 commencing September 15, 1993, and ending March 15, 2033, each installment to and including the installment payable on March 15, 2003, to fe 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 Republic of France is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project through the Project Management Unit and through its departments and agencies referred to in Schedule 2 to this Agreement with due diligence and efficiency and in conformity with appropriate financial, administrative and accounting practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. -5- Section 3.02. In order to assist the Borrower in carrying the Project, the Borrower shall employ, or cause the enterprises referred to or selected pursuant to Sections 3.07 (a) and 3.09 of this Agreement to employ, consultants, experts, including audi- tors and accountants, whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Asso- ciation, such consultants to be selected in accordance with prin- ciples and procedures satisfactory to the Association on the basis of 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 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 the Borrower to replace or repair such goods. (b) The Borrower shall cause all goods and s-rvices 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, and contract documents for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borruwer: (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 expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. -6- (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 of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Association of their respective obligations under the Development Credit Agreement and the accomplishment of the purposes of the Credit. Section 3.05. By March 31 of each year during execution of the Project, the Borrower shall, through the Project Management Unit, submit to the Association for its approval the Borrower's proposal for the selection of Parapublic Enterprises for the purpose of the carrying out of Part A of the Project during such year. Section 3.06. (a) The Borrower shall: (i) select and employ through the Project Management Unit in consultation with the enterprises selected pursuant to the provisions of Section 3.05 r-f this Agreement and for the' purpose of carrying out Part A of the Project, management consultants and other consultants in con- formity with the provisions of Section 3.02 of this Agreement; (ii) establish through the Project Management Unit teams for the preparation of proposals for rehabilitation programs and contrats-plan; such teams to be composed of suitably qualified staff in adequate numbers from the enterprises concerned and staff of CFP or BOM and the activities of such teams to be co- ordinated in each case by such management consultants; (iii) cause the enterprises concerned: (A) to ensure that the staff selected for such teams shall contribute to the work of such teams on a full-time basis, and (B) to provide such management consultants with adequate support staff, equipment and appro- priate offices; and (iv) notify, through the Project Management Unit, the Association, promptly, of the date of establishment of such teams. (b) The Borrower shall, through the Project Management Unit, furnish to the Association: (i) within six months after -7- the establishment of the teams referred to in paragraph (a) (ii) of this Section, the proposals prepared by said teams for re- habilitation programs for the Association's review and comment; such rehabilitation programs to include lists of urgently needed spare parts and equipment to be provided under Part A.3 of the Project for the Association's approval; and (ii) within twelve months after the establishment of the teams referred to in para- graph (a) (ii) of this Section, the proposals of said teams for the resulting contrats-plan, for the Association's review and comment. (c) By March 31, 1984, the Borrower shall, in consultation with the Association and enterprises selected pursuant to Section 3.05 of this Agreement, review execution of Part A.1 of the Project and make recommendations for the further execution of Part A.1 of the Project. (d) At the end of the first year of implementation of each contrat-plan referred to in Part A.2 of the Project and annually thereafter until completion of the Project, the Borrower shall, in consultation with the Association and the enterprises con- cerned, review the performance of the Borrower and the enter- prises concerned in respect of their respective obligations under said contrats-plan. Section 3.07. (a) The Borrower shall, for the purpose of carrying out Part B.1 of the Project, cause, through CVCCEP each of SOTRAC, SONADIS, SODEFITEX, OPT, SENELEC, CPSP, OHLM, SICAP, Dakar-Marine, and BNDS (as defined under Part B.1 of the Project) or such other enterprises as the CVCCEP may propose to the Asso- ciation from time 'o time and may have been agreed by the Asso- ciation to select and employ auditors in conformity with the provisions of Section 3.02 of this Agreement. (b) The Borrower shall cause said enterprises: (i) to have their accounts audited, in accordance with appropriate auditing principles consistently applied by the auditors employed pursuant to subparagraph (a) (i) above; (ii) to furnish to the Association as soon as available: (A) certified copies of their accounts and financial statements as audited under Part B.1 of the Project, and (B) the reports of such audits of such scope and in such detail as the Association shall have reasonably requested. (c) Except as the Association shall otherwise agree, the Borrower shall cause said enterprises to contribute, as and when -8- needed, during the first year of such audits at least 25%, and during the second and third year at least 50%, of the total cost of the auditors employed by any such enterprises. Section 3.08. By March 31 of each year during execution of the Project, the Borrower shall, through CVCCEP, submit to the Association for its approval a proposal for the selection of Parapublic Enterprises for the purpose of carrying out Part B.2 of the Project. Section 3.09. The Borrower shall, for the purpose of carry- ing out Part B.2 of the Project, cause each of the enterprises selected pursuant to the provisions of Section 3.08 of this Agreement: (i) to select and employ accountants in conformity with the provisions of Section 3.02 of this Agreement; (ii) to contribute, as and when needed, at least 25% of the total cost of the accountants employed by any such enterprise pursuant to sub- paragraph (i) above; and (iii) to furnish to the Association any financial statements and reports prepared with the assistance of said accountants. Section 3.10. (a) The Borrower shall, for purposes of the carrying out of Part B.3 of the Project, select and employ con- sultants through CVCCEP in consultation with the Ordre des Experts et des Evaluateurs Agre's du Senegal in conformity with the provisions of Section 3.02'of this Agreement. (b) By June 30, 1984, the Borrower shall: (A) cause the Ordre des Experts et des Evaluateurs Agre's du Senegal to pre- pare national auditing standards; and (B) submit such standards through its Ministry of tJustice with the comments of such Mini- stry to the Association for comment. (c) By December 31, 1984, the Borrower shall, through CVCCEP, prepare and submit to the Association for its review pro- posals for legislation to establish national auditing standards. Section 3.11. During execution of the Project, the Borrower shall maintain the Project Management Unit within the Borrower's Secretariat General de la Presidence adequate powers, organiza- tion and staffing; such unit to be headed, at all times, by a suitably qualified Director who shall be President of GESP and shall report directly to the Secretaire General de la Presidence. -9- Section 3.12. (a) By December 31, 1983, the Borrower shall submit to the Association for comment the recommendations of the study, carried out under Part C.3 (i) of the Project. (b) By December 31, 1984, the Borrower shall submit to the Association for its approval the training program to be carried out under Part C.3 (ii) of the Project, such training program to be prepared on the basis of the results of the study carried out under Part C.3 (i) of the Project. Section 3.13. (a) The Borrower shall, promptly upon their preparation, submit to the Association for its approval terms of reference of all studies to be carried out under Part D of the Project. (b) Promptly upon completion of any study carried out under Part D of the Project, the Borrower shall furnish any such study to the Association and afford the Association a reasonable opportunity to comment on its recommendations. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall maintain or cause to be maintained separate accounts 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 responsi- ble for carrying out the Project or any part thereof. (b) The Borrower shall: (i) have the accounts referred to in paragraph (a) of this Section 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 four months af Uer the end of each such year, a certified copy of the report of such audit by such auditors, of such scope and in such detail as the Association shall have rea- sonably requested; and (iii) furnish to the Association such other information concerning said accounts, records and expendi- tures and the audit thereof as the Association shall from time to time reasonably request. - 10 - ARTICLE V Effective Date; Termination Section 5.01. The following event is specified as an additional condition to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions, namely, that the Project Management Unit has been effectively established within the Borrower's Secr6tariat G6n6ral de la Prfsidence with adequate powers, organization and staffing acceptable to the Association. Section 5.02. The date N 00oe V, 11 V3 is hereby specified for the. purposes of Section 12.04 of the General Condi- tions. ARTICLE VI Representatives of the Borrower; Addresses Section 6.01. The Minister responsible for finance of the Borrower is designated as representacive 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: I Ministere de 1'Economie et des Finances Rue Charles LaIne B.P. 4017 Dakar, Sgnegal Cable address: Telex: MINFINANCES 512 Dakar, Sen6gal TRESOR SG 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) 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 SENEGAL By L 0% t Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By/SIO ".a.-L op4ic- Regional Vice President Western Africa - 12 - 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) Staff cost and 370,000 100% equipment for the Project Management Unit and equip- ment for Part C of the Project (2) Equipment for 1,620,000 100% Part A.3 of the Project (3) (a) Consul- 3,880,000 100% tants under Parts A, B.3 and C of the Project (b) Consultants 740,000 100% under Part D of the Project (4) Audits under 1,160,000 Part B..1 of the Project during: (a) first year 75% of any such audits - 13 - Amount of the Credit Allocated % of (Expressed in Expenditures Category SDR Equivalent) to be Financed (b) second and 50% third year of any such audits (5) Accountants 460,000 75% under Part B.2 of the Project (6) Refunding of 460,000 Amount due under Project Section 2.02 (b) Preparation of this Agreement Advance (7) Unallocated 1,510,000 TOTAL 10,200,000 2. The disbursement percentages have been calculated in com- pliance with the policy of the Association that the proceeds of the Credit shall not be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; on this basis, if the amount of any such taxes levied on or in respect of items in any Category decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such Category as required to be consistent with the aforemen- tioned policy of the Association. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of: (a) expenditures made prior to the date of this Agreement; (b) expenditures in respect of Category 2 unless the Asso- ciation has approved such equipment pursuant to the provisions of Section 3.06 (b) (i) of this Agreement; and - 14 - (c) expenditures in respect of Category 3 (b) unless the Association has approved the terms of reference of the studies pursuant to the provisions of Section 3.13 (a) of this Agreement. 4. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in para- graph 1 above, if the Association has reasonably estimated that the amount of the Credit then 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 expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 5. 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 this Agreement, no expenditure 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 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 Asso- ciation's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 15 - SCHEDULE 2 Description of the Project The Project consists of the following: Part A: Rehabilitation of Public Enterprises 1. Preparation of rehabilitation programs for selected enterprises of the Parapublic Sector; such programs to consist of diagnostic studies, detailed recommendations and a timetable for implementation of recommended measures. 2. Preparation of contrats-plan to be entered into between the Borrower and selected Parapublic Enterprises; said contrats-plan to specify, inter alia, the performance objectives of the respective enterprises and the Bor- rower's financial and other obligations towards such enterprises. 3. Provision of equipment for Parapublic Enterprises needed for the implementation of the rehabilitation programs. Part B: Audits of Public Enterprises and Accounting Assistance 1. Carrying out of 3 consecutive annual audits under the supervision of CVCCEP of selected Parapublic Enter- prises, including Sociftf des Transports en Commun du Cap Vert (SOTRAC), Soci&t& Nationale de Distribution (SONADIS), Societ6 pour le D6veloppement des Fibres Textiles (SODEFITEX), Office des Postes et T6lecommu- nications (OPT), Socifte Nationale de l'Electricitf (SENELEC), Caisse de P&requation et de Stabilisation des Prix (CPSP), Office des Habitations A Loyer Mod6r6 (OHLM), Societe Immobiliare du Cap Vert (SICAP), Banque Nationale de D6veloppement du S6n6gal (BNDS) and Dakar-Marine. 2. Improvement of accounting and internal auditing proce- dures of about 25 enterprises of the Parapublic Sector under the supervision of CVCCEP in cooperation with CFP and COF. - 16 - 3. Preparation of proposals for legislation for the estab- lishment of national auditing standards by l'Ordre des Experts et des Evaluateurs Agrees du Senegal under the supervision of C1VCCEP. Part C: Strengthening o/ Government Control Organizations and of Management of Parapublic Enterprises 1. CFP (i) Training of controllers in techniques of financial analysis of enterprises. (ii) Development of a comprehensive computerized data base for monitoring the economic and financial performance of Para-Public Enterprises. (iii) Acquisition of computer equipment. 2. ACC/COF (i) Training of controllers in techniques of account- ing and internal auditing of Etablissements Publics. (ii) Development of a comprehensive computerized data base, in cooper'ation with CFP, for Etablissements Publics. (iii) Preparation and implementation of a program for the strengthening of accounting and financial management of about five Etablissements Publics A Caractere Industriel et Commercial. (iv) Acquisition of office equipment and vehicles. 3. BOM (i) Carrying out of a study to assess the training needs of personnel of Parapublic Enterprises. (ii) Carrying out of a training program for personnel of Parapublic Enterprises and government control organizations in cooperation with specialized training institutions. - 17 - (iii) Acquisition of office equipment. 4. CVCCEP (i) Strengthening of CVCCEP's capacity to supervise the audit program to be carried out under Part B.1 of the Project. (ii) On-the-job traininag of auditors of CVCCEP at a major accounting firm abroad. (iii) Acquisition of office equipment and vehicles. 5. DTAI/BOM (i) Training of personnel of Parapublic Enterprises in data processing. (ii) Acquisition of computer equipment and establish- ment of decentralized data processing systems in about five Etablissements Publics. 6. CFP/BOM On-the-job training of controllers and management advisers through their participation in the teams to be established pursuant to Section 3.06 (ii) of this Agreement. Part D: Carrying out of studies on the organization, management and performance of the Parapublic Sector and on other issues related to the Borrower's policy regarding the enterprises of the Parapublic Sector. The Project is expected to be completed by December 31, 1987. - 18 - SCHEDULE 3 Procurement 1. Except as provided in paragraph 2 hereof, equipment shall be procured through competitive bidding following local procurement procedures acceptable to the Association. 2. Contracts estimated to cost the equivalent of $10,000 or less may be procured after having obtained quotations from at least three suppliers. 3. The Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Associa- tion of the first application for withdrawal of funds from the Credit Account in respect of any contract financed out of the proceeds of the Credit, two conformed copies of such contract, together with the analysis of the respective bids, recommenda- tions for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the provisions of this Schedule, promptly inform the Borrower and state the reasons for such determination. 4. 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 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