Madagascar - Agricultural Sector Adjustment Credit : Credit 1691 - Japanese Grant Agreement - Conformed

FF ",7JAPANESE GRANT AGREEMENT AF-16-1 MAG Japanese Grant Agreement (Agricultural Sector Adjustment Operation) between DEMOCRATIC REPUBLIC OF MADAGASCAR and INTERNATIONAL DEVELOPMENT ASSOCIATION as ADMINISTRATOR on behalf of the GOVERNMENT OF JAPAN Dated , 1986 JAPANESE GRANT AGREEMENT AF-16-1 MAG JAPANESE GRANT AGREEMENT AGREEMENT, dated aw 1986,.between DEMOCRATIC REPUBLIC OF MADAGASCAR U(the Beneficiary) and INTER- NATIONAL DEVELOPMENT ASSOCIATION, as Administrator (the Adminis- trator) on behalf of the GOVERNMENT OF JAPAN (Japan). WHEREAS (A) the Executive Directors of the International Development Association (IDA) have established by their Resolu- tion No. IDA 85-1 of May 21, 1985 (the Resolution), a Special Facility for Sub-Saharan Africa (the African Facility) consti- tuted by the funds which shall be contributed by the Inter- national Bank for Reconstruction and Development (the Bank) and other donors and administered by IDA, for the purpose of, and in accordance with, the provisions of the Resolution; (B) pursuant to Section F of the Resolution, Japan has agreed to provide Japanese funds in the form of grants (the SJF Grants) in support of programs of stru-'ural change, policy reform and institutional improvement in co:Latries which are eligible for financing from the African Facilit,'s resources; (C) by the notes exchanged betwaen Japa,n and IDA on November 20, 1985 (the Notes) concerning the SJ)f Grants, Japan and IDA agreed that IDA will act as Adminiotratoar of the Japanese funds in accordance with the provisions of the Notes; (D) the Administrator has received a letter, March 24, 1986, from the Beneficiary describing a program of actions, objectives and policies designed to improve the efficiency of the agricultural sector of the Beneficiary (hereinafter called the Program), declaring the Beneficiary's commitment to the execution of the Program, and requesting assistance from the resources of the African Facility in the financing of urgently needed imports required during such execution, and the Adminis- trator has determined that such assistance would be in accordance with the provisions of the Resolution; (E) the Beneficiary has requested Japanese funds from the Administrator for the financing of imports in support of -2- the Program, and the Administrator has determined that the provision of such funds, in an amount of six hundred million Yen (Y 600,000,000) (the Japanese Grant), would be in accordance with the provisions of the Resolution and the Notes; (F) the Beneficiary has also requested IDA to provide additional assistance towards the financing of the Program and by an agreement, dated 0Qo , 1986, between the Beneficiary and IDA (the Development Credit Agreement), IDA is agreeing to provide such assistance in an amount of nineteen million Special Drawing Rights (SDR 19,000,000) (the IDA Credit); (G) the Beneficiary has requested IDA, acting as Adminis- trator of the African Facility, to provide additional assistance in support of the Program and, by an agreement dated 1986, between the Beneficiary and IDA, acting as Administrator of the African Facility, (the African Facility Credit Agreement), IDA is agreeing to provide a financial contribution in an aggre- gate principal amount equivalent to thirty-one million Special Drawing Rights (SDR 31,000,000) (the African Facility Credit); (H) the Beneficiary intends to contract from Kreditanstalt fUr Wiederaufbau (hereinafter called KfW) a financial contribu- tion from the Federal Republic of Germany, under the Special Joint Financing Agreement with the Special African Facility (hereinafter called the KfW Contribution) in an amount of ten million Deutsche Marks (DM 10,000,000) in support of the Program on the terms and conditions set forth in an agreement (the KfW Agreement) to be entered into between the Beneficiary and KfW; WHEREAS, IDA has agreed, on -he basis, inter alia, of the foregoing, to act as Administratoc of the Japanese Grant; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The "General Conditions Applicable to Develop- ment Credit Agreements" of IDA, dated January 1, 1985, with - 3 - the modifications set forth below (the General Conditions), constitute an integral part of this Agreement: (a) the term "Association", whenever used in the General Conditions, means IDA acting as Administrator of the Japanese Grant, except in the phrase "member of the Association" in Sec- tions 2.01(5) and 6.02(e)(i); (b) the term "Borrower", wherever used in the General Conditions, means the Beneficiary; (c) the terms "Credit", "Development Credit Agreement" and "Credit Account", whenever used in the General Conditions, are amended to read as "Japanese Grant", "Japanese Grant Agreement", "Japanese Credit Agreement" and "Japanese 'rant Account", respectively; (d) Sections 3.02, 3.03, 3.04, 3.05, 4.01, 4.02, 4.03, 4.04, 4.06, 6.05, 7.01, 8.01(a), 12.05 and the second sentence of Section 5.01 are deleted; (e) in Sections 2.01 and 6.02, the term "Association" shall include also the International Development Association acting in its own capacity; (f) the last sentence of Section 3.02 is deleted; and (g) paragraph 9 of Section 2.01 is modified to read as follows: "The term "Project" means the imports that may be financed out of the proceeds of the Japanese Grant in accordance with Section 2.02 (a) of this Agreement." Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions, in the Preamble to this Agreement, and in the African Facility Credit Agreement have the respective meanings therein set forth. ARTICLE II The Japanese Grant Section 2.01. The Administrator agrees to extend to the Beneficiary, on the terms and conditions set forth or rc;'erred to in this Agreement, a grant in various currencies equivalent to six hundred million Yen (Y 600,000,000). Section 2.02. (a) The amount of the Japanese Grant may be withdrawn from the Japanese Grant Account in accordance with the provisions of Schedule 1 to the African Facility Credit Agree- ment, as such schedule may be amended from time to time by agree- ment between the Beneficiary and IDA, for expenditures made (or, if the Administrator 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 Japanese Grant. (b) Withdrawals shall be made only on account of expen- ditures for goods produced in, or services supplied from, the territories of: (i) any Part II member of IDA; and (ii) any country designated by IDA, acting as Administrator of the African Facility, as meeting the provisions set forth in paragraphs 4 (f) (ii) or (iii) of the Resolution. (c) The Beneficiary shall, for the purposes of the Project, open and maintain in dollars a special account (Special Account B) in its Central Bank on terms and conditions satisfactory to the Administrator. Deposits into, and payments out of, Special Account B shall be made in accordance with the provisions of Schedule 3 to the African Facility Credit Agreement. (d) Notwithstanding the provisions of subparagraph (a) above, the Administrator shall, at the request of Japan, suspend the Beneficiary's right to make withdrawals under this Agreement if an event shall have occurred which would have entitled IDA to suspend the Beneficiary's right to make withdrawals under the African Facility Credit Agreement (whether or not the full amount of the African Facility Credit has then been withdrawn). (e) Whenever a disbursement from the Japanese Grant Account is required to be made in a currency other than the Yen for the purposes of this Grant Agreement, the Administrator shall with- draw from the Japanese Grant Account an amount in Yen sufficient for the Association to purchase the required amount of the appro- priate currency. Section 2.03. Except as the Administrator shall otherwise agree, procurement of goods and works required for the Project and to be financed out of the proceeds of the Japanese Grant -5- shall be governed by the provisions of Schedule 2 to the African Facility Credit Agreement. Section 2.04. The Closing Date shall be June 30, 1988, or such later date as the Administrator shall establish. The Administrator shall promptly notify the Beneficiary of such later date. ARTICLE III Effective Date; Termination; Representatives Section 3.01. The followiig event is specified as additional conditions to the effectiveness of this Agreement within the meaning of Section 12.01 (b) of the General Conditions, namely, that all conditions precedent to the effectiveness of the African Facility Credit Agreement, except for the effectiveness of this Agreement, have been fulfilled. Section 3.02. The date sixty (60) days after the date of this Agreement is hereby specified for the purposes of Sec- tion 12.04 of the General Conditions. Section 3.03. This Agreement and all obligations of the Beneficiary and the Administrator thereunder shall terminate on the date 5 years after the date of this Agreement or on the date of the last disbursement of the proceeds of the Grant, whichever shall be the earlier. Section 3.04. The Minister of the Beneficiary responsible for Finance shall be the representative of the Beneficiary for tht urposes of Section 11.03 of the General Conditions. Section 3.05. The addresses specified in Section 6.02 of the African Facility Credit Agreement shall be the addresses speci- fied for the purposes of Section 11.01 of the General Conditions. -6- IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized representatives, 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. DEMOCrATIC REPUBLIC OF MADAGASCAR By/31L & Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator on behalf of the GOVERNMENT OF JAPAN By ACmVg By Regional Vice President Eas ern and Southern Africa