Mali - Second Urban Project : Credit 1677 - Credit Agreement - Conformed

CREDIT NUMBER 1677 MLI Development Credit Agreement (Second Urban Project) between REPUBLIC OF MALI and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated 1 , 1986 CREDIT NUMBER 1677 MLI DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated L , 1986, between REPUBLIC OF MALI (the Borr ooer) and INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association). WHEREAS (A) the Borrower, having satisfied itself as to the feasibility and priority of the Project described in Schedule 2 to this Agreement, has requested the Association to assist in the financing of the Project; (B) Parts C, D (1) (b), D (5), D (6), D (7) and E of the Project will be carried out by the Borrower; Parts A, B, D (1) (a), D (2), D (3) and D (4) will be carried out by the District of Bamako (the District) with the Borrower's assistance and, as part of such assistance, the Borrower will make available to the District certain part of the proceeds of the Credit as provided in this Agreement; (C) the Borrower intends to contract from the French Republic through the Fonds d'Aide et de Cooperation (FAC) a Grant (the FAC Grant) in an aggregate amount equivalent to seven hundred fifty thousand dollars to assist in financing the Project on the terms and conditions set forth in an agreement (the FAC Grant Agreement) to be entered into between the Borrower and FAC; and WHEREAS the Association has agreed, on the basis, inter alia, of the foregoing, to extend the Credit to the Borrower upon the terms and conditions set forth in this Agreement and in the Project Agreement of even date herewith between the Association and the District of Bamako; 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 the Association, dated January 1, 1985, with the last sentence of Section 3.02 deleted (the General Conditions) constitute an integral part of this Agreement. Section 1.02. Unless the context otherwise requires, the several terms defined in the General Conditions and in the -2- Preamble to this Agreement have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Project Agreement" means the agreement between the Association and the District of Bamako of even date herewith, as the same may be amended from time to time, and such term includes all schedules and agreements supplemental to the Project Agree- ment; (b) "Subsidiary Loan Agreement" means the agreement to be entered into between the Borrower and the District pursuant to Section 3.02 (a) of this Agreement, as the same may be amended from tiire to time, and such term includes all schedules to the Subsidiary Loan Agreement; (c) "Special Account" means the account referred to in Section 2.02 (b) of this Agreement; (d) "DSTD" means Direction des Services Techniques du District, a directorate responsible for the technical services of the District; (e) "CFA franc" means the currency of the Borrower; (f) "Revolving Fund" means the account referred to in Section 3.01 (c) of this Agreement and "Initial Deposit" means the initial amount to be deposited into said account; (g) "Land Development Account" means the account opened in the Banque de Developpement du Mali under No. 267-129E to receive the proceeds of plots developed and sold under the Urban Development Project (Credit No. 943-MLI); (h) "Project Unit" means the Project Unit established under the Urban Development Project (Credit No. 943-MLI); (i) "DNICT" means Direction Nationale de l'Interieur des Collectivites Territoriales, a directorate responsible for supervising the operations of the Borrower's municipalities; (j) "DNI" means Direction Nationale des Imports, a directorate of the Ministry of Finance of the Borrower responsi- ble, inter alia, for supervising all activities relating to land tenure; and -3- (k) "Project Preparation Advance" means the project pre- paration advance granted by the Association to the Borrower pursuant to an exchange of letters dated May 22, 1986 and May 28, 1986 between the Borrower and the Association. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Bor- rower, on the terms and conditions set forth or referred to in the Development Credit Agreement, an amount in various currencies equivalent to twenty-five million two hundred thousand Special Drawing Rights (SDR 25,200,000). Section 2.02. (a) The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule I to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Asso- ciation, 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) The Borrower shall, for the purposes of the Project, open and maintain in CFA Francs a special account in a commercial bank on terms and conditions satisfactory to the Association. Deposits into, and payments out of, the Special Account shall be made in accordance with the provisions of Schedule 4 to this Agreement. (c) 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 principal 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 Prepartion Advance shall thereuk n be cancelled. Section 2.03. The Closing Date shall be March 31, 1993 or such later date as the Association shall establish. The Associa- tion shall promptly notify the Borrower of such later date. Section 2.04. (a) The Borrower shall pay to the Association a commitment charge at the rate of one-half of one per cent (1/2 -4- of 1%) per annum on the principal amount of the Credit not withdrawn from time to time. The commitment charge shall accrue from a date sixty days after the date of the Development Credit Agreement 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 2.05. 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 2.06. Commitment charges and service charges 13hall be payable semiannually on March I and September 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each March I and September 1 commencing September 1, 1996, and ending March 1, 2036. Each installment to and including the installment payable on March 1, 2006 shall be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter shall be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the French Republic is hereby specified for the purposes of Section 4.02 of the General Condi- tions. ARTICLE III Execution of the Project Section 3.01. (a) The Borrower declares its commitment to the objectives of the Project as set forth in Schedule 2 to this Agreement and, to this end, shall carry out Parts C, D (1) (b), D (5), D (6), D (7) and E of the Project through the Project Unit under the overall responsibility of the Ministry of Interior -5- with due diligence and efficiency and in conformity with appropriate administrative, financial and urban management practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without any limitation or restriction upon any of its other obligations under this Agreement, the Borrower shall cause the District to perform in accordance with the provisions of the Project Agreement all the obligations of the District therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable the District to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (c) Without any limitation or restriction upon the gene- rality of the provisions of paragraphs (a) and (b) above with regard to the provision of funds, the Borrower shall: (i) open and thereafter maintain in the Borrower's currency an account (the Revolving Fund) in a commercial bank on terms and conditions satisfactory to the Association; (ii) deposit into the Revolving Fund an initial deposit of one hundred million CFA Francs; and thereafter deposit into the Revolving Fund on the first day of every calendar quarter an amount equivalent to the financial requirements of the Project for that quarter not financed out of the proceeds of the Credit. Section 3.02. (a) The Borrower shall relend the proceeds of the Credit which may from time to time be allocated to Category (1) (b) of the table set forth in paragraph 1 of Schedule 1 to ..m this Agreement to the District under a subsidiary loan agreement to be entered into between the Borrower and the District, under terms and conditions which shall have been approved by the Association and which shall include interest at a rate of 8% per annum and a twenty-five year repayment period including a grace period of three years; the Borrower shall bear the foreign exchange risk on the proceeds of the Credit so onlent. (b) The Borrower shall exercise its rights under the Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower and the Association and to accomplish the purposes of the Credit, and except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive the Subsidiary Loan Agreement or any provision thereof. -6- Section 3.03. Except as the Association shall otherwise agree, procurement of the goods, works and consultants' services 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 3.04. The Borrower and the Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (relating to in- surance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Parts A, B, D (1) (a), D (2), D (3) and D (4) of the Project shall be carried out by the District pursuant to Section 2.03 of the Project Agreement. Section 3.05. The Borrower shall: (a) maintain the Project Unit with staff and facilities in adequate numbers and with responsibility for carrying out the day-to-day management of the Project in accordance with the provisions of Schedule 5 to this Agreement; (b) maintain within the District: (i) a Directorate of Finance with qualified and experienced staff and facilities in adequate numbers to discharge all functions and responsibilities entrusted to said Directorate by Arr t No. 1345 MI/CAB dated March 3, 1986; and (ii) a District Treasury, with qualified and experienced staff and facilities in adequate numbers to discharge all functions and responsibilities entrusted to said Treasury by Arr t No. 6344 MFC/DNTP dated March 3, 1986; (c) appoint and thereafter maintain as: (i) head of the Project Unit; (ii. District Treasurer; and (iii) head of the Directorate of Finance; Malian Nationals whose technical qualifi- cations and professional experience shall be satisfactory to the Association; and (d) (i) maintain the Land Development Account; (ii) cause the District to deposit the proceeds of all sales of plots devel- oped under the Project into the said account; and (iii) ensure that amounts deposited in the Land Development Account shall be used only for the purposes of carrying out further land develop- ment activities in the District except as shall be otherwise agreed upon between the Borrower and the Association. Section 3.06. The Borrower shall: (a) by December 31, 1986 review with the Association draft instruments aimed at completing -7- or implementing the new land tenure law (Code Domanial et Foncier) with a view to incorporating into such instruments any improvement which appears necessary to further the purposes of the Project; and (b) no later than December 31, 1986, transfer to the District all land required for Part B of the Project. Section 3.07. Before approving any request for practical training abroad under Part E (1) of the Project, the Borrower shall submit to the Association for its approval the names and qualifications of candidates for such training and the program of activities to be undertaken by them. Section 3.08. The Borrower shall review periodically with the Association the progress made in the carrying out of the Action Plan set forth in Schedule 6 to this Agreement. ARTICLE IV Financial Covenants Section 4.01. (a) The Borrower shall maintain or cause to be maintained separate records and accounts adequate to reflect in accordance with sound accounting practices the operations, resources and expenditures in respect of the Project of the departments or agencies of the Borrower responsible for carrying out any part of the Project. (b) The Borrower shall: (i) have the accounts referred to in paragraph (a) of this Section, including the Special Account, 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 copy of 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 concerning said accounts and the audit thereof and said records as the Association shall from time to time reasonably request. - 8 - (c) For all expenditures with respect to which withdrawals from the Credit Account were made on the basis of statements of expenditure, the Borrower shall: (i) maintain or cause to be maintained, in accordance with paragraph (a) of this Section, separate records and accounts reflecting such expenditures; (ii) retain, until at least one year after the Associa- tion has received the audit report for the fiscal year in which the last withdrawal from the Credit Account was made, all records (contracts, orders, invoices, bills, receipts and other documents) evidencing such expenditures; (1i) enable the Association's representatives to examine such records; and (iv) ensure that such separate accounts are included in the annual audit referred to in paragraph (b) of this Section and that the report thereof contains, in respect of such separate accounts, a separate opinion by said auditors as to whether the proceeds of the Credit withdrawn in respect of such expenditures were used for the purposes for which they were provided. ARTIGLE V Remedies of the Association Section 5.01. Pursuant to Section 6.02 (h) of the General Conditions, the following additional events are specified: (a) The District shall have failed to perform any of its obligations under the Project Agreement. (b) As a result of events which have occurred after the date of the Development Credit Agreement, an extraordinary situation shall have arisen which shall make it improbable that the District will be able to perform its obligations under the Project Agreement. (c) Ordinance No. 77-44/CMLN dated July 12, 1977 of the Borrower (the Administrative Reform Law) as amended- to date; -9- Ordinance No. 78-32/CMLN dated August 18, 1978 of the Borrower (Statut of the District of Bamako) and Arretes No. 1345/MI/CAB dated March 3, 1986 and No. 1344/MFC/DNTP dated March 3, 1986, of the Borrower shall have been amended, suspended, abrogated, repealed or waived so as to affect materially and adversely the ability of the District to perform any of its obligations under the Project Agreement. (d) The Borrower or any other authority having jurisdiction shall have taken any action for the dissolution or disestablish- ment of the District or for the suspension of its operations. (e) (i) Subject to subparagraph (ii) of this paragraph: (A) The right of the Borrower to withdraw the proceeds of any grant or loan made to the Borrower for the financing of the Project shall have been suspended, cancelled or terminated in whole or in part, pursuant to the terms of the agreement providing therefor; or (B) any such loan shall have become due and payable prior to the agreed maturity thereof. (ii) Subparagraph (i) of this paragraph shall not apply if the Borrower establishes to the satisfaction of the Association that: (A) such suspension, cancellation, termination or prematuring is not caused by the failure of the Borrower to perform any of its obligations under such agreement; and (B) adequate funds for the Project are available to the Borrower from other sources on terms and conditions consistent with the obligations of the Borrower under this Agreement. Section 5.02. Pursuant to Section 7.01 (d) of the General Conditions, the following additional events are specified: (a) the event specified in paragraph (a) of Section 5.01 of this Agreement shall occur and shall continue for a period of sixty days after notice thereof shall have been given by the Association to the Borrower; and - 10 - (b) the events specified in paragraphs (d) and (e)(i)(B) of Section 5.01 of this Agreement shall occur subject to the proviso of paragaph (e)(ii) of that Section. ARTICLE VI Effective Date; Termination Section 6.01. 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 Subsidiary Loan Agreement has been executed on behalf of the Borrower and the District; (b) all conditions precedent to the effectiveness of, or initial disbursement under the FAC Grant Agreement have been fulfilled except for the effectiveness of this Agreement; (c) the Head of the Directorate of Finance of the District and the District Treasurer referred to in Section 3.05 (c) have been appointed in accordance with the provisions of said Section 3.05 (c) and have taken up their positions; (d) the District Technical Unit referred to in Section 3.04 of the Project Agreement has been established and its Director has been appointed in accordance with the provisions of para- graph (b) of said Section 3.04; and (e) the Revolving Fund referred to in Section 3.01 (c) of this Agreement has been opened and the initial deposit made in accordance with the provisions of said Section 3.01 (c). Section 6.02. The following are specified as additional matters, within the meaning of Section 12.02 (b) of the General Conditions, to be included in the opinion or opinions to be furnished to the Association: (a) that the Project Agreement has been duly authorized or ratified by the District, and is legally binding upon the District in accordance with its terms; and (b) that the Subsidiary Loan Agreement has been duly authorized or ratified by the Borrower and the District and is - 11 - Iegally binding upon the Borrower and the District in accordance with its terms. Section 6.03. The date ninety (90) days after the date of this Agreement is hereby specified for the purposes of Sec- tion 12.04 of the General Conditions. ARTICLE VII Representative of the Borrower; Addresses Section 7.01. The Minister of the Borrower responsible for finance is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministere des Finances et du Commerce Bamako Republic of Mali Cable address: Telex: MINIFINANCES 972559 Bamako 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) - 12 - 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. REPUBLIC OF MALI By /< ,/I&c& Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By k. i,V 4 / SC4Regional Vice President Western Africa - 13 - SCHEDULE I 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 (a) under Part A 7,000,000 75% and D of the Project (b) under Part B 5,400,000 75% of the Project (2) Equipment, vehi- 3,360,000 75% cles and spare parts, fuel and supplies (3) Technical 5,940,000 100% Assistance and Training (4) Refunding of 730,000 Amount due under Project Preparation Section 2.02 (c) Advance of this Agreement (5) Unallocated 2,770,000 TOTAL 25,200,000 2. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for expenditures prior to the date of this Agreement. - 14 - SCHEDULE 2 Description of the Project The objective of the Project is to assist the Borrower in expanding urban services in the District of Bamako through im- proved management and through strengthening of municipal institu- tions, inter alia, in the fields of road maintenance and repairs, solid waste management, assessment and collection of municipal taxes, land development and distribution of new plots, and regularization of land tenure titles. The Project consists of the following parts, subject to such modifications thereof as the Borrower and the Association may agree upon from time to time to achieve such objectives: Part A: Infrastructure Improvement 1. Reconstruction or rehabilitation of about 35 km of streets, about 10 km of sidewalk and clearing and repairing of about 25 km of storm drains. 2. Construction of about 15 km of primary paved road including two reinforced concrete box culverts. 3. Improvement of about 30 street intersections including about 10 with traffic lights; installation of about 700 traffic signs; marking of about 20 km of traffic lane; and installation or repair of about 700 street lights. 4. Paving of about 10 km of sidewalks and 2 km of streets. 5. Construction of an off-site water main (about 5 km) and a medium-voltage electrical transmission line (about 3 km) to supply water and electricity to the Bako-Djikoroni area. 6. Rehabilitation of three market squares in the District. Part B: Land Development 1. Development of sites of about 160 ha in Bako-Djikoroni, and about 725 ha in Kalaban-Sud; supply of water to these sites through ground wells; and upgrading and restructuring of a site of about 200 ha in Bankoni with regularization of tenure through granting of land-titles. - 15 - 2. A program to regularize land tenure on various sites of about 900 ha in Bamako through granting of land titles. 3. Construction of about 30 km of unpaved primary roads in Bamako. Part C: Cadastral Mapping 1. Carrying out of aerial photography and ground surveys. 2. Production of large scale multipurpose maps for the District. Part D: Institution Building 1. Strengthening of the District's financial management through establishment of: (a) a directorate of finance for the District; and (b) a position of District Treasurer. 2. Establishment of a computerized index of land titles; and acquisition of equipment, vehicles, spare parts and supplies needed to strengthen the operations of the District. 3. Construction and equipping of a new District building; establishment and equipping of a District Technical Unit and refurbishing of offices for the District Treasurer. 4. Improvement of DSTD's management in the fields of solid waste management and workshop maintenance through provision of experts' services, equipment and studies for development of sites for solid waste and sludge disposal. 5. Acquisition of equipment and vehicles for the Project Unit. 6. Strengthening of DNICT through provision of equipment, vehicles and consultants' services. 7. Strengthening of DNI through provision of experts' services and acquisition of materials and supplies required to: (a) carry out priority activities necessary to implement the new land tenure law (Code Domanial et Foncier); and (b) define institutional and cadastral methods necessary to ensure a successful implementation of said law. - 16 - Part E: Training and Technical Assistance 1. Training including on-the-job training and short-term prac- tical training abroad and seminars for staff, at any level, responsible for carrying out any part of the Project. 2. Technical assistance and consultants' services including audit services, services for the carrying out of a municipal taxation study, and services for the preparation of a follow-up project, and for other studies to be determined during Project implementation by mutual agreement between the Borrower and the Association. The Project is expected to be completed by September 30, 1992. - 17 - SCHEDULE 3 Procurement and Consultants' Services Section I: Procurement of Goods and Works Part A: International Competitive BiddinE 1. Except as provided in Part D hereof, goods and works shall be procured under contracts awarded in accordance with procedures consistent with those set forth in Sections I and II of the "Guidelines for Procurement under IBRD Loans and IDA Credits" published by the Bank in May 1985 (the Guidelines). 2. Services for Part C of the Project shall be procured as provided for in paragraph 1 above and bidders for such services shall be prequalified as described in paragraph 2.10 of the Guidelines. 3. To the extent practicable, contracts for equipment shall be grouped in bid packages estimated to cost the equivalent of $50,000 or more each. Part B: Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A hereof, goods manufactured in Mali may be granted a margin of preference in accordance with, and subject to, the provisions of paragraphs 2.55 and 2.56 of the Guidelines and paragraphs 1 through 4 of Appendix 2 thereto. Part C: Preference for Domestic Contractors In the procurement of works in accordance with the proce- dures described in Part A.1 hereof, the Borrower and the District may grant a margin of preference to domestic contractors in accordance with, and subject to, the provisions of paragraphs 2.55 and 2.56 of the Guidelines and paragraph 5 of Appendix 2 thereto. Part D: Other Procurement Procedures 1. (a) Works for cadastral surveys under Part C of the Proj- ect, works for drainage cleaning and works for the rehabilitation - 18 - of streets and sidewalks with paving stones estimated to cost less than $10,000 equivalent may be carried out by force account; and (b) works for the rehabilitation of streets and sidewalks with paving stones estimated to cost more than $10,000 equivalent and furniture and equipment estimated to cost less than $50,000 equivalent for each contract may be procured under contracts awarded on the basis of competitive bidding, advertised locally, in accordance with procedures satisfactory to the Association. 2. Items estimated to cost less than the equivalent of $10,000 per contract, up to an aggregate amount not to exceed the equiva- lent of $400,000, may be procured under contracts awarded on the basis of comparison of price quotations solicited from a list of at least three suppliers eligible under the Guidelines, in accordance with procedures acceptable to the Association. Part E: Review by the Association of Procurement Decisions 1. Review of invitations to bid and of proposed awards and final contracts: (a) With respect to each contract estimated to cost the equivalent of $10,000 or more, the procedures set forth in paragraphs 2 and 4 of Appendix 1 to the Guidelines shall apply. Where payments for such contract are to be made out of the Special Account, such procedures shall be modified to ensure that the two conformed copies of the contract required to be furnished to the Association pursuant to said paragraph 2 (d) shall be furnished to the Association prior to the making of the first payment out of the Special Account in respect of such contract. (b) With respect to each contract not governed by the pre- ceding paragraph, the procedures set forth in paragraphs 3 and 4 of Ap?endix 1 to the Guidelines shall apply. Where payments for such contract are to be made out of the Special Account, such procedures shall be modified to ensure that the two conformed copies of the contract together with the other information required to be furnished to the Association pursuant to said paragraph 3 shall be furnished to the Association as part of the evidence to be furnished pursuant to paragraph 4 of Schedule 4 to the Development Credit Agreement. (c) The provisions of the preceding subparagraphs (a) and (b) shall not apply to contracts on account of which the Associa- - 19 - tion has authorized withdrawals from the Credit Account on the basis of statements of expenditure. Such contracts shall be retained in accordance with Section 4.01 (c) (ii) of this Agreement. 2. The figure of 15% is hereby specified for purposes of para- graph 4 of Appendix 1 to the Guidelines. Section II. Employment of Consultants In order to assist the Borrower and the District in carrying out the Project, the Borrower and the District shall employ con- sultants whose qualifications, experience and terms and condi- tions of employment shall be satisfactory to the Association. Such consultants shall be selected in accordance with principles and procedures satisfactory to the Association on the basis of the "Guidelines for the Use of Consultants by World Bank Bor- rowers and by the World Bank as Executing Agency" published by the Bank in August 1981. - 20 - SCHEDULE 4 Special Account 1. For the purposes of this Schedule: (a) the term "eligible Categories" means Categories (1) through (3) set forth in the table in paragraph 1 of Schedule 1 to this Agreement; (b) the term "eligible expenditures" means expenditures 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 allocated from time to time to the eligible Categories in accordance with the provisions of Schedule 1 to this Agreement; and (c) the term "Authorized Allocation" means an amount of one hundred million CFA Francs to be withdrawn from the Credit Account and deposited in the Special Account pursuant to paragraph 3 (a) of this Schedule. 2. Except as the Association shall otherwise agree, payments out of the Special Account shall be made exclusively for eligible expenditures in accordance with the provisions of this Schedule. 3. After the Association has received evidence satisfactory to it that the Special Account has been duly opened, withdrawals of the Authorized Allocation and subsequent withdrawals to replenish the Special Account may be made as follows: (a) On the basis of a request or requests by the Borrower for a deposit or deposits which add up to the aggregate amount of the Authorized Allocation, the Association shall, on behalf of the Borrower, withdraw from the Credit Account and deposit in the Special Account such amount or amounts as the Borrower shall have requested. (b) The Borrower shall furnish to the Association requests for replenishment of the Special Account at such intervals as the Association shall specify. On the basis of such requests, the Association shall withdraw from the Credit Account and deposit into the Special Account such amounts as shall be required to replenish the Special Account with amounts not exceeding the amount of payments made out of the Special Account for eligible - 21 - expenditures. All such deposits shall be withdrawn by the Asso- ciation from the Credit Account under the respective eligible Categories, and in the respective equivalent amounts, as shall have been justified by the evidence supporting the request for such deposit furnished pursuant to paragraph 4 of this Schedule. 4. For each payment made by the Borrower out of the Special Account for which the Borrower requests replenishment pursuant to paragraph 3 (b) of this Schedule, the Borrower shall furnish to the Association, prior to or at the time of such request, such and other evidence as the Association shall reasonably request, showing that such payment was made for eligible expenditures. 5. (a) Notwithstanding the provisions of paragraph 3 of this Schedule, no further deposit into the Special Account shall be made by the Association when either of the following situations first arises: (i) the Association shall have determined that all further withdrawals should be made directly by the Borrower from the Credit Account in accordance with the provisions of paragraph (a) of Section 2.02 of this Agreement; or (ii) the total unwithdrawn amount of the Credit allo- cated to the eligible Categories, minus the amount of any outstanding special commitment entered into by the Association pursuant to Section 5.02 of the General Conditions with respect to the Project, shall be equal to the equivalent of twice the amount of the Authorized Allocation. (b) Thereafter, withdrawal from the Credit Account of the remaining unwithdrawn amount Of the Credit allocated to the eli- gible Categories shall follow such procedures as the Association shall specify by notice to the Borrower. Such further withdrawals shall be made only after and to the extent that the Association shall have been satisfied that all such amounts remaining on deposit in the Special Account as of the date of such notice have been or will be utilized in making payments for eligible expendi- tures. 6. (a) If the Association shall have determined at any time that any payment out of the Special Account: (i) was made for any expenditure or in any amount not eligible pursuant to paragraph 2 - 22 - of this Schedule; or (ii) was not justified by the evidence furnished pursuant to paragraph 4 of this Schedule, the Borrower shall, promptly upon notice from the Association, deposit into the Special Account (or, if the Association shall so request, refund to the Association) an amount equal to the amount of such payment or the portion thereof not so eligible or justified. No further deposit by the Association into the Special Account shall be made until the Borrower has made such deposit or refind. (b) If the Association shall have determined at any time that any amount outstanding in the Special Account will not be required to cover further payments for eligible expenditures, the Borrower shall, promptly upon notice from the Association, refund to the Association such outstanding amount for crediting to the Credit Account. - 23 - SCHEDULE 5 The Project Unit The Project Unit will report directly to the Minister of the Borrower responsible for the Interior. It will be headed by a Director assisted by a project management advisor, two engineers, two accountants, and two secretaries. The Director of the Project will have the rank of National Director. The tasks of the Project Unit will be to assist the Borrower, the District services and the regional governmental services responsible for carrying out the Project. Specifically, the Project Unit will: (a) plan, coordinate and supervise the carrying out of the Project; (b) manage the legal and financial aspects of the Project (contracts, requests for disbursements, Special Account); (c) monitor the carrying out of the Project; and (d) maintain all records and accounts related to the Project. - 24 - SCHEDULE 6 Implementation Program Pursuant to Section 3.08 of the Credit Agreement, the Bor- rower will complete the following tasks by the dates set forth hereafter: 1. By December 31, 1987, reorganize the procedures for budget- ing, accounting and controlling the finances of the District with a view to improving the collection of all District taxes and other revenues. 2. No later than November 30 of each fiscal year, review the proposed budget of the District in consultation with the Associa- tion with a view to taking all measures necessary to enable the District to perform its obligations under the Project. 3. Submit to the Association, no later than December 31, 1986, a statement showing the financial condition of the District as of December 31, 1985. 4. Complete the reform of business licenses and declare such reform effective by January 1, 1988. 5. Complete by December 31, 1988 ground surveys for all proper- ties located within the District with a view to establish the computerized index referred to under Part D (2) of the Project. 6. Expand enrollment and collection of business licences and road cleaning and refuse collection taxes in order to achieve, through the Project implementation period, an overall increase of revenues deriving therefrom by a rate of 10% per annum in respect of business licenses and 15% per annum in respect of road clean- ing and refuse collection taxes. 7. By October 31, 1986, submit to the Association, for its review and comments, the draft guidelines to be followed for allocating plots developed under the Project. INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the International Development Association. FOR SECRETARY