Conformed Copy - C2023 - Structural Adjustment Credit - Agreement

Page 1 CONFORMED COPY NORWEGIAN GRANT RELATED TO CREDIT NUMBER 2023 BEN Agreement for the Administration of Certain Funds to be made available by the GOVERNMENT OF THE KINGDOM OF NORWAY in Conjunction with the Structural Adjustment Credit in the PEOPLE'S REPUBLIC OF BENIN Dated December 22, 1989 NORWEGIAN GRANT RELATED TO CREDIT NUMBER 2023 BEN AGREEMENT AGREEMENT, dated December 22, 1989, between the GOVERNMENT OF THE KINGDOM OF NORWAY (Norway) and the INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association) to provide for the administration by the Association of certain funds to be made available by Norway to the People's Republic of BENIN (PRB). WHEREAS (A) the Agreement, dated October 2, 1986, between Norway and the International Bank for Reconstruction and Development and the International Development Association provides the framework for cofinancing of development projects by the parties thereto; (B) Norway wishes to make available to PRB a grant in the amount of twenty million Norwegian Kroner (NOK 20,000,000) (the Norwegian Grant) to assist PRB in the financing of urgently needed imports required for the execution of its Structural Adjustment Program (the Program); (C) Norway wishes that the proceeds of the Norwegian Grant should be incremental to the Credit extended by the Association to PRB for the financing of the Program pursuant to the Development Credit Agreement (Structural Adjustment Credit), dated May 26, 1989, between PRB and the Association (the Development Credit Agreement) for the same purposes; and WHEREAS, the Association, at the request of Norway, has agreed to administer the Norwegian Grant upon the terms and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Page 2 Section 1.01. The Association, as Administrator on behalf of Norway, shall enter into a Development Grant Agreement and such other agreements with PRB, as it may deem appropriate but consistent with the terms and conditions of the Development Credit Agreement (excluding the debt service provisions thereof) for the purpose of assisting in financing the Program. Such agreements with PRB shall, inter alia, provide that the proceeds of the Norwegian Grant may be withdrawn by PRB to finance the reasonable cost of goods and services required for the Program and otherwise eligible for financing under the Development Credit Agreement, and that the amounts to be withdrawn need not be repaid and shall bear no interest or other charges. A copy of each such agreement shall be furnished to Norway. Section 1.02. The Association, as Administrator on behalf of Norway, shall have the sole responsibility for supervision of the Program. Section 1.03. The administration and enforcement of any provisions of any agreement entered into between PRB and the Association for the purposes of this Agreement shall be handled solely by the Association, and the Association specifically reserves the right, at its discretion and without notice to Norway, to exercise, refrain from exercising or waive any rights under such agreement or to modify any provision thereof, provided, however, that before suspending the right of PRB to make withdrawals of funds under such agreement, the Association shall inform Norway and afford Norway a reasonable opportunity for consultation with the Association. Section 1.04. The Association shall exercise the same care in the discharge of its functions under this Agreement as it exercises with respect to the administration and management of its own affairs and shall have no further responsibility to Norway in respect thereof. ARTICLE II Section 2.01. For the purpose of this Agreement, Norway shall during 1989 deposit an amount of twenty million Norwegian Kroner (NOK 20,000,000) in a trust account with the Bank of Norway in the name of the Association (the Trust Account). The funds in the Trust Account shall be freely exchangeable by the Association with other currencies as may facilitate their administration. Section 2.02. The Association shall disburse from the Trust Account such amounts as, from time to time, shall be needed to meet the reasonable costs of goods and services financed or to be financed pursuant to Section 1.01 of this Agreement. Such disbursements shall be effected on the basis of applications for withdrawal for eligible expenditures submitted by PRB to the Association in accordance with the Association's normal disbursement procedures for withdrawal and disbursement of proceeds of credits made by the Association. Section 2.03. In order to assist in defraying the costs of administration and other expenses incurred by the Association under this Agreement, the Association may invest and reinvest the funds in the Trust Account, pending their disbursement to PRB, and may retain for its own account the income from any such investment or reinvestment. ARTICLE III Section 3.01. (a) The Association shall maintain separate records and accounts in respect of the funds in the Trust Account and disbursed by the Association pursuant to the provisions of this Agreement, and the Association shall furnish on a quarterly basis to Norway a statement of account on such records and accounts; and (b) the Association shall cause such accounts and records to be audited and certified by the Association's external auditors for each fiscal year that funds shall remain in the Trust Account and shall furnish the report of such audit by said auditors to Norway. ARTICLE IV Section 4.01. Norway and the Association shall consult from time to time, at their mutual request, on all matters arising out of this Agreement. Section 4.02. The Association shall keep Norway informed of the progress of the Program. To that end, the Association shall furnish to Norway all relevant progress, performance and assessment reports relating to the Program. Section 4.03. The Association shall inform Norway of any forthcoming major Page 3 missions and meetings in connection with the Program and shall afford representatives of Norway the opportunity to participate in such missions and meetings. Section 4.04. The Association shall inform Norway of any proposed significant modification to the Development Credit Agreement and shall afford Norway a reasonable opportunity to exchange views with the Association before effecting any such modification. ARTICLE V Section 5.01. This Agreement shall become effective as of the date first above written and, subject to the provisions of this Article, shall continue in effect until all disbursements have been made from the Trust Account to PRB. Section 5.02. If at any time it appears to either party that the purposes of this Agreement can no longer effectively, or appropriately, be carried out, this Agreement may be terminated at the initiative of such party after ninety (90) days' written notice to that effect. Section 5.03. Upon termination of this Agreement, unless the parties agree on another course of action, any agreement or portion thereof entered into by the Association, as Administrator on behalf of Norway, shall be transferred to Norway, and any funds or other property of Norway held hereunder by the Association shall be returned to Norway, and the Association's administration shall be considered terminated. Section 5.04. Promptly after termination of this Agreement, the Association shall furnish to Norway a final report and a financial statement on the Trust Account, together with an opinion of the Association's external auditors on such statement. ARTICLE VI Section 6.01. This Agreement may be amended only by written agreement of the parties hereto. Section 6.02. 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, mail, telegram, cable or telex 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 addresses as such party shall have designated by notice to the party giving such notice or making such request. The addresses so specified are: For Norway: The Royal Ministry of Development Cooperation P.O. Box 8142, Oslo Dep. 0033 Oslo 1 Norway Cable address: Telex: NORAD-N 74256 Oslo 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 undersigned duly authorized thereto, have signed this Agreement. Page 4 GOVERNMENT OF THE KINGDOM OF NORWAY By /s/ Vidar Wikberg Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Edward V.K. Jaycox Authorized Representative