Conformed Copy - L2920 - Municipal Development Project - Amendment 2

Page 1 November 2, 1993 Dr. Domingo Cavallo Minister of Economy and Public Works Hipolito Yrigoyen 250-533 1310 Buenos Aires, Argentina Re: ARGENTINA - Municipal Development Project (Loan 2920 -AR) Amendment to the Loan Agreement Dear Dr. Cavallo: Please refer to the Loan Agreement between the Argentine Republic (the Borrower) and the International Bank for Reconstruction and Development (the Bank) dated November 29, 1988 as amended on September 16, 1992. We are pleased to inform you that, pursuant to a letter forwarded to the Bank by the Subsecretaria de Vivienda y Ordenamiento Ambiental of the Ministerio de Salud y Accion Social on October 22, 1993, the Bank has agreed to amend the Loan Agreement as follows: A. Schedule 4 Paragraph 1.(c) is hereby amended by substituting the figure of $20,000,000 in place of $10,000,000. Schedule 6 Paragraph 2. of Part C. of Section I of this Schedule is hereby amended by substituting the figure of $350,000 in place of $250,000, and shall read in its entirity as follows: "2. Civil works estimated to cost the equivalent of $75,000 or more but not exceeding the equivalent of $1,500,000, up to an aggregate not exceeding the equivalent of $139,000,000 and goods estimated to cost the equivalent of $75,000 or more but not exceeding the equivalent of $350,000, up to an aggregate not to exceed the equivalent of $47,000,000, may be procured under contracts awarded on the basis of competitive bidding, advertised locally, in accordance with procedures satisfactory to the Bank." Section II of this Schedule is hereby amended by adding a new paragraph 2. to the existing text (which becomes paragraph 1.): "2. Notwithstanding the provisions of paragraph 1 of this Section, the provisions of the Consultants Guidelines requiring prior Bank review or approval of budgets, short lists, selection procedures, letters of invitation, proposals, evaluation reports and contracts shall not apply to contracts with firms estimated to cost less than $100,000 equivalent each, or to contracts with individuals estimated to cost less than $50,000 equivalent each. However, this exception to prior Bank review shall not apply to the terms of reference for such contracts nor to single source selection of firms, to assignments of a critical nature, as determined by the Bank, and to amendments of contracts raising the contract value to $100,000 equivalent or above for firms, or to $50,000 equivalent or above for individuals." Please confirm your agreement to the foregoing amendments by signing and dating this letter in the space provided below. This amendment may be executed in two counterparts, each of which shall be an original. Upon your confirmation, please return one fully executed original of this amendment letter. Because of their interest in this matter, we are sending copies of this letter to Arq. Bricchetto and to the heads of the five provincial executing units. Very truly yours, Page 2 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s/ Malcolm D. Rovat Acting Director Country Department IV Latin America and the Caribbean Regional Office AGREED: ARGENTINE REPUBLIC By /s/ Domingo F. Cavallo Authorized Representative Date: