Conformed Copy - L4237 - Shandong Environment Project - Supplemental Letter

Page 1 SHANDONG PROVINCE February 4, 1998 International Bank for Reconstruction and Development 1818 H. Street N.W. Washington, D.C. 20433 Re: Loan No. 4237 CHA (Shandong Environment Project) Performance Indicators Gentlemen: We refer to the Loan Agreement of even date herewith between the People’s Republic of China (the Borrower) and International Bank for Reconstruction and Development (the Bank) for a Shandong Environment Project (the Project) and to the Project Agreement of same date between the Bank and Shandong Province (the Province) for the Project (the Project Agreement). For purposes of Part G of Schedule 2 to the Project Agreement, the Province will monitor and evaluate the carrying out of the Project and the achievement of the Project’s objectives, all in accordance with the indicators set forth in the Annex to this letter. Please confirm your agreement to the foregoing by signing the form of confirmation in the space provided below. Sincerely yours, SHANDONG PROVINCE By /s/ Zhou Wenzhong Authorized Representative CONFIRMED: International Bank for Reconstruction and Development By /s/ Yukon Huang Acting Regional Vice President East Asia and Pacific Performance Indicators