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1 CONFORMED COPY CREDIT NUMBER 486 ET Deve
CONFORMED COPY CREDIT NUMBER 486 ET Development Credit Agreement (Second Wolano Agricultural Development Project) BETWEEN EMPIRE OF ETHIOPIA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JUNE 26, 1974 Public Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure Authorized CONFORMED COPY CREDIT NUMBER 486 ET Development Credit Agreement (Second Wolamo Agricultural Development Project) BETWEEN 0 EMPIRE OF ETHIOPIA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED JUNE 26, 1974 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated June 26, 1974, between EMPIRE OF ETHIOPIA (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) The Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement (hereinafter called the Project) by extending the Credit as hereinafter provided; and (B) By a development credit agreement dated November 26, 1969, (hereinafter called the First Credit Agreement) between the Borrower and the Association, the Association granted to the Borrower a credit in various currencies equivalent to three million five hundred thousand dollars ($3,500,000) to assist in financing the first phase of an intensive program of agricultural development to be continued and expanded under the Project to be financed hereunder; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement acc

2 ept all the provisions of the General Co
ept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "WADU" means the Wolamo Agricultural Development Unit, a separate entity within the Extension and Project Implementation Department of its Ministry of Agriculture of the Borrower established pursuant to the First Credit Agreement; (b) "Project Area" means the area comprising the Wolamo Awraja (District) of the Borrower including such areas as were included in the Project Area under the First Credit Agreement; 4 (c) "Revolving Fund" means the fund created pursuant to Section 4.16 of the First Credit Agreement; (d) "AIDB" means the Agricultural and Industrial Development Bank of the Borrower; (e) "CMC" means an organization established by WADU as a cooperative but not yet registered as such; and (f) "WFCU" means the Wolamo Farmers Cooperative Union, a central organization of cooperatives in the Project Area. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Ag

3 reement set forth or referred to, an amo
reement set forth or referred to, an amount in various currencies equivalent to twelve million dollars ($12,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance w-th the provisions of Schedule I to this Agreement, as such Schedule may be amended from time to time, 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. Section 2.03. Except as the Association shall otherwise agree, contracts for the purchase of goods, the carrying out of works or services (other than consultants' services) for the Project and to be financed out of the proceeds of the Credit, shall be awarded in accordance with the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be June 30, 1980 or such other date as shall be agreed between the Borrower and the Association. 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. Service charges shall be payable semi-annually on June I and December 1 in each year. 5 Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each June I and December 1 commencing December 1, 1984, and ending June 1, 2024, each installment to and including the installmen

4 t payable on June 1, 1994 to be one-half
t payable on June 1, 1994 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project through the Extension and Project Implementation Department of its Ministry of Agriculture (hereinafter EPID-WADU), and with the assistance, inter alia, of -'her appropriate agencies and instrumentalities of the Borrower with due diligence and efficiency and in conformity with appropriate administrative, agricultural, engineering and financial practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. The Borrower shall cause WADU to provide adequate and appropriate staff, and such consultancy services as may be necessary to support it, for the purpose of the timely carrying out of the studies included in Part (4) of the Project. The Borrower shall consult with the Association to determine the staffing and consultancy services requirements of the said studies, and the terms of reference therefor. Section 3.03. (a) The Borrower undertakes to insure or to cause the insurance of, or to make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acqu

5 isition, transportation and delivery the
isition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 3.04. (a) The Borrower shall furnish or cause to be furnished to the Association, promptly upon their preparation, the reports, plans, specifications, 6 contract documents and work and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borrower: (i) shall maintain or cause to be maintained records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit, and to disclose the use thereof in the Project; (ii) shall enable the Association's accredited representatives to visit the facilities and sites included in the Project and to examine the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) shall furnish or cause to be furnished to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. Section 3.05. (a) Under the terms an

6 d conditions set forth in Schedule 4 to
d conditions set forth in Schedule 4 to this Agreement as the same may be amended from time to time by agreement between the Borrower and the Association, and contained in a subsidiary loan agreement acceptable to the Association, the Borrower shall relend one million eight hundred thousand dollars ($1,800,000) or such other sum as the Association shall from time to time agree to AIDB for the purpose of financing the provision of seasonal credits under Parts (1) and (2) of the Project for farm inputs in the Project Area. AIDB shall provide the said seasonal credits through cooperatives and WADU, under terms and conditions approved by the Association. (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. Except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive the subsidiary loan agreement or any provision thereof. Section 3.06. The Borrower shall cause WADU or AIDB, as the case may be, to relend to cooperatives and CMC's in the Project Area all funds necessary for the acquisition of cooperative stores and offices and the equipment thereof, constructed or purchased under the Project, on terms and conditions to be approved by the Association. Section 3.07. The Borrower shall cause WADU to adopt project evaluation procedures acceptable to the Association. 7 ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall maintain or cause

7 to be maintained records adequate to re
to be maintained records adequate to reflect in accordance with consistently maintained appropriate accounting practices the operations, resources and expenditures, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out the Project or any part thereof. (b) The Borrower shall cause WADU to: (i) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) including without limitation those relating to the Revolving Fund and CMC's for each fiscal year audited, in accordance with sound 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 copies of its financial statements for such year as so audited and (B) 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 * the accounts and financial statements of WADU and the audit thereof as the Association shall from time to time reasonably request. (c) The Borrower shall cause WFCU and all of the (i) CMC's, and (ii) cooperatives, in the Project Area, to adopt satisfactory accounting procedures adequate to reflect their income and expenditures, and shall cause all CMC's and cooperatives in the Project Area to have their accounts and financial statements audited

8 semi-annually by the Controller of WFCU
semi-annually by the Controller of WFCU under the supervision of WADU, and all the accounts and financial statements of said cooperatives and WFCU to be audited annually by its Registrar of Cooperatives. The Borrower shall submit or cause to be submitted all such audits and accompanying reports to the Association for its review and comments no later than six months after the end of each such annual audit period. Section 4.02. The Borrower shall cause AIDB and WADU, as the case may be, to take out and maintain with responsible insurers, or to make other provision satisfactory to the Association for, insurance of farm inputs and vehicles financed out of the proceeds of the Credit against such risks and in such amounts as shall be consistent with appropriate practice. Section 4.03. The Borrower shall cause WADU to prepare a plan of work in advance of each fiscal year to be approved by the Borrower and the Association, 8 and shall advance to WADU at three monthly intervals such sums as may be required to enable WADU to carry out the succeeding quarter's portion of the said approved annual plan of work. Section 4.04. In order to carry out Part (3)(b) of the Project, the Borrower shall cause WADU to prepare a rural crafts development plan, such plan to include provisions for the training and employment of instructors, and for the extension of credit facilities for the purchase of tools and other equipment related to the implementation of said plan. The Borrower shall cause WADU to submit the said plan to the Association for its approv

9 al prior to its implementation. Section
al prior to its implementation. Section 4.05. The Borrower shall arrange for appropriate coordination between its Institute of Agricultural Research and WADU with regard to crop trials and research activities related to agricultural output in the Project Area. Section 4.06. The Borrower shall provide or cause to be provided promp,tly as needed all funds necessary and take or cause to be taken all other action as may be required to adequately maintain the roads and tracks to be constructed under the Project. Section 4.07. The Borrower shall cause WADU at all times to employ qualified and experienced staff, and shall consult with the Association prior to the initial or new appointment of the personnel to the following positions in WADU: (i) Director- and, (ii) Heads of the (A) Extension and Training Division, (B) Marketing and Credit Division, (C) Finance Division, (D) Cooperative Development Section and (E) Artificial Insemination Section. Section 4.08. The Borrower shall cause WADU to submit to the Association for its review and comments the design of the water supply system for the two settlements included in Part 3(b) of the Project. ARTICLE V Remedies of the Association Section 5.01. The Association may, upon the occurrence of certain events specified in Sections 6.02 or 7.01 of the General Conditions or in Sections 5.02 and 5.03 of this Agreement and the continuance thereof for the period, if any, specified for the purpose: (i) suspend in whole or in part the right of the Borrower to make withdrawals from the Credit Account

10 or (ii) declare the principal of the Cre
or (ii) declare the principal of the Credit then outstanding to be due and payable immediately together with the charges thereon. 9 Section 5.02. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified: (a) an event giving the Association the right to suspend the right of the Borrower to withdraw the proceeds of the First Credit Agreement in whole or in part shall have occurred; and (b) the Borrower or any other authority having jurisdiction shall have taken any action without the prior approval of the Association for the dissolution or disestablishment of WADU, AIDB or of any of the 'articipating cooperatives or CMC's in the Project Area and such dissolution or disestablishment would in the opinion of the Association materially or adversely affect the execution of or the benefits expected to be derived from the Project, provided, however, that the aforesaid shall not apply to the dissolution or disestablishment of a CMC upon becoming a cooperative. Section 5.03. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified: (a) the event specified in paragraph (b) of Section 5.02 of this Agreement shall occur and shall continue for a period of 60 days after notice thereof shall have been given by the Association to the Borrower; and (b) the proceeds provided under the First Credit Agreement shall have been declared, or become, due and payable in advance of the agreed maturity thereof. ARTICLE VI Effective Date; Termination Section 6.01

11 . The following events are specified as
. The following events are specified as additional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01(b) of the General Conditions: (a) the Borrower and AIDB shall have entered into the subsidiary loan agreement required by Section 3.05 of this Agreement; (b) the settlers in the settlements established pursuant to the First Credit Agreement shall have obtained leases adequate to ensure their tenure on terms and conditions satisfactory to the Association; 10 (c) EPID and AIDB shall have entered into an agreement satisfactory to the Association setting forth the conditions of their cooperation in respect of the carrying out of Parts (1) and (2) of the Project including, inter alia, the provision and collection of farm credit and the distribution of farm inputs; and (d) WFCUJ and AIDB shall have entered into an agreement satisfactory to the Association setting forth the terms and conditions under which extension of seasonal credits to cooperatives in the Project Area will be prolided. Section 6.02. The lollowing are specified as additional matters. w ithir the meanint, of Section 12.02(b) of the General Condition. to be in illied in the opinion or opinions to be furnished to the Association: (a) the execution and delivery of the subsidiary loan agreement have been duly authorized or ratified by all necessary governmental, corporate and administrative action, and said agreement constitutes a valid and binding obligation of the Borrower and AIDB in accordance with its terms; (b) th

12 e leases referred to in Section 6.01(b)
e leases referred to in Section 6.01(b) of this Agreement hae been duly authorized and constitute valid and binding obligations k the Bomm e, er in accordance with their terms: (c) the execution and delivery of the agreement referred to in Section 6.01(c) of this Agreement has been duly authorized or ratified by all necessary governmental, corporate and administrative action, and said agreement constitiltes a valid and binding obligation of EPID and AIDB in accordance with its terms; and (d) the execution and delivery of the agreement referred to in Section 6.01(d) of this Agreement has been duly authorized or ratified by all necessary governmental, corporate and administrative action, and said agreement constitutes a valid and binding obligation of WFCU and AIDB in accordance with its terms. Section 6.03. A date 90 days after the date of this Agreement is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 6.04. The obligations of the Borrower under Articles Ill and IV of this Agreement and the provisions of Section 5.02 of this Agreement and those of Section 5.03 of this Agreement shall cease and determine on the date on which 11 the Development Credit Agreement shall terminate or on a date twenty-five years after the date of this Agreement, whichever shall be the earlier. ARTICLE VII Representative of the Borrower; Addresses Section 7.01. The Minister of Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section

13 7.02. The following addresses are speci
7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministry of Finance Addis Ababa Ethiopia Cable address: Ministry of Finance Addis Ababa For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: INDEVAS Washington, D.C. 12 IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, 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. EMPIRE OF ETHIOPIA By /s/ Ghebeyehou Mekbib Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Bernard R. Bell Regional Vice President Eastern Africa 13 SCHEDULE 1 Withdrawal of the Proced2s 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 Dollar Equivalent) to be Financed I. Incremental farm 1,800,000 100% of foreign inputs to be fi- expenditures or nanced under sea- 69% of total ex- sonal loans penditures II. Machinery and 360,000 100% of foreign equipment ex- expenditures or cluding rural 69% of total ex- water supply penditures equipment III. Vehicles 530,000 100% of foreign expenditures o

14 r 69% of total ex- penditures IV. WADU b
r 69% of total ex- penditures IV. WADU buildings 200,000 69% of total ex- including live- penditures stock market V. WADU contribution 410,000 69% of total ex- to cooperative penditures staff salaries, buildings and equipment VI. Road construction 600,000 69% of total ex- including salaries penditures of WADU Road Per- sonnel VII. Salaries, material 250,000 50% of total ex- and equipment for penditures water supply for farmers and settle- ments VIII. Assistance to 150,000 69% of total ex- rural artisans penditures 14 Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed IX. Salaries of WADU 3,000,000 59% of total ex- staff including penditures includ- expatriates ex- ing staff continu- cluding road con- ing First Project struction and activities water supply per- sonnel X. WADU operating 1,300,000 59% of total ex- expenses penditures includ- ing continuation of First Project activities X1. Studies 200,000 69% of total ex- penditures XII. Unallocated 3,200,000 TOTAL 12,000,000 2. For the purposes of this Schedule the term "foreign expenditures" means expenditures for goods or services supplied from, the territory, and in the currency, of any country other than the Borrower. 3. The disbursement percentages have been calculated in compliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supp

15 ly thereof; to that end, if any event oc
ly thereof; to that end, if any event occurs which shall affect the amount of any such taxes included in the cost of any item to be financed out of the proceeds of the Credit, the Association may, by notice to the Borrower, correspondingly adjust the disbursement percentage then applicable to such item. 4. Notwithstanding the provisions of paragraph I above, no withdrawals shall be made in respect of expenditures prior to the date of this Agreement. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in paragraph I above, if the 15 Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category to the extent required to meet such estimated shortfall proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expenditures and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the dishursement percentage then applicable to such expenditures in order that further wk thIrawah undi such Category may Continue until all expenditures thereunder sal!l ha%v been made. b. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for s

16 uch item shall be financed out of the pr
uch item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. 16 SCHEDULE 2 Description of the Project The, Project is the continuation and expansion over a five year period of the rural development program initiated under the First Credit Agreement. It would provide credit for incremental agricultural inputs, suppo.t 'or cooperative development, facilities for livestock development, and technical and administrative services to small farmers in the Project Area. In particular the Project would provide support for increased WADU extension, training, technical, and administrative activities and services for the following: (1) In the Woredas (sub-districts) of Sodo and Bolosso of Wolamo Awraja: (a) Extension services to farmers not benefiting from proceeds of the First Credit Agreement, and animal health, soil conservation and home economics services and incremental agricultural inputs and related credit to all farmers in the area whether they have been beneficiaries of funds provided under the First Credit Agreement or not; and (b) The introduction of new services, including livestock and poultry development, promotion of improved fodder crop

17 s, and the establishment of a primary li
s, and the establishment of a primary livestock market and holding ground. (2) Throughout the remaining Woredas of the Project Area: The introduction of extension, elementary animal health, soil conservation and home economics services, together with credit for the purchase of agricultural inputs. (3) In areas covered by (1) and (2) above, the Project would further include: (a) Continued support for 1.3 CMC's and WFCU; and (b) Establishment of a further 39 CMC's including the construction of stores and offices and provision of equipment therefor, construction of about 600 km of minor roads and tracks (including upgrading of tracks), improvement of rural water supplies for farmers and for two settlements in the Project Area, assistance to rural artisans, and the provision of expanded administrative services. 17 (4) The Project will also include: (a) A monitoring study of the soil conservation program to provide data for the formulation of a more extensive program of erosion control in the territories of the Borrower; (b) A study on the suitability of available land for further settlement within the Project Area; (c) A study of control and use of ranching land within the Project Area; and (d) An experimental program for improvement of coffee quality. The Project is expected to be completed by June 30, 1979. 18 SCHEDULE 3 Procurement A. General Procedures 1. Except as provided in Part A.2 hereof, contracts shall be let under procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA

18 Credits" published by the Bank in April
Credits" published by the Bank in April 1972, as revised in October 1972 (hereinafter called the Guidelines), on the basis of international competitive bidding. 2. The following procurement procedures shall apply in respect of the goods and works set forth hereunder to be financed in whole or in part out of the proceeds of the Credit: (a) Construction of WADU headquarters shall be awarded to the lowest evaluated bidder on the basis of competitive bidding advertised locally. (b) All other civil works included in the Project will be carried out by WADU force account. (c) Contracts for goods and services costing less than $30,000 equivalent would be awarded on the basis of the Borrower's normal procurement procedures, but orders would be grouped together whenever possible and all orders in excess of $30,000 will be subject to the procedures set forth in Parts A(1) and C(l) of this Schedule 3. B. Evaluation and Comparison of Bids for Goods; Preference for Domestic Manufacturers 1. For the purpose of evaluation and comparison of bids for the supply of goods subject to international competitive bidding: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically-manufactured goods; (ii) customs duties and other import taxes on imported goods, and sales and similar taxes on domestically-supplied goods, shall be excluded; and (iii) the cost to the Borrower of inland freight and other expenditures incidental to the delivery of goods to the place of the

19 ir use or installation shall be included
ir use or installation shall be included. 2. Goods manufactured in the Empire of Ethiopia may be granted a margin of preference in accordance with, and subject to, the following provisions: 19 (a) All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. (b) After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in the Empire of Ethiopia if the bidder shall have established to the satisfaction of the Borrower and the Association that the manufacturing cost of such goods includes a value added in the Empire of Ethiopia equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in the Empire of Ethiopia. (3) Group C: bids offering any other goods. (c) All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. The lowest evaluated bid of each group shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. (d) If, as a result of the comparison und

20 er paragraph (c) above, the lowest bid i
er paragraph (c) above, the lowest bid is a bid from group C, all group C bids shall be further compared with the lowest evaluated bid from group A after adding to the c.i.f. bid price of the imported goods offered in each group C bid, for the purpose of this further comparison only, an amount equal to (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such group C bid, or (ii) 150 of the c.i.f. bid price of such goods if said customs duties and taxes exceed I 5/( of such price. If the group A bid in such further comparison is. the lowest, it shall be selected for the award; if not, the lowest evaluated bid from group C shall be selected. C. Review of Procurement Decisions by Association 1. With respect to all contracts for goods estimated to cost the equivalent of S30,000 or more: 20 (a) Before bids are invited, the Borrower shall furnish or cause to be furnished to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, the Borrower shall, before a final decision on the award is m

21 ade, inform or cause to be informed the
ade, inform or cause to be informed the Association of the name of the bidder to which it intends to award the contract and the reasons for the intended award and shall furnish to the Association, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, together with the recommendation for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the provisions of this Agreement, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (d) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 2. With respect to each contract to be financed out of the proceeds of the Credit and not governed by the preceding paragraph, the Borrower shall furnish or cause to be furnished to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of bids, recommendations for award and such other inform

22 ation as the Association shall reasonabl
ation as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the provisions of this Agreement, promptly inform the Borrower and state the reasons for such determination. 0 21 SCHEDULE 4 Principal Terms and Conditions of Project On-Lending Operations On-Lending Terms of Seasonal Credit for Farm Inputs (a) The Borrower will on-lend to AIDB on the following terms: Annual Interest Rate: 7-1/4% Period: 15 years, including 5 years of grace on payment of principal (b) AIDB will on-lend to farmers who are members of a CMC on the following terms: Annual Interest Rate: 12% Period: 11 months In the granting of credit and collection of repayments, AIDB would appoint WADU as an agent and would pay WADU for these services 2% of the credit amount per annum. (c) For distribution of credit and collection of repayments for loans under (b) above WADU would attempt to use the services of WFCU and the CMC's, and would pay 1% of the credit amount per annum to WFCU and a further 1% to CMC's for those services. If WADU is unable to secure the foregoing arrangements, alternative arrangements acceptable to the Association will be substituted therefor. (d) AIDB will on-lend to WFCU on the following terms: Annual Interest Rate: 10% Period: 12 months (e) WFCU will on-lend to cooperatives on the following terms: Annual Interest Rate: 11% Period: 12 months 22 (f) Cooperatives will on-lend to their member farmers on the following terms: Annual Interest Rate: 12% Period: II mon