28-Jun-2022 Date: _______________ H. E. Rindra Hasimbelo Rabarinirinarison Minister of Economy and Finance Ministry of Economy and Finance Antananarivo Republic of Madagascar Re: IDA Grant E112-MG / Credit 7193-MG (Phase 2 of Improving Nutrition Outcomes) Additional Instructions: Disbursement and Financial Information Letter Excellency: I refer to the Financing Agreement between the Government of Madagascar (“Recipient”) and the International Development Association (“Association”) for the above-referenced Project. The General Conditions, as defined in the Financing Agreement, provide that the Recipient may from time to time request withdrawals of Financing1 amounts from the Financing Account2 in accordance with the Disbursement and Financial Information Letter, and such additional instructions as the Association may specify from time to time by notice to the Recipient. The General Conditions also provide that the Disbursement and Financial Information Letter may set out Project specific financial reporting requirements. This letter constitutes such Disbursement and Financial Information Letter (“DFIL”), and may be revised from time to time. I. Disbursement Arrangements, Withdrawal of Financing Funds, and Reporting of Uses of Financing Funds The Disbursement Guidelines for Investment Project Financing, dated February 2017, (“Disbursement Guidelines”), are available in the Association’s public website at https://www.worldbank.org and its secure website “Client Connection” at https://clientconnection.worldbank.org. The Disbursement Guidelines are an integral part of the DFIL, and the manner in which the provisions in the Disbursement Guidelines apply to the Grant is specified below. (i) Disbursement Arrangements  General Provisions (Schedule 1). The table in Schedule 1 sets out the disbursement methods which may be used by the Recipient, and conditions, information on registration of authorized signatories, processing of Withdrawal Applications (including minimum value of applications and processing of advances), instructions on supporting documentation, and frequency of reporting on the Designated Account(s). 1 “Financing” means: (a) the Credit if the Financing Agreement provides for a Credit only; (b) the Grant if the Financing Agreement provides for a Grant only; or both the Credit and the Grant if the Financing Agreement provides for both a Credit and a Grant. 2 “Financing Account” means: (a) the Credit Account if the Financing Agreement provides for a Credit only; (b) the Grant Account if the Financing Agreement provides for a Grant only; or (c) the Credit Account in respect of the Credit and the Grant Account in respect of the Grant if the Financing Agreement provides for a Credit and a Grant. 2 (ii) Withdrawal Applications Electronic Delivery3 The Recipient will deliver Withdrawal Applications (with supporting documents, “Applications”) electronically through the Association’s web-based portal “Client Connection” at https://clientconnection.worldbank.org. This option will be effected after the officials designated in writing by the Recipient who are authorized to sign and deliver Applications have registered as users of “Client Connection”. The designated officials will deliver Applications electronically by completing the Form 2380, which is accessible through “Client Connection”. By signing the Authorized Signatory Lette r, the Recipient confirms that it is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Association by electronic means. The Recipient may exercise the option of preparing and delivering Applications in paper form on exceptional cases (including those where the Recipient encounters legal limitations), and which were previously agreed with the Association. By designating officials to use SIDC and by choosing to deliver the Applications electronically, the Recipient confirms through the Authorized Signatory Letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, available in the Association's public website at https://www.worldbank.org and “Client Connection”; and (b) to cause such officials to abide by those terms and conditions. II. Financial Reports and Audits 4 (i) Financial Reports The Recipient must prepare and furnish to the Association not later than forty-five (45) days after the end of each calendar quarter, interim unaudited financial reports (“IFRs”) for the Project covering the quarter. Where a UN agency is contracted by the Recipient, the Recipient is responsible to ensure that the financial reporting requirements applicable to the UN Agency are stipulated in the agreement between the Recipient and the UN agency and met in a timely manner. (ii) Audits Each audit of the Financial Statements must cover the period of one fiscal year of the Recipient, commencing with the fiscal year in which the first withdrawal was made. The audited Financial Statements for each such period must be furnished to the Association not later than six (6) months after the end of such period. Where a UN agency is contracted by the Recipient, the Recipient is responsible to ensure that the documentation requirements applicable to the UN agency, for project audit purposes, are stipulated in the agreement between the Recipient and the UN agency and shall cause the UN agency to provide the project audit report as stipulated in the agreement between the Recipient and the UN agency in a timely manner. III. Other Important Information For additional information on disbursement arrangements, please refer to the Loan Handbook available on the Association’s public website and “Client Connection”. The Association recommends that you register as a user of “Client Connection”. From this website you will be able to prepare and deliver Applications, monitor the near real-time status of the Grant, and retrieve related policy, financial, and procurement information. For more information about the website and registration arrangements, or if you have any queries in relation to the above, please contact the Association by email at 3 Section 11.01(c) of the General Conditions. 4 Section 5.09 of the General Conditions. 3 askloans@worldbank.org using the above reference. Yours sincerely, ______________________________ Marie-Chantal Uwanyiligira Country Manger for Madagascar Eastern and Southern Africa Region Attachments 1. Form of Statement of Expenditure (SOE) With copies: Ministry of Economy and Finance Antananarivo Republic of Madagascar UCP / Ministry of Health Monsieur Alain Rakotovao Coordonnateur National UPNNC / Office National de la Nutrition Monsieur Francois de Paul Rakotovao Directeur National 4 Schedule 1: Disbursement Provisions A. Basic Information Grant Country Madagascar Closing Date Section III.B.2. of Schedule 2 to the E112-MG Number/ Recipient Republic of Madagascar Financing Agreement Credit Name of the Project Phase 2 for Improving Nutrition Disbursement Four (4) months after the closing 7193-MG Number Outcomes Deadline Date5 date B. Disbursement Methods and Supporting Documentation Disbursement Methods6 Methods Supporting Documentation7 Direct Payment Yes Records (Supplier Invoices/Copy of Receipts) Reimbursement Yes  Statement of Expenditure (SOE) in the format provided in Attachment 1 of the DFIL Advance (into a Designated Yes  Statement of Expenditure (SOE) in the format provided in Attachment 1 of the DFIL Account) Special Commitments Yes Copy of Letter of Credit, Copy of Proforma Invoice C. Designated Account(s)8 DA-A: Segregated - Managed by UCP / Ministry of Health; DA-A, DA-B: Fixed Type and Management Unit DA-B: Segregated - Managed by UPmC / Office National de la Nutrition Ceiling Financial Institution - Banque Centrale De Madagascar DA-A, DA-B: USD Currency Name Monthly DA-A: 4,000,000 Frequency of Reporting9 Amount DA-B: 4,000,000 D. Minimum Value of Applications10 The minimum value of applications for Direct Payment, Reimbursement, Commitment Issuance-SC and Commitment Issuance-UN Blanket is 20.00 percent of DA ceiling. E. Authorized Signatures11 Withdrawal and Documentation Applications12 The existing Blanket Letter N° 914-2021-MEF/SG/DGT/DDP/SADE/Rd signed by Rindra Hasimbelo Rabarinirinarison Minister of Economy and Finance dated on September 17, 2021 and its amendments. F. Additional Instructions For notes in Schedule 1: Sections and subsections relate to the “Disbursement Guidelines for Investment Project Financing”, d ated February 2017. 5 Subsection 3.7 6 Section 2 7 Subsections 4.3 and 4.4 8 Sections 5 and 6 9 Subsection 6.3 10 subsection 3.5 11 Subsection 3.1 and 3.2 12 Subsection 3.3 and 3.4 5 (i) All other supporting documentation for SOEs should be retained by the project management or Recipient and must be made available for review by periodic World Bank missions and internal and external auditors (ii) Funds from the Designated Account may be transferred to Transactions Accounts denominated in Ariary or US dollars $, opened during the preparation by each PIU at commercial bank to enable payment of eligible expenditures. Transactions and balance in these accounts are to be included in all project financial reports. (iii) Disbursements under Category 5 of Section III.A of Schedule 2 of the Financing Agreement (Part 5 of the Project – Contingency Emergency Response CERC will be subject to the conditions precedent to accessing the CERC funds, namely that the Recipient has provided, and the Bank has accepted, evidence of the occurrence of an eligible crisis or emergency and the Recipient has prepared and adopted/adhered to the CERC Operations Manual. Disbursements under this component will follow procedures described in the CERC Operations Manual including supporting documentation; provided that this disbursement letter will first need to be amended and reinstated at a later date to reflect those specific arrangements. In order to provide necessary liquidity for fast response, the ceiling of the Advance under the CERC could be up to 100% of the amount allocated to the CERC category. 6 Attachment 1 – Statement of Expenditures SOE Model Template (incl. listing of prior review payments) IDA – International Development Association Statement of Expenditures Financier Payment made during the to Loan/Credit/Grant period from # Application # The following expenditures have been incurred during the retroactive Yes No Category # financing period (please tick) The following expenditures have been incurred before the closing date Yes No Page # of the loan/credit/grant (please tick) ONLY for the Designated Account 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Ite Suppli Brief Prior Contr Contra Invoi Date Total % Eligi Excha Date of Amoun m er’s Descrip Review act # ct ce of Amoun Finan ble nge Withdr t No Name tion of (Contr Curren Num Paym t of ced Amo Rate awal Withdr the act?) (Client cy and ber ent Invoice from unt from awn Expend Conne Amoun Covere the the from iture (YES or ction # t d by Bank (Col Design the NO) for Applic 9x ated Design Prior (Origin ation 10) Accoun ated Review al + t Accoun Contra Amend (Net of t cts) ment) Retenti on) (Col 11/12) 0.00 0.00 TOTAL 0.00 Supporting documents for this SOE are retained at (insert location) A separate form should be used for each category.