OFFICIAL DOCUMENTS GRANT NUMBER EO230-GM Financing Agreement (Second Fiscal Management, Energy and Telecom Reform Development Policy Financing) between REPUBLIC OF THE GAMBIA and INTERNATIONAL DEVELOPMENT ASSOCIATION GRANT NUMBER E0230-GM FINANCING AGREEMENT AGREEMENT dated as of the Signature Date between REPU31,IC OF THEU GAMBIA ('Recipien") and IN TERNATIONAL DEVELOPMENT ASSOCIATION (-Assoc iation") for the purpose of providing financing in support of the Program (as defined in the Appendix to this Agreement). The Association has decided to provide this financing on the basis, inter alia, of: (i) the actions which the Recipient has already taken Under the Program and which are described in Section I.A of Schedule I to this Agreement: and (ii) the Recipient's maintenance of an adequate macroeconomic policy tramework. The Recipient and the Association therefore hereby agree as follows: ARTICLE I - GENERAL CONDITIONS; DEFINITIONS 1.01. The General Conditions (as defined in the Appendix to this Agreement) apply to and form part of this Agreement. 1.02 Unless the context requires otherwise, the capitalized terms used in this Agreement have the meanings ascribed to them in the General Conditions or in the Appendix to this Agreement. ARTICLE II - FINANCING 2.01. The Association agrees to extend to the Recipient a grant. which is deemed as Concessional Financing for purposes of the General Conditions, in an amount equivalent to fourteen million four hundred thousand Special Drawing Rights (SDR 14,400.000) (-Tinancing-). 2.02. The Maximum Commitment Charge Rate is one-half of one percent (1/2 of I %) per annum on the Unwithdrawn Financing Balance. 2.03. The Payment Dates are June 15 and December 15 in each year. 2.04. The Payment Currency is Dollar. 2.05. Without limitation upon the provisions of Section 5.05 of the General Conditions, the Recipient shall promptly furnish to the Association sUch information relating to the provisions of this Article 11 as the Association may, from time to time, reasonably request. ARTICLE III - PROGRAM 3.01. The Recipient declares its commitment to the Program and its implementation. To this end, and further to Section 5.05 of the General Conditions: (a) the Recipicnt and the Association shall1 from tilme to time. at the reqiesI oI either party. exchange xvews on the Recipients macroeconomic polic\ frameork and the progress achieved in carry ing ot the P rogranm1, (b) prior to each such exchange of vie\s. the Recipient shall furnish to the Association for its review and comment a report on the progress achieved in carrying ont the Program, in such detail as the Association shall reasonably requnest: and (c) Withont limllitation Upon the provisions of paragraphs (a) and (b) of this Section. the Recipient shall promptlN inform the Association of any situation that woUld have tile effect of materially reversing the objectives of the Program or any action taken under the Program. ARTICLE IV- EFFECTIVENESS; TERMINATION 4.01 The Additional Conditions of Effectiveness consist of the following, nanely that the Association is satisfied with the progress achieved by the Recipient in carrying oLIt the Program and with the adeqUacy of the Recipient's macroeconomic policy framework. 4.02 The Effectiveness Deadline is the date thirty (30) days after the Signature Date. 4.03 For purposes of Section 10.05 (b) of the General Conditions, the date on which the obligations of the Recipient Under this Agreement (other than those providing for payment obligations) shall terminate is twenty years after the Signature Date. ARTICLE V - REPRESENTATIVE; ADDRESSES 5.01 the Recipient's Representative is its minister responsible for finance. 5.02 For purposes of Section 1 1.01 of the General Conditions: (a) the Recipient's address is: Ministry of Finance and Economic Affairs The Quadrangle BanjUl. Republic of The Gambia: and (b) the Recipient's Electronic Address is: Facsimile: -2204227954 >31 -3l- 5.03 Fo pUrposcs of Seet i i 1.01 n f the General Cond it ions: (a) the Assiciatin's address is: International De\elopiment Association 1818 H1 Street, NV. Washington. D.C. 20433 United States of America; and (b) the Association's Electronie Address is: Telex: Faesimile: 248423 (MCI) 1-202-477-6391 -4- AG R 1 as of the Signature Date REPUBLIC OF THE GAMBIA By,I uthorized c resentative Name:c Title Date: INTERNATIONAL DEVELOPMENT ASSOCIATION Bv Athorized Representative Name: Title: Y>^ (> Date: SCHEDULL 1 Program Actions; Availability of Financing Proceeds Section 1. Actions under the Pro2ram A. Actions Taken Under the Proeram, The actions taken by the Recipient under the Program i nel ude the fol lowing: 1. To strengthen eiscal risk and debt management practices, the Recipient has: (i) through its Ministry of Finance and Economic Affairs (MOFEA), published an annual borrowing plan for 2021 and (ii) through its Cabinet. approved the framework for ie management of government loan guarantees developed by MOFA. 2. To enhance the efficiency of public investment management, the Recipient has: (i) through its Cabinet, approved the criteria for proJect selection; and (ii) through the Stralegic Review Board, approved project appraisal guidelines (covering environmental impact and risks) developed by MOFEA. To improve financial performance in the energy sector, the Recipient has: (i) through its Cabinet, approved a tariff compensation imeehanism that compensates NAWEC for any shortfall between the approved tariff and required revenues starting in 202 1 and (ii) through the NAWEC Board, adopted a financial policy to establish a treasury function, a regulatory\ affairs function. and introduce clinate screening into the investment appraisal function. 4. To strengthen the governance framework and improve transparency in the energy sector. the Recipient has signed a perfornance contract between NAWEC and the MOFFA ftr 2021-23 which ensures increased oversight by the MOFEA and PJ RA through: (i) a quarterly performance monitoring franework; and (ii) third- party monitoring of NA WEC fuel supply. To encourage female participation in NAWEC's stalfing and, in particular. in leadership positions, the Recipient has, through the NAWEC Board, approved a gender policy that addresses equal opportunity recruitment and empioylment. 6. lo prepare for further liberalization of the telecom market, the Recipient has. through the Ministry of information and Communicalion In frastructure, incorporated the Gambia Fiber Optic Company Limited for Cuture private participation in the ownership and management of the wholesale fiber optic assets. 7. To enhance corporate governance for state-owned enterprises, the Recipient has, through MOFEA, established the state-owned enterprises oversight directorate at MOFEA. -6- Section II. A%ailabilit, of Financing Proceeds A. General. The Recipient may withdraw the proceeds of the F'inancing in accordance with the provisions of this Section and such additional instructions as the Association may specify b> notice to the Recipient. B. Allocation of Financing Amounts. The Financing is allocated in a single withdrawal tranche. from which the Recipient may make withdrawals of the Financing proceeds. The al location of the amoLints of the Financ1ing to this end is set out in the table below: Allocations Amount of the Financing Allocated (expressed in SDR) Single Withdrawal Tranche 14,400,000 TOTAL AMOUNT 14400,000 C. Withdrawal Tranche Release Conditions No withdrawal shall be made of the Single Tranche unless the Association is satisfied: (a) with the Program being carried out by the Recipient: and (b) with the adequacy of the Recipient's macroeconomic policy framework, D. Deposit of Financing Amounts I . The Recipient, within thirty (30) days after the withdrawal of the Financing from the Financing AccoLInt, shall report to the Association: (a) the exact sum received into the account referred to in Section 2.03 (a) of the General Conditions; (b) the details ofthe account to which the Dalasi equivalent of the Financing proceeds will be credited: (c) the record that an equivalent amount has been accounted for in the Recipient's budget management svstens; and (d) the statement of receipts and disbursement of the account referred to in Section 2.03 (a) of the General Conditions. E. Closing Date. The Closing Date is June 30, 2023. -7- APPENDIX Section 1. Definitions . -Cabinet- mcans Ilie Recipient's cabinet establisbed and operating pursuant to Section 73 of the Constitution of the Republic of tbe Gambia. 1997. 2. Giambia Fiber Optic Company Livmited means the Gambia fiber optic company limited. a private limited liability cornpany registered under the Companies Act of [be Ciambia, 2013. 3. -General Conditions" means tbe [-nternational Development Association General Conditions for IDA Financing. Development Policy Financing", dated December 14. 2018 (revised on August 1. 2020. April 1. 2021 and January 1. 2022). 4. 'Ministry of Finance and Economic Affairs- or the acronym ~MOFEA" means the Recipient's ministry responsible for finance. or any successor bereto. - -Ministrv of 1information and Communication Infrastructure" means the Recipient's ministry responsible for information and communication infrastructure, or any successor bereto. 6. -National Water and Electricity Company" or te acrony " NAWEC- means the Recipient's national vater and electricity company, a public enterprise established and operating pursuant to the laws of the Recipient 7. -NAWLC Board" means board of NAWEC established and operating pursuant to te laws of tbe Recipient. 8. -Program' means: the program of objectives, policies, and actions set forth or referred to in the letter dated March 28, 2022 from te Recipient to the Association declaring te Recipient's coninitment to te execution of the Program, and reluesting assistance from the Association iii support of Ilie Program during its execution and coniprising actions taken, including those set forth in Section 1 of Sehedule I to this Agreenent. and actions to be taken consistent with tbe prograi's objectives. 9. -PURA- means The Ganbia public utilities regulatory autbority established and operating pursuant te PURA Act 2001 of the laws of the Recipient and charged with the responsibility to regulate among other sectors electricity, petroleum (downstream), water and sewage, transportation and telecomniunications. l0. Signature Date' nieans the later of the two dates on which the Recipient and Ile Association signed this Agreenent and such definition applies to all references to "the date of tbe FinancingAgreement" in the General Conditions. -8- Il Sinle Witldra\w al Tranche' mcans the amount of the [Financing allocated to ilie Categor entitled Single Withdrawal TIranche in the table set forth in Part B of Section 11 of Schedule I to this Agreceient. 1 2. ~Strategic Revieu Board" ncans the lRcipient's technical body established i åhitin MIOFHA and nandated to appraise and endorse all programnies and projiecs consisient with national and sectoral development strategies and priority actions plans.