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CONFORMED COPY
GEF TRUST FUND GRANT NUMBER TF 023844 MOZ
Global Environment Facility
Trust Fund Grant Agreement
(Coastal and Marine Biodiversity Management Project)
between
REPUBLIC OF MOZAMBIQUE
and
INTERNATIONAL BANK FOR RECONSTRUCTION
Acting as Implementing Agency of the
Global Environment Facility (GEF)
Dated August 1, 2000
GEF TRUST FUND GRANT NUMBER TF 023844 MOZ
GLOBAL ENVIRONMENT FACILITY TRUST FUND GRANT AGREEMENT
AGREEMENT, dated August 1, 2000, between REPUBLIC OF MOZAMBIQUE (the 
Recipient) and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank) 
acting as an implementing agency of the Global Environment Facility (GEF) in 
respect of grant funds provided to the GEF Trust Fund by certain members of the 
Bank as participants of the GEF.
WHEREAS (A) the Bank, pursuant to Resolution No. 91-5 of March 14, 1991 of 
the Executive Directors of the Bank, established the GEF to assist in the 
protection of the global environment and promote thereby environmentally sound 
and sustainable economic development;
(B)
following the restructuring of the GEF, such arrangements continued 
in place on the basis set forth in Resolution No. 94-2 of May 24, 1994, of the 
Executive Directors of the Bank which, inter alia, established the GEF Trust 
Fund and appointed the Bank as trustee of the GEF Trust Fund (Resolution No. 
94-2);
(C)
the second replenishment of the GEF Trust Fund was approved on the 
basis set forth in Resolution No. 98-2 of July 14, 1998, of the Executive 
Directors of the Bank (Resolution No. 98-2);
(D)
the Recipient, having satisfied itself as to the feasibility and 
priority of the Project described in Schedule 2 to this Agreement (the Project), 
has requested assistance from the resources of the GEF Trust Fund for funding 
the Project, and said request having been approved in accordance with the 
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provisions of the Instrument for the Establishment of the Restructured Global 
Environment Facility approved under Resolution 94-2, and to be funded from 
contributions to the GEF Trust Fund under Resolution No. 98-2, which may include 
funds carried over from the first replenishment of the GEF Trust Fund under 
Resolution No. 94-2;
(E)
the Recipient has also requested the International Development 
Association (the Association) to provide additional financing towards the 
financing of the Project, and by an agreement (the Development Credit Agreement) 
of even date herewith between the Recipient and the Association, the Association 
has agreed to provide such assistance in an aggregate amount equivalent to four 
million two hundred thousand Special Drawing Rights (SDR 4,200,000);
WHEREAS the Bank has agreed, on the basis, inter alia, of the foregoing, 
to extend the GEF Trust Fund Grant to the Recipient upon the terms and 
conditions set forth in this Agreement;
NOW THEREFORE the parties hereto hereby agree as follows:
ARTICLE I
General Conditions; Definitions
Section 1.01 (a) The following provisions of the General Conditions 
Applicable to Loan and Guarantee Agreements for Currency Pool Loans of the Bank, 
dated January 1, 1985, (as amended through December 2, 1997) with the 
modifications set forth in paragraph (b) of this Section (the General 
Conditions) constitute an integral part of this Agreement:
(i)
Article I;
(ii)
Sections 2.01 (2), (3), (6), (8), (9), (10), (15), (16), 
(17), (19) and (20), 
2.02 and 2.03;
(iii)
Section 3.01;
(iv)
Section 4.01 and the first sentence of Section 4.09;
(v)
Article V;
(vi)
Sections 6.01, 6.02, (c), (e), (f), (i), (l), (m), (n), (o) 
and (p), 6.03, 
6.04 and 6.06;
(vii)
Section 8.01 (b);
(viii) Sections 9.01 (a) and (c), 9.04, 9.05, 9.06, 9.07, 9.08 and 
9.09;
(ix)
Sections 10.01, 10.03 and 10.04; 
(x)
Article XI; and
(xi)
Sections 12.01 (c), 12.03 and 12.04.
(b)
The General Conditions shall be modified as follows:
(i)
a new paragraph shall be added to the end of Section 2.01 to 
read as follows: 
“the term “Special Drawing Rights” and the 
symbol “SDR” mean special drawing 
rights as valued by the 
International Monetary Fund in accordance with its 
Articles of Agreement”;
(ii)
the term “Bank”, wherever used in the General Conditions, 
other than in 
Sections 2.01 (8) and 6.02 (f) thereof 
and the last use of such term in 
Section 5.01 thereof, means 
the Bank acting as an implementing agency of the 
GEF, except that in Section 6.02, the term “Bank” shall also include the Bank 
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acting in its own capacity;
(iii)
the term “Borrower”, wherever used in the General 
Conditions, means the 
Recipient;
(iv)
the term “Loan Agreement”, wherever used in the General 
Conditions, means this 
Agreement;
(v)
the term “Loan” and “loan”, wherever used in the General 
Conditions, means the 
GEF Trust Fund Grant;
(vi)
the term “Loan Account”, wherever used in the General 
Conditions, means the 
GEF Trust Fund Grant Account;
(vii)
The second sentence of Section 5.01 is modified to read: 
“Except as the Bank 
and the Borrower shall otherwise agree, 
no withdrawals shall be made: (a) on 
account of expenditures in 
the territories of any country which is not a 
member of the Bank or for goods produced in, or services supplied from, such 
territories; or (b) for the purpose of any payment to persons or 
entities, or 
for any import of goods, if such payment or import, to 
the knowledge of the 
Bank, is prohibited by a decision of the 
United Nations Security Council taken 
under Chapter VII of the 
Charter of the United Nations.”;
(viii) a new subparagraph is added after subparagraph (o) in 
Section 6.02 of the 
General Conditions, as follows: 
“an extraordinary situation shall have arisen 
in which any 
further disbursement under the GEF Trust Fund Grant would exceed 
the resources available for disbursement from the GEF.”; and
(ix)
Section 11.01 is modified by replacing, in the second 
sentence, the word “
radiogram” with the word 
“facsimile” and adding a new sentence at the end of 
the said Section to read:
“Deliveries made by facsimile transmission shall also be confirmed 
by mail.”
Section 1.02. Wherever used in this Agreement, unless the context 
otherwise requires, the several terms defined in the General Conditions and in 
the Recitals to this Agreement have the respective meanings therein set forth, 
and the following additional terms have the following meanings:
(a)
“CPI” means the Borrower’s Investment Promotion Center;
(b)
“DNFFB” means the Borrower’s National Directorate of Forestry and 
Wildlife;
(c)
“DINATUR” means the Borrower’s National Directorate of Tourism; 
(d)
“Implementing Agencies” mean the Borrower’s agencies with technical 
responsibility for implementing the Project, namely DINATUR, DNFFB, CPI, MADER 
and INIA;
(e)
“MADER” means the Borrower’s Ministry of Agriculture and Rural 
Development;
(f)
“INIA” means the Borrower’s Institute of Agricultural Research;
(g)
“Initial Planning Framework Guidelines” means the guidelines 
referred to in paragraph 5 of Schedule 4 to this Agreement;
(h)
“Micro-Project” means a micro-project designed, prepared and 
carried out under Part B.3 (a) of the Project;
(i)
“Micro-Projects Operational Manual” means the manual referred to in 
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paragraph 2 of Schedule 4 to this Agreement as amended from time to time, in 
consultation with the Bank, and such term includes any schedules to the 
Micro-Projects Operational Manual;
(j)
“Matching Grant” means the matching grant to be provided for 
Micro-Projects under Part B.(3) (a) of the Project;
(k)
“Matching Grant Agreement” means the matching grant agreement 
referred to in paragraph 3 of Schedule 4 to this Agreement;
(l)
“MICOA” means the Borrower’s Ministry for Coordination of 
Environmental Affairs;
(m)
“Midterm Review” means the midterm review referred to in paragraph 
4 of Schedule 4 to this Agreement;
(n)
“Performance Indicators” means the indicators referred to in 
Schedule 6 to this Agreement;
(o)
“Project Implementation Plan” means the plan referred to in 
paragraph 1 (a) (ii) of Schedule 4 to this Agreement containing, inter alia, 
work plans, training plans, and procedures to be used for the purposes of the 
implementation of the Project, as it may be amended from time to time, in 
consultation with the Bank, and such term includes any schedules to the Project 
Implementation Plan;
(p)
“Project Management Report” means each report prepared in 
accordance with Section 4.02 of this Agreement;
(q)
“Special Account” means the account referred to in Section 2.02 (b) 
of this Agreement;
(r)
“Project Areas” means  the following areas in northern Mozambique, 
namely: (i) an area of about 9,500 sq. km. in Mocimboa da Praia and Palma in the 
province of Cabo Delgado; and (ii) an area of about 4,700 sq. km. in the 
contiguous districts of Nacala-Porto and Mossuril in the province of Nampula;
(s)
“Project Year" means the 12 month period beginning from the 
Effective Date and ending 12 months thereafter and each successive 12 month 
period following thereafter;
(t)
“Beneficiary” means a community or group which meets the criteria 
specified in the Micro-Projects Operational Manual to which or for whose benefit 
a Matching Grant is made or proposed to be made for a Micro-Project;
(u)
“NGOs” means non-governmental organizations; and
(v)
“Memorandum of Understanding” means a memorandum of understanding 
referred to in paragraph 1 (a) (i) of Schedule 4 to this Agreement.
ARTICLE II
The GEF Trust Fund Grant
Section 2.01. The Bank agrees to make available to the Recipient, on the 
terms and conditions set forth or referred to in this Agreement, the GEF Trust 
Fund Grant in an amount in various currencies equivalent to three million one 
hundred thousand Special Drawing Rights (SDR 3,100,000).
Section 2.02. (a) The amount of the GEF Trust Fund Grant may be withdrawn 
from the GEF Trust Fund Grant Account in accordance with the provisions of 
Schedule 1 to this Agreement for: (i) expenditures made (or, if the Bank shall 
so agree, to be made) in respect of the reasonable cost of goods, works and 
services required for carrying out the Project described in Schedule 2 to this 
Agreement and to be financed out of the proceeds of the GEF Trust Fund Grant, 
and (ii) amounts paid (or, if the Association shall so agree, amounts to be 
paid) by the Borrower on account of withdrawals made to meet the reasonable cost 
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of goods, works and services required for any Micro-Project in respect of which 
the withdrawal from the GEF Trust Fund Grant Account is requested.
(b) 
The Recipient may, for the purposes of the Project, open and 
maintain in dollars a special deposit account in a commercial bank on terms and 
conditions satisfactory to the Bank, including appropriate protection against 
set-off, seizure or attachment. Deposits into, and payments out of, the Special 
Account shall be made in accordance with the provisions of Schedule 5 to this 
Agreement.
Section 2.03. The Closing Date shall be June 30, 2005 or such later date 
as the Bank shall establish. The Bank shall promptly notify the Recipient of 
such later date.
ARTICLE III
Execution of the Project
Section 3.01. (a) The Recipient declares its commitment to the objectives 
of the Project as set forth in Schedule 2 to this Agreement and, to this end, 
shall carry out the Project with due diligence and efficiency and in conformity 
with appropriate administrative, financial, engineering, environmental, and 
technical practices and shall provide, promptly as needed, the funds, 
facilities, services and other resources required for the Project.
(b)
Without limitation upon the provisions of paragraph (a) of this 
Section and except as the Recipient and the Bank shall otherwise agree, the 
Recipient shall carry out the Project in accordance with the Implementation 
Program set forth in Schedule 4 to this Agreement.
Section 3.02. Except as the Bank shall otherwise agree, procurement of the 
goods, works, and consultants' services required for the Project and to be 
financed out of the proceeds of the GEF Trust Fund Grant shall be governed by 
the provisions of Schedule 3 to this Agreement. 
Section 3.03. For the purposes of Section 9.08 of the General Conditions 
and without limitation thereto, the Recipient shall:
(a)
prepare, on the basis of guidelines acceptable to the Bank, and 
furnish to the Bank not later than six (6) months after the Closing Date or such 
later date as may be agreed for this purpose between the Recipient and the Bank, 
a plan for the future operation of the Project; and 
(b)
afford the Bank a reasonable opportunity to exchange views with the 
Recipient on said plan.
ARTICLE IV
Financial Covenants
Section 4.01. (a) The Recipient shall maintain, or cause to be maintained, 
records and accounts adequate to reflect, in accordance with sound accounting 
practices, the operations, resources and expenditures in respect of the Project 
of the departments or agencies of the Recipient responsible for carrying out the 
Project or any part thereof.
(b)
The Recipient shall:
(i)
have the records and accounts referred to in paragraph (a) 
of this Section, 
including those for the Special Account, for 
each fiscal year audited, in 
accordance with appropriate 
auditing principles consistently applied, by 
independent auditors acceptable to the Bank;
(ii)
furnish to the Bank as soon as available, but in any case 
not later than six 
months after the end of each such year, the 
report of such audit by said 
auditors, of such scope and 
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in such detail as the Bank shall have reasonably 
requested; and
(iii)
furnish to the Bank such other information concerning said 
records and 
accounts and the audit thereof as the Bank 
shall from time to time reasonably 
request.
(c)
For all expenditures with respect to which withdrawals from the GEF 
Trust Fund Grant Account were made on the basis of statements of expenditure, 
the Recipient shall:
(i)
maintain or cause to be maintained, in accordance with 
paragraph (a) of this 
Section, records and accounts reflecting 
such expenditures;
(ii)
retain, until at least one year after the Bank has received 
the audit report 
for the fiscal year in which the last 
withdrawal from the GEF Trust Fund Grant 
Account was 
made, all records (contracts, orders, invoices, bills, receipts 
and other documents) evidencing such expenditures;
(iii)
enable the Bank’s representatives to examine such records; 
and
(iv)
ensure that such records and accounts are included in the 
annual audit 
referred to in paragraph (b) of this Section 
and that the report of such audit 
contains a separate opinion 
by said auditors as to whether the statements of 
expenditure submitted during such fiscal year, together with the procedures 
and internal controls involved in their preparation, can be relied 
upon to 
support the related withdrawals.
Section 4.02. (a) Without limitation upon the provisions of Section 4.01 
of this Agreement, the Recipient shall carry out a time-bound action plan 
acceptable to the Bank for the strengthening of its financial management system 
for the Project in order to enable the Recipient, not later than 18 months after 
the Effective Date, or such later date as the Bank shall agree, to prepare 
quarterly Project management reports, acceptable to the Bank, each of which: 
(i)
(A) sets forth actual sources and applications of funds for 
the Project, both 
cumulatively and for the period covered by said 
report, and projected sources 
and applications of funds for the 
Project for the six-month period following 
the period 
covered by said report; and (B) shows separately expenditures 
financed out of the proceeds of the GEF Trust Fund Grant during the 
period 
covered by said report and expenditures 
proposed to be financed out of the 
proceeds of 
the GEF Trust Fund Grant during the six-month period following the 
period covered by said report;
(ii)
(A) describes physical progress in Project implementation, 
both cumulatively 
and for the period covered by said report; and 
(B) explains variances between 
the actual and previously forecast 
implementation targets; and
(iii)
sets forth the status of procurement under the Project and 
expenditures under 
contracts financed out of the proceeds of the 
GEF Trust Fund Grant, as at the 
end of the period covered by said 
report.
(b)
Upon the completion of the action plan referred to in paragraph (a) 
of this Section, the Recipient shall prepare, in accordance with guidelines 
acceptable to the Bank, and furnish to the Bank not later than 45 days after the 
end of each calendar quarter a Project Management Report for such period.
ARTICLE V
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Effective Date; Termination
Section 5.01. The following events are specified as additional conditions 
to the effectiveness of the GEF Trust Fund Grant Agreement within the meaning of 
Section 12.01 (b) of the General Conditions:
(a)
the Recipient has: (i) appointed and assigned to MICOA a full-time 
financial and procurement staff with qualifications and experience satisfactory 
to the Bank; and (ii) appointed an adequate number of technical and 
administrative personnel, with qualifications and experience satisfactory to the 
Bank, to assist in the carrying out of Project activities in the Project Areas;
(b)
the Recipient has established a financial management and accounting 
system acceptable to the Bank;
(c)
the Recipient has appointed auditors in accordance with the 
provisions of Section II of Schedule 3 to this Agreement; 
(d)
the Recipient has adopted and furnished to the Bank the Initial 
Planning Framework Guidelines, in form and substance satisfactory to the Bank;
(e)
the Recipient has furnished to the Bank each Memorandum of 
Understanding in form and substance satisfactory to the Bank;
(f)
the Recipient has furnished to the Bank a procurement plan 
satisfactory to the Bank for the procurement of goods, works and services 
required for the first Project Year; and
(g)
all conditions precedent to the effectiveness of the Development 
Credit, other than those related to the effectiveness of this Agreement, have 
been fulfilled.
Section 5.02. The date ninety (90) days after the date of this Agreement 
is hereby specified for the purposes of Section 12.04 of the General Conditions.
Section 5.03. This Agreement shall continue in effect until the GEF Trust 
Fund Grant has been fully disbursed and the parties to this Agreement have 
fulfilled all their obligations hereunder.
ARTICLE VI
Representative of the Recipient; Addresses
Section 601. The Governor of the Bank of Mozambique is designated as 
representative of the Borrower for the purposes of Section 11.03 of the General 
Conditions. 
Section 6.02. The following addresses are specified for the purposes of 
Section 11.01 of the General Conditions:
For the Recipient:
Banco de Moçambique
Avenida 25 de Setembro
P.O. Box 423
Maputo, Mozambique
Cable address: 
Telex:
MOBANCO
6355/7 BMMO
Maputo
For the Bank:
International Bank for
   Reconstruction and Development,
acting as an Implementing Agency of
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the Global Environment Facility
1818 H Street, NW
Washington, D.C. 20433
United States of America
Cable address:
Telex:
INDEVAS
248423 (MCI) or
Washington, D.C.
 64145 (MCI)
IN WITNESS WHEREOF, the parties hereto, acting through their duly 
authorized representatives, 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.
REPUBLIC OF MOZAMBIQUE
By /s/ Marcus Namashulua
Authorized Representative
INTERNATIONAL BANK FOR RECONSTRUCTION
   AND DEVELOPMENT
acting as an implementing agency of the
Global Environment Facility
By /s/ Praful Patel
Acting Regional Vice President
Africa
SCHEDULE 1
Withdrawal of the Proceeds of the GEF Trust Fund Grant
1.
The table below sets forth the Categories of items to be financed out of 
the proceeds of the GEF Trust Fund Grant, the allocation of the amounts of the 
GEF Trust Fund Grant to each Category and the percentage of expenditures for 
items so to be financed in each Category:
Amount of the GEF Trust
Fund Grant Allocated
   % of
  (Expressed in
Expenditures
Category
SDR Equivalent)
to be Financed
(1)
Works
75,000
100% of foreign
expenditures and
85% of local 
expenditures
(2)
Goods, equipment 
      375,000
100% of foreign
and vehicles
foreign expenditures
and 85% of local 
expenditures
(3)
Micro-Projects
      850,000
100%
(4)
Consultants’ services    1,500,000
100%
including audit
services
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(5)
Operating Costs
300,000
85% of local
expenditures
Total
     3,100,000
2.
For the purposes of this Schedule:
(a)
the term “foreign expenditures” means expenditures in the currency 
of any country other than that of the Recipient for goods or services supplied 
from the territory of any country other than that of the Recipient; 
(b)
the term “local expenditures” means expenditures in the currency of 
the Recipient or for goods or services supplied from the territory of the 
Recipient; and
(c)
the term “Operating Costs” means the incremental operating costs 
arising under the Project on account of maintenance of vehicles, fuel, 
equipment, office supplies, utilities, consumables, travel and accommodation, 
and Project staff salaries but excluding salaries of the Recipient’s civil 
servants.
3.
Notwithstanding the provisions of paragraph 1 above, no withdrawals shall 
be made:
(a)
in respect of payments made for expenditures prior to the date of 
this Agreement; and
(b)
in respect of expenditures under Category (3) for a Micro-Project 
unless the Micro-Project has been approved by the Bank in accordance with, and 
subject to, the provisions of the Micro-Projects Operational Manual and the 
Matching Grants Agreement, including the eligibility criteria and terms and 
conditions set forth in the said Manual and the Matching Grants Agreement.
4.
The Bank may require withdrawals from the GEF Trust Fund Grant Account to 
be made on the basis of statements of expenditure for expenditures for: (a) 
goods and works under contracts costing less than $100,000 equivalent each; (b) 
for consultants’ services under contracts not exceeding: (i)$100,000 each for 
consulting firms, and (ii) $50,000 each for individual consultants; and (c) 
Operating Costs, all under such terms and conditions as the Bank shall specify 
by notice to the Recipient.
SCHEDULE 2
Description of the Project
The
objective of the Project is to carry out, on a pilot basis, an 
integrated approach to sustainable development in the Project Areas, including: 
(i) strategic integration of conservation measures with regional economic 
development; (ii) establishment and protection of conservation areas; (iii) 
initiation of conservation-oriented community activities; (iv) building of the 
capacity of stakeholders responsible in the Project Areas for biodiversity 
protection; (v) raising public awareness of the importance of biodiversity 
conservation issues and measures; and (vi) establishing best practice for 
environmentally and biodiversity-friendly development.
The Project consists of the following Parts, subject to such modifications 
thereof as the Recipient and the Bank may agree upon from time to time to 
achieve such objectives:
Part A: 
Strategic Development Plans
The acquisition for the provincial and district governments of the Project 
Areas of strategic planning tools for utilization in the conservation and 
sustainable development of coastal and marine resources in the Project Areas, 
including the development of two strategic spatial development plans to: (i) 
cover the Project Areas; and (ii) provide the strategic framework for (A) 
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district development particularly in designated conservation areas, and (B) 
private sector development and community-based natural resource management or 
co-management with government agencies.
Part B:
Biodiversity Conservation and Sustainable Community Development
1.
Management of conservation activities and biological monitoring in the 
Project Areas, including:
(a)
biodiversity conservation and management in the key conservation 
areas identified in the strategic development planning process;
(b)
the establishment and gazetting of the conservation areas, boundary 
rationalization and zoning for environmentally sustainable uses;
(c)
(i)
the provision of technical advisory services for the 
preparation and carrying 
out of detailed management plans for the 
marine conservation areas and their 
buffer zones,
(ii)
community land demarcation,
(iii)
provision of equipment and construction of infrastructure 
including guard 
posts and boundary markers, and
(iv)
capacity building for park staff and local communities 
responsible for the 
co-management of natural resources 
and development of revenue generating 
mechanisms; 
and
(d)
(i)
development of best practice guidelines for protected area 
co-management;
(ii)
development of regulations for: (A) the co-management of 
natural resources by 
park staff and local communities, and 
(B) the terms and conditions to be 
provided for 
in conservation concessions and co-management agreements with 
private sector entities,
(iii)
analysis of legal, regulatory and institutional issues, and
(iv)
ecological and social assessments and community 
consultations to develop 
appropriate management options for 
other areas of biological interest in the 
Recipient’s 
territory.
2.
(a)
The provision of technical advisory services for the carrying out  
of ecological surveys and monitoring of turtles, dugongs and other indicator 
species in marine conservation areas and adjacent coastal and marine habitats.
(b)
The provision of training to local communities to build local 
capacity for data collection relevant to the establishment of management 
guidelines for sustainable harvesting of marine resources.
(c)
The establishment in the Project Areas of two field stations to 
assist in the carrying out of the Recipient’s coastal zone management 
decentralization strategy and the Recipient’s environmental and biodiversity 
monitoring and evaluation system.
3.
(a)
The provision of Matching Grants to assist Beneficiaries in the 
carrying out of community-based micro-projects (through local governments and 
with the assistance of NGOs and community facilitators) that promote 
biodiversity conservation, including community-run eco-tourism activities and/or 
micro-enterprises that reduce pressure on biological resources.
(b)
Training of community facilitators; capacity building for 
micro-enterprise development; and facilitating negotiations between the private 
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sector participants and local communities in the Project Areas.
Part C:
Private Sector Development
1.
(a)
Identification in one of the Project Areas of a suitable site for 
substantial private sector investment in biodiversity conservation.
(b)
(i)
Provision of technical advisory services to advise on the 
best means of 
translating biodiversity management and 
social expectations of local 
communities in the Project 
Areas into environmentally sustainable and 
profitable alternative forms of livelihood.
(ii)
Provision of technical advisory services for the preparation 
of concession 
agreements between the Recipient and 
concessionaires for developments in the 
Project Areas 
which conform with criteria and guidelines established during 
the strategic development planning process, including (A) provision of 
specialized procurement training, (B) preparation of bid 
documents, (C) 
promotion of proposed tenders, and (D) 
the establishment of appropriate tender 
procedures and 
effective monitoring of the administration of said procedures 
to safeguard globally important biodiversity values in the Project Areas.
Part D: 
Training and Public Awareness 
1.
The provision of training to build capacity for decentralized coastal zone 
planning and management in the Project Areas, including:
(i)
training of (A) the technical staff of the Implementing 
Agencies, (B) 
communities and local resource users, 
and (C) traditional leaders, religious 
leaders, local NGOs and 
local government staff and other local administrators; 
and
(ii)
provision of about 10 scholarships for higher level or 
university degrees at 
both regional and international 
institutions in biodiversity and coastal zone 
management 
studies.
2. 
The carrying out of a public awareness campaign targeting decision makers 
and local resource users to increase knowledge of issues related to marine and 
coastal biodiversity conservation and to reinforce sustainable use of natural 
resources in the Project Areas, including: (i) information workshops, (ii) the 
publication of a coastal zone newsletter by MICOA, (iii) site visits; (iv) the 
utilization of local language radio broadcasts to educate the public on 
biodiversity and environmental issues.
Part E:
Project Management and Monitoring and Evaluation
1. 
Coordination and management of the Project at the central and local 
levels, including (i) the holding of regular Project coordinating meetings, and 
(ii) provision of technical advisory services, equipment and logistical 
assistance in the carrying out of the Project.
2. 
Establishment and implementation of a monitoring and evaluation system for 
the Project, including:
(i)
the establishment of an effective system for data collection 
and processing on 
environmental and biodiversity matters; and
(ii)
the establishment of an independent monitoring and 
evaluation team to (A) 
assess the overall effectiveness 
of the Project, (B) evaluate the 
effectiveness of Project 
activities in achieving Project specific outputs and 
objectives, (C) establish and expand ecological indicators for the Project 
Areas, (D) monitor the status of the social conditions of 
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the Project Areas, 
and (E) advise on the most effective 
institutional structure for the future 
collection and evaluation 
of monitoring data concerning the state of the 
coastal zone in the Project Areas.
*  *  *
The Project is expected to be completed by December 31, 2004.
SCHEDULE 3
Procurement and Consultants’ Services
Part A:
General
Section I.
Procurement of Goods and Works
Goods and works shall be procured in accordance with (a) the provisions of 
Section I of the “Guidelines for Procurement under IBRD Loans and IDA Credits” 
published by the Bank in January 1995, and revised in January and August 1996, 
and in September 1997 and January 1999, (the Guidelines); and (b) the provisions 
of the following Parts of this Section I.
Part B:
International Competitive Bidding
1.
Except as otherwise provided in Part C of this Section, contracts for 
goods and works shall be procured under contracts awarded in accordance with the 
provisions of Section II of the Guidelines and paragraph 5 of Appendix 1 
thereto.
2.
The following provisions shall apply to goods and works to be procured 
under contracts awarded in accordance with the provisions of paragraph 1 of this 
Part B.
(a)
Pre-qualification
Bidders for contracts for works estimated to cost $1,000,000 equivalent or 
more shall be pre-qualified in accordance with the provisions of paragraphs 2.9 
and 2.10 of the Guidelines.
(b)
Grouping of Contracts
To the extent practicable, contracts for goods shall be grouped in bid 
packages estimated to cost $100,000 equivalent or more each.
Part C:
Other Procurement Procedures
1.
National Competitive Bidding
Goods estimated to cost less than $100,000 equivalent per contract, up to 
an aggregate amount not to exceed $1,000,000 equivalent, and works estimated to 
cost less than $500,000 equivalent per contract, up to an aggregate amount not 
to exceed $600,000 equivalent, may be procured under contracts awarded in 
accordance with the provisions of paragraphs 3.3 and 3.4 of the Guidelines.
2.
National and International Shopping
(a)
Goods estimated to cost less than $50,000 equivalent per contract, 
up to an aggregate amount not to exceed $100,000 equivalent, may be procured 
under contracts awarded on the basis of international shopping procedures in 
accordance with the provisions of paragraphs 3.5 and 3.6 of the Guidelines, on 
the basis of at least 3 quotations from reputable suppliers in two different 
countries.
(b)
Goods estimated to cost less than $20,000 equivalent per contract, 
up to an aggregate amount not to exceed $100,000 equivalent, may be procured 
under contracts awarded on the basis of national shopping procedures in 
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accordance with the provisions of paragraphs 3.5 and 3.6 of the Guidelines, on 
the basis of at least 3 quotations from local suppliers.
3.
Procurement from IAPSO
As an alternative to the methods specified in paragraph 2 above, goods may 
be procured from the Inter Agency Procurement Services Office of the United 
Nations Development Program in accordance with the provisions of paragraph 3.9 
of the Guidelines.
4.
Community Participation
Goods and works required for Part B.3 of the Project shall be procured in 
accordance with procedures acceptable to the Association.
Part D:
Review by the Bank of Procurement Decisions
1.
Procurement Planning
Prior to the issuance of any invitations to pre-qualify for bidding or to 
bid for contracts, the proposed procurement plan for the Project shall be 
furnished to the Bank for its review and approval, in accordance with the 
provisions of paragraph 1 of Appendix 1 to the Guidelines. Procurement of all 
goods and works shall be undertaken in accordance with such procurement plan as 
shall have been approved by the Bank and with the provisions of said paragraph 
1.
2.
Prior Review
(a)
With respect to each contract for goods and works estimated to cost 
the equivalent of $100,000 or more, and the first three contracts for goods, 
regardless of size, the procedures set forth in paragraphs 2 and 3 of Appendix 1 
to the Guidelines shall apply.
(b)
With respect to each contract for goods to be procured under 
shopping procedures specified in this Part C, the following procedures shall 
apply:
(i)
prior to the selection of any supplier or execution of any 
contract, under 
shopping procedures, the Recipient shall 
provide to the Bank a report on the 
comparison and evaluation 
of quotations received;
(ii)
prior to the execution of any contract procured under direct 
contracting or 
shopping procedures, the Recipient shall 
provide to the Bank a copy of the 
specifications 
and the draft contract; and
(iii)
the procedures set forth in paragraphs 2(f), 2(g) and 3 of 
Appendix 1 to the 
Guidelines shall apply.
3.
Post Review
With respect to each contract not governed by paragraph 2 of this Part, 
the procedures set forth in paragraph 4 of Appendix 1 to the Guidelines shall 
apply.
Section II.
Employment of Consultants
Part A:
General
Consultants’ services shall be procured in accordance with (a) the 
provisions of the Introduction and Section IV of the “Guidelines: Selection and 
Employment of Consultants by World Bank Borrowers" published by the Bank in 
January 1997 and revised in September 1997 and January 1999, (the Consultant 
Guidelines); and (b) the provisions of the following Parts of this Section II.
Page  14
Part B:
Quality- and Cost-Based Selection
Except as otherwise provided in Part C of this Section, consultants’ 
services shall be procured under contracts awarded in accordance with the 
provisions of Section II of the Consultant Guidelines, paragraph 3 of Appendix 1 
thereto, Appendix 2 thereto, and the provisions of paragraphs 3.13 through 3.18 
thereof applicable to quality- and cost-based selection of consultants.
Part C:
Other Procedures for the Selection of Consultants
1.
Selection Based on Consultants’ Qualifications
Services estimated to cost less than $100,000 equivalent per contract may 
be procured under contracts awarded in accordance with the provisions of 
paragraphs 3.1 and 3.7 of the Consultant Guidelines.
2.
Single Source Selection
Services estimated to cost less than $100,000 equivalent per contract, 
may, with the Bank’s prior agreement, be procured in accordance with the 
provisions of paragraphs 3.8 through 3.11 of the Consultant Guidelines.
3.
Individual Consultants
Tasks that meet the requirements set forth in paragraph 5.1 of the 
Consultant Guidelines shall be procured under contracts awarded to individual 
consultants in accordance with the provisions of paragraphs 5.1 through 5.3 of 
the Consultant Guidelines.
Part D:
Review by the Bank of the Selection of Consultants
1.
Selection Planning
Prior to the issuance to consultants of any requests for proposals, the 
proposed plan for the selection of consultants under the Project shall be 
furnished to the Bank for its review and approval, in accordance with the 
provisions of paragraph 1 of Appendix 1 to the Consultant Guidelines. Selection 
of all consultants’ services shall be undertaken in accordance with such 
selection plan as shall have been approved by the Bank and with the provisions 
of said paragraph 
2.
Prior Review
(a)
With respect to each contract for the employment of consulting 
firms estimated to cost the equivalent of $100,000 or more, the procedures set 
forth in paragraphs 1, 2 (other than the third subparagraph of paragraph 2 (a)) 
and 5 of Appendix 1 to the Consultant Guidelines shall apply.
(b)
The procedures set forth in paragraphs 1, 2 (other than the  second 
subparagraph of paragraph 2(a)) and 5 of Appendix 1 to the Consultant Guidelines 
shall apply with respect to:
(i)
each contract for the employment of (A) consulting firms 
estimated to cost the 
equivalent of $100,000 or more, and (B) 
individual consultants estimated to 
cost the equivalent of 
$50,000 or more;
(ii)
the terms of reference of all contracts for consulting 
services; and
(iii)
the first three contracts for consulting services.
(c)
With respect to each contract for the employment of individual 
consultants estimated to cost the equivalent of $25,000 or more, the 
qualifications, experience, terms of reference and terms of employment of the 
consultants shall be furnished to the Bank for its prior review and approval. 
The contract shall be awarded only after the said approval shall have been 
Page  15
given.
3.
Post Review
With respect to each contract not governed by paragraph 2 of this Part, 
the procedures set forth in paragraph 4 of Appendix 1 to the Consultant 
Guidelines shall apply.
SCHEDULE 4
Implementation Program
1.
Project Implementation Plan 
(a)
(i)
MICOA shall conclude a memorandum of understanding with each 
of the 
Implementing Agencies and each district or 
provincial government participating 
in the Project, all in form 
and substance satisfactory to the Bank.
(ii)
The Recipient shall prepare and furnish to the Bank a 
Project Implementation 
Plan in a form and substance 
satisfactory to the Bank.
(b)
The Recipient shall carry out the Project in accordance with: (i) 
procedures set out in the Project Implementation Plan; and (ii) each Memorandum 
of Understanding.
(c)
Except as the Bank shall otherwise agree, the Recipient shall not 
amend or waive any provision of the Project Implementation Plan or a Memorandum 
of Understanding, if such amendment or waiver may, in the opinion of the Bank, 
materially or adversely affect the implementation of the Project.
2.
Micro-Projects Operational Manual
(a)
The Recipient shall carry out Part B.3 of the Project in accordance 
with procedures set out in a Micro-Projects Operational Manual in form and 
substance satisfactory to the Bank and, except as the Bank shall otherwise 
agree, shall not amend or waive any provision thereof, if such amendment or 
waiver may, in the opinion of the Bank, materially or adversely affect the 
implementation of Part B.3 of the Project.
(b)
The Micro-Projects Operational Manual shall, inter alia: (i) set 
out eligibility criteria and terms and conditions, satisfactory to the Bank, for 
the provision to Beneficiaries of Matching Grants; and (ii) procedures and 
guidelines, satisfactory to the Bank, applicable to the carrying out of Part B.3 
of the Project.
3.
Terms and conditions of Matching Grant Agreements
The Recipient shall enter into a matching grant agreement satisfactory to 
the Bank with each Beneficiary. The terms and conditions of a Matching Grant 
Agreement shall inter alia provide that:
(a)
the Beneficiary (i) carries out the Micro-Project with due 
diligence and efficiency and in accordance with sound technical, financial, 
environmental and managerial standards; and (ii) maintains adequate records to 
reflect, in accordance with sound accounting practices, the operations, 
resources and expenditures relating to the Micro-Project;
(b)
the goods, works and services to be financed from the proceeds of 
the Matching Grant shall (i) be procured in accordance with procedures ensuring 
efficiency and economy; and (ii) be used exclusively in the carrying out of the 
Micro-Project; and
(c)
the Recipient shall have the right to:
(i)
inspect by itself, or jointly with the Bank, if the Bank 
Page  16
shall so request, the 
goods, works, sites, plants and 
construction included in the Micro-Project, 
the operations 
thereof and any relevant records and documents;
(ii)
obtain such information as the Recipient or the Bank shall 
reasonably request 
regarding the administration, operation and 
financial conditions of the 
Beneficiary; and
(iii)
suspend or terminate the right of the Beneficiary to use the 
proceeds of the 
Matching Grant upon the failure by the 
Beneficiary to perform any of its 
obligations 
under the Matching Grant.
4.
Midterm Review
The Recipient shall:
(a)
maintain policies and procedures adequate to enable it to monitor 
and evaluate on an ongoing basis, in accordance with the Performance Indicators 
specified in Schedule 6 to this Agreement, the carrying out of the Project and 
the achievement of the objectives thereof;
(b)
carry out, jointly with the Bank, not later than November 30, 2002 
, a Midterm Review, of the Project, which shall cover, inter alia, (i) progress 
made in meeting the Project’s objectives; (ii) overall Project performance as 
measured against the said Performance Indicators, and (iii) the quality of the 
advisory services provided for the Project;
(c)
at least three (3) weeks prior to the Midterm Review, furnish to 
the Bank a report describing the status of the items listed in paragraph (a) 
above and of Project implementation generally; and
(d)
not later than four (4) weeks after the Midterm Review, prepare an 
action program, acceptable to the Bank, for further implementation of the 
Project having regard to the findings of the Midterm Review and, thereafter, 
implement such action program.
5.
Initial Planning Framework Guidelines
The Recipient shall prepare guidelines, in form and substance satisfactory 
to the Bank, to be used for ensuring that investments in the Project Areas are 
compatible with the overall objectives of the Project, including the objectives 
of the spatial development plans under Part A of the Project.
SCHEDULE 5
Special Account
1.
For the purposes of this Schedule:
(a)
the term “eligible Categories” means Categories (1) through (5) set 
forth in the table in paragraph 1 of Schedule 1 to this Agreement;
(b)
the term “eligible expenditures” means expenditures in respect of 
the reasonable cost of goods and services required for the Project and to be 
financed out of the proceeds of the GEF Trust Fund Grant allocated from time to 
time to the eligible Categories in accordance with the provisions of Schedule 1 
to this Agreement; and
(c)
the term “Authorized Allocation” means an amount equivalent to 
$300,000 to be withdrawn from the GEF Trust Fund Grant Account and deposited 
into the Special Account pursuant to paragraph 3 (a) of this Schedule.
2.
Payments out of the Special Account shall be made exclusively for eligible 
expenditures in accordance with the provisions of this Schedule.
3.
After the Bank has received evidence satisfactory to it that the Special 
Page  17
Account has been duly opened, withdrawals of the Authorized Allocation and 
subsequent withdrawals to replenish the Special Account shall be made as 
follows:
(a)
For withdrawals of the Authorized Allocation, the Recipient shall 
furnish to the Bank a request or requests for deposit into the Special Account 
of an amount or amounts which do not exceed the aggregate amount of the 
Authorized Allocation. On the basis of such request or requests, the Bank shall, 
on behalf of the Recipient, withdraw from the GEF Trust Fund Grant Account and 
deposit into the Special Account such amount or amounts as the Recipient shall 
have requested.
(b)
(i)
For replenishment of the Special Account, the Recipient 
shall furnish to the 
Bank requests for deposits into the 
Special Account at such intervals as the 
Bank shall 
specify; and
(ii)
Prior to or at the time of each such request, the Recipient 
shall furnish to 
the Bank the documents and other evidence 
required pursuant to paragraph 4 of 
this Schedule for the 
payment or payments in respect of which replenishment is 
requested. On the basis of each such request, the Bank shall, on behalf of 
the 
Recipient, withdraw from the GEF Trust Fund Grant Account 
and deposit into the 
Special Account such amount as the 
Recipient shall have requested and as shall 
have been 
shown by said documents and other evidence to have been paid out of 
the Special Account for eligible expenditures. All such deposits 
shall be 
withdrawn by the Bank from the GEF Trust Fund 
Grant Account under the 
respective eligible Categories, 
and in the respective equivalent amounts, as 
shall have 
been justified by said documents and other evidence.
4.
For each payment made by the Recipient out of the Special Account, the 
Recipient shall, at such time as the Bank shall reasonably request, furnish to 
the Bank such documents and other evidence showing that such payment was made 
exclusively for eligible expenditures.
5.
Notwithstanding the provisions of paragraph 3 of this Schedule, the Bank 
shall not be required to make further deposits into the Special Account:
(a)
if, at any time, the Bank shall have determined that all further 
withdrawals should be made by the Recipient directly from the GEF Trust Fund 
Grant Account in accordance with the provisions of Article V of the General 
Conditions and paragraph (a) of Section 2.02 of this Agreement;
(b)
if the Recipient shall have failed to furnish to the Bank, within 
the period of time specified in Section 4.01 (b) (ii) of this Agreement, any of 
the audit reports required to be furnished to the Bank pursuant to said Section 
in respect of the audit of the records and accounts for the Special Account;
(c)
if, at any time, the Bank shall have notified the Recipient of its 
intention to suspend in whole or in part the right of the Recipient to make 
withdrawals from the GEF Trust Fund Grant Account pursuant to the provisions of 
Section 6.02 of the General Conditions; or
(d)
once the total unwithdrawn amount of the GEF Trust Fund Grant 
allocated to the eligible Categories, minus the total amount of all outstanding 
special commitments entered into by the Bank pursuant to Section 5.02 of the 
General Conditions with respect to the Project, shall equal the equivalent of 
twice the amount of the Authorized Allocation. Thereafter, withdrawal from the 
GEF Trust Fund Grant Account of the remaining unwithdrawn amount of the GEF 
Trust Fund Grant allocated to the eligible Categories shall follow such 
procedures as the Bank shall specify by notice to the Recipient. Such further 
withdrawals shall be made only after, and to the extent that the Bank shall have 
been satisfied that, all such amounts remaining on deposit in the Special 
Account as of the date of such notice will be utilized in making payments for 
Page  18
eligible expenditures.
6.
(a)
If the Bank shall have determined at any time that any payment out 
of the Special Account (i) was made for an expenditure or in an amount not 
eligible pursuant to paragraph 2 of this Schedule; or (ii) was not justified by 
the evidence furnished to the Bank, the Recipient shall, promptly upon notice 
from the Bank (A) provide such additional evidence as the Bank may request; or 
(B) deposit into the Special Account (or, if the Bank shall so request, refund 
to the Bank) an amount equal to the amount of such payment or the portion 
thereof not so eligible or justified. Unless the Bank shall otherwise agree, no 
further deposit by the Bank into the Special Account shall be made until the 
Recipient has provided such evidence or made such deposit or refund, as the case 
may be.
(b)
If the Bank shall have determined at any time that any amount 
outstanding in the Special Account will not be required to cover further 
payments for eligible expenditures, the Recipient shall, promptly upon notice 
from the Bank, refund to the Bank such outstanding amount.
(c)
The Recipient may, upon notice to the Bank, refund to the Bank all 
or any portion of the funds on deposit in the Special Account.
(d)
Refunds to the Bank made pursuant to paragraph 6 (a), (b) and (c) 
of this Schedule shall be credited to the GEF Trust Fund Grant Account for 
subsequent withdrawal or for cancellation in accordance with the relevant 
provisions of this Agreement, including the General Conditions.
SCHEDULE 6
Performance Indicators
The performance indicators for the Project shall include the following:
1.
Strategic Development Plans endorsed and under implementation in at least 
two districts in the Project Areas by the fourth Project Year.
2.
All new concessions issued in at least two districts of the Project Areas 
are in compliance with strategic development plans by the fourth Project Year.
3.
Management plans for at least two identified conservation areas are 
endorsed by the Recipient and under implementation by the end of the third 
Project Year.
4.
Biological Monitoring Plan prepared by Midterm Review and fully 
operational by the end of the third Project Year.
5.
At least five community development projects identified by the end of the 
third Project Year.
6.
Bid documents prepared and the training under Part D of the Project 
completed by the end of the third Project Year and concessionary process 
underway with at least 2 potential investors by the end of the third Project 
Year.
7.
Training program for Part D of the Project developed and under 
implementation by the end of the end of the third Project Year.
8.
Increased involvement of NGOs in monitoring and implementation of the 
Project by the third Project Year.
9.
Improved coordination achieved by the third Project Year among 
stakeholders evidenced by the number of recorded agreements from regular 
management meetings of the Borrower’s National Steering Committee.
Page  19