OFFICIAL 1 DOCUMENTS i SCF-PPCR GRANT NUMBER TF015095 Strategic Climate Fund - Pilot Program for Climate Resilience Grant Agreement (Climate Information System and Pilot Program for Climate Resilience Coordination Project) between REPUBLIC OF YEMEN and INTERNATIONAL DEVELOPMENT ASSOCIATION acting as an Implementing Entity of the Pilot Program for Climate Resilience under the Strategic Climate Fund Dated Octo \\ ,2013 SCF-PPCR GRANT NUMBER TF015095 GRANT AGREEMENT AGREEMENT dated Oc to t , 2013, entered into between REPUBLIC OF YEMEN ("Recipient") and INTERNATIONAL DEVELOPMENT ASSOCIATION ("World Bank"), acting as an implementing entity of the Pilot Program for Climate Resilience ("PPCR") under the Strategic Climate Fund ("SCF"). The Recipient and the World Bank hereby agree as follows: Article I Standard Conditions; Definitions 1.01. The Standard Conditions for Grants Made by the World Bank out of Various Funds, dated February 15, 2012 ("Standard Conditions"), constitute an integral 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 Standard Conditions or in the Appendix to this Agreement. Article H The Project 2.01. The Recipient declares its commitment to the objectives of the Project described in Schedule 1 to this Agreement ("Project"). To this end, the Recipient shall carry out the Project in accordance with the provisions of Article II of the Standard Conditions. 2.02. Without limitation upon the provisions of Section 2.01 of this Agreement, and except as the Recipient and the World Bank shall otherwise agree, the Recipient shall ensure that the Project is carried out in accordance with the provisions of Schedule 2 to this Agreement. Article m The Grant 3.01. The World Bank agrees to extend to the Recipient, on the terms and conditions set forth or referred to in this Agreement, a grant in an amount equal to nineteen million United States Dollars (US$19,000,000) ("Grant") to assist in financing the Project. 3.02. The Recipient may withdraw the proceeds of the Grant in accordance with Section IV of Schedule 2 to this Agreement. -2- 3.03. The Grant is funded out of the abovementioned SCF-PPCR trust fund for which the World Bank receives periodic contributions from the donor to the trust fund. In accordance with Section 3.02 of the Standard Conditions, the World Bank's payment obligations in connection with this Agreement are limited to the amount of funds made available to it by the donor under the abovementioned trust fund, and the Recipient's right to withdraw the Grant proceeds is subject to the availability of such funds. Article IV Recipient's Representative; Addresses 4.01. The Recipient's Representative referred to in Section 7.02 of the Standard Conditions is the Minister of Planning and International Cooperation. 4.02. The Recipient's Address referred to in Section 7.01 of the Standard Conditions is: Ministry of Planning and International Cooperation P.O. Box 175, Sana'a Republic of Yemen Facsimile: 967-1-250-665 967-1-250-605 4.03. The World Bank's Address referred to in Section 7.01 of the Standard Conditions is: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable: Telex: Facsimile: INDEVAS 248423 (MCI) or 1-202-477-6391 Washington, D.C. 64145 (MCI) -3- AGREED at District of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF YEMEN By Authorized Representative Name: & L mz .4L-) P s..,,(, Title: K ilAk GLAAIJ COO~~ ?)- INTERNATIONAL DEVELOPMENT ASSOCIATION acting as an Implementing Entity of the Pilot Program for Climate Resilience under the Strategic Climate Fund By Authoriz epresentative Name:e\ Title: Wc K~c~ -4- SCHEDULE 1 Project Description The objective of the Project is to improve the quality of hydro-meteorological and climate services provided to end-users. The Project consists of the following parts: Part A: Institutional Strengthening and Capacity Building 1 . Strengthening the institutional capacity of the Civil Aviation and Meteorological Authority (CAMA)/Yemen Meteorological Service (YMS), Environment Protection Authority (EPA), Ministry of Agriculture and Irrigation (MAI) and National Water Resources Authority (NWRA), including development of appropriate institutional strategies, revision of legal and regulatory framework, and development and implementation of standard operating procedures, through the provision of technical advisory services. 2. Building the capacity of the staff of CAMA/YMS, EPA, MAI, NWRA and major users of weather and climate services, and developing a training program for training and retraining of relevant staff, designing short courses and on-job training, through the provision of training and technical advisory services. 3. Designing and implementing a modernization program to facilitate connectivity and interoperability of the CAMA/YMS system with the systems of the other agencies, through the provision of training and technical advisory services. Part B: Modernization and Expansion of the National Hydro-meteorological and Monitoring Networks 1 . Carrying out of technical modernization and observing networks, including: (a) rehabilitation and extension of the MAI agro-meteorological observing network; (b) extension of the weather and climate surface observing networks for CAMA/YMS; (c) replacement, rehabilitation and expansion of NWRA hydro- meteorological network; (d) delivery and installation of a Doppler weather radar; (e) installation of three upper air stations; (f) upgrade of the CAMA/YMS calibration laboratory; and (g) installation of identified marine observing stations, all through the provision of works, technical advisory services and acquisition of goods. 2. Carrying out of modernization of the communication and ICT system, including: (a) upgrading communication equipment of all observing networks (i.e., C,AMA/YMS, MAI, NWRA and EPA); (b) assessing and strengthening the national data and archive management system; and (c) upgrading operational -5- satellite receiving systems for forecasting and mapping applications, all through the provision of technical advisory services and acquisition of goods. 3. Designing and piloting of an environmental monitoring system for EPA, including: (a) developing a needs assessment and design of air quality monitoring networks; and (b) piloting an operational air quality monitoring network, all through the provision of technical advisory services. Part C: Enhancement of Service Delivery System 1. Enhancement of public weather service for agriculture, water resources and inigation, disaster risk management, media, civil aviation, health, and renewable energy, including: (a) upgrading CAMA/YMS forecaster workstations and software; (b) introducing specialized communications instruments; and (c) enhancing the capability to assess the impact of forecasts and warning on end- users utilizing survey tools, all through the provision of technical advisory services and acquisition of goods. 2. Piloting an early warning system, including: (a) developing standards of procedures, guidelines, warning protocols and signals developed and agreed to by all stakeholders, including CAMA/YMS, MAI, NWRA and Civil Defense; (b) introducing forecaster workstations, communication systems and developing software for multi hazard warning and information delivery systems to connect CAMA/YMS, MAI, NWRA, and Civil Defense; and (c) conducting operational training and drills with government stakeholders and local communities, all through the provision of technical advisory services and training. 3. Improving service delivery to sectorial, local communities and individuals differentiated by gender, age, and other demographic indicators, including: (a) improving quality and utility of weather and climate information for water resources, and expanding the existing national water information management system; (b) developing a prototype agricultural information system; and (c) improving quality and utility of weather and climate information for public health and marine sectors, all through the provision of technical advisory services. 4. Establishing a national framework for climate services within CAMA/YMS, including: (a) introducing computer systems to access climate information from national sources, WMO and other regional centers; (b) developing a digital library of climate-relevant information from all sectors; and (c) translating and delivering climate information to make it more user-friendly, all through the provision of technical advisory services. -6- Part D: PPCR Program Management and Knowledge Sharing 1. Strengthening and developing the institutional capacity of EPA for overall guidance of Project implementation and coordination of participating line ministries and agencies, including consolidating the results of the Project to inform decision making, monitor gender sensitive approach to implementation of the Project and effective integration of information of the investments under the Project into a coherent database, through the provision of technical advisory services. 2. Strengthening and developing the capacity of the PCU for day-to-day management and implementation of the Project, including: (a) fiduciary (i.e., financial and procurement management); (b) preparation of Project reports; (c) processing of contracts and tender evaluation; (d) coordination of participating line ministries and agencies; (e) supervision of Project activities; (f) training of staff in Project management and implementation support; and (g) related activities on Project management and implementation, all through the provision of technical advisory services, training, operating costs and acquisition of goods. 3. Facilitating knowledge sharing and dissemination of information to raise public awareness on climate variability and change and its impact on day-to-day activities, including promoting carrying out of public outreach activities, and development of a climate data base, all through the provision of technical advisory services and training. -7- SCHEDULE 2 Project Execution Section 1. Institutional and Other Arrangements A. Institutional Arrangements 1. Environment Protection Authority (EPA) The Recipient shall at all times during the implementation of the Project, ensure that resources, satisfactory to the World Bank, are available to EPA for the purpose of ensuring prompt and efficient oversight and coordination of the line ministries and other agencies in the implementation of the Project. 2. Implementation Committee (a) The Recipient shall ensure that the Implementation Committee is maintained at all times during the implementation of the Project, with a composition, mandate, and in form and substance satisfactory to the World Bank. (b) Without limitation to sub-paragraph (a) immediately above, the Recipient shall ensure that Implementation Committee will be responsible for providing policy guidance to ensure prompt and efficient implementation of the Project, including, inter alia: (i) reviewing progress made towards achieving the Project's objective; (ii) facilitating the coordination of Project activities, and making recommendations for removal of any obstacles to the implementation of the Project; and (iii) providing comments on reports and reviews prepared by the Program Coordination Unit under the Project. 3. Program Coordination Unit (PCU) (a) The Recipient shall maintain, at all times during the implementation of the Project, a program coordination unit (the Program Coordination Unit or PCU) within the EPA, with functions, staffing and resources satisfactory to the World Bank. (b) Without limitation to the provisions of Section I.A. I of this Schedule, the PCU shall be responsible for day-to-day administration of overall planning, coordination, the technical, fiduciary (i.e. procurement and financial management), environmental and social safeguards compliance, coordination, monitoring, evaluation, reporting and communication of -8- the activities under the Project, all in accordance with the provisions of this Agreement and the Project Operating Manual. B. Project Operating Manual 1. The Recipient shall carry out the Project in accordance with the provisions of the Project Operating Manual, containing detailed arrangements and procedures for: (a) institutional coordination and day-to-day execution of the Project; (b) Project budgeting, disbursement and financial management; (c) procurement; (d) environmental and social safeguard guidelines; (e) monitoring, evaluation, reporting and communication; (f) the ESMP and the Negative List; and (g) such other administrative, financial, technical and organizational arrangements and procedures as shall be required for the Project. 2. The Recipient shall not amend, abrogate, waive or fail to enforce any provision of the Project Operating Manual without the prior written agreement of the World Bank; provided, however, that in case of any conflict between the arrangements and procedures set out in the Project Operating Manual and the provisions of this Agreement, the provisions of this Agreement shall prevail. C. Anti-Corruption The Recipient shall ensure that the Project is carried out in accordance with the provisions of the Anti-Corruption Guidelines. D. Environmental and Social Safeguards 1. The Recipient shall ensure that installation of the Doppler radar; and upgrade of the marine observation stations under Part B of the Project, in the identified locations: (i) will be carried out in accordance with the Environmental and Social Management Plan (ESMP); and (ii) will exclude the activities in the Negative List. 2. The Recipient shall include in the Project Reports referred to in Section IL.A of this Schedule, adequate information on the implementation of the ESMP, giving details of: (a) measures taken in furtherance of the ESMP; (b) conditions, if any, which interfere or threaten to interfere with the smooth implementation of the ESMP; and (c) remedial measures taken or required to be taken to address such conditions and to ensure the continued efficient and effective implementation of the ESMP. -9- Section II. Project Monitoring, Reporting and Evaluation A. Project Reports; Completion Report 1. The Recipient shall monitor and evaluate the progress of the Project and prepare Project Reports in accordance with the provisions of Section 2.06 of the Standard Conditions and on the basis of indicators acceptable to the World Bank. Each Project Report shall cover the period of six calendar months, and shall be furnished to the World Bank not later than forty five (45) days after the end of the period covered by such report. 2. Without limitation to Section 2.06 of the Standard Conditions, the Recipient shall: (a) on or about the date twenty four (24) months after the Effective Date, submit to the World Bank a mid-term report, in such detail as the World Bank shall reasonably request, documenting progress achieved in the carrying out of the Project during the period preceding the date of the mid-term report, taking into account the monitoring and evaluation activities performed pursuant to Section II.A.1 of this Schedule, and setting out the measures recommended to ensure the efficient carrying out of the Project and the achievement of the objective thereof during the period following such date; and (b) review with the World Bank the mid-term report, on or about the date one (1) month after its submission, and thereafter take all measures required to ensure the efficient implementation of the Project and the achievement of its objectives, based on the conclusions and recommendations of the mid-term report and the World Bank's views on the matter. 3. The Recipient shall prepare the Completion Report in accordance with the provisions of Section 2.06 of the Standard Conditions. The Completion Report shall be furnished to the World Bank not later than six (6) months after the Closing Date. B. Financial Management; Financial Reports; Audits 1 . The Recipient shall ensure that a financial management system is maintained in accordance with the provisions of Section 2.07 of the Standard Conditions. 2. The.Recipient shall ensure that interim unaudited financial reports for the Project are prepared and furnished to the World Bank not later than forty-five (45) days after the end of each calendar quarter, covering the quarter, in form and substance satisfactory to the World Bank. 3. The Recipient shall have its Financial Statements for the Project audited in accordance with the provisions of Section 2.07 (b) of the Standard Conditions. Each such audit of the Financial Statements shall cover the period of one (1) fiscal year of the Recipient. The audited Financial Statements for each such - 10- period shall be furnished to the World Bank not later than six (6) months after the end of such period. Section Ill. Procurement A. General 1. Procurement and Consultant Guidelines. All goods, works and non- consulting-services and consultants' services required for the Project and to be financed out of the proceeds of the Grant shall be procured in accordance with the requirements set forth or referred to in: (a) Section I of the Procurement Guidelines in the case of goods, works and non-consulting services, and Sections I and IV of the Consultant Guidelines in the case of consultants' services; and (b) the provisions of this Section III, as the same shall be elaborated in the procurement plan prepared and updated from time to time by the Recipient for the Project in accordance with paragraph 1.18 of the Procurement Guidelines and paragraph 1.25 of the Consultant Guidelines ("Procurement Plan"). 2. Definitions. The capitalized terms used below in this Section to describe particular procurement methods or methods of review by the World Bank of particular contracts, refer to the corresponding method described in Sections 11 and III of the Procurement Guidelines, or Sections II, Ill, IV and V of the Consultant Guidelines, as the case may be. B. Particular Methods of Procurement of Goods, Works and Non-consulting Services 1 . International Competitive Bidding. Except as otherwise provided in paragraph 2 below, goods, works and non-consulting services shall be procured under contracts awarded on the basis of International Competitive Bidding. 2. Other Methods of Procurement of Goods, Works and Non-consulting Services. The following methods, other than International Competitive Bidding, may be used for procurement of goods, works and non-consulting services for those contracts specified in the Procurement Plan: (a) Limited International Bidding; (b) National Competitive Bidding, subject to the additional procedures set forth in paragraph 3 immediately below; (c) Shopping; (d) Procurement under Framework Agreements in accordance with procedures which have been found acceptable to the World Bank; and (e) Direct Contracting. 3. The following are the additional procedures to the NCB: (a) a Recipient-owned enterprise in the Republic of Yemen shall be eligible to bid only if it can establish that it is legally and financially autonomous, operates under commercial law, and is not a dependent agency of the Recipient; (b) bidding (or pre-qualification, if required) shall not be restricted to any particular class of contractors or suppliers, and non-registered contractors and suppliers shall also be eligible to participate; (c) the modified national standard bidding documents approved by the Association shall be used; (d) registration shall not be used to assess bidders' qualifications; qualification criteria (in case pre-qualification was not carried out) and the method of evaluating the qualification of each bidder shall be stated in the bidding documents, and before contract award the bidder having submitted the lowest evaluated responsive bid shall be subject to post-qualification; (e) a foreign bidder shall not be required to register or to appoint an agent as a condition for submitting its bid and, if determined to be the lowest evaluated responsive bidder, shall be given reasonable opportunity to register, without let or hindrance; the registration process shall not be applicable to sub- contractors; (1) no bidder shall be requested or permitted to modify its bid after the bid closing date shall have elapsed and bids submitted after the deadline for submission of bids shall be returned to the bidder unopened; (g) post-bidding negotiations with the lowest or any other bidder shall not be permitted; (h) under exceptional circumstances, the procuring entity may, before the expiration of bid validity, request all bidders in writing to extend the validity of their bids, in which case bidders shall not be requested nor permitted to amend the price or any other condition of their bids; a bidder shall have the right to refuse to grant such an extension without forfeiting its bid security, but any bidder granting such extension shall be required to provide a corresponding extension of its bid security; (i) price adjustment provisions may be included in contracts for works with a duration of more than eighteen (18) months; (j) rejection of all bids is justified when there is lack of effective competition, or bids are not substantially responsive, however, lack of competition shall not be determined solely on the basis of the number of bidders; and - 12- (k) each contract financed from the proceeds of the Grant shall provide that the contractor or supplier shall permit the World Bank, at its request, to inspect their accounts and records relating to the performance of the contract and to have such accounts and records audited by auditors appointed by the World Bank. C. Particular Methods of Procurement of Consultants' Services 1. Quality- and Cost-based Selection. Except as otherwise provided in paragraph 2 below, consultants' services shall be procured under contracts awarded on the basis of Quality- and Cost-based Selection. 2. Other Methods of Procurement of Consultants' Services. The following methods, other than Quality- and Cost-based Selection, may be used for procurement of consultants' services for those assignments which are specified in the Procurement Plan: (a) Least Cost Selection; (b) Selection based on Consultants' Qualifications; (c) Procurement from WMO, a UN agency; (d) Single-source Selection of consulting firms; and (e) Selection of Individual Consultants. D. Review by the World Bank of Procurement Decisions The Procurement Plan shall set forth those contracts which shall be subject to the World Bank's Prior Review. All other contracts shall be subject to Post Review by the World Bank. Section IV. Withdrawal of Grant Proceeds A. General 1. The Recipient may withdraw the proceeds of the Grant in accordance with the provisions of: (a) Article Ill of the Standard Conditions; (b) this Section; and (c) such additional instructions as the World Bank may specify by notice to the Recipient (including the "World Bank Disbursement Guidelines for Projects" dated May 2006, as revised from time to time by the World Bank and as made applicable to this Agreement pursuant to such instructions), to finance Eligible Expenditures as set forth in the table in paragraph 2 below. 2. The following table specifies the categories of Eligible Expenditures that may be financed out of the proceeds of the Grant ("Category"), the allocations of the amounts of the Grant to each Category, and the percentage of expenditures to be financed for Eligible Expenditures in each Category: - 13 - Category Amount of the Grant Percentage of Expenditures Allocated (expressed in to be Financed (inclusive of USD) Taxes) (1) Consultants' services and 100% Training under Part A. of the Project 3,450,000 (2) Goods. works, non- 100% consulting services, and consultants' services 7,750,000 under Part B of the Project (3) Goods, non-consulting 100% services, consultants' services and Training 4,200,000 under Part C of the Project (4) Goods, consultants' 100% services, Training and 3,600,000 Operating Costs under Part D of the Project TOTAL AMOUNT 19,000,000 For the purpose of the table set forth immediately above: (a) the term "Training" means the cost associated with the training, study tours and w orkshops approved by the World Bank, for reasonable expenditures (other than eKpenditures for consultants' services), including: (i) travel, room, board and per diem expenditures incurred by trainers, workshop facilitators and trainees in connection with their training; (ii) local and approved international training; (iii) course fees; (iv) training facility and training instrument rentals; and (v) training material preparation, acquisition, reproduction and distribution expenses; (b) the term "Operating Costs" means the incremental expenses incurred on account of Project management, including office equipment and supplies, vehicle operation and maintenance, communication and insurance costs, office administration costs, costs of advertisements, utilities, transportation and approved rental of vehicles, travel and per diem, excluding the salaries of the Recipient's civil service; and (c) the terms "Goods" excludes purchase of vehicles. - 14 - B. Withdrawal Conditions; Withdrawal Period 1. Notwithstanding the provisions of Part A of this Section IV, no withdrawal shall be made for payments made prior to the date of this Agreement, except that withdrawals under Category (4) up to an aggregate amount not to exceed $50,000 equivalent may be made for such payments made prior to this date but on or after April 1, 2013. 2. The Closing Date referred to in Section 3.06 (c) of the Standard Conditions is February 28, 2019. - 15- APPENDIX Definitions 1. "Anti-Corruption Guidelines" means the "Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants", dated October 15, 2006 and revised in January 2011. 2. "Civil Aviation and Meteorological Authority" or "CAMA" means the authority established and operating pursuant to Republican Decree No. 444 of 2000, of the laws of the Recipient, or any successor thereto. 3. "Consultant Guidelines" means the "Guidelines: Selection and Employment of Consultants under IBRD Loans and IDA Credits and Grants by World Bank Borrowers" dated January 2011. 4. "Environment Protection Authority" or "EPA" means the authority established and operating pursuant to Republican Decree No. 101 of 2005, of the laws of the Recipient, or any successor thereto. 5. "Environmental and Social Management Plan" or "ESMP" means the Recipient's framework, acceptable to the World Bank, dated February 2013, and published on February 13, 2013 and February 19, 2013, respectively, setting forth measures to manage potential environmental risks and mitigate, reduce and/or offset adverse environmental impacts associated with the implementation of Part B of the Project, including, the budget and cost estimates, and sources of funding, along with the institutional and procedural measures needed to implement such actions, measures and policies, and includes the Negative List defined below. 6. "Implementation Committee" means the committee referred to in Section 1. A. 2 of Schedule 2 to this Agreement. 7. "Ministry of Agriculture and Irrigation" or "MAI" means the Recipient's Ministry responsible for agriculture and irrigation, and any successor thereto. 8. "National Water Resources Authority" or "NWRA" means the authority established and operating pursuant to Republican Decree 154 of 1995, of the laws of the Recipient, and any successor thereto. 9. "Negative List" means the list activities set forth in the ESMP which due to their nature or potential impacts, are not eligible for inclusion in the Project. 10. "Program Coordination Unit" or "PCU" means the coordination unit referred to in Section 1. 3 of Schedule 2 to this Agreement. - 16 - 11. "Procurement Guidelines" means the "Guidelines: Procurement of Goods, Works and Non-consulting Services under IBRD Loans and IDA Credits and Grants by World Bank Borrowers" dated January 2011. 12. "Procurement Plan" means the Recipient's procurement plan for the Project, dated June 10, 2013, and referred to in paragraph 1.18 of the Procurement Guidelines and paragraph 1.25 of the Consultant Guidelines, as the same shall be updated from time to time in accordance with the provisions of said paragraphs. 13. "Project Operating Manual" means the manual, satisfactory to the World Bank, and referred to in Section I.B.1 of Schedule 2 to this Agreement, as the same may be amended from time to time with agreement of the Association. 14. "WMO" means World Meteorological Organization, an agency of the United Nations. 15. "Yemen Meteorological Service" or "YMS" means the authority established and operating pursuant to Republican Decree No. 444 of 2000, of the laws of the Recipient, or any successor thereto.