CREDIT NUMBER 1092 BA Development Credit Agreement (Grain Storage Project) between THE SOCIALIST REPUBLIC OF THE UNION OF BURMA and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated FC66rddw 1981 CREDIT NUMBER 1092 BA DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated red, 1981, between THE SOCIALIST REPUBLIC OF THE UNION OF BURMA (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (herein- after called the Association). WHEREAS the Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; and WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated June 30, 1980, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "AFPTC" means the Agricultural and Farm Produce Trade Corporation, a state-owned corporation established within the Borrower's Ministry of Trade, or any successor thereto; (b) "CC" means the Construction Corporation, a state- owned corporation, established within the Borrower's Ministry of Construction, or any successor thereto; (c) "BRC" means the Burma Railways Corporation, a state- owned corporation, established within the Borrower's Ministry of Transport and Communications, or any successor thereto; -2- (d) "Subsidiary Loan Agreement" means the agreement to be entered into between the Borrower and AFPTC pursuant to Section 3.01 (b) of this Agreement, as such agreement may be amended from time to time and such term shall include all schedules to such agreement; (e) "Kyats" and "K" mean the currency of the Borrower; (f) "Fiscal Year" and "FY" mean the Borrower's fiscal year beginning April 1 and ending March 31; and (g) "Project Area" means the area comprising the three divisions of Irrawady, Rangoon and Pegu, located in the Lower Burma Region. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equi- valent to seventeen million nine hundred thousand Special Drawing Rights (SDR 17,900,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Asso- ciation, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods and civil works to be financed out of the proceeds of the Credit, shall be governed by the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be September 30, 1985 or such later date as the Association shall establish. The Association shall promptly notify the Borrower of such later date. -3- Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semiannually on June 15 and December 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each June 15 and December 15 commencing June 15, 1991, and ending December 15, 2030, each installment to and including the installment payable on December 15, 2000, to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. Section 2.09. The Managing Director of AFPTC, or any person duly authorized in writing by him, is designated as representative of the Borrower for the purpose of taking any action required or permitted to be taken under the provision of Section 2.02 of this agreement and Article V of the General Conditions, in respect of the amount relent to AFPTC under the Subsidiary Loan Agreement. ARTICLE III Execution of the Project Section 3.01. (a) The Borrower shall carry c,ut, or cause to be carried out, the Project with due A4ligence and effi- ciency and in conformity with appropriate administrative, engi- neering and financial practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. (b) The Borrower shall relend the proceeds of the Credit to AFPTC under a Subsidiary Loan Agreement to be entered into between the Borrower and AFPTC upon terms and conditions accept- able to the Association. Except as the Association shall otherwise agree, such Subsidiary Loan Agreement shall provide, inter alia, that (i) AFPTC shall pay periodically to the Borrower amounts representing interest on the amount relent at an annual rate of 9% -4- per annum on the principal amount withdrawn and outstanding from time to time, and (ii) amortization of the principal amount relent will be over a term of twenty years, including a three and one- half year grace period from the date of the Subsidiary Loan Agreement. (c) The Borrower shall exercise its rights under the Sub- sidiary Loan Agreement in such manner as to protect the interests of the Borrower and the Association and to accomplish the purposes of the Credit, and except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive the Subsidiary Loan Agreement or any provision thereof. Section 3.02. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 3.03. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b). The Borrower: (i) shall maintain or cause to be main- tained records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit, and to disclose their use in the Project; (ii) shall enable the Association's accredited represen- tatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) shall furnish or cause to be furnished to the Association at regular intervals all such information as the Association shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. -5- (c) Upon the award by the Borrower of any contract for goods, works or services to be financed out of the proceeds of the Credit, the Bank may publish a description thereof, the name and nationality of the party to whom the contract was awarded and the contract price. (d) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Association, the Borrower shall cause to be prepared and furnished to the Association a report, of such scope and in such detail as the Association shall reasonably request, on the execu- tion and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Association of their respective obligations under this Agreement and the accomplishment of the purposes of the Credit. Section 3.04. The Borrower shall take or cause to be taken all such action as shall be necessary to acquire as and when needed all such land and rights in respect of land as shall be required for carrying out the Project and upon request shall furnish to the Association evidence satisfactory to the Associa- tion that such land and rights in respect of land are available for purposes related to the Project. Section 3.05. In the event that the agreed locations for the stores to be constructed (under Part A of the Project) were to be changed during the Project implementation, the Borrower shall cause AFPTC to furnish to the Association such changes for its comments prior to the commencement of construction. Section 3.06. For purpose of ensuring effective coordination in the implementation of the Project, the Borrower shall esta- blish and maintain a Project Coordination Committee, chaired by the Deputy Minister of Trade. Section 3.07. The Borrower shall ensure that (a) by May 1, 1981, an adequately staffed and equipped pest control squad will be stationed in each of the 14 consolidated townships in which facilities are located or to be located under Part A of the Project; and (b) by June 1, 1982, an additional such pest control squad will be stationed in each such consolidated township. -6- Section 3.08. (a) Not later than May 1, 1981, in respect of Fiscal Year 1981/82 and, thereafter, not later than April 1 of each subsequent Fiscal Year, the Borrower shall cause AFPTC to furnish to the Association, for its review, an annual plan for overseas training, indicating selected candidates and training facilities. (b) Until the completion of the Project, the Borrower shall ensure that AFPTC's personnel trained overseas under the Project shall, upon completion of such training, work exclusively on (i) implementation of the Project; and (ii) provide in-service training to other field staff of AFPTC. Sectioi 3.09. The Borrower shall cause AFPTC to: (i) review its current paddy grading criteria and make recommendations so as to ensure that farmers have adequate financial incentives to deliver paddy of better storability and quality; and (ii) furnish to the Association, by January 31, 1982, such review and recommen- dations for its review and comments. Section 3.10. The Borrower shall cause AFPTC to establish and maintain an adequately staffed Project Implementation Unit within its Project Department and headed by a Project Director, with suitable qualifications acceptable to the Association, responsible for implementation of the new storage construction, rehabilitation and pilot drying programs includIng procurement matters, training programs, monitoring and reporting. Section 3.11. The Borrower shall cause AFPTC to: (i) estab- lish and maintain a Storage Maintenance Unit within its Project Department; (ii) establish and maintain a Quality Control Unit within its Procurement and Sales Department; and (iii) adequately staff the respective Units which are to be headed by personnel whose experience is satisfactory to the Association. Section 3.12. The Borrower shall cause CC to assign the responsibilities for coordinating all aspects of the civil works under Parts A and G of the Project within CC and between AFPTC and CC, during the Project Implementation, to a Project Coordinator with qualifications acceptable to the Association. Section 3.13. For the purpose of establishing a regular railway service for the transportation of rice between Rangoon and Thazi/Mandalay: - 7 - (a) the Borrower shall cause AFPTC, not later than July 1, 1981, to enter into an agreement with BRC, upon terms and condi- tions satisfactory to the Association, providing for regularly scheduled unit trains for rice transportation; (b) not later than six weeks prior to the the proposed date of signing of the said agreement, the Borrower shall cause AFPTC to furnish to the Association, for its review and comment, a draft of such agreement; and (c) the Borrower shall take all such measures as may be required to ensure the timely implementation of the said agreement and execution of AFPTC's and BRC's respective obligations there- under. Section 3.14. The Borrower shall: (i) cause AFPTC to enter into contractual agreements with CC, upon terms and conditions satisfactory to the Association, to construct the stores under Parts A and G of the Project; (ii) not later than six weeks prior to the proposed date of signing of such contracts, cause AFPTC to furnish the Association, for its review and comment, drafts of such contracts; (iii) cause AFPTC to furnish the Association with copies of said signed contracts; and (iv) take all such measures as may be required to ensure the timely implementation of said contracts. Section 3.15. The Borrower shall, by May 1, 1981, cause AFPTC to increase the responsibilities of its Transport Department to include: (i) the operation of rice transshipment stores; (ii) the movement, coordination and planning of water and land transporta- tion of rice, including the supervision of contracts for the operation of the rice unit train; (iii) the fumigation of ship and transit storages; and (iv) the coordination and implementation of the pest control program. Section 3.16. In order to assist AFPTC in carrying out Part J of the Project, the Borrower shall, by July 1, 1981, employ engineering consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall cause AFPTC to maintain records adequate to reflect in accordance with consistently -8- maintained appropriate accounting practices the operations and financial condition of AFPTC. (b) The Borrower shall cause AFPTC to maintain separate accounts in respect to the Project and to: (i) have such accounts together with AFPTC's financial statements (balance sheets, statements of income and expenses and related statements) for each Fiscal Year audited, in accordance with appropriate auditing principles consistently applied, by the Director General of the Central Accounts Office; (ii) furnish to the Association as soon as available, but in any case not later than four months after the end of each such Year, copies of AFPTC's unaudited accounts and, not later than nine months after each such Year, (A) certified copies of AFPTC's financial statements for such Year as so audited and (B) the report of such audit by said Director General, of such scope and in such detail as the Association shall have reasonably requested; and (iii) furnish to the Association such other infor- mation concerning the accounts and financial statements of AFPTC and the audit thereof as the Association shall from time to time reasonably request. Section 4.02. The Borrower shall cause AFPTC to take out and maintain with responsible insurers, or to make other provision satisfactory to the Association for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 4.03. The Borrower shall furnish to the Association for its review and comment, not later than August 31 of each Fiscal Year, a draft budget and implementation plan in respect of the Project for the next succeeding Fiscal Year. ARTICLE V Remedies of the Association Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified pursuant to paragraph (h) thereof: (a) AFPTC shall have failed to perform any covenant, agree- ment or obligation under the Subsidiary Loan Agreement; and (b) the Borrower or any other authority having jurisdiction shall have taken any action for the dissolution or disestablish- ment of AFPTC or for the suspension of its operations. -9- Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified pursuant to paragraph (d) thereof: (a) the event specified in paragraph (a) of Section 5.01 of this Agreement shall occur and shall continue for a period of sixty days after notice thereof shall have been given by the Association to the Borrower and AFPTC; and (b) the event specified in paragraph (b) of Section 5.01 of this Agreement shall occur. ARTICLE VI Effective Date; Termination Section 6.01. The following events are specified as addi- tional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions: (a) the Project Coordination Committee referred to in Section 3.06 of this Agreement has been established; (b) (i) the Project Implementation Unit referred to in Section 3.10 of this Agreement has been established, and (ii) the Project Director referred to in Section 3.10 of this Agreement has been appointed; (c) the requirements of Section 3.12 of this Agreement have been fulfilled; and (d) the execution and delivery of the Subsidiary Loan Agreement on behalf of the Borrower and AFPTC, respectively, has been duly authorized or ratified by all necessary governmental or corporate action. Section 6.02. The following is specified as an additional matter, within the meaning of Section 12.02 (b) of the General Conditions, to be included in the opinion or opinions to be furnished to the Association, namely, that the Subsidiary Loan Agreement has been duly authorized or ratified by the Borrower and AFPTC, and is legally binding upon the Borrower and AFPTC, respectively, in accordance with its terms. - 10 - Section 6.03. The date / , is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 6.04. The obligations of the Borrower under Article IV of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date twenty years after the date of this Agreement, whichever shall be the earlier. ARTICLE VII Representatives of the Borrower; Addresses Section 7.01. The Minister or the Deputy Minister of Planning and Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Minister of Planning and Finance Office of the Ministers Rangoon Burma Cable address: FINANCE Rangoon For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America r Cable address: Telex: INDEVAS 440098 (ITT) Washington, D.C. 248423 (RCA) 64145 (WUI) - 11 - IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. THE SOCIALIST REPUBLIC OF THE UNION OF BURMA By AKaw- Aj-'X414 Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By S/ Regional Vice President South Asia - 12 - SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category SDR Equivalent) to be Financed (1) Directly imported 8,210,000 100% of foreign equipment and mate- expenditures rials, including prefabricated storage shell (2) Civil works 9,160,000 55% of local and locally expenditures procured items (3) Technical assistance, 530,000 100% training, monitoring and evaluation TOTAL 17,900,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Association that no proceeds of the - 13 - Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 4. Notwithstanding the provisions of paragraph I above, no withdrawals shall be made in respect of payments made for expen- ditures prior to the date of this Agreement. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in para- graph I above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expendi- tures; and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expendi- tures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as, in the Association's reason- able opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 14 - SCHEDULE 2 Description of the Project The Project is to increase the Borrower's capacity for the storage of paddy and to improve its system for transpor- tation of rice. The Project consists of the following Parts: Part A: Construction of new paddy stores, made from timber and prefabricated steel structures, including the provision of storage facilities of 100,000 tons capacity, at about 20 sites in the Project Area. Part B: Rehabilitation of about 500 permanent stores, owned by AFPTC, and of about 120 small wooden jetties. Part C: Improvement of grading efficiency and store management through provision of new equipment. Part D: Implementation of a program of pest control through provision of equipment and supplies. Part E: Implementation of a pilot project to improve the drying capabilities of procurement centers in three townships. Part F: Rehabilitation of 60 double bogie rice wagons with vacuum brakes and bearings for increasing wagon utilization and reli- ability of rice transportation. Part G: Construction of a transshipment store for rice at Thazi with a capacity of about 3,000 tons. - 15 - Part H: Strengthening the Borrower's capabilities in handling and storing paddy by providing, inter alia, about 70 man-months of overseas training and about 305 man-months of local training to AFPTC's personnel. Part I: Strengthening the monitoring and evaluation capabil ties of AFPTC. Part J: The preparation of detailed storage designs and assistance in the supervision of Part A of the Project through 30 man-months of technical assistance. The Project is expected to be completed by September 30, 1984. - 16 - SCHEDULE 3 Procurement A. International Competitive Bidding 1. Except as provided in Part C hereof, goods shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1977 (hereinafter called the Guidelines), on the basis of inter- national competitive bidding as described in Part A of the Guidelines. 2. For goods to be procured on the basis of international competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Association as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender or prequalification documents relating thereto, as the case may be, a general procurement notice, in such form and detail and containing such information as the Association shall reasonably request; the Association will arrange for the publica- tion of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods remain to be procured on the basis of international competitive bidding. 3. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international competitive bidding, (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for the imported goods, or the ex-factory price or off-the-shelf price of other goods offered in such bid; and (ii) customs duties and other import taxes levied in connection with the importation, or the sales and similar taxes levied in connection with the sale or delivery, pursuant to the bid, of the goods shall not be taken into account in the evaluation of the bids. B. Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A of this Schedule, goods manufactured in the Socialist Republic of the Union of Burma may be granted - 17 - a margin of preference in accordance with, and subject to, the following provisions: 1. All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering gocds manufactured in the Socialist Republic of the Union of Burma if the bidder shall have established to the satisfac- tion of the Borrower and the Association that the manufacturing cost of such goods includes a value added in the Socialist Republic of the Union of Burma equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in the Socialist Republic of the Union of Burma. (3) Group C: bids offering any other goods. 3. All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. Such lowest evaluated bids shall then be compared with each other, and if, as a result of this comparison, a bid from Group A or Group B is the lowest, it shall be selected for the award. 4. If, as a result of the comparison under paragraph 3 above, the lowest bid is a bid from Group C, all Group C bids shall be further compared with the lowest evaluated bid from Group A after adding to the evaluated bid price of the imported goods offered in each Group C bid, for the purpose of this further comparison only, an amount equal to: (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such Group C bid; or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If - 18 - the Group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from Group C which as a result of the comparison under paragraph 3 is the lowest evaluated bid shall be selected. C. Other Procurement Procedures 1. Civil works for the construction of new stores under Parts A and G of the Project shall be carried out on the basis of negotiated contracts between AFPTC and CC on terms and conditions satisfactory to the Association. 2. Small items costing the equivalent of $10,000 or less each and not exceeding the equivalent of $300,000 in the aggregate may be procured off-the-shelf. D. Review of Procurement Decisions by the Association With respect to all contracts for equipment and materials estimated to cost the equivalent of $100,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, the Bor- rower shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and shall furnish to the Association, in sufficient time for its review, a detailed report on the evalua- tion and comparison of the bids received, together with the Borrower's recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsis- tent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. - 19 - (d) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 2. With respect to each contract not governed by the preceding paragraph, the Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respective bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an extension of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cost of the contract by more than 15% of the original price, the Borrower shall inform the Association of the proposed modification, waiver, extension or change order and the reasons therefor. The Association, if it determines that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform the Borrower and state the reasons for its determination. E. Procurement Without Contracting Civil works under Part B of the Project shall be carried out by force account by AFPTC. INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Development Association. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the 6 day of 198F E. FOR SECRETARY