LOAN NUMBER 9345-AO Loan Agreement (Third Angola Growth and Inclusion Development Policy Loan) between REPUBLIC OF ANGOLA and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT LOAN NU M BER 9345-AO LOAN AGREEMENT AGREEMENT dated as of the Signature Date between the REPUBLIC OF ANGOLA ("Borrower") and the INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT ("Bank") for the purpose of providing financing in support of the Program (as defined in the Appendix to this Agreement). The Bank has decided to provide this financing on the basis, inter alia, of: (i) the actions which the Borrower has already taken tinder the Program, and which are described in Section LA of Schedule Ito this Agreement; and (ii) the Borrower's maintenance of an adequate macroeconomic policy framework. The Borrower and the Bank therefore hereby agree as follows: ARTICLE I- GENERAL CONDITIONS; DEFINITIONS 1.01. The General Conditions (as defined in the Appendix to this Agreement) apply to and formpart of this Agreement. 1.02. Unless the context requires otherwise, the capitalized terms used in this Agreement have the meanings ascribed to them in the General Conditions or in the Appendix to this Agreement. ARTICLE II - LOAN 2.01. The Bank agrees to lend to the Borrower an amount of five hundred million Dollars ($500,000,000) as such amount may be converted from time to time through a Currency Conversion ("Loan"), 2.02. The Front-end Fee is one quarter of one percent (0.25%) of the Loan amount. 2.03. The Commitment Charge is one quarter of one percent (0.25%) per annum on the Unwithdrawn Loan Balance. 2.04. The interest rate is the Reference Rate plus the Variable Spread or such rate as may apply following a Conversion; subject to Section 3.02(e) of the General Conditions. 2.05. The Payment Dates are February 15 and August 15 in each year. 2.06. The principal amountof the Loan shall be repaid in accordance with Schedule 2 to this Agreement. 2.07. Without limitation upon the provisions of Section 5.05 of the General -2- Conditions, the Borrower shall promptly furnish to the Bank such information relating to the provisions of this Article II as the Bank may, from time to time, reasonably request. ARTICLE Ill - PROGRAM 3.01. The Borrower declares its commitment to the Program and its implementation. To this end, and further to Section 5.05 of the General Conditions: (a) the Borrower and the Bank shall from time to time, at the request of either party, exchange views on the Borrower's macroeconomic policy framework and the progress achieved in carrying out the Program; (b) prior to each such exchange of views, the Borrower shall furnish to the Bank for its review and comment a report on the progress achieved in carrying out the Program, in such detail as the Bank shall reasonably request; and (c) without limitation upon paragraph (a) and (b) of this Section, the Borrower shall promptly inform the Bank of any situation that would have the effect of materially reversing the objectives of the Program or any action taken under the Program including any action specified in Section I of Schedule I to this Agreement. ARTICLE IV - REMEDIES OF THE BANK 4.01. The Additional Event of Suspension consists of the following, namely, a situation has arisen which shall make it improbable that the Program, or a significant part of it, will be carried out. ARTICLE V - EFFECTIVENESS; TERMINATION 5.01. The Additional Condition of Effectiveness consists of the following, namely, the Bank is satisfied with the progress achieved by the Borrower in carrying out the Program and with the adequacy of the Borrower's macroeconomic policy framework. 5.02. The Effectiveness Deadline is the date ninety (90) days after the Signature Date. 5.03. For purposes of Section 9.05 (b) of the General Conditions, the date on which the obligations of the Borrower under this Agreement (other than those providing for payment obligations) shall terminate is twenty (20) years after the Signature Date. -3- ARTICLE VI - REPRESENTATIVE; ADDRESSES 6.01. The Borrower's Representative is its Minister responsible for finance. 6.02. For purposes of Section 10.01 of the General Conditions: (a) the Borrower's address is: Minist6rio das Finanias Largo da Mutamba Luanda, Angola; and (b) the Borrower's Electronic Address is Facsimile: E-mail: + 244 222 706 002/3 ugd.dadg@minfingov.ao 6.03. For purposes of Section 10.01 of the General Conditions: (a) the Bank's address is: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America; and (b) the Bank's Electronic Address is: Telex: Facsimile: E-mail: 248423(MCI) or 1-202-477-6391 angola_alert@worldank.org 64145(MCI) -4- AGREED as of the Signature Date. REPUBLIC OF ANGOLA By Authorized Representative Name: Vera Daves de Sousa Title: Minister of Finance Date: INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By Authorized Representative Name: Jean-Christophe Carret Title: Country Director Date: Ii~ ) -5- SCHEDULE 1 Program Actions; Availability of Loan Proceeds Section 1. Actions under the Program A. Actions Taken Under the Prolgam. The actions taken by the Borrower under the Program include the following: 1. The Borrower has: (a) promoted the transparency and efficiency of public expenditure, particularly social expenditure by publishing a medium-term fiscal framework as well as quarterly monitoring reports on social expenditures, as evidenced by: (i) Projecglies FisCais de Medio Prazo dated February 4, 2022, as published on the Borrower's website: K m i (ii) a report dated February 11, 2022, on the execution of social expenditures for the third quarter of 202] published by the Borrower's Ministry of Finance (Relatoio de Execuqdo da Despesa Social do 0 G.E III Trimesire 2021) published on the Borrower's website: : ( I) transparently accounted for fuel subsidies by publishing quarterly information on said fuel subsidies and making an allocation for the full estimate of the cost of fuel subsidies in the 2022 annual budget, as evidenced by: (i) the publication of a report by the Borrower's Ministry of Finance ("Relatorio de Fundamenlaqdo - Orqamento Geral do Estado 2022") dated October 2021, published on the Borrower's website; and (ii) the adoption of the budget law No. 32/21 published on the Didrio da Repiiblica (I Serie - No. 246) on December 30, 2021; and (c) improved the transparency of the public debt by publishing annually the key terms of all loans contracted or guaranteed by the Borrower each year starting from 2020, and adopting standard contractual terms to be incorporated in all foreign debt loans; as evidenced by: (i) the publication of a table ("Summary of Key Terms of External Financial Indebtedness of the Republic of Angola from January 1, 2020") dated February 15, 2022, published on the Borrower's website ii p I3 p;it aid (ii) the publication of said terms in a regulation by the Borrower's Ministry of Finance (Instrutivo No. 44/2022 dated February 2, 2022). 2. Fhe Borrower has: (a) advanced the privatization program for an additional five assets from the national priority list and published progress reports covering the number of bids received, the price, terms, and identification of the winning bidder, as evidenced by: (i) the regular publication of a dashboard ("Prograna de Privatizaq5Tes - PROPRIV 2019-2022") with all the relevant information on the Borrower's website; and (ii) the publication of the following regulations: (A) -6- Despacho Presidencial No. 87/20 dated June 15, 2020, published in the Didrio da Repuiblica (I Sdrie - No. 84) on June 15, 2020; (B) Despacho Presidencial No. 181/20 dated December 18, 2020, published in the Didrio da RepPblico (I S6rie - No. 205) on December 18, 2020; (C) Despacho Presidential No. 184/20 dated December 21, 2020, published in the Didrio da Repiblica (I Srie - No. 206) on December 21, 2020; (D) Despacho Presidencial No. 201/21 dated November 23, 2021, published in the Dicirio do Repblica (I S6rie - No. 219) on November 23, 2021; and (E) Despacho Presidential No. 31-A/22 dated February 8, 2022, published in the Diario da Repfblica (I Sdrie - No.25) on February 8, 2022; (b) improved the implementation of economic regulation, including competition policy and phasing out of price controls, by adopting a legislation that provides for operational independence of regulatory entities, as evidenced by its Law No. 27/2021 published in the Diario da Repfiblica (I Sdrie. No. 202) on October 25, 2021; and (c) promoted private investment and expansion of telecom networks to update the infrastructure sharing regulation in-line with international good practices, as evidenced by a Presidential Decree No. 42/22 dated February 10, 2022, published in the Didrio da Reptblica (I Sdrie - No. 27) on -February 10, 2022. 3. The Borrower has: (a) brought the electricity sector on a path towards cost- recovery tariff levels by approving annual revenue requirements for generation, transmission and distribution for the 2022-2023 period; as evidenced by IRSEA Resolutions No.1, No.2 and No.3 dated January 31, 2022; and (b) accelerated the expansion of variable renewable energy generation capacity by giving priority to dispatching electricity from renewable energy plants connected to the grid and establishing principles for providing financial support to the operators of renewable energy plants; as evidenced by Presidential Decree No. 76/21 dated March 25, 2021, published on the DiariodaRepdblica(I Sdrie-No. 52) on March 25,2021. 4. The Borrower has: (a) institutionalized electronic payments for the provision of social cash transfers, as evidenced by a regulation adopted by FAS (FAS Circular No. 004/D. Geral - FAS/2020) dated August 28, 2020; and (b) strengthened its payment system oversight policy and defined the mandate, scope and objectives of its tecnical commission for the development of its payment system; as evidenced by: (i) a Presidential Decree (Decrelo PresidenCial No. 65/21 -Aprova o Regulamento da Cornissao Tecnica para o Desenvolvimento do Sistema de Paganenlos de Angola) dated March 12, 2021. published in the Diario da Repiblica (I Sdrie - No.45) on March 12, 2021; (ii) Aviso No. 02/2022 (Sislema de Paganentos de Angola - PresaCio de Serviqos de Pagamento) dated January 21, 2022, published in the Didrio da RepPblica (I S6rie - No.22) on February 2, 2022 ; (iii) Aviso No. 03/2022 (Sistema de Pagamentos de Angola - Regras e Procedimentos Operacionais Apliedveis as Infraestruturas do Mercado Financeiro) dated January 21, 2022, published in the Didrio da Repdblica (I S6rie - No. 22) on February 2, 2022; (iv) Aviso No. 05/2022 (Sistema de -7- Pagamentos de Angola - Arranjos de Pagamento) dated February 1, 2022, published in the Dicirio da Reptiblica (l Sdrie -No. 23) on February 3, 2022; and (v) the BNA payment oversight policy (Politica de Superintend6ncia do Sistema de Pagamenlos), dated December 2021, as published on tihe BNA's websi te on December 28, 2021. 5. The Borrower has approved regulatory instruments to promote the financially sustainable delivery and expansion of water services as evidenced by: (i) IRSEA Resolution No. 04.A/EAS/2022 dated January 31, 2022; (ii) IRSEA Instrtivos No.], No.2, No.3 and No.4; all dated January 31, 2022; and (iii) IRSEA Normativos No.] and No. 2 both dated January 31, 2022. 6. The Borrower has approved a bulk water use tariff and given GABHIC the mandate for the application of the economic and financial regime on the use of water resources as well as for climate preparedness and response in order to promote sustainable, efficient and climate-resilient use of water resources nation- wide; as evidenced by: (i) Presidential Decree No. 41/21 dated February 12, 2021, published in the Dicirio da Republica (I S6rie - No. 28) on February 12, 2021; and (ii) Presidential Decree No. 160/21 dated June 18, 2021, published in the Dicirio da Republica (1 S6rie - No. 113) on June 18, 2021. Section II. Availability of Loan Proceeds A. General. The Borrower may withdraw the proceeds of the Loan in accordance with the provisions of this Section and such additional instructions as the Bank may specify by notice to the Borrower. B. Allocation of Loan Amounts. The Loan is allocated in: (a) a single withdrawal tranche, from which the Borrower may make withdrawals of the Loan proceeds; and (b)the amounts requested by the Borrower to pay the Front-end Fee; and each Interest Rate Cap or Interest Rate Collar premium. The allocation of the amounts of the Loan to this end is set out in the table below: Allocations Amount of the Loan (expressed in USD) (1) Single Withdrawal Tranche 498,750,000 (2) Front-end Fee 1,250,000 (3) Interest Rate Cap or Interest Rate Collar premium (Amount due pursuant to Section 4.05 (c) 0 of the General Conditions) TOTAL AMOUNT 500,000,000 -8- C. Withdrawal Tranche Release Conditions 1. No withdrawal shall be made of the Single Withdrawal Tranche unless the Bank is satisfied: (a) with the Program being carried out by the Borrower; and (b) with the adequacy of the Borrower's macroeconomic policy framework. 2. Notwithstanding the foregoing, if, at any time prior to the receipt by the Bank of a request for withdrawal of an amount of the Loan, the Bank determines that a review of the Borrower's progress in carrying out the Program is warranted, the Bank shall give notice to the Borrower to that effect. Upon the giving of such notice, no withdrawals shall be made of the Unwithdrawn Loan Balance unless and until the Bank has notified the Borrower of its satisfaction, after an exchange of views as described in paragraphs (a) and (b) of Section 3.01 of Article I 11of this Agreement, with the progress achieved by the Borrower in carrying out the Program. 3. No withdrawal shall be made of the Single Withdrawal Tranche unless the Bank is satisfied, based on evidence satisfactory to it, that the situation described in paragraph (c) of Section 3.01 of Article I 11of this Agreement has been resolved. D. Deposit of Loan Amounts 1I The Borrower, within thirty (30) days after the withdrawal of the Loan from the Loan Account, shall report to the Bank: (a) the exact sum received into the account referred to in Section 2.03 (a) of the General Conditions; (b) the details of the account to which the Kwanza equivalent of the Loan proceeds will be credited; (c) the record that an equivalent amount has been accounted for in the Borrower'sbudget management systems; and (d) the statement of receipts and disbursement of the account referred to in Section 2.03 (a) of the General Conditions. E. Closing Date. The Closing Date is June 30, 2023. -9- SCHEDULE 2 Commitment-Linked Amortization Repayment Schedule The following table sets forth the Principal Payment Dates of the Loan and the percentage of thetotal principal amount of the Loan payable on each Principal Payment Date ("Installment Share"). Level Principal Repayments Principal Payment Date Installment Share On each February 15 and August 15 Beginning August 15, 2025, 2.86% through February 15, 2042 On August 15, 2042 2,76% -10- APPENDIX Definitions 1. "BNA" means BanCo Nacional de Angola, the Borrower's central bank, operating under the Borrower's Law No. 24/21 dated October 18, 2021, or any successor thereto acceptable to the Bank. 2. "FAS" means Fundo de Apoio Social, the Borrower's social support fund, as established and operating under the Borrower's Decree No. 44/94 dated October 28, 1994, and any successor thereto acceptable to the Bank. 3. "GABHIC" means Gabinete para a Admninistra(do das Bacias Hidrogr(ficas do Cunene, Cubango e Cuvelai, the Borrower's basin administration agency for Cunene, Cubango and Cuvelai basins, as established and operating under the Borrower's Presidential Decree No. 161/21 dated June 18, 2021, and any successor thereto acceptable to the Bank. 4. "General Conditions" means the "International Bank for Reconstruction and Development General Conditions for IBRD Financing, Development Policy Financing", dated December14, 2018 (revised on August 1, 2020, December 21, 2020, April 1, 2021, and January 1, 2022). 5. "IRS EA" means Instituto Regulador c/os Serviqos de Electricidade e de Agua, the Borrower's regulatory body for electricity and water, as established and operating under the Borrower's Presidential Decree No. 59/16 dated March 16, 2016, or any successor thereto acceptable to the Bank. 6. "Kwanza" means the Borrower's local currency. 7. "Ministry of Finance" means the Borrower's ministry responsible for finance, or any successor thereto acceptable to the Bank. 8. "Program" means the program of objectives, policies, and actions set forth or referred to in the letter dated February 17, 2022, from the Borrower to the Bank declaring the Borrower's commitment to the execution of the Program, and requesting assistance from the Bank in support of the Program during its execution and comprising actions taken, including those set forth in Section I of Schedule I to this Agreement, and actions to be taken consistent with the Program's objectives. 9. "PROPRIV" means the Borrower's Program for Privatization 2019-2022, approved pursuant to the Borrower's Presidential Decree No. 250/19 published on the Diario da Republica No. 174 on October 30, 2020. -11- 10. "Signature Date" means the later of the two dates on which the Borrower and the Bank signed this Agreement and such definition applies to all references to "the date of the LoanAgreement" in the General Conditions. IL. "Single Withdrawal Tranche" means the amount of the Loan allocated to the category entitled "Single Withdrawal Tranche" in the table set forth in Part B of Section II of Schedule Ito this Agreement.