19-Mar-2020 _____________ Honorable Dr. Teuea Toatu Minister for Finance & Economic Development Ministry for Finance & Economic Development P.O. Box 67 Bairiki, Tarawa Republic of Kiribati Re: IDA Grant Number D559-KI (Kiribati Outer Islands Transport Infrastructure Investment Project) Additional Instructions: Disbursement and Financial Information Letter Excellency: I refer to the Financing Agreement (“Agreement”) between the Republic of Kiribati (“Recipient”) and the International Development Association (the “Association”) for the above -referenced Project. The General Conditions, as defined in the Agreement, provide that the Recipient may from time to time request withdrawals of IDA Grant No.D559-KI (“Grant”) in accordance with the Disbursement and Financial Information Letter, and such additional instructions as the Association may specify from time to time by notice to the Recipient. The General Conditions also provide that the Disbursement and Financial Information Letter may set out Project specific financial reporting requirements. This letter constitutes such Disbursement and Financial Information Letter (“DFIL”), and may be revised from time to time. I. Disbursement Arrangements, Withdrawal of Grant Funds, and Reporting of Uses of Grant Funds. The Disbursement Guidelines for Investment Project Financing, dated February 2017, (“Disbursement Guidelines”) are available in the Association’s public website at https://www.worldbank.org and its secure website “Client Connection” at https://clientconnection.worldbank.org. The Disbursement Guidelines are an integral part of the DFIL, and the manner in which the provisions in the guidelines apply to the Grant is specified below. (i) Disbursement Arrangements  General Provisions (Schedule 1). The table in Schedule 1 sets out the disbursement methods which may be used by the Recipient, and conditions and information on registration of authorized signatures, processing of withdrawal applications (including minimum value of applications and processing of advances), instructions on supporting documentation, and frequency of reporting on the Designated Account. (ii) Electronic Delivery. Section 11.01 (c) of the General Conditions. The Recipient will deliver Withdrawal Applications (with supporting documents) electronically through the Association’s web-based portal “Client Connection” at https://clientconnection.worldbank.org. This option will be effected after the officials designated in writing by the Recipient who are authorized to sign and deliver Withdrawal Applications have registered as users of “Client Connection”. The designated 1818 H Street NW  Washington, DC 20433 USA officials will deliver Applications electronically by completing the Form 2380, which is accessible through “Client Connection”. By signing the Authorized Signatory Letter, the Recipient confirms that it is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Association by electronic means. The Recipient may exercise the option of preparing and delivering Withdrawal Applications in paper form on exceptional cases (including those where the Borrower encounters legal limitations), and which were previously agreed with the Association. By designating officials to use SIDC and by choosing to deliver the Applications electronically, the Recipient confirms through the authorized signatory letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, available in the Association's public website at https://worldbank.org and “Client Connection”; and (b) to cause such official to abide by t hose terms and conditions. II. Financial Reports and Audits. (i) Financial Reports. The Recipient must prepare and furnish to the Association not later than forty-five (45) days after the end of each calendar quarter, interim unaudited financial reports (“IFR”) for the Project covering the quarter. (ii) Audits. Each audit of the Financial Statements must cover the period of one fiscal year of the Recipient, commencing with the fiscal year in which the first withdrawal was made. The audited Financial Statements for each such period must be furnished to the Association not later than six (6) months after the end of such period. III. Other Information. For additional information on disbursement arrangements, please refer to the Loan Handbook available on the Association’s website (http://www.worldbank.org/) and “Client Connection”. The Association recommends that you register as a user of “Client Connection”. From this website you will be able to prepare and deliver Applications, monitor the near real-time status of the Grant, and retrieve related policy, financial, and procurement information. For more information about the website and registration arrangements, or if you have any queries in relation to the above, please contact the Association by email at AskLoan@WorldBank.org using the above reference. Sincerely, Michel Kerf Country Director Papua New Guinea & Pacific Islands East Asia and Pacific Region Page 2 of 8 Attachments 1. Statement of Expenditures (SOE) 2. Form of Authorized Signatory Letter With copies: Ministry of Finance and Economic Development Bairiki, Tarawa Republic of Kiribati secretary@mfep.gov.ki Ministry of Infrastructure and Sustainable Energy Betio, Tarawa Republic of Kiribati secretary@mise.gov.ki Ministry of Information, Communications, Transport and Tourism Development Betio, Tarawa Republic of Kiribati tteannaki@micttd.gov.ki Page 3 of 8 Schedule 1: Disbursement Provisions Basic Information Country Republic of Kiribati Section III.B.2. of Schedule 2 to Recipient Ministry of Finance and Closing Date the Financing Agreement. Economic Development IDA Grant D559-KI Name of the Project Kiribati Outer Islands Disbursement Four (4) months after the closing Number Transport Infrastructure Deadline Date date. Investment Project Subsection 3.7 ** Disbursement Methods and Supporting Documentation Disbursement Methods Methods Supporting Documentation Section 2 (**) Subsections 4.3 and 4.4 (**) Direct Payment Yes Copy of records Reimbursement Yes Statement of Expenditures (Attachment 1) Advance Yes (refer to Other Statement of Expenditures (Attachment 1) Disbursement Instructions below) Special Commitments Yes Copy of Letter of Credit Designated Account (Sections 5 and 6 **) (Refer to Other Disbursement Instructions below) Pooled; one (1) pooled designated account will be Fixed Type Ceiling established under the Project. Financial Institution - ANZ Bank Australian Dollars (AUD) Currency Name Frequency of Reporting Quarterly or more often as needed 2,500,000 Amount Subsection 6.3 (**) Minimum Value of Applications (subsection 3.5) The minimum value of applications for Reimbursement, Direct Payment and Special Commitment is AUD 500,000. Authorized Signatures (Subsection 3.1 and 3.2 **) The form for Authorized Signatories Letter is provided in Attachment 2 of this letter Please send the Authorized Signatory Letter to the address indicated below: The World Bank Level 19, 14 Martin Place CML Building Page 4 of 8 Sydney NSW 2000, Australia Attention: Country Director Withdrawal and Documentation Applications (Subsection 3.3 and 3.4 **) All Withdrawal Applications and supporting documentation will be electronically sent via the Association’s system Client Connection. For Withdrawal Applications in paper form, please submit to the address below: The World Bank 26th Floor, One Global Place 5th Avenue corner 25th Street, Bonifacio Global City Taguig City, Philippines Attention: Senior Regional Team Leader, WFACS Other Disbursement Instructions 1. Advance disbursement method and the use of designated account will not be available to the Project until the issue of lapsed loans listed below is fully resolved: a) TF0A2674, Kiribati Road Rehabilition Project b) TF12678, Pacific Aviation Investment Project c) IDA D105, Pacific Aviation Investment Project 2. This DFIL may not be fully adapted to the disbursement of funds allocated from time to time to Category (5) of the disbursement table in Section III.A of Schedule 2 to the Financing Agreement. The DFIL will be revised, if needed, when funds are allocated to Category (5) of the disbursement table. ** Sections and subsections relate to the “Disbursement Guidelines for Investment Project Financing”, dated February 2017. Page 5 of 8 Attachment 1 - Statement of Expenditures Credit and Grant # Payment made during the period Application from to # Category # The following expenditures have been incurred during the retroactive financing period (please tick) Yes No Page # The following expenditures have been incurred during before the closing date of the credit (please tick) Yes No In case of DA payments 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Contrac Total Amount Contract # t Prior Date amount paid from Service Brief currenc % Review (Client Invoice of of invoice Expenditure Designated provider / Description y and Finance Item Contract Connectio number payme covered Amount Eligible Amount Account Supplier / of the amount d by the Remarks No ? n # for nt by for Financing claimed (which Payee's (original Associa expenditure (YES or Prior Applicatio should be Name + tion NO) Review n (net of equal to amend retention) #11) contracts) ment) TOTAL Supporting documents for this SOE retained at:(insert location) Prepared by: ____________ Authorized Representative: _____________________ *A separate form should be used for each category Page 6 of 8 Attachment 2 – Form of Authorized Signatory Letter [Letterhead] Ministry of Finance and Economic Development [Street address] [City] [Country] [DATE] International Development Association Level 19, 14 Martin Place CML Building Sydney NSW 2000 Australia Attention: Country Director Re: IDA Grant Number D559-KI (Kiribati Outer Islands Transport Infrastructure Investment Project) I refer to the Financing Agreement (“Agreement”) between the Republic of Kiribati (the “Recipient”) and the International Development Association (the “Association”), dated _______, providing the above Financing. For the purposes of Section 2.03 of the General Conditions as defined in the Agreement, any 1[one] of the persons whose authenticated specimen signatures appear below is authorized on behalf of the Recipient to sign applications for withdrawal and applications for a special commitment under this Financing. For the purpose of delivering Applications to the Association, 2[each] of the persons whose authenticated specimen signatures appears below is authorized on behalf of the Recipient, acting 3[individually] 4[jointly], to deliver Applications, and evidence in support thereof on the terms and conditions specified by the Association. 5[Thisconfirms that the Recipient is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to 1 Instruction to the Recipient: Stipulate if more than one person needs to sign Applications, and how many or which positions, and if any thresholds apply. Please delete this footnote in final letter that is sent to the Association. 2 Instruction to the Recipient: Stipulate if more than one person needs to jointly sign Applications, if so, please indicate the actual number. Please delete this footnote in final letter that is sent to the Association. 3 Instruction to the Recipient: Use this bracket if any one of the authorized persons may sign; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Association. 4 Instruction to the Recipient: Use this bracket only if several individuals must jointly sign each Application; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Association. 5 Instruction to the Recipient: Add this paragraph if the Recipient wishes to authorize the listed persons to accept Secure Identification Credentials and to deliver Applications by electronic means; if this is not applicable, please delete the paragraph. Please delete this footnote in final letter that is sent to the Association. Page 7 of 8 the Association by electronic means. In full recognition that the Association shall rely upon such representations and warranties, including without limitation, the representations and warranties contained in the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation (“Terms and Conditions of Use of SIDC”), the Recipient represents and warrants to the Association that it will cause such persons to abide by those terms and conditions.] This Authorization replaces and supersedes any Authorization currently in the Association records with respect to this Agreement. [Name], [position] Specimen Signature: ____________________ [Name], [position] Specimen Signature: ____________________ [Name], [position] Specimen Signature: ____________________ Yours truly, / signed / ______________ Page 8 of 8