Page 1 RCA 248423. \09 WUI 64145 \09 FAX (202) 477-6391 The World Bank 1818 H Street N.W. (202) 473-1000 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Washington, D.C. 20433 Cable Address: INTBAFRAD I NTERNATIONAL DEVELOPMENT ASSOCIATION U.S.A. Cable Address: INDEVAS CONFORMED COPY December 9, 2010 H.E. Dr. Salam Fayyad Prime Minister and Minister of Finance Palestinian Authority Ramallah, West Bank Re: West Bank and Gaza: European Community Grant Agreement Related to the Tertiary Education Project (TF056121) Reallocation of the EC Grant Proceeds Excellency: We refer to the European Community Grant Agreement dated March 27, 2006 between Palestine Liberation Organization (for the benefit of the Palestinian Authority) (the “Recipient”) and International Development Association (the “World Bank”), acting as administrator of grant funds provided by the Commission of European Communities, acting on behalf of the European Community (the “Trust Fund Grant Agreement”). We also refer to your letter dated October 21, 2010, requesting reallocation of the grant proceeds and increase of the percentage of eligible expenditures to be financed by the grant. We are pleased to concur with your request and propose to amend the table set forth in paragraph 1 of Schedule 1 to the Trust Fund Grant Agreement as follows: Amount of the % of Eligible EC Grant Allocated Expenditures Category (Expressed in Euros) to be Financed (1) Consultants’ Services and 810,000 55% training (2) QIF Grants 4,090,000 100% ________ TOTAL 4,900,000 Except as specifically amended by this Amendment Letter, all provisions of the Trust Fund Grant Agreement remain in full force and effect. Page 2 2 Please confirm your agreement on behalf of the Recipient to the above amendment by signing and returning to us one fully executed original of this Amendment Letter, and retaining one original for your records. This amendment will become effective as of the date of the countersignature upon receipt by the World Bank of the copy of this Letter countersigned by you Sincerely, INTERNATIONAL DEVELOPMENT ASSOCIATION /s/ Miriam J. Sherman Country Director West Bank and Gaza CONFIRMED: PALESTINE LIBERATION ORGANIZATION (for the Benefit of the Palestinian Authority) By: /s/ Salam Fayyad Authorized representative Name: Salam Fayyad Title: Prime Minister and Minister of Finance Date: December 20, 2010