OFFICIAL DOCUMENTS CREDIT NUMBER 6349-BD Financing Agreement (Bangladesh Jobs Programmatic Development Policy Financing) between PEOPLE'S REPUBLIC OF BANGLADESH and INTERNATIONAL DEVELOPMENT ASSOCIATION CREDIT NUMBER 6349-BD FINANCING AGREEMENT AGREEMENT dated as of the Signature Date between the PEOPLE'S REPUBLIC OF BANGLADESH ("Recipient") and the INTERNATIONAL DEVELOPMENT ASSOCIATION ("Association") for the purpose of providing financing in support of the Program (as defined in the Appendix to this Agreement). The Association has decided to provide this financing on the basis, inter alia, of: (i) the actions which the Recipient has already taken under the Program and which are described in Section I A of Schedule 1 to this Agreement; and (ii) the Recipient's maintenance of an adequate macroeconomic policy framework. The Recipient and the Association 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 form 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 General Conditions or in the Appendix to this Agreement. ARTICLE II - FINANCING 2.01. The Association agrees to extend to the Recipient a credit, which is deemed as Concessional Financing for purposes of the General Conditions, in the amount equivalent to One Hundred Eighty Million Nine Hundred Thousand Special Drawing Rights (SDR 180,900,000) (variously, "Credit" and "Financing") (variously, "Credit" and "Financing"). 2.02. The Maximum Commitment Charge Rate is one-half of one percent (1/2 of 1%) per annum on the Unwithdrawn Financing Balance. 2.03. The Service Charge is three-fourths of one percent (3/4 of 1%) per annum on the Withdrawn Credit Balance. 2.04. The Interest Charge is one and a quarter percent (1.25%) per annum on the Withdrawn Credit Balance -2- 2.05. The Payment Dates are June 1 and December 1 in each year. 2.06. The principal amount of the Credit shall be repaid in accordance with the repayment schedule set forth in Schedule 2 to this Agreement. 2.07. The Payment Currency is Dollar. 2.08. Without limitation upon the provisions of Section 5.05 of the General Conditions, the Recipient shall promptly furnish to the Association such information relating to the provisions of this Article II as the Association may, from time to time, reasonably request. ARTICLE III - PROGRAM 3.01. The Recipient declares its commitment to the Program and its implementation. To this end, and further to Section 5.05 of the General Conditions: (a) the Recipient and the Association shall from time to time, at the request of either party, exchange views on the Recipient's macroeconomic policy framework and the progress achieved in carrying out the Program; (b) prior to each such exchange of views, the Recipient shall furnish to the Association for its review and comment a report on the progress achieved in carrying out the Program, in such detail as the Association shall reasonably request; and (c) without limitation upon the provisions of paragraphs (a) and (b) of this Section, the Recipient shall promptly inform the Association of any situation that would have the effect of materially reversing the objectives of the Program or any action taken under the Program. ARTICLE IV - REMEDIES OF THE ASSOCIATION 4.01. The Additional Event of Suspension consists of the following: that a situation has arisen which shall make it improbable that the Program, or a significant part of it, will be carried out. 4.02. The Additional Event of Acceleration consists of the following, namely, that the event specified in Section 4.01 of this Agreement occurs and is continuing for a period of 30 days after notice of the event has been given by the Association to the Recipient. -3- ARTICLE V - EFFECTIVENESS; TERMINATION 5.01. The Additional Condition of Effectiveness consists of the following, namely, that the Association is satisfied with the progress achieved by the Recipient in carrying out the Program and with the adequacy of the Recipient'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 10.05 (b) of the General Conditions, the date on which the obligations of the Recipient under this Agreement (other than those providing for payment obligations) shall terminate is twenty (20) years after the Signature Date. ARTICLE VI - REPRESENTATIVE; ADDRESSES 6.01. The Recipient's Representative is the Senior Secretary/Secretary or the Additional Secretary, or any Joint Secretary, Joint Chief, Deputy Secretary, Deputy Chief, Senior Assistant Secretary, Senior Assistant Chief, Assistant Secretary or Assistant Chief of the Economic Relations Division of the Ministry of Finance. 6.02. For purposes of Section 11.01 of the General Conditions: (a) the Recipient's address is: Economic Relations Division Ministry of Finance Government of the People's Republic of Bangladesh Sher-E-Bangla Nagar 1207 Dhaka, Bangladesh; and (b) the Recipient's Electronic Address is: Facsimile: +880-2-918-0788 E-mail: secretary@erd.gov.bd 6.03. For purposes of Section 11.01 of the General Conditions: (a) The Association's address is: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America; and -4- (b) the Association's Electronic Address is: Telex: Facsimile: E-mail: 248423 (MCI) 1-202- 477-6391 qfan@worldbank.org AGREED as of the Signature Date. PEOPLE'S REPUBLIC OF BANGLADESH By Authorized Representative Name: Monowar Ahmed Title: Secretary Date: January 9, 2019 INTERNATIONAL DEVELOPMENT ASSOCIATION By Authorized Representative Name: Qimiao Fan Title: Country Director for Bangladesh, Bhutan and Nepal Date: January 9, 2019 -5- SCHEDULE 1 Program Actions; Availability of Financing Proceeds Section I. Actions under the Pro2ram Actions Taken Under the Program. The actions taken by the Recipient under the Program include the following: 1. The Recipient, through its Parliament, has enacted the One Stop Shop Act 2018 (Act No. 10 of 2018) and published it in the Official Gazette. 2. The Ministry of Finance has submitted the Customs Act 2018 (Bill No. 58 of 2018) to the Recipient's Parliament for approval. 3. The National Board of Revenue (NBR) has made publicly available on its website a comprehensive set of rules and procedures for Bonded Warehouse licensing and operation. 4. (i) The Ministry of Finance has rolled out Climate Budgeting across 20 ministries with climate relevant expenditures, and (ii) the Cabinet of Ministers has approved the National Environmental Policy 2018. 5. The Ministry of Finance has integrated the management of the Government Service Pension Fund and the General Provident Fund of civil servants through the establishment of the Central Accounts Office of Pension and Fund Management. 6. The Recipient, through its Parliament, has passed the Bangladesh Labor Act (Amendment) 2018 (Act No. 48 of 2018). 7. The Recipient, through its Parliament, has enacted the Wage Earners Welfare Board Act 2018 (Act No. 30 of 2018) and published it in the Official Gazette. 8. The Recipient, through its Parliament, has enacted the National Skills Development Authority Act 2018 (Act No. 45 of 2018) and published it in the Official Gazette. 9. The Ministry of Women and Children Affairs has submitted the draft Child Daycare Act to the Scrutiny Committee of the Recipient's Cabinet of Ministers. Section II. Availability of Financing Proceeds A. General. The Recipient may withdraw the proceeds of the Financing in accordance with the provisions of this Section and such additional instructions as the Association may specify by notice to the Recipient. -6- B. Allocation of Financing Amounts. The Financing is allocated in a single withdrawal tranche, from which the Recipient may make withdrawals of the Financing proceeds. The allocation of the amounts of the Financing to this end is set out in the table below: Allocations Amount of the Financing Allocated (expressed in SDR) (1) Single Withdrawal 180,900,000 Tranche TOTAL AMOUNT 180,900,000 C. Withdrawal Tranche Release Conditions. No withdrawal shall be made of the Single Withdrawal Tranche unless the Association is satisfied: (a) with the Program being carried out by the Recipient; and (b) with the adequacy of the Recipient's macroeconomic policy framework. D. Deposit of Financing Amounts. 1 The Recipient, within thirty (30) days after the withdrawal of the Financing from the Financing Account, shall report to the Association: (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 Bangladeshi Taka equivalent of the Financing proceeds will be credited; (c) the record that an equivalent amount has been accounted for in the Recipient's budget 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 27, 2019. -7- SCHEDULE 2 Repayment Schedule Principal Amount of the Date Payment Due Credit repayable (expressed as a percentage)* On each June 1 and December 1: Commencing on June 1, 2024 to and including 1.65% December 1, 2043. commencing on June 1, 2044 to and including 3.40% December 1, 2048 * The percentages represent the percentage of the principal amount of the Credit to be repaid, except as the Association may otherwise specify pursuant to Section 3.05 (b) of the General Conditions. -8- APPENDIX Section I. Definitions 1. "Bangladesh Labour (Amendment) Act 2018" means the Recipient's Act (Act No. 48 of 2018) passed by the Recipient's Parliament on October 24th, 2018. 2. "Bonded Warehouse" means a secure facility supervised by customs authorities, where dutiable landed imports are stored for the purpose of manufacturing of exportable goods or release on assessment and payment of import duties, taxes, and other charges. 3. "Cabinet of Ministers" means the council of ministers established pursuant to the Recipient's Constitution as the chief executive/decision-making body of the Recipient's government. 4. "Central Accounts Office of Pension and Fund Management" means the Recipient's newly established office created under the Finance Division of the Ministry of Finance, vested with the responsibility of managing the accounts of civil service pensioners from across the Recipient's ministries. 5. "Child Daycare Act 2018" means the Recipient's draft Act sponsored by the Recipient's Ministry of Women and Children Affairs that aims to regulate the licensing and operations of public and private child daycare centers in the Recipient's territory. 6. "Climate Budgeting" means the Recipient's government practice by which the public funds can be aligned and mobilized for the purpose of addressing national climate policy priorities. 7. "Customs Act 2018" means the Recipient's draft Act (Bill No. 58 of 2018), sponsored by the Recipient's Ministry of Finance on behalf of the NBR and placed in Parliament on October 27, 2018, which aims to establish rules and procedures governing the facilitation and regulation of cross-border trade; and collection of customs duties. 8. "General Conditions" means the "International Development Association General Conditions for IDA Financing, Development Policy Financing", dated July 14, 2017. 9. "General Provident Fund" means the Recipient's contributory pension for civil servants, which operates according to the General Provident Fund Rules 1979. 10. "Government Service Pension Fund" means the Recipient's non-contributory pension fund for civil servants. -9- 11. "Ministry of Labour and Employment" means the Recipient's Ministry of Labour and Employment or any successor thereto. 12. "Ministry of Finance" means Recipient's Ministry of Finance or any successor thereto. 13. "Ministry of Women and Children Affairs" means the Recipient's Ministry of Women and Children Affairs or any successor thereto. 14. "National Environmental Policy 2018" means the policy adopted by the Recipient's Cabinet of Ministers on October 2, 2018 comprising a set of actions that aim to protect the environment and its sustainability. 15. "National Board of Revenue (NBR)" means the Recipient's board established through President's Order No. 76 of 1972, vested with the responsibilities of tax administration and formulation of tax policies. 16. "National Skills Development Authority Act 2018" means the Recipient's Act (Act No. 45 of 2018) issued on September 18, 2018 and published in the Official Gazette on October 1, 2018. 17. "One Stop Shop Act 2018" means the Recipient's Act (Act No. 10 of 2018) issued on February 5, 2018 and published in the Official Gazette on February 12, 2018. 18. "Program" means the program of objectives, policies, and actions set forth or referred to in the letter dated November 1, 2018, from the Recipient to the Association declaring the Recipient's commitment to the execution of the Program, and requesting assistance from the Association in support of the Program during its execution and comprising actions taken, including those set forth in Section I of Schedule 1 to this Agreement, and actions to be taken consistent with the Program's objectives. 19. "Scrutiny Committee of the Cabinet of Ministers" means the committee constituted by the Recipient's Cabinet of Ministers to be responsible for further revision of the draft Child Daycare Act 2018, examining its consistency with the Recipient's current legal framework and assessing the merits of proposals for Cabinet of Ministers' approval. 20. "Signature Date" means the later of the two dates on which the Recipient and the Association signed this Agreement and such definition applies to all references to "the date of the Financing Agreement" in the General Conditions. 21. "Single Withdrawal Tranche" means the amount of the Financing allocated to the category entitled "Single Withdrawal Tranche" in the table set forth in Part B of Section II of Schedule 1 to this Agreement. -10- 22. "Wage Earners Welfare Board Act 2018" means the Recipient's Act (Act No. 30 of 2018) issued on July 9, 2018 and published in the Official Gazette on July 29, 2018.