I, I International Bank for Reconstruction and Development I I '. LJ 0 International Development Association International Finance Corporation FOR OFFICIAL USE ONLY FOR For consideration on EXECUTIVE Tuesday, April 28, 1998 DIRECTORS' MEETING M98-21 [Rev.] IDA/M98-21 [Rev.] IFC/M98-11 FROM: The Secretary Apri11S,1998 (~." Minutes of Meeting of the Executive Directors of the Bank and IDA, followed by a Joint Meeting of the Board of Directors of IFC and the Executive Directors of the Bank and IDA held in the Board Room on March 26, 1998 at 2:38 p.m. (These minutes replace those issued on Apri114, 1998. Corrections were made in paragraphs 3 and 4.) 1. There were present: CHAIRMAN J. D. Wolfensohn, President followed by S. Sandstrom, Managing Director EXECUTIVE DIRECTORS AND ALTERNATES ACTING AS EXECUTIVE DIRECTORS S. Ahmed (Alternate) E. Ako-Adjei (Temporary Alternate) K. AI-Aboodi (Alternate) K. AI-Saad J. Amatong A. Bugrov J. Cariaga E. Del Bufalo F. Douamba (Temporary Alternate) A. Elrnanan (Temporary Alternate) L. Good L. Hubloue J. Hutagalung J. Hylewski (Alternate) A. Kamitomai (Alternate) J. Knotnerus (Temporary Alternate) Y-H. Lee Li Yang J-c. Milleron 1. Niemi F. Passacantando , J. Piercy R. Reich (Temporary Alternate) M. Wickstead (Alternate) This document has a restricted distribution and may be used by recipients only in t~~ performance of their official duties. Its contents may not otherwise be disclosed without I World Bank authorization. .-' _ L 2 M98-21 [Rev.] IDA/M98-21 [Rev.] IFC/M98-11 ALTERNATES NOT ACTING AS EXECUTIVE DIRECTORS M.Amr O. Bourges 1. Fernandez De Mesa C. Legg M. Marek E.Miagkov J. Nogues J. Varder Sun Vithespongse ZhaoXiaoyu OFFICERS AND STAFF PARTICIPATING I. Shihata, Senior Vice President J-M. Severino, Vice President, ( . . & General Counsel East Asia & Pacific Zhang Shengman, Secretary A. Rigo, Deputy General Counsel S. Aiyer, Country Director, EACKO R. Holtzmann, Director, HDNSP M. Koch-Weser, Director, LCSES O. Lafourcade, Director, LCGC G. Perry, Director, LCSPR C. Claessens, PREM Z. Qureshi, EACKO B. Sheahan, CLASC, IFC S. Swannack-Nunn, LCC1C P. Young, IMF H. Denton, Corporate Secretariat BANK/IDA BUSINESS Structural Adjustment Loan to Korea ( . \"" ,.. 2. The Executive Directors considered the President's Report and Recommendation (R98-63 dated March 19, 1998) and, with Messrs. Del Bufalo and Knotnerusopposed, approved the Structural Adjustment Loan to the Republic of Korea in the amount of US$2.0 billion on the payment terms and other terms and conditions set out in the President's Report (LOAN APPROVAL NO. 98-9). It was agreed that the approval of this loan, on non-standard terms and conditions, would not constitute" a precedent for future loans to other borrowers. It was also agreed that the Executive Directors would discuss the pricing policy in the near future. Loan to China - East China ijiangsu) Power Transmission Project 3. The Executive Directors approved, with Ms. Piercy abstaining, the loan to the People's Republic of China for an East China Oiangsu) Power Transmission Project in the amount of U5$250.0 million on the payment terms and other terms and conditions set out in the President's Memorandum (R98-47 dated March 6, 1998) (STREAMLINED PROCEDURE LOAN APPROV AL NO. 98-20). 3 M98-21 [Rev.] IDA/M98-21[Rev.] IFC/M98-11 Grant from the Global Environment Facility Trust Fum! and Loan to China - Energy Conservation Project 4. The Executive Directors approved, with Ms. Piercy abstaining, the grant from the Global Environment Facility Trust Fund and the loan to the People's Republic of China for an Energy Conservation Project in the amounts of SDR 16.3 million (US$22 million equivalent) and U5$63.0 million on the payment terms and other terms and conditions set out in the President's Memorandum (R98-43[GEF/R98-4] dated March 5,1998) (STREAMLINED PROCEDURE GEF GRANT APPROVAL NO. 98-4; STREAMLINED PROCEDURE LOAN APPROVAL NO. 98-21). Amendment of Interest Subsidy Fund Resolution 5. The Executive Directors recorded their approval on March 18, 1998 of the recommendation contained in paragraph 4 of the President's Memorandum entitled " Amendment of Interest Subsidy Fund Resolution" (R98-48), and adoption of the following C resolution: RESOLUTION NO. 98-1 AMENDMENT TO RESOLUTION NO. 75-111 iINTEREST SUBSIDY FUND The following secttpn is added to the above-mentioned resolution. References to the "Fun~ mean the Interest Subsidy Fund established in 1975 pursuant to the above-mentioned resolution for the purpose of supplementing interest payments due from borrowers to the International Bank for Reconstruction and Development (the "Bank") on intermediate term loans. References to the "Administrator" mean the Bank in its capacity as administrator of the Interest Subsidy Fund. References to "Contributing Government" mean a m~ber of the Bank that has made a contribution to the Interest Subsidy Fund. ) Section H. Utilization ot'Resources for the HIPC Initiative (a) Any amount of the resources of the Fund that is not required for . intermediate terms loans'may be used in accordance with the provisions of this Section in support of the HIPC Debt Initiative through the HIPC Debt Initiative Trust Fund (the HIPC Trust Fund) established under Resolution Nos. 96-9 and IDA 96-5 adopted by the Executive Directors of the Bank and the International Development Association (the Association). (b) The Administrator will notify each Contributing Government of the amount of the resources of the Fund that is not required for intermediate term loans and the proportion of that amount that is attributable to the contribution of such Contributing Government. The Administrator shall make such 4 M98-21 [Rev.] IDA/M98-21 [Rev.} IFC/M98~11 determinations on a pro rata basis, based on the present value of the contributions of the Contributing Governments, as determined by the Administrator. (c) A Contributing Government, if it so wishes, may instruct the Administrator to use all or a portion of the Contributing Government's share of the resources that are not required for intermediate term loans for the HIPC Initiative by delivering a notification to that effect, in form and substance satisfactory to the Administration. Such notification may either instruct the Administrator to retain such resources in the Fund and to use them in support of multilateral debt relief under the HIPC Initiative in the manner specified in the notification or to transfer them to the HIPC Debt Initiative Trust Fund (the ­ .., . ( HIPC Trust Fund) established under Resolution Nos. 96-9 and IDA 96-5 adopted by the Executive Directors of the Bank and the International Development Association (the Association) for use in the manner specified in the notification. In the latter case, the Administrator shall transfer to the HIPC Trust Fund the amount of the resources specified in the notification. (d) This Section shall become effective upon receipt by the Administrator and the Association of a notification from any Contributing Government pursuant to paragraph (c) of this Section. Farewell to Mr. Varder 6. The Chairman made the customary presentation to Mr. Varder on the expiration of his f(f,'" term of service. The Executive Directors noted their appreciation of his services and tendered ~~W him good wishes for the future. Date of Next Meeting 7. It was agreed to hold a meeting of the Executive Directors of the Bank and IDA on March 31, 1998. BANK/IFC BUSINESS Mexico - Country Assistance Strategy 8. The Executive Directors of the Bank and the Board of Directors of IFC discussed the joint IBRD/IFC Country Assistance Strategy for Mexico (R98-49[IFC/R98-30) dated March 6, 1998). (The Chairman's Concluding Remarks were subsequently distributed as SecM98-230[IFC/SecM98-17].) 5 M98-21 [Rev.] IDA/M98-21[Rev. ] IFC/M98-11 Adjournment 9. The meeting recessed at 5:02 p.m., reconvened at 6:02 p.m. and adjourned at 6:50 p.m. Distribution: Executive Directors and Alternates President Bank Group Senior Management Vice Presidents, Bank, !Fe and MIGA Directors and Department Heads, Bank, IFC and MIGA