LOAN NUMBER 9460-SC Loan Agreement (Seychelles Second Fiscal Sustainability and Climate Resilience Development Policy Loan) between REPUBLIC OF SEYCHELLES and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT LOAN AGREEMENT AGREEMENT dated as of the Signature Date between REPUBLIC OF SEYCHELLES (“Borrower”) and 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 under the Program and which are described in Section I A of Schedule 1 to 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 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 — LOAN 2.01. The Bank agrees to lend to the Borrower the amount of twenty-five million Dollars (USD 25,000,000) 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 January 15 and July 15 in each year. 2.06. The principal amount of 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 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 III — 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 1 to this Agreement. ARTICLE IV — REMEDIES OF THE BANK 4.01. The Additional Event of Suspension consists of the following: 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: 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. ARTICLE VI — REPRESENTATIVE; ADDRESSES 6.01. The Borrower’s Representative is its minister responsible for finance, national planning and trade. 6.02. For purposes of Section 10.01 of the General Conditions: (a) the Borrower’s address is: P.O. Box 313  Liberty House  Victoria, Mahè   Seychelles; and (b) the Borrower’s Electronic Address is: Facsimile: E-mail: 248-432 5161 minister@finance.gov.sc  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: 248423(MCI) or 1-202-477-6391 64145(MCI) AGREED as of the Signature Date. REPUBLIC OF SEYCHELLES By _____________________________________/s1/ Authorized Representative Naadir Nigel Hamid Hassan Name: __________________________/n1/ Minister Title: __________________________/t1/ 23-Dec-2022 Date: __________________________/d1/ INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By _____________________________________/s2/ Authorized Representative Idah Z. Pswarayi-Riddihough Name: __________________________/n2/ Country Director for Mozambique, Madagasc Title: __________________________/t2/ 22-Dec-2022 Date: __________________________/d2/ SCHEDULE 1 Program Actions; Availability of Loan Proceeds Section I. Actions under the Program A. Actions Taken Under the Program. The actions taken by the Borrower under the Program include the following: 1. To strengthen government oversight over public enterprises, the Borrower through its Cabinet of Ministers has submitted to its National Assembly the Public Enterprises Bill, 2022, including implementing provisions, which aims to improve performance monitoring, to ensure appropriate oversight, of public enterprises for better service delivery, transparency, and accountability. 2. To modernize international business tax policy and implementation of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting, the Borrower through its Ministry of Finance, National Planning and Trade, has published in the Government Gazette, the Business Tax (Amendment) Bill, 2022, which includes transfer pricing provisions, which regulate the use of the arm’s length principle to control transfer-price manipulation. 3. To foster resilient development, the Borrower, through the Seychelles Planning Authority within the Ministry of Lands and Housing has adopted and published on the website of the Seychelles Planning Authority, Guidelines which serve as a roadmap to integrate hazard and climate risks in land use plans utilized to determine the use of Seychelle’s land area in accordance with the Physical Planning Act, 2021. 4. To ensure the privacy of consumer credit information and protect the interests of financial consumers, the Borrower, through its National Assembly has enacted the Financial Consumer Protection Act, 2022, which is aimed at fairly, reasonably, and effectively handling financial consumer disputes to promote development of the financial sector. 5. To enhance competition and ensure an open and non-discriminatory access regime in the information, communication and technology industry (“ICT”), the Borrower, through its Cabinet of Ministers has submitted to the National Assembly the Communications Bill, 2022, which make provisions for the creation of an independent ICT regulator (Seychelles Communications Regulatory Authority) to regulate competition in the ICT industry. 6. To promote the long-term sustainability of fishing in Seychelles, the Borrower through its Ministry of Fisheries and Blue Economy, has published in the Government Gazette the Fisheries (Mahé Plateau Trap and Line Fishery) Regulations, 2021, which are aimed at facilitating implementation of the Seychelles Mahé Plateau Trap and Line Fishery Co- management Plan and also prescribe measures for the proper management of fisheries. 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: (i) the Front-end Fee and (ii) 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 Tranche Allocated (expressed in USD) (1) Single Withdrawal Tranche 24,937,500 (2) Front-end Fee 62,500 (3) Amount due pursuant to Section 0 4.05 (c) of the General Conditions TOTAL AMOUNT 25,000,000 C. Withdrawal Tranche Release Conditions. 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. D. Deposit of Loan Amounts. 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 Seychelles Rupee equivalent of the Loan proceeds will be credited; (c) the record that an equivalent amount has been accounted for in the Borrower’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 March 15,2024. SCHEDULE 2 Commitment-Linked Amortization Repayment Schedule The following table sets forth the Principal Payment Dates of the Loan and the percentage of the total principal amount of the Loan payable on each Principal Payment Date (“Installment Share”). Level Principal Repayments Principal Payment Date Installment Share On each January 15 and July 15 Beginning January 15, 2028 through July 15, 2037 5% APPENDIX Definitions 1. “Business Tax (Amendment) Bill, 2022” means the Borrower’s Business Tax (Amendment) Bill, 2022. 2. “Cabinet of Ministers” means the Borrower’s Cabinet of Ministers responsible for formulating government policies and advising the President of the Republic of Seychelles. 3. “Communications Bill” means the Borrower’s Communications Bill No. 16 of 2022. 4. “Financial Consumer Protection Act, 2022” means the Borrower’s Financial Consumer Protection Act 6 of 2022. 5. “Fisheries (Mahé Plateau Trap and Line Fishery) Regulations, 2021” means the Borrower’s Fisheries (Mahé Plateau Trap and Line Fishery) Regulations S.I. 77 of 2021. 6. “General Conditions” means the “International Bank for Reconstruction and Development General Conditions for IBRD Financing, Development Policy Financing”, dated December 14, 2018 (revised on August 1, 2020, December 21, 2020, April 1, 2021, and January 1, 2022) 7. “Guidelines” means the Guidelines for Hazard Sensitive Land Use Plan dated October 19, 2022 and published on the website of the Borrower’s Seychelles Planning Authority on November 17, 2022. 8. “Ministry of Finance, National Planning and Trade” means the Borrower’s Ministry of Finance, National Planning and Trade. 9. “Ministry of Fisheries and Blue Economy” means the Borrower’s Ministry of Fisheries and Blue Economy, or any successor thereto. 10. “Ministry of Land and Housing” means the Borrower’s Ministry of Land and Housing, or any successor thereto. 11. “Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting” means the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting ratified by the Borrower on June 23, 2021 and entered into force on April 1, 2022. 12. “National Assembly” means the Borrower’s Parliament. 13. “Program” means: the program of objectives, policies, and actions set forth or referred to in the letter dated November 11, 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 1 to this Agreement, and actions to be taken consistent with the program’s objectives. 14. “Physical Planning Act, 2021” means the Borrower’s Physical Planning Act 55 of 2021. 15. “Public Enterprises Bill, 2022” means the Borrower’s Public Enterprise Bill of 2022. 16. “Seychelles Communications Regulatory Authority” means the Borrower’s Communications Regulatory Authority to be established pursuant to the Communications Bill, 2022, to regulate competition in the information, communications and technology industry. 17. “Seychelles Mahé Plateau Trap and Line Fishery Co-management Plan” means the Seychelles Mahé Plateau Trap and Line Fishery Co-management Plan published in Government Notice No.68 of 2020. 18. “Seychelles Planning Authority” means the Borrower’s Planning Authority mandated under the Town and Country Planning Act Cap 237, to enforce the Physical Planning Act and its regulations. 19. “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 Loan Agreement” in the General Conditions.