OFFICIAL DOCUMENTS LOAN NUMBER 9402-MA Loan Agreement (Strengthening Human Capital for a Resilient Morocco Development Policy Loan) between KINGDOM OF MOROCCO and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT LOAN NUMBER 9402-MA LOAN AGREEMENT AGREEMENT dated as of the Signature Date between KINGDOM OF MOROCCO ("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 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 four hundred seventy-three million three hundred thousand Euro (EUR 473,300,000), 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 April 1 and October 1, 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 11 as the Bank may, from time to time, reasonably request. -2- 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- EFFECTIVENESS; TERMINATION 4.01. The Additional Condition of Effectiveness consists of the following, namely, that 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. 4.02. The Effectiveness Deadline is the date ninety (90) days after the Signature Date. ARTICLE V - REPRESENTATIVE; ADDRESSES 5.01. The Borrower's Representative is the Minister in charge of finances. 5.02. For purposes of Section 10.01 of the General Conditions: (a) the Borrower's address is: Ministkre de l'Econonie et des Finances Quartier Administratif Avenue Mohammed V Rabat Kingdom of Morocco; and (b) the Borrower's Electronic Address is: -3- Cable address: Facsimile: MINFIN (+212) 537 67 75 30/31 (+212) 537 76 40 81 5.03. 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) -4- AGREED as of the Signature Date. KINGDOM OF MOROCCO By: Authorized Represent ive Name: Title: Date: A INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By: A horized Representative Name: Ti tle:Cctdy0ctv Date:.O /Z/ t -5- SCHEDULE 1 Program Actions; Availability of Loan Proceeds Section 1. Actions under the Program A. Actions Taken Under the Program. The actions taken by the Borrower under the Program include the following: Pillar 1. Improving Protection Against Health Risks 1 (a) To extend mandatory health insurance coverage to workers under the professional unique contribution and auto-entrepreneur regimes, the Borrower has promulgated Law No. 30-21 amending and completing Law No. 98-15 which governs, inter alia, the mandatory health insurance ("AMO") coverage of professionals, independent workers and non-salaried persons exercising a liberal activity ("TNS"), as Law No. 30-21, published in the Official Gazette No. 7056, dated January 13, 2022. (b) To operationalize the expansion of the AMO for TNS, the Borrower has adopted Decree No. 2.21.930 modifying and completing Decree No. 2.18.622 defining the list of professional categories subject to the AMO regime, including those employed in the agriculture and tourism sectors who are the most vulnerable to climate change, as said Decree has been published in the Official Gazette No. 7043 bis dated November 29, 2021. (d) To enroll approximately three million three hundred thousand TNS into AMO, including approximately one million six hundred thousand farmers due to high climate-vulnerability of the agriculture sector, the Borrower has adopted and published several Decrees implementing Law 98-15 as amended and complemented by Law No. 30-21. 2. To oversee and coordinate the health and social protection reforn, the Borrower has created an inter-ministerial steering committee, which includes a technical committee, pursuant to Decree No. 2.21.532 published in the Official Gazette No, 7043 Bis dated November 29, 2021, 3. To gradually reduce greenhouse gas emissions from health facilities to zero by 2050 and to improve the resilience of the health system to climate change, the Borrower has made a formal commitment to the COP26 pursuant to the Ministry of Health and Social Protection's letter to the COP26 Chair dated November 12, 2021 and has established a steering committee to implement it pursuant to Ministry of Health and Social Protection's Decision No. 6521 dated May 6, 2022. -6- 4. (a) To enhance human resources and enable the establishment of a health service, the Borrower has exempted health workers from the Statute of the Civil Service pursuantto the promulgation of Law No. 39-21 completing Dahir 1.58.008 published in the Official Gazette No. 7007, dated July 26, 2021. (b) To increase the availability of doctors, the Borrower has promulgated Law No. 33-21 modifying and supplementing Law No. 131-13 governing the, practice of medicine, so as to allow foreign doctors to practice medicine in Morocco, as Law No. 33-21 has been published in the Official Gazette No. 7010, dated August 8, 2021. Pillar II. Improving Protection of Human Capital in Childhood and Against Poverty in Old Age I1. To provide the legal framework for the health and social protection reform and to mandate the expansion of an adaptable and climate-smart health and social protection system, the Borrower has promulgated Framework Law No. 09-21 published in the Official Gazette No. 6975 dated April 27, 2021. 2. (a) To expand pension coverage for workers under the professional unique contribution and auto-entrepreneur regimes, the Borrower has promulgated Law No. 31-21 amending and completing Law no. 99-15 which governs, inter alia, the pension regime for TNS, as Law. No. 31-21 has been published in the Official Gazette No. 7056, dated January 13, 2022, (b) To operationalize the expansion of the pension system for TNS, the Borrower has adopted Decree No. 2.21.930 modifying and completing Decree No. 2.18.622 defining the list of professional categories subject to the pension system, including those employed in the agriculture and tourism sectors who are the most vulnerable to climate change, as Decree No. 2.21.930 has been published in the Official Gazette No. 7043 bis dated November 29, 2021. (c) To enable the enrolment into the pension regime of approximately three million three hundred thousand TNS, including approximately one million six hundred thousand farmers, all subject to high climate-vulnerability, the Borrower has adopted and published several Decrees implementing amended Law 99-15. (d) To improve the sustainability of the pension schemes and the viability of the contributory social protection system, the Borrower has launched the parametric reform of the collective retirement pension scheme ("RCAR"), modifying, particularly, the rate of revaluation of the pensions, pursuant to the Decrees No. 2.20.935 and 2.20.936 dated July 27, 2021 amending and supplementing respectively Decrees No. 2.77.551 and No. 2.92.927 setting forth the terms of application of the RCAR, published in the Official Journal No. 7014 dated August 19, 2021. -7- Pillar Ill. Improving Climate Risk Management and Resilience Against Catastrophic Events 1 (a) To improve disaster and climate resilience at the local level, the Borrower has mandated the establishment of disaster risk management units at the level of prefectures, provinces, districts and pashaliks pursuant to the Ministry of Interior's Circular dated April 1, 2021. (b) To implement the emergency program launched by the Borrower on February 17, 2022 to mitigate the effects of the 2021-2022 drought rainfall deficits in the agriculture sector, and more particularly its first axis which objective is to protect the farmers: (i) a convention was signed between the Ministry of Economy and Finance, the Ministry of Agriculture, Maritime Fisheries, Rural Development and Water and Forests ("MAMFRD") and the Fund Hassan II approving the terms and conditions of the funding approved for the implementation of this "axis" on February 24, 2022; and (ii) a joint circular was issued by the Ministry of Interior and MAMFRD detailing the procedures for the distribution of subsidized animal feed on February 26, 2022. Section IL 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 the Front-end Fee. The allocation of the amounts of the Loan to this end is set out in the table below: Amount of the Loan . Allocated AllocationsAloae (Expressed in EIJR) (1) Single Withdrawal Tranche 472,116,750 (2) Front-end Fee 1,183,250 TOTAL AMOUNT 473,300,000 -8- 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. Closing Date. The Closing Date is June 30, 2023. -9- SCHEDULE Z Amortization 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"). Principal Payment Date Installment Share On each April 1 and October 1: Beginning April 1, 2027, through April 1, 3.52% 2035 Beginning October 1, 2035, through April 2.77% 1,2042 On October 1, 2042 1.38% - 10- APPENDIX Definitions 1. "AMO" means Assurance maladie obligatoire, the Borrower's mandatory health insurance. 2. "CNSS" means Caisse nationale de la sicurit sociale, the Borrower's National Social Security Fund. 3. "Decrees" means the Borrower's Decrees No. 2.21.368, 2.21.369, 2.20.803, 2.21290, 2.21.52% 2.21.530, 2.21.528, 2.21.752, 2.21.750, 2.21.749, 2.21.751, 2.21,928, 2.21.970, 2.21.971, 2.21.1020, 2.21.1019, 2.21.1018. 4. "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). 5. "Official Gazette" means the Borrower's Bulletin Officiel. 6. "Program" means the program of objectives, policies, and actions set forth or referred to in the letter dated May 5, 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 I to this Agreement, and actions to be taken consistent with the program's objectives. 7. "RAMED" means Rdgine d'assistance m9dicale, the Borrower's medical assistance scheme which provides health insurance coverage free of charge to poor and vulnerable households. 8. "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. 9. "Single Withdrawal Tranche" means the amount of the Loan allocated to the category entitled "Single Withdrawal Tranche" in the table set forth in Part B of Section II of Schedule I to this Agreement. 10. "TNS" means professionals, independent workers and non-salaried persons exercising a liberal activity.