OFFICIAL
DOCUMENTS
GRANT NUMBER D086-SB
Financing Agreement
(Additional Financing For Rapid Employment Project)
between
Solomon Islands
and
INTERNATIONAL DEVELOPMENT ASSOCIATION
Dated                , 2015


FINANCING AGREEMENT
AGREEMENT dated        (0, 2015, entered into between
SOLOMON ISLANDS ("Recipient") and INTERNATIONAL DEVELOPMENT
ASSOCIATION ("Association") for the purpose of providing additional financing for
activities related to the Original Project (as defined in the Appendix to this Agreement).
This Agreement: (i) sets out the terms and conditions related to the Additional
Financing for the Rapid Employment Project; and (ii) amends specific provisions of the
Original Financing Agreement (as such term is defined in the Appendix to this Agreement).
The Recipient and the Association hereby agree as follows:
ARTICLE I - GENERAL CONDITIONS; DEFINITIONS
1.01.  The General Conditions (as defined in the Appendix to this Agreement) constitute
an integral part of this Agreement.
1.02.  Unless the context requires otherwise, the capitalized tenns 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, on the terms and conditions set
forth or referred to in this Agreement, a grant in an amount equivalent to one
million one hundred thousand Special Drawing Rights (SDR 1,100,000)
("Financing") to assist in financing the project described in Schedule 1 to this
Agreement ("Project").
2.02.  The Recipient may withdraw the proceeds of the Financing in accordance with
Section IV of Schedule 2 to this Agreement.
2.03.  The Maximum Commitment Charge Rate payable by the Recipient on the
Unwithdrawn Financing Balance shall be one-half of one percent (1/2 of 1%) per
annum.
2.04.  The Payment Dates are May 15 and November 15 in each year.
2.05.  The Payment Currency is Dollar.


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ARTICLE III - PROJECT
3.01.  The Recipient declares its commitment to the objectives of the Project. To this
end, the Recipient shall carry out: (i) Part 1(A) of the Project through MID;
(ii) Parts 1(B) and 2 of the Project through HCC; and (iii) Part 3 of the Project
jointly through MID and HCC; all in accordance with the provisions of Article IV
of the General Conditions.
3.02.  Without limitation upon the provisions of Section 3.01 of this Agreement, and
except as the Recipient and the Association shall otherwise agree, the Recipient
shall ensure that the Project is carried out in accordance with the provisions of
Schedule 2 to this Agreement.
ARTICLE IV - EFFECTIVENESS; TERMINATION
4.01.  The Effectiveness Deadline is the date ninety (90) days after the date of this
Agreement.
4.02.  For purposes of Section 8.05 (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 date of this
Agreement.
ARTICLE V - REPRESENTATIVE; ADDRESSES
5.01.  The Recipient's Representative is the Minister for Finance and Treasury.
5.02.  The Recipient's Address is:
Ministry of Finance and Treasury
P.O. Box 26
Honiara, Solomon Islands
Facsimile:
677-27855
5.03.  The Association's Address is:
International Development Association
1818 H Street, N.W.
Washington, D.C. 20433


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United States of America
Cable:              Telex:             Facsimile:
INDEVAS             248423 (MCI)       1-202-477-6391
Washington, D.C.
AGREED at                         ,                    as of
the day and year first above written.
SOLOMON ISLANDS
By
Authorized Representative
Name: Wt       _v_          _
Title:
INTERNATIONAL DEVELOPMENT ASSOCIATION
By
R.
Authorized Representative
Name: FR 4A/7   P. Dk    EQ9       A
Title: C40AATIt Y Z>ROC7OR EA<AJC


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SCHEDULE 1
Project Description
The objective of the Project is to assist targeted vulnerable urban populations in
the Recipient's territory to: (i) increase their incomes through the provision of short term
employment; (ii) improve their knowledge, experience and basic employment skills that
are valued in the workplace and society; and (iii) improve their access to services and
markets through repaired, more climate resilient roads and access infrastructure.
The Project consists of the Original Project and the following additional part:
Part 1 (A) (iii) Improvement and maintenance of urban and peri-urban roads in and
around Honiara.


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SCHEDULE 2
Project Execution
Section I.    Implementation Arran2ements
A.     Project Steering Committee
The Recipient shall maintain throughout the period of Project implementation, the
Project Steering Committee with functions and composition satisfactory to the
Association, including senior representatives of MID, HCC, Ministry of Finance
and Treasury, the Ministry of Development Planning and Aid Coordination, and
other senior officials of key ministries, stakeholders, agencies and institutions. The
Project Steering Committee shall be responsible for overall strategic guidance and
policy direction.
B.     Technical Coordination Committee
The Recipient shall maintain throughout the period of Project implementation, the
Technical Coordination Committee with functions and composition satisfactory to
the Association, including department heads of MID, of HCC, a representative of
the consultant hired under Part 2 of the Project, and representatives of other key
stakeholders, agencies and institutions.
C.     Project Operations Manual
The Recipient shall implement the Project (including Sub-Projects) in accordance
with the provisions of the Project Operations Manual.
D.     Financial and Accounting Procedures
The Recipient shall implement activities under the Project (including Sub-
Projects) through HCC and MID in accordance with the provisions of the Financial
Management Manual.
E.     Environmental and Social Management Guidelines
The Recipient shall ensure that the Project (including Sub-Projects) is
implemented in accordance with the provisions of the Environmental and Social
Management Guidelines.
F.     Anti-Corruption
The Recipient shall ensure that the Project is carried out in accordance with the
provisions of the Anti-Corruption Guidelines.


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G.     Sub-Grants to Community Groups
1.     The Recipient (through HCC) shall provide each Sub-Grant to a Community
Group: (i) in accordance with the eligibility and selection criteria, disbursement,
financial management, monitoring and other relevant provisions set forth in the
Project Operations Manual; and (ii) pursuant to an agreement to be entered into
between the Recipient (through HCC) and such Community Group (Sub-Project
Agreement) containing terms and conditions satisfactory to the Association, which
shall include the provisions set forth in Schedule 3 to this Agreement.
2.     The Recipient (through HCC) shall exercise its rights in relation to each such Sub-
Grant provided to a Community Group under a Sub-Project Agreement in such
manner as to: (i) protect the interests of the Recipient and the Association;
(ii) comply with its obligations under this Agreement; and (iii) achieve the
purposes of the Project. Except as the Association shall otherwise agree, the
Recipient (through HCC) shall not assign, amend, abrogate or waive any Sub-
Project Agreement or any of its provisions.
Section II.   Project Monitoring, Reporting and Evaluation
A.     Project Reports
The Recipient shall monitor and evaluate the progress of the Project and prepare Project
Reports in accordance with the provisions of Section 4.08 of the General Conditions and
on the basis of indicators agreed with the Association. Each Project Report shall cover the
period of one (1) calendar quarter, and shall be furnished to the Association not later than
forty-five (45) days after the end of the period covered by such report.
B.     Financial Management, Financial Reports and Audits
1.     The Recipient shall maintain or cause to be maintained a financial management
system in accordance with the provisions of Section 4.09 of the General
Conditions.
2.     Without limitation on the provisions of Part A of this Section, the Recipient shall
prepare and furnish to the Association as part of the Project Report not later than
forty-five (45) days after the end of each calendar quarter, interim unaudited
financial reports for the Project covering the quarter, in form and substance
satisfactory to the Association.
3.     The Recipient shall have its Financial Statements audited in accordance with the
provisions of Section 4.09 (b) of the General Conditions. Each audit of the
Financial Statements shall cover the period of one (1) fiscal year of the Recipient.
The audited Financial Statements for each such period shall be furnished to the
Association not later than six (6) months after the end of such period.


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Section HI.   Procurement
A.     General
1.     Goods, Works and Non-consulting Services. All goods, works and non-
consulting services required for the Project and to be financed out of the proceeds
of the Financing shall be procured in accordance with the requirements set forth or
referred to in Section I of the Procurement Guidelines, and with the provisions of
this Section.
2.     Consultants' Services. All consultants' services required for the Project and to
be financed out of the proceeds of the Financing shall be procured in accordance
with the requirements set forth or referred to in Sections I and IV of the Consultant
Guidelines, and with the provisions of this Section.
3.     Definitions. The capitalized terms used below in this Section to describe particular
procurement methods or methods of review by the Association of particular
contracts, refer to the corresponding method described in the Procurement
Guidelines, or Consultant Guidelines, as the case may be.
B.     Particular Methods of Procurement of Goods, Works and Non-consulting
Services
1.     International Competitive Bidding. Except as otherwise provided in paragraph
2 below, goods, works and non-consulting services shall be procured under
contracts awarded on the basis of International Competitive Bidding.
2.     Other Methods of Procurement of Goods, Works and Non-consulting
Services. The following table specifies the methods of procurement, other than
International Competitive Bidding, which may be used for goods, works and non-
consulting services. The Procurement Plan shall specify the circumstances under
which such methods may be used:
Procurement Method
(a) National Competitive Bidding, subject to the additional procedures set out
in Schedule 4 to this Agreement
(b) Shopping
(c) Direct Contracting


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C.     Particular Methods of Procurement of Consultants' Services
1.     Quality- and Cost-based Selection. Except as otherwise provided in paragraph
2 below, consultants' services shall be procured under contracts awarded on the
basis of Quality- and Cost-based Selection.
2.     Other Methods of Procurement of Consultants' Services. The following table
specifies methods of procurement, other than Quality- and Cost-based Selection,
which may be used for consultants' services. The Procurement Plan shall specify
the circumstances under which such methods may be used.
Procurement Method
(a) Selection under a Fixed Budget
(b) Selection Based on Consultants' Qualifications
(c) Single-Source Selection
(d) Procedures set forth in paragraphs 5.2 and 5.3 of the Consultant Guidelines
for the Selection of Individual Consultants
(e) Sole Source Procedures for the Selection of Individual Consultants
D.     Review by the Association of Procurement Decisions
The Procurement Plan shall set forth those contracts which shall be subject to the
Association's Prior Review. All other contracts shall be subject to Post Review by
the Association
Section IV.   Withdrawal of the Proceeds of the Financing
A.     General
1.     The Recipient may withdraw the proceeds of the Financing in accordance with the
provisions of Article II of the General Conditions, this Section, and such additional
instructions as the Association shall specify by notice to the Recipient (including
the "World Bank Disbursement Guidelines for Projects" dated May 2006, as
revised from time to time by the Association and as made applicable to this
Agreement pursuant to such instructions), to finance Eligible Expenditures as set
forth in the table in paragraph 2 below.
2.     The following table specifies the categories of Eligible Expenditures that may be
financed out of the proceeds of the Financing ("Category"), the allocations of the


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amounts of the Financing to each Category, and the percentage of expenditures to
be financed for Eligible Expenditures in each Category:
Percentage of
Amount of the          Expenditures
Financing Allocated      to be Financed
Category           (expressed in SDR)     (Inclusive of Taxes)
(1) Sub-Grants (incurred           0            100% of amounts
by HCC)                                      disbursed
(2) Works (incurred by          360,000                 100%
MID)
(3) (i) Goods, Training,        380,000                 100%
Consultants' Services
and Incremental
Operating Costs
(incurred by MID)
(ii) Goods, Training,        360,000                 100%
Consultants' Services
and Incremental
Operating Costs
(incurred by HCC)
TOTAL AMOUNT                    1,100,000
B.     Withdrawal Conditions; Withdrawal Period
1. Notwithstanding the provisions of Part A of this Section, no withdrawal shall be
made for payments made prior to the date of this Agreement.
2.     The Closing Date is December 31, 2016.


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SCHEDULE 3
Terms and Conditions of
Sub-Project Agreements
Except as the Association shall otherwise agree, in order to provide a Sub-Grant
to a Community Group, the Recipient shall enter into a written agreement with such
Community Group (Sub-Project Agreement), pursuant to which the Recipient shall obtain
rights adequate to protect the interests of the Recipient and the Association, including the
right to:
(i)    Require the Community Group to carry out the Sub-Project for which the
Sub-Grant is made:
(a)    with due diligence and efficiency;
(b)    in accordance with sound technical, economic, financial,
managerial, environmental and social standards; and
(c)    in accordance with the provisions of the Project Operations
Manual, the Environmental and Social Management Guidelines,
and the Anti-Corruption Guidelines.
(ii)   Require the Community Group to provide, promptly as needed, the
resources required for the Sub-Project.
(iii)  Require the Community Group to:
(a)    maintain records and accounts adequate to reflect the operations,
resources and expenditures related to the Sub-Project; and
(b)    at the Recipient's or the Association's request, have such records
and accounts audited by independent auditors acceptable to the
Association, in accordance with consistently applied auditing
standards acceptable to the Association, and promptly furnish the
records and accounts as so audited to the Recipient and the
Association.
(iv)   Require the Community Group to procure the goods, works and services
to be financed out of the proceeds of the Sub-Grant in accordance with the
provisions of Section III of Schedule 2 to the Financing Agreement.
(v)    Require the Community Group to enable the Recipient and the Association
to inspect the Sub-Project, its operation and any relevant records and
documents.


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(vi)   Require the Community Group to prepare and furnish to the Recipient and
the Association all such information as they shall reasonably request
relating to the foregoing.
(vii)  Suspend or terminate the right of the Community Group to use the
proceeds of the Sub-Grant, or obtain a refund of all or any part of the
amount of the Sub-Grant then withdrawn, upon the Community Group's
failure to perform any of its obligations under the Sub-Project Agreement.


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SCHEDULE 4
Special Procedures for National Competitive Bidding in Solomon Islands
The procedure to be followed for National Competitive Bidding shall be those set forth in
the provisions on competitive bidding in the Interim Financial Instructions 2014, Chapter
7 (Supply Chain Management) issued by the Ministry of Finance with modifications set
forth below in order to ensure economy, efficiency and transparency and broad consistency
with the provisions of Section I of the "Guidelines for Procurement under IBRD Loans and
IDA Credits" published by the Association in January 2011 and revised July 2014 (the
Guidelines), as required by paragraphs 3.3 and 3.4 of the Guidelines.
Eligibility
1. The eligibility of bidders shall be defined under Section I of the Association's
Guidelines; accordingly, no bidder or potential bidder shall be declared ineligible
for contracts financed by the Association for reasons other than those provided in
Section I of the Guidelines. Foreign bidders shall be eligible to participate in
bidding under the same conditions as national bidders. In particular, no domestic
preference over foreign bidders shall be granted to national bidders in bid
evaluation, nor shall foreign bidders be asked or required to form joint ventures
with national bidders in order to submit a bid.
Registration
2. Registration shall not be used to assess bidders' qualifications. A foreign bidder
shall not be required to register as a condition for submitting its bid and, if
determined to be the lowest evaluated responsive bidder, shall be given reasonable
opportunity of registering, without any let or hindrance. The registration process
shall not be applicable for Sub-contractors. Bidding shall not be restricted to any
particular class of contractors, and non-classified contractors shall also be eligible
to bid.
Advertising; Time for Bid Preparation
3. Invitations to bid shall be advertised in at least one newspaper of national
circulation, allowing a minimum of thirty (30) days for the preparation and
submission of bids shall be allowed except for commodities and small goods
contract. Potential bidders shall be allowed to purchase bidding documents up to
any time prior to the deadline for submission of bids.
Standard Bidding Documents
4. Standard Bidding Documents, acceptable to the Association, shall be used.


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Qualification Criteria
5. Qualification criteria shall be clearly specified in the bidding documents, and all
criteria so specified, and only such specified criteria, shall be used to determine
whether a bidder is qualified. Qualification shall be assessed on a pass or fail basis
and merits points shall not be used. Such assessment shall only take into account
the bidder's capacity and resources to perform the contract, specifically its
experience and past performance on similar contracts, capabilities with respect to
personnel, equipment and construction and manufacturing facilities, and financial
capacity. The evaluation of the bidder's qualifications shall be conducted
separately from the technical and commercial evaluation of the bid.
Bid Submission, Bid Opening and Bid Evaluation
6. Bidders may submit bids, at their option, either in person or by courier service or
by mail. Bids shall be opened in public, immediately after the deadline for
submission of bids. Bids received after the deadline for bid submission shall be
rejected and returned to the bidders unopened.
7. All bidding for goods and works shall be carried out through a one-envelope
procedure.
8. Evaluation of bids shall be made in strict adherence to the criteria that shall be
clearly specified in the bidding documents and quantified in monetary terms for
evaluation criteria other than price; merit points shall not be used in bid evaluation.
9. A contract shall be awarded to the technically responsive bid that offers the lowest
evaluated price and no negotiations shall be permitted.
10. Bidders shall not be eliminated from detailed evaluation on the basis of minor,
non-substantial deviations.
11. No bidder shall be rejected on the basis of a comparison with the employer's
estimate and budget ceiling without the Association's prior concurrence.
12. A copy of the minutes of the public bid opening shall be promptly provided to all
bidders, and to the Association with respect to contracts subject to prior review.
Rejection of All Bids and Re-Bidding
13. Neither shall all bids be rejected nor new bids solicited without the Association's
prior written concurrence.


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Extension of the Validity of Bids
14. Extension of validity of bids may be allowed in exceptional circumstances but
there shall be no amendment of the price or any other condition of the bids. Bidders
may refuse such an extension without forfeiting their bid securities, but bidders
granting an extension shall provide extension of the validity of their bid securities.
Complaints by Bidders and Handling of Complaints
15. The Recipient shall establish and implement an effective and independent protest
mechanism allowing bidders to protest and to have their protests handled in a
timely manner.
Fraud and Corruption
16. The Association shall declare a firm or individual ineligible, either indefinitely or
for a stated period, to be awarded a contract financed by the Association, if it at
any time determines that the firm or individual has, directly or through an agent,
engaged in corrupt, fraudulent, collusive, coercive or obstructive practices in
competing for, or in executing, a contract financed by the Association.
Right to Inspect/ Audit
17. Each bidding document and contract financed from the proceeds of a Financing
shall include a provision requiring bidders, suppliers, contractors and
subcontractors to permit the Association at its request, to inspect their accounts
and records relating to the bid submission and performance of the contract and to
have said accounts and records audited by auditors appointed by the Association.
The deliberate and material violation by the bidder, supplier, contractor or
subcontractor or such provision may amount to obstructive practice.


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APPENDIX
Definitions
1.     Anti-Corruption Guidelines" means the "Guidelines on Preventing and Combating
Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and
Grants", dated October 15, 2006, and revised in January 2011.
2.     "Category" means a category set forth in the table in Section IV of Schedule 2 to
this Agreement.
3.     "Community Group" means each community group organized at the local level
and responsible for carrying out a Sub-Project using a Sub-Grant on terms and
conditions set out in a Sub-Project Agreement.
4.     "Consultant Guidelines" means the "Guidelines: Selection and Employment of
Consultants under IBRD Loans and IDA Credits and Grants by World Bank
Borrowers" dated January 2011 (revised July 2014).
5.     "Environmental and Social Management Guidelines" means the Environmental
and Social Management Guidelines prepared and adopted by the Recipient, and
updated and redisclosed in Infoshop on April 22, 2014, and referred to in Section
I of Schedule 2 to this Agreement, setting out, inter alia, policies and procedures
for the screening and management of environmental and social impacts of
activities to be carried out under the Project (including Sub-Projects), and
including Environmental Management Plans for specific types of activities and a
Resettlement Policy Framework for land acquisition and resettlement, as the same
may be amended from time to time with the agreement of the Association.
6.     "Financial Management Manual" means the manual prepared and adopted by the
Recipient and referred to in Section I of Schedule 2 to this Agreement, setting out,
inter alia, details of financial management procedures for the Project.
7.     "Fiscal Year" or "FY" means the twelve (12) month period corresponding to any
of the Recipient's fiscal years, which period commences on January 1 and ends on
December 31 of each calendar year.
8.     "General Conditions" means the "International Development Association General
Conditions for Credits and Grants", dated July 31, 2010.


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9.     "HCC" means the Honiara City Council, the local government body established
under Section 4 of the Honiara City Act 1999 for the purpose of the administration
of Honiara City, or any successor thereto.
10.    "Incremental Operating Costs" means reasonable expenditures incurred by the
Recipient on account of implementation and management of the Project (which
expenditures would not have been incurred absent of the Project), including the
Recipient's staff travel costs, allowances, costs of vehicle rental, fuel and
maintenance, communication costs, office supplies and equipment, office rental
fees, utilities, and consumables required for holding meetings related to the
Project, but excluding salaries of civil servants of the Recipient.
11.    "MID" means the Recipient's Ministry of Infrastructure Development, or any
successor thereto.
12.    "Original Financing Agreement" means the financing agreement for a Rapid
Employment Project between the Recipient and the Association, dated July 2, 2010
(Grant No H575-SB).
13.    "Original Project" means the Project described in the Original Financing
Agreement.
14.    "Procurement Guidelines" means the "Guidelines: Procurement of Goods, Works
and Non-consulting Services under IBRD Loans and IDA Credits and Grants by
World Bank Borrowers" dated January 2011 (revised July 2014).
15.    "Procurement Plan" means the Recipient's procurement plan for the Project, dated
June 2, 2015 and referred to in paragraph 1.18 of the Procurement Guidelines and
paragraph 1.25 of the Consultant Guidelines, as the same shall be updated from
time to time in accordance with the provisions of said paragraphs.
16.    "Project Operations Manual" means the Project Operations Manual prepared and
adopted by the Recipient and referred to in Section I of Schedule 2 to this
Agreement, setting out, inter alia, details of principles, procedures, criteria,
guidelines and timetables required for the implementation of the Project, including
the administrative, operational, procurement, financial management, monitoring
and evaluation, and project and financial reporting arrangements, as well as
principles, criteria and procedures for selecting and implementing Sub-Projects
and details of administering Sub-Grants, as the same may be amended from time
to time with the agreement of the Association.
17.    "Project Steering Committee" means the Project Steering Committee to be
maintained pursuant to Section I of Schedule 2 to this Agreement and responsible
for, inter alia, overseeing the overall implementation of the Project (including Sub-
Projects), providing policy guidance, facilitating coordination among government


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ministries, agencies, institutions and other stakeholders, and providing advice on
annual work plans and budgets of MID and HCC, in accordance with the objectives
of the Project.
18.   "Sub-Grant" means a grant to be provided by the Recipient (through HCC) to a
Community Group to finance the costs of a Sub-Project.
19.   "Sub-Project" means urban works and services to be undertaken by a Community
Group with the proceeds of a Sub-Grant.
20.   "Sub-Project Agreement" means an agreement for a Sub-Project to be entered into
between the Recipient (through HCC) and a Community Group pursuant to Section
I of Schedule 2 to this Agreement.
21.    "Training" means reasonable costs incurred by the Recipient for training under the
Project, including purchase, translation and publication of materials, rental of
facilities, course fees, workshop supplies, rental of equipment, reasonable
honorarium of resource persons, and travel, accommodation and subsistence of
participants.
22.    "Technical Coordination Committee" means the Technical Coordination
Committee to be maintained pursuant to Section I of Schedule 2 to this Agreement
and responsible for, inter alia, ensuring coordination of activities jointly carried
out by MID and HCC.
Section II.  Amendments to the Ori2inal Financing A2reement
The Original Financing Agreement is amended as follows:
1. The Project development objective in Schedule 1 to the Original Financing Agreement
is amended to read as set out in Schedule 1 to this Agreement.
2. Reference to "MID's Division of Transport Policy and Planning" in Section I.D of
Schedule 2 of the Financing Agreement is amended to read "MID".