CREDIT NUMBER 6694-BJ GRANT NUMBER D667-BJ Financing Agreement (Benin First Fiscal Management and Structural Transformation Development Policy Operation: Supplemental Financing) between REPUBLIC OF BENIN and INTERNATIONAL DEVELOPMENT ASSOCIATION CREDIT NUMBER 6694-BJ GRANT NUMBER D667-BJ FINANCING AGREEMENT AGREEMENT dated as of the Signature Date between REPUBLIC OF BENIN ("Recipient") and INTERNATIONAL DEVELOPMENT ASSOCIATION ("Association") for the purpose of providing supplemental 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 the Original 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 grant and a credit, which are deemed as Concessional Financing for purposes of the General Conditions (collectively, "Financing") in the following amounts: (a) an amount equivalent to eighteen million three hundred thousand Special Drawing Rights (SOR 18,300,000) ("Grant"); and (b) the amount of twenty-three million Euros (EUR23 ,000,000) ("Credit"). 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 the greater of: (a) the sum of three-fourths of one percent (3/4 of 1%) per annum plus the Basis Adjustment to the Service Charge; and (b) three-fourths of one percent (3 /4 of 1%) per annum; on the Withdrawn Credit Balance. 2.04. The Payment Dates are May 15 and November 15 in each year. -2- 2.05. The principal amount of the Credit shall be repaid in accordance with the repayment schedule set forth in Schedule 2 to this Agreement. 2.06. The Payment Currency is Euro. 2.07. 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 thi s 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, namely 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 4.0 I of this Agreement occurs and is continuing for a period of sixty (60) days after notice of the event has been given by the Association to the Recipient. ARTICLE V - EFFECTIVENESS; TERMINATION 5.0 I. The Additional Condition of Effectiveness consists of the following, namely the Association is satisfied with the progress achieved by the Recipient in carrying out -3- 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 its minister responsible for finance. 6.02. For purposes of Section 11.01 of the General Conditions: (a) the Recipient 's address is: Ministere de l 'Economie et des Finances BP 302 Cotonou Route de I' Aeroport de Cotonou Republic of Benin; and (b) the Recipient ' s Electronic Address is: Telephone: Fax: E-mail: (+229) 21-31-10-20 (+229) 21-30-18-51 mobi lisation@caabenin.org (+229) 21-31-42-61 (+229) 21-31 -5 3-56 6.03. For purposes of Section 11.0 I 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 (b) the Association' s Electronic Address is : Telex: Facsimile: 248423 (MCI) 1-202-477-6391 -4- AGREED as of the Signature Date. REPUBLIC OF BENIN By Name: Romuald WADAG I Le Mm· 'v " de l'Economie Title: et LL ~ Jurnan 2 0 2o Date: --.2 9 ------- INTERNATIONAL DEVELOPMENT ASSOCIATION By Authoriz d Representative Name: BTOU SE Ck Title: &4/V~W R£.i: k_J-. Date: .O';) } Q6 J fu 52(() -5- SCHEDULE 1 Program Actions; Availability of Financing Proceeds Section I. Actions under the Program The actions taken by the Recipient under the Program are outlined in Section I of Schedule 1 to the Origi nal Agreement. 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. 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: Amount of the Credit Amount of the Allocations Allocated Grant Allocated (expressed in Euros) (expressed in SDR) (1) Single Withdrawal 23 ,000,000 18,300,000 Tranche TOT AL AMOUNT 23 ,000,000 18,300,000 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. The Recipient, within sixty (60) 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 detai ls of the account to which the XOF equivalent of the Financi ng 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 -6- disbursement of the account referred to m Section 2.03 (a) of the General Conditions. E. Closing Date. The Closing Date is December 31 , 2020. -7- SCHEDULE2 Repayment Schedule Principal Amount of the Date Payment Due Credit repayable (expressed as a percentage)* On each Mayl 5 and November 15, commencing 1.5625% November I 5, 2026 to May 15, 2058. * 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. Defi nitions 1. "Basis Adjustment to the Service Charge" means the Association ' s standard basis adjustment to the Service Charge for credits in the currency of denomination of the Credit, in effect at 12:01 a.m. Washington, D.C. time, on the date on which the Credit is approved by the Executive Directors of the Association, and expressed either as a positive or negative percentage per annum. 2. "General Conditions" means the "International Development Association General Conditions for IDA Financing, Development Policy Financing", dated December 14, 2018. 3. "Original Agreement ' means the agreement dated December 16, 2019, between the Recipient and Association under which the Association provided financing (Credit No. 6526-BJ and Grant No. D546-BJ) in support of the Program. 4. "Program" means the program of objectives, policies, and actions set forth or referred to in the letter dated May 14, 2020, 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. 5. "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. 6. "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. 7. "XOF" means African Financial Community Franc, the Recipient' s lawful currency.