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His Excellency Mohamed Berrada                    December 2, 1991
Minister of Finance
Ministry of Finance
Rabat
Kingdom of Morocco
                   Re:  Loan No. 3168 MOR
                        Highway Sector Project
                        Amendment to Schedule 1 to the Loan
Agreement
Excellency,
     We refer to the Loan Agreement dated March 15, 1990 between
the Kingdom of Morocco and the Bank for the above-captioned Project
and to the letter dated April 5, 1991 from your Ministry to the Bank
requesting an increase in the disbursement percentages set forth in
the table in paragraph 1 of Schedule 1 to said Loan Agreement.
     We are pleased to Inform you that the Bank agrees to modify
the percentages applicable to Categories (1) and (2) set forth in
said table, as follows:
                      Amount of the
                    Loan Allocated           % of
                    (Expressed in            Expenditures
     Category       Dollar Equivalent)       to be Financed
(1)  Works under        55,700,000           80% from September 1, 1990
     Parts A (2)                             through December 31, 1991
     and A (3) of                            and 64% thereafter
     the Project
(2)  Goods under            2,700,000        100% of foreign expenditures;
     Parts A (4),                            100% of local expenditures
     B (3) and B (4)                         (ex-factory costa); and,
     of the Project                          from September 1, 1990
                                             through December 31, 1991,
                                             80% of local expenditures for
                                             other items procured locally
                                             and, thereafter, 70% of local
                                             expenditures for such other
                                             items procured locally 
     The figures of 80% referred to above shall apply to all expenditures, eligible 
for financing at such rate pursuant to the terms of the Loan Agreement, in respect of 
which (a) the Bank shall have received
applications for withdrawals or made payment there for on or after
September 1, 1990 but not later than December 31, 1991 or (b)
payment there for shall have been made out of the Special Account on
or after September 1, 1990 but not later than December 31, 1991.
     The other Categories set forth in the table in paragraph 1 of
Schedule 1 to the Loan Agreement shall remain unchanged.
     Please confirm your agreement to the foregoing by signing the
form of confirmation on the copy of this letter and returning said
copy to us.
      In view of their interest in the foregoing, we are sending
copies of this letter to H.E. Moulay Zine Zahidi, Delegated
Minister, H.E. Mohamed Kabbaj, Minister of Public Works and Training
and H.E. Mohamed Bouamoud, Minister of Transport.
                                   Very truly yours,
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                                  Peter P. Bottelier
                                       Director
                                  Maghreb Department
                          Middle East & North Africa Region