June 18, 2020 Her Excellency Rocío Tábora Secretaria de Estado en el Despacho de Finanzas Secretaría de Finanzas Avenida Cervantes, Barrio El Jazmín, Edificio SEFIN Tegucigalpa, M.D.C. Honduras Re: HONDURAS: Additional Financing for the Rural Competitiveness Project IDA 6046-HN Additional Instructions: AMENDED Disbursement Letter I refer to the Financing Agreement (“Agreement”) between the Republic of Honduras (the “Recipient”) and the International Development Association (the “Association”) for the above- referenced Project, dated November 14, 2017. The Agreement provides that the Association may issue additional instructions regarding the withdrawal of the proceeds of IDA Credit 6046-HN (“Financing”). This letter (“Disbursement Letter”), as revised from time to time, constitutes the additional instructions. This is the first amendment of the Disbursement Letter dated November 14, 2017 for the above referenced project. This letter restates Section II (vi) to include a new designated account for Category 3 (Part 5). All other provisions and attachments of the Disbursement Letter dated November 14, 2017 shall remain in force and effect. The Disbursement Guidelines for Investment Project Financing, dated February 2017, (“Disbursement Guidelines”), are an integral part of the Disbursement Letter. The manner in which the provisions in the Disbursement Guidelines apply to the Financing is specified below. Sections and subsections in parentheses below refer to the relevant sections and subsections in the Disbursement Guidelines and, unless otherwise defined in this letter, the capitalized terms used have the meanings ascribed to them in the Disbursement Guidelines. I. Disbursement Arrangements (i) Disbursement Methods (section 2). The following Disbursement Methods may be used under the Financing:  Reimbursement  Advances (ii) Disbursement Deadline Date (subsection 3.7). The Disbursement Deadline Date is 4 months after the Closing Date specified in the Financing Agreement. Any changes to this date will be notified by the Association. (iii) Disbursement Conditions (subsection 3.8). Please refer to the Disbursement Condition(s) specified in the Financing Agreement. II. Withdrawal of Financing Proceeds (i) Authorized Signatures (subsection 3.1). A letter should be furnished to the Association at the address indicated below providing the name(s) and specimen signature(s) of the official(s) authorized to sign Applications: The World Bank 1818 H Street, N.W. Washington, DC 20433 Attention: Y. Seynabou Sakho, Country Director (ii) Applications (subsections 3.2 - 3.3). Please provide completed Applications for withdrawal, together with supporting documents, through the Association’s Client Connection, web-based portal, following the instructions for electronic delivery. In the case the Recipient does not have internet access, the Association may permit the delivery of Applications for withdrawal, together with supporting documents, in accordance with subsection 3.3, to the following address: Banco Mundial SCN Quadra 02, Lote A Ed. Corporate Financial Center, 7º Andar 70712-900 Brasilia, D.F. - Brazil Attention: Loan Operations (iii) Electronic Delivery (subsection 3.4). The Association may permit the Recipient to electronically deliver to the Association Applications (with supporting documents) through the Association’s Client Connection, web-based portal. The option to deliver Applications to the Association by electronic means may be effected if: (a) the Recipient has designated in writing, pursuant to the terms of subparagraph (i) of this Section, its officials who are authorized to sign and deliver Applications and to receive secure identification credentials (“SIDC”) from the Association for the purpose of delivering such Applications by electronic means; and (b) all such officials designated by the Recipient have registered as users of Client Connection. If the Association agrees, the Association will provide the Recipient with SIDC for the designated officials. Following which, the designated officials may deliver Applications electronically by completing Form 2380, which is accessible through Client Connection (https://clientconnection.worldbank.org). The Recipient may continue to exercise the option of preparing and delivering Applications in paper form. The Association reserves the right and may, in its sole discretion, temporarily or permanently disallow the electronic delivery of Applications by the Recipient. (iv) Terms and Conditions of Use of SIDC to Process Applications. By designating officials to use SIDC and by choosing to deliver the Applications electronically, the Recipient confirms through the authorized signatory letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation (“Terms and Conditions of Use of Secure Identification Credentials”); and (b) to cause such official to abide by those terms and conditions. (v) Minimum Value of Applications (subsection 3.5). The Minimum Value of Applications is US$ 500,000 for Reimbursements. (vi) Advances (sections 5 and 6). a. For Categories 1 and 2 (DA-C)  Type of Designated Account (subsection 5.3): Segregated.  Currency of Designated Account (subsection 5.4): US Dollars.  Financial Institution at which the Designated Account Will Be Opened (subsection 5.5): Banco Central de Honduras.  Ceiling (subsection 6.1): Variable ceiling, based on a expenditures forecast for a six- month period b. For Category 3 (DA-D)  Type of Designated Account (subsection 5.3): Segregated.  Currency of Designated Account (subsection 5.4): US Dollars.  Financial Institution at which the Designated Account Will Be Opened (subsection 5.5): Banco Central de Honduras.  Ceiling (subsection 6.1): Based on an approved forecast III. Reporting on Use of Financing Proceeds (i) Supporting Documentation (section 4). Supporting documentation should be provided with each Application for withdrawal as set out below:  For requests for Reimbursement and for reporting eligible expenditures paid from the Designated Account: o Forecast for six months to cover project execution and sub-projects investments, applicable when requesting advance to the Designated Account; o Statement of Expenditures for all expenditures financed under Categories 1 and 3; o Customized Statement of Expenditures for sub-projects expenditures financed under Category 2; and o A reconciliation of the Designated Account, with a copy of the bank statement, applicable only when reporting eligible expenditures paid from the Designated Account. (ii) Frequency of Reporting Eligible Expenditures paid from the Designated Account (subsection 6.3): Quarterly. IV. Other Important Information For additional information on disbursement arrangements, please refer to the Loan Handbook available on the Association’s website (http://www.worldbank.org/) and “Client Connection”. The Association recommends that you register as a user of “Client Connection”. From this website you will be able to prepare and deliver Applications, monitor the near real-time status of the Credit, and retrieve related policy, financial, and procurement information. For more information about the website and registration arrangements, or if you have any queries in relation to the above, please contact the Association by email at AskLoans@WorldBank.org using the above reference. Yours sincerely, INTERNATIONAL DEVELOPMENT ASSOCIATION ___________________________ Maria Virginia Hormazabal Finance Officer Loan Operations