CONFORMED COPY CREDIT NUMBER 588 MAU Development Credit Agreement (Nouadhibou Port Project) BETWEEN ISLAMIC REPUBLIC OF MAURITANIA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED OCTOBER 31, 1975 CONFORMED COPY CREDIT NUMBER 588 MAU Development Credit Agreement (Nouadhibou Port Project) BETWEEN ISLAMIC REPUBLIC OF MAURITANIA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED OCTOBER 31, 1975 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated October 31, 1975, between the ISLAMIC REPUBLIC OF MAURITANIA (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) The Borrower has requested the Association, the Caisse Centrale de Cooperation Economique, an agency of the Republic of France (hereinafter called Caisse Centrale), and the Kuwait Fund for Arab Economic Development (hereinafter called the Kuwait Fund) to assist in the financing of the Project described in Schedule 2 to this Agreement; (B) By an agreement to be entered into between Caisse Centrale and the Borrower (hereinafter called the Caisse Centrale Loan Agreement), Caisse Centrale intends to assist the Borrower in financing Parts IA and D(i), 1lA and Ill of the Project by making to the Borrower a loan (hereinafter called the Caisse Centrale Loan) in an amount equivalent to five million seven hundred thousand dollars ($5,700,000); (C) By an agreement to be entered into between the Kuwait Fund and the Borrower (hereinafter called the Kuwait Fund Loan Agreement), the Kuwait Fund intends to assist the Borrower in financing Parts I and 11B of the Project by making to the Borrower a loan (hereinafter called the Kuwait Fund Loan) in an amount equivalent to eight million three hundred thousand dollars ($8,300,000); WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were 4 fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Port" means the port of Nouadhibou; (b) "PAN" means Port Autonoine de Nouadhibou, an Etablissement Public of the Borrower, established and operating pursuant to Decree No. 75.035 of February 6, 1975; (c) "UM" means Ouguiya, the currency of the Borrower; (d) "Port Master Plan" means the plan for the development of the port of Nouadhibou, to be adopted pursuant to Section 4.02 of this Agreement as such plan may be modified from time to time in consultation with the Association; and (e) "Plan of Action" means the plan of action set forth in Schedule 4 to this Agreement, as such plan of action may be modified from time to time in agreement with the Association. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equivalent to eight million dollars ($8,000,000), Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule I to this Agreement, as such Schedule may be amended from time to time, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, the goods, works and services (other than consultants' services) for the Project to be financed 5 out of the proceeds of the Credit, shall be procured in accordance with the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be March 31, 1979 or such other date as shall be agreed between the Borrower and the Association. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on January I and July 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each January I and July I commencing January 1, 1986 and ending July 1, 2025, each installment to and including the installment payable On July 1, 1995 to be one-half of one per cent (1/2 of 1) of such principal amount, and each installment thereafter to be one and one-half Per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. Section 2.09. Except as the Borrower and the Association shall otherwise agree, if the Borrower shall repay in advance of maturity any part of its indebtedness under the Caisse Centrale Loan Agreement or the Kuwait Fund Loan Agreement, the Borrower shall simultaneously repay a proportionate amount of the Credit then outstanding. ARTICLE HI Execution of the Project Section 3.01. The Borrower shall carry out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the p.urpose, Section 3.02. In order to assist the Borrower (a) in the preparation of plans and specifications for the Project- (b) in the preparation of bidding documents for the Project and in analyzing bids received; and (c) in the supervision of the constructions under the Project, the Borrower shall employ engineering consultants 6 whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association. Section 3.03. In carrying out Part IA of the Project, the Borrower shall employ contractors acceptable to the Association upon terms and conditions satisfactory to the Association. Section 3.04. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acquisition, transportation and delivery the:.td' to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 3.05. (a) The Borrower shall furnish to the Association, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borrower shall: (i) maintain records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit, the Caisse Centrale Loan and the Kuwait Fund Loan, and to disclose the use thereof in the Project; (ii) enable the Association's representatives to visit the facilities and construction sites included in the Project, and to examine the goods financed out of such proceeds and my relevant records and documents; and (iii) furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit, the Caisse Centrale Loan and the Kuwait Fund Loan and the goods and services financed out of such proceeds. 7 Section 3.06. The Borrower shall take or cause to be taken all such action as shall be necessary to acquire as and when needed all such land and rights in respect of land as shall be required for the construction and operation of the facilities included in the Project and shall furnish to the Association, promptly after such acquisition, evidence satisfactory to the Association that such land and rights in respect of land are available for purposes related to the Project. Section 3.07. Promptly when the individual facilities under Part I of the Project and the equipment under Part 11 of the Project are available for use, the Borrower shall transfer such facilities and equipment to PAN and shall cause PAN to increase, upon any such transfer, its capital by an amount or amounts corresponding to the cost of such facilities and equipment as shall have been borne by the Borrower. Section 3.08. In order to assist PAN in (a) port administration; (b) the improvement of its accounting and financial procedures, including the revision of tariffs; and (c) the survey and reorganization of port operations, the Borrower shall employ consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association, and shall cause PAN to utilize the services of such consultants in accordance with said terms and conditions. Section 3.09. In order to assist the Borrower in carrying out the studies under Part IV of the Project, the Borrower shall employ consultants acceptable to the Association upon terms and conditions satisfactory to the Association. ARTICLE IV Other Covenants Section 4.01. The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with consistently maintained appropriate accounting practices the operations, resources and expenditures, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out the Project or any part thereof. Section 4.02, The Borrower shall take or cause PAN to take all such action as shall be necessary to adopt, within twelve months after the date of this Agreement or such other date as shall be agreed with the Association, a port master plan for the development of the Port, in consultation with the Association. Section 4.03. During the implementation of the Project, the Borrower shall, from time to time, consult with the Association on its program and on PAN's program for investments in facilities for the Port. 8 Section 4.04. The Borrower shall take or cause PAN to take all such action as shall be necessary on its part or on PAN's part, respectively, to implement the Plan of Action in a manner satisfactory to the Association. Section 4.05. (a) The Borrower shall, for the purpose of the Project, open a special account at the Tresor and shall maintain in it funds in an amount equivalent to the estimated local expenditures under the Project during the following three months. The Borrower shall also credit in said account the proceeds of the Credit withdrawn from the Credit Account which the Association shall not have paid directly to suppliers of goods or services at the Borrower's request and on its behalf. (b) The Borrower shall open another account (caisse d'avance) in a bank in Mauritania, and shall credit it with fun%s withdrawn from the special account referred to in paragraph (a) hereof, in such amounts as shall be needed to cover ordinary, small local expenditures under the Project. ARTICLE V Management and Operations of PAN Section 5.01. (a) The Borrower shall cause PAN at all times to manage its affairs, maintain its financial position, and carry on its operations, all in accordance with appropriate administrative, financial, engineering and port management practices and under the supervision of experienced and competent management assisted by qualified and competent staff. (b) The Borrower shall cause PAN adequately to maintain the works, installations and equipment used in its operations and promptly make all necessary renewals and repairs thereof, all in accordance with sound engineering and port management standards and practices. (c) The Borrower shall cause PAN at all times to take all such action as shall be necessary on its part to acquire, maintain and renew all rights which are necessary or useful for the purpose of carrying out its obligations under this Agreement. Section 5.02. The Borrower shall cause PAN to take out and maintain with responsible insurers insurance against such risks and in such amounts as shall be consistent with appropriate practice, taking into account the asset values reflected in PAN's balance sheet as such values shall be revised from time to time in accordance with sound and consistently maintained methods of valuation acceptable to the Association. 9 Section 5.03. (a) Except as the Association shall otherwise agree, the Borrower shall ensure that PAN does not incur any debt if its net revenues for the financial year next preceding the date of such incurrence or for a later twelve-month period ended prior to the date of such incurrence, whichever amount is the greater, shall be less than 1.5 times the maximum debt service requirements for any succeeding financial year on all PAN's debt, including the debt to be incurred. (b) For the purposes of this Section: (i) "debt" means all debt of PAN, including debt guaranteed by PAN, maturing by its terms more than one year after the date on which it is originally incurred; (ii) debt shall be deemed to be incurred on the date of execution and delivery of the contract or other document providing for such debt or modifying its terms of payment; (iii) the term "net revenues" means the difference between (A) gross operating revenue from all sources, adjusted to take account of PAN's tariffs in effect at the time of the incurrence of debt even though they were not in effect during the entire financial year or twelve-month period to which such revenues relate, and (B) all operating expenses, including adequate maintenance, taxes, if any, and administrative expenses, but before provision for depreciation, debt service requirements, and annual distribution of profits to the Borrower under Section 5.08 of this Agreement; (iv) the term "debt service requirements" means the aggregate amount of amortization (including sinking fund payments, if any), interest !,,d other charges on debt; and (v) whenever in connection with this Section it shall be necessary to value in the currency of the Borrower debt payable in another currency, such valuation shall be made on the basis of the rate of exchange at which such other currency is obtainable by PAN, at the time such valuation is made, for the purposes of servicing such debt or, if such other currency is not so obtainable, at the rate of exchange that will be reasonably determined by the Association. 10 Section 5.04. (a) The Borrower shall cause PAN to maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. (b) The Borrower shall cause PAN to: (i) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with sound auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later than six months after the end of each such year, A. certified copies of its financial statements for such year as so audited and B. the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested; and (iii) furnish to the Association such other information concerning the accounts and financial statements of PAN and the audit thereof as the Association shall from time to time reasonably request. Section 5.05. (a) The Borrower shall establish or cause PAN to establish appropriate tariffs and charges for each of the individual services and other facilities provid6d, as would enable PAN to cover operating, maintenance, replacement, depreciation, taxes and administrative and other expenses, including payment of interest and other charges on debt, if any, and to achieve the rate of return referred to in Section 5.06. (b) Without any limitation upon the provisions of paragraph (a) of this Section, the Borrower shall, in establishing the tariffs and charges therein referred to, give or cause PAN to give due consideration to the Port's competitiveness with other ports. Section 5.06. (a) Except as the Association shall otherwise agree, th, Borrower shall take or cause PAN to take from time to time all necessary measures, * 11 including, but not limited to adjustments in the tariffs referred to in Section 5.05, as shall be required to enable PAN to earn an annual rate of return of not less than six per cent (6%) up to fiscal year 1977 and of not less than two and one half per cent (2.5%) thereafter; (b) for the purposes of this Section: (i) the annual rate of return shall be calculated in respect of each fiscal year by relating the net operating revenue for that year to the average of the value of the net fixed assets in operation at the beginning and at the end of that year; (ii) the term "net operating revenue" shall mean the difference between (A) gross operating revenue and (B) operating and administrative expenses, including adequate maintenance and depreciation and taxes, if any, but excluding distribution of profits, interest and other charges on debt (if any); and (iii) the term "value of net fixed assets in operation" shall mean the gross value of fixed assets in operation less the accumulated depreciation, such assets to be valued and such depreciation to be calculated from time to time in accordance with sound and consistently maintained methods of valuation and depreciation acceptable to the Association. Section 5.07. (a) Except as the Association shall otherwise agree, the Borrower shall take or cause PAN to take from time to time all steps necessary for PAN to maintain a working ratio for the Port of not more than thirty five per cent (35%) in financial years 1975 and 1976 and thirty per cent (30%) in financial year 1977 and thereafter. (b) For the purposes of this Section, the term "working ratio" means total operating and administrative expenses of the Port, excluding depreciation, taxes, interest and other charges on debt (if any) and distribution of profits, divided by gross operating revenue. Section 5.08. Except as the Association shall otherwise agree, the Borrower shall cause PAN to take all necessary measures to distribute annually profits to the Borrower, starting from fiscal year 1977, on its equity at the minimum rate of three per cent (3%) per annum. 12 ARTICLE VI Remedies of the Association Section 6.01. Pursuant to Section 6.02(h) of the General Conditions, the following additional events are specified: (a) The Borrower's Decree No. 75.035 of February 6, 1975, shall, without the consent of the Association, have been amended, suspended, abrogated, repealed or waived in such a way as to (i) substantially alter the organization, powers and responsibilities of PAN, or (ii) materially or substantially affect the ability of PAN to carry out its operations. (b) The Borrower or any other authority having jurisdiction shall, without the consent of the Association, have taken any action for the dissolution or disestablishment of PAN or for the suspension of its operations. (c) (i) Subject to subparagraph (ii) of this paragraph: (A) the right of the Borrower to withdraw the proceeds of the Caisse Centrale Loan or of the Kuwait Fund Loan shall have been suspended, cancelled or terminated, in whole or in part, pursuant to the provisions of the Caisse Centrale Loan Agreement or the Kuwait Fund Loan Agreement, or (B) any such loan shall have become due and payable prior to the agreed maturity thereof. (ii) Sub-paragraph (i) of this paragraph shall not apply if the Borrower establishes to the satisfaction of the Association that: (A) such suspension, cancellation, termination or prematuring is not caused by failure by the Borrower to perform any of its obligations under any such agreement and (B) adequate funds for the Project are available to the Borrower from other sources on terms and conditions consistent with the obligations of the Borrower under this Agreement. Section 6.02. Pursuant to Section 7.01(d) of the General Conditions, the following additional events are specified, namely, that any event specified in paragraphs (a), (b) and (c)(i)(B) of Section 6.01 of this Agreement shall occur. ARTICLE VII Effective Date; Termination Section 7.01. The following event is specified as an additional condition to the effectiveness of the Development Credit Agreement within the meaning of 13 Section 12.01(b) of the General Conditions, namely, that the Caisse Centrale Loan Agreement and the Kuwait Fund Loan Agreement have been duly signed and conditions precedent to initial disbursements, if any, under such agreements, save for the effectiveness of this Agreement, have been fulfilled. Section 7.02. The date January 28, 1976 is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 7.03. The obligations of the Borrower under Section 4.03 of this Agreement and the provisions of Article V of this Agreement and those of Section 6.02 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date twenty-five years after the date of this Agreement, whichever shall be the earlier. ARTICLE VIII Representative of the Borrower; Addresses Section 8.0 1. The Minister responsible for the Planning of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 8.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministere de la Planification et du D6veloppement Industriel Nouakchott Mauritanie Cable address: MINIPLAN Nouakchott For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America 14 Cable address: INDEVAS Washington, D.C. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. ISLAMIC REPUBLIC OF MAURITANIA By /s / Ahmedou Ould Abdallah Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Roger Chaufournier Regional Vice President Western Africa 15 SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Civil Works and 5,920,000 37% Consulting Serv- ices under Parts I.A and D(i) of the Project (2) Technical Assis- 350,000 50% tance and Train- ing under Part III of the Project (3) Consulting Serv- 300,000 100% ices under Part IV of the Proj- ect (4) Unallocated 1,430,000 TOTAL 8,000,000 2. The disbursement percentages have been calculated in compliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if any event occurs which shall affect the amount of any 16 such taxes included in the cost of any item to be financed out of the proceeds of the Credit, the Association may, by notice to the Borrower, correspondingly adjust the disbursement percentage then applicable to such item. 3. Notwithstanding the provisions of paragraph I above, no withdrawals shall be made in respect of expenditures prior to the date of this Agreement. 4. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in paragraph I above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category to the extent required to meet the estimated shortfall proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expenditures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 5. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. 17 SCHEDULE 2 Description of the Project The Project, which is part of Mauritania's Port Master Plan, consists of the following parts: I. Civil Works A. (1) Extension of the Fishing Wharf by 300 m, with an alongside depth of 6 m; (2) Extension of the Commercial Wharf by 48 m, with an alongside depth of 8 m on one side and 7 m on the other; (3) Replacement of the approach way linking the Commercial Wharf to the shore, by a causeway; extension of one of the adjacent ramps for small fishing craft by 10 m and dredging to 4 m alongside that ramp; B. Construction of a sewerage system for the fish plants and other buildings at the Port; C. Construction of (i) administrative buildings for PAN, including an office for the marine services, administrative buildings for the port authority, the Merchant Navy and the Fisheries, and a Police and Health Station, and (ii) three housing facilities for port officers and a sailors' residential club; and D. Provision of consulting services for the supervision of the civil works (i) under paragraph A above; and (ii) under paragraphs B and C above. 11. Equipment A. The procurement of a harbor master's launch; and B. The procurement of navigation aids maintenance equipment. III. Technical Assistance A. Utilization of up to 40 man-months of specialists' services to assist PAN in port administration, in accounting and finance, and in the survey and reorganization of port operations; and 18 B. Training of port personnel in foreign fishing ports. IV. Studies for Ship Repair Facilities Utilization of specialist's services for carrying out studies for the development of ship repair facilities. The Project is expected to be completed by September 30, 1978. 19 SCHEDULE 3 Procurement A. General Procedures 1. Contracts shall be let inder procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in April 1972, as revised in October 1972 (hereinafter called the Guidelines), on the basis of international competitive bidding. 2. In the implementation of the procedures referred to in Part A. I above, the following will apply: (i) Bidders for the works included in Part I of the Project shall be prequalified as described in part 2.2 of the Guidelines; and (ii) Bidders for such works may submit (a) separate bids for any of the following works: (A) the maritime civil works included in Part LA of the Project; (B) the sewerage works included under Part LB of the Project; and (C) the works for the construction of buildings under Part I.C of the Project, or (b) a bid for any combination of such civil works. In the case of a bid under (b) above, the bidder will be required to submit separate bids for the works included in the combination. B. Evaluation and Comparison of Bids for Ciiil Works; Preferences for Domestic Con tractors With respect to any contract for civil works included under Category (1) of the table set forth in Schedule I to the Credit Agreement, the Borrower may grant a margin of preference of 7-1/2% to domestic contractors, in accordance with, and subject to, the following provisions: (a) Contractors shall be required to prequalify as provided in Part A of this Schedule and applicants for qualification applying also for such preference shall be asked to provide, as part of the information for qualification, such information, including details of ownership, as shall be required to determine whether, according to the classification established by the Borrower and accepted by the Association, a particular firm or group of firms qualifies for a domestic preference. The bidding documents shall clearly indicate the preference and the method that will be followed in the evaluation and comparison of bids to give effect to such preference. 20 (b) After bids have been received and reviewed by the Borrower, responsive bids will be classified into the following groups: (i) bids offered by domestic contractors eligible for preference; and (ii) bids offered by other contractors. For the purpose of evaluation and comparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above. C. Review of Procurement Decisions by Association 1. Review of prequalification. The Borrower shall, before qualification is invited, inform the Association in detail of the procedure to be followed and shall introduce such modifications in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and, where applicable, of their eligibility for domestic preference under Part B.1 above and of the reasons for the exclusion of any applicant for prequalification and for such eligibility shall be furnished by the Borrower to the Association for its comments before the applicants are notified, and the Borrower shall make such additions to, deletions from, or modifications in, the said list as the Association shall reasonably request. 2. Review of invitation to bid and of proposed awards and final contracts: With respect to all contracts for civil works estimated to cost the equivalent of $50,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) Promptly after the bids have been received, the Borrower shall inform the Association of the names of the bidders and the respective amounts of the bids. (c) After bids have been received and evaluated, the Borrower shall, before a final decision on the award is made, inform the Association of the name of S21 the bidder to which it intends to award the contract and the reasons for the intended award and shall furnish to the Association, in sufficient time for its review, a detailed report, by the consultants referred to in Section 3.02 of this Agreement, on the evaluation and comparison of the bids received, together with the recommendation for award of the said consultants and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended awa-rd would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (d) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (e) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 3. With respect to each contract to be financed out of the proceeds of the Credit and not governed by the preceding paragraph, the Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. 22 SCHEDULE 4 Plan of Action Dates by which measures shall be completed, ex- cept as the Borrower and the Association shall otherwise agree Measures to be taken 1976 January 1 A. The Borrower will employ and cause PAN to utilize Advisors acceptable to the Association upon terms and conditions satisfactory to the Association, who will, inter alia: (i) With respect to organization and operations: (a) recommend to PAN's Board the steps necessary to improve PAN's present organizational and administrative structure to enable it to fulfill its statutory responsibilities and objectives; (b) recommend to PAN improvements in the quality and productivity of commercial and port opera- tions and assist PAN in issuing manuals and drafting port regulations; (c) advise PAN and the fishing industry establishment at the Port on berthing and servicing facilities needed to meet the needs of the various fleets; (d) train PAN's personnel in management, administration and control of operations; (e) advise the Borrower and PAN on finalization of the Port Master Plan; and (f) assist the Port Director in implementing the measures referred to in sub-paragraphs (a) to (c) above. 23 Dates by which measures shall be completed, ex- cept as the Borrower and the Association shall otherwise agree Measures to be taken (ii) With respect to accounting and finance: (a) formulate a clear statement of PAN's financial objectives so that it can attain a satisfactory balance between profitability to cover its financial obligations (includ- ing those under the Credit Agreement with the Association) and future growth requirements, on the one hand, and its posi- tion as a public service entity, on the other hand; (b) reorganize PAN's accounting system on proper commercial lines so that accounts will accurately reflect financial results, and costs of principal services can be readily determined; (c) introduce within PAN a system of management accounting; (d) undertake cost studies and recommend to PAN a cost-based tariff system; (e) provide suitable training to PAN's accountant and his staff, and prepare a comprehensive budget and accounts manual; and (f) organize and introduce an adequate system of internal audit. B. The Borrower will take the necessary steps to obtain assistance of an experienced ship repair firm for drafting terms of reference for market and engineering studies for ship repair facilities. 24 S Dates by which measures shall be completed, ex- cept as the Borrower and the Association shall otherwise agree Measures to be taken June 1 C. The Borrower will employ experts acceptable to the Association upon terms and conditions satisfactory to the Association for the purpose of carrying out the above mentioned market studies for ship repair facilities. July I D. The Borrower will appoint a committee to review the existing customs regulations and procedures and their enforcement, with the participation of interested Government agencies and users, in order to attract traffic to Nouadhibou through improved customs services. September 1 E. The Borrower will set up an overall man- power plan for the port and maritime sector. The plan will include: (i) determination of staffing needs; (i) job descriptions; (iii) training programs; and (iv) procedures for transfer of maritime personnel from one Government Department or agency to another. With respect to item (i), the Borrower will be assisted by the Advisors referred to in paragraph A. above as regards the review of PAN's staffing resources and needs and by the manpower specialist provided under the Development Credit Agreement No. 459 MAU (Education Project) as regards manpower resources and re- quirements in the fishing and maritime sectors in Mauritania. November 1 F. The Borrower will appoint a full-time and adequately trained Director to the Port December 1 G. The Borrower will consult with the Association on the conclusions of the market study referred to in paragraph B. above and review with the Association the steps required to carry out the engineering studies. 25 Dates by which measures shall be completed, ex- cept as the Borrower and the Association shall otherwise agree Measures to be taken H. The Borrower will consult with the Association on the conclusions and recommendations of the committee referred to in paragraph D. above. 1977 April 1 1. The Borrower will, on the basis of the studies and recommendations of the Advisors referred to in paragraph A. above, issue port user regulations including, inter alia, general conditions for granting licenses and concessions. J. The Borrower will cause PAN to issue licenses stipulating, inter alia: (i) the type and quantity of equipment to be used for port operations; (ii) the amount of fees to be paid to PAN; (iii) the productivity levels to be achieved; and (iv) the penalties to be applied in case these productivity levels are not achieved by the specified dates. July 1 K. The Borrower will consult with the Association as to the implementation by PAN of the recommendations of the Advisors under paragraph A.(i). L. The Borrower will consult with the Association as to the implementation by PAN of the recommendations of the Advisors under paragraph A.(ii). October 1 M. The Borrower will cause PAN to evaluate the results achieved in the implementation of the recommendations referred to in paragraph K. above. 26 Dates by which measures shall be completed, ex- cept as the Borrower and the Association shall otherwise agree Measures to be taken N. The Borrower will cause PAN to evaluate the results achieved in the implementation of the recommendations referred to in paragraph L. above. 0. The Borrower will take or cause PAN to take all necessary measures for the productivity of fishing Port operations, including loading of frozen fish, to be increased by at least 30% in relation to the average productivity during the last quarter of 1974.