OFFICIAL DOCUMENTS LOAN NUMBER 9147-MA Loan Agreement (Additional Financing for the Program of Improving Primary Health in Rural Areas and Responding to COVID-19 Pandemic Emergency) between KINGDOM OF MOROCCO and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT LOAN NUMBER 9147-MA LOAN AGREEMENT AGREEMENT dated as of the Signature Date between the KINGDOM OF MOROCCO ("Borrower") and the INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT ("Bank"). The Borrower and the Bank 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- LOAN 2,01. The Bank agrees to lend to the Borrower the amount of thirty-five million Dollars (USD 35,000,000), as such amount may be converted from time to time through a Currency Conversion ("Loan"), to assist in financing the program described in Schedule I to this Agreement ("Program"). 2.02. The Borrower may withdraw the proceeds of the Loan in accordance with Section IV of Schedule 2 to this Agreement. All withdrawals from the Loan Account shall be deposited by the Bank into an account specified by the Borrower and acceptable to the Bank. 2.03. The Front-end Fee is one quarter of one percent (0.25%) of the Loan amount. 2.04. The Commitment Charge is one quarter of one percent (0.25%) per annum on the Unwithdrawn Loan Balance, provided that the Commitment Charge for the period beginning on the date of accrual of the Commitment Charge and ending on the date of the first anniversary of such date of accrual shall be zero percent (0%)1 205. The interest rate is the Reference Rate plus the Fixed Spread; or such rate as may apply following a Conversion; subject to Section 3.02(e) of the General Conditions. 2.06. The Borrower elects to apply the Automatic Rate Fixing Conversion to the Loan. Accordingly, without limitation upon the provisions of Article IV of the General Conditions and unless otherwise notified by the Borrower to the Bank in -2- accordance with the provisions of the Conversion Guidelines, the interest rate basis applicable to the aggregate principal amount of the Loan withdrawn during each Interest Period shall be converted from the initial Variable Rate to a Fixed Rate for the full maturity of such amount in accordance with the provisions of Article IV of the General Conditions and of the Conversion Guidelines. 2.07. The Payment Dates are April 15 and October 15 in each year. 2.08. The principal amount of the Loan shall be repaid in accordance with Schedule 3 to this Agreement. ARTICLE III ---- PROGRAM 3.01. The Borrower declares its commitment to the objectives of the Program. To this end, the Borrower shall carry out the Program through the MoH in accordance with the provisions of Article V of the General Conditions and Schedule 2 to this Agreement. ARTICLE IV - TERMINATION 4.01. The Effectiveness Deadline is the date ninety (90) days after the Signature Date. ARTICLE V - REPRESENTATIVE; ADDRESSES 5.01. The Borrower's Representative is its Minister of Economy, Finance and Administration Reform. 5.02. For purposes of Section 10.01 of the General Conditions: (a) the Borrower's address is: Minislre de 'Economie, des Finances et de la Reforme Administrative Avenue Mohammed V Rabat Kingdom of Morocco; and (b) the Borrower's Electronic Address is: Cable address: Facsimile: MINFIN 212-537-67-75-30/31 212-537-76-40-81 5.03. For purposes of Section 10.01 of the General Conditions: (a) the Bank's address is: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America; and (b) the Bank's Electronic Address is: Telex: Facsimile: 248423(MCI) or 1-202-477-6391 64145(MCI) -4- AGREED as of the Signature Date. KINGDOM OF MOROCCO By: Authorized Representative Name: uŽLeLwÆ Title:/ Date: INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By: Authorized Representative Name: 1 e Title: 114i L e l Date:> I -5- SCHEDULE 1 Program Description The objective of the Program is to expand access to primary health care in targeted rural areas and to strengthen detection and case management to respond to the COVID-19 pandemic in the Program Area. The Program consists of the following activities to be implemented in the Program Area: Part 1: Expanding Equitable Access to Primary Care in Rural Areas 1. Reducing maternal, neonatal, and under five mortality through the implementation of activities set forth in the Action Plan to Reduce Maternal, Neonatal, and Under Five Mortality. 2. Strengthening the detection and management of non-communicable diseases through the carrying out of: (a) prevention measures, including the organization of awareness campaigns on the benefits of a healthy diet and physical activity; (b) screening measures, including equipping health centers and mobile teams with screening equipment, training of health staff at the ESSP-level on screening techniques, and conducting screening activities; and (c) strengthening measures, including disseminating standards of care to all ESSPs and mobile teams, training professionals on standards of care, and providing health facilities with basic essential drugs. 3. Strengthening mobile health coverage through: (a) the provision of 57 equipped mobile units to be attached to ESSPs in the Program Area; (b) strengthening of the technical platform of existing mobile units; and (c) capacity building for health care providers in the management of mobile medical units. Part 2: Improving Health System Governance at the Primary Level 1. Provision of support to the MoH in the creation of an incentive mechanism for all health professionals. 2. Improving accountability at the primary health care level through: (a) The expansion of the biennial quality assessment tool in the health sector (the "concours qualit&') at the primary healthcare level in the Program Area, through the carrying out of annual reviews of the quality assessment tool, the provision of training, including for the personnel of all the centers that are enrolled; and publications and dissemination events for an increased number of primary healthcare facilities, in particular rural ones; and -6- (b) The establishment of a comprehensive GRM by clarifying the existing institutional structure and operational arrangements. 3. Developing an integrated, computerized and accessible HMIS, including through: (a) the carrying out of foundational and analytical work, formulation of the data dictionary and coding standards, formulation of the data model which includes data flows and types of data across the health system, and the formulation of national charts of accounts and statistics; (b) updating the HMIS Master Plan; and (c) testing of integrated computerized systems in one region and central support structures. Part 3: Emergency COVID-19 Response 1 . Provision of support to the MoH for case detection, case confirmation, contract tracing, case recording and case reporting to: (a) strengthen disease surveillance systems, public health laboratories, and epidemiological capacity for early detection and confirmation of cases; (b) combine detection of new cases with active contact tracing; (c) support epidemiological investigation; (d) strengthen risk assessment, and (e) provide on-time data and information for guiding decision-making and response and mitigation activities. 2. Provision of support for the strengthening of the Borrower's health care system to better respond to the COVID-19 pandemic through: (a) the preparation of financing plans for establishing and equipping specialized units in selected hospitals; (b) the preparation of treatment guidelines, clinical training of health workers and hospital infection control guidelines; (c) the provision of medical supplies, diagnostic reagents, including kits and other operating costs. -7- SCHEDULE 2 Program Execution Section . Implementation Arrangements A. Program Institutions 1. The Borrower, through its MoH, shall maintain the following institutional arrangements throughout the implementation of the Program and as further set out in the Implementation Manual and, except as the Bank shall otherwise agree, the Borrower shall not amend or waive any of such arrangements if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the carrying out of the Program or the achievement of the objective thereof. 2. Steering Committee and Technical Committee for the Program The Borrower shall maintain throughout the Program: (a) a steering committee which shall be chaired by the Secretary General of the MoH and include directors of each of the relevant MoH departments; and (b) a technical committee chaired by the director of DPRF and composed of representatives of each of the relevant MoH departments. B. Other Program Institutional and Implementation Arrangements 1. Implementation Manual The Borrower shall: (a) no later than thirty (30) days after the Effective Date (or such later date as agreed with the Bank), update the Implementation Manual in form and substance satisfactory to the Bank; and (b) immediately thereafter, shall carry out the Program in accordance with such Implementation Manual and, except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision of said Manual if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the carrying out of the Program or the achievement of the objective thereof. 2. Action Plan The Borrower shall carry out the Action Plan, or cause the Action Plan to be carried out, in accordance with the schedule set out in the said Action Plan in a manner satisfactory to the Bank. -8- C. Verification Protocol The Borrower shall carry out technical audits at least annually through the IGM for the verification of achievement of DLRs I through 9 which are set forth in the table in Section IV.A.2 of this Schedule in accordance with the Verification Protocol set forth in the Implementation Manual, and furnish to the Bank not later than thirty (30) days after the verification of compliance of said DLRs, a report on the results of said verification of compliance process of such scope and in such detail as the Bank shall reasonably request. Section H. Excluded Activities The Borrower shall ensure that the Program excludes any activities which: A. in the opinion of the Bank, are likely to have significant adverse impacts that are sensitive, diverse, or unprecedented on the environment and/or affected people; or B. involve the procurement of: (1) works, estimated to cost USD 75,000,000 equivalent or more per contract; (2) goods, estimated to cost USD 30,000,000 equivalent or more per contract; (3) non-consulting services, estimated to cost USD 30,000,000 equivalent or more per contract; or (4) consultants' services, estimated to cost USD 20,000,000 equivalent or more per contract. Section HI. Program Monitoring, Reporting and Evaluation The Borrower shall furnish to the Bank each Program Report not later than forty- five (45) days after the end of each calendar year, covering the calendar year. Section IV. Withdrawal of Loan Proceeds A. General 1. Without limitation upon the provisions of Article I of the General Conditions and in accordance with the Disbursement and Financial Information Letter, the Borrower may withdraw the proceeds of the Loan to: (a) pay the Front-end Fee; (b) pay each Interest Rate Cap or Interest Rate Collar premium; and (c) finance Program Expenditures (inclusive of Taxes), on the basis of the results ("Disbursement Linked Results" or "DLRs") achieved by the Borrower as measured against specific indicators ("Disbursement Linked Indicators" or "DLIs"); all as set forth in the table in paragraph 2 of this Part A. 2. The following table specifies each category of withdrawal of the proceeds of the Loan (including the Disbursement Linked Indicators as applicable) ("Category"), the Disbursement Linked Results for each Category (as applicable), and the allocation of the amounts of the Loan to each Category: -9- Category (including Disbursement Disbursement Linked Amount of the Loan Linked Indicator as Result Allocated applicable) (as applicable) (expressed in USD) (1) DLI #1: Increase in DLR#1.1: 0.97% in CY15 0 number of pregnant women receiving DLR#1.2: 2.18% in CY16 0 antenatal care during a visit to a rural ESSP in DLR#1.3: 3.88% in CY I7 0 the Program Area DLR#1.4: 5.83% in CYI8 0 (2) DLI #2: Increase in DLR#2.1: 1.71% in CYI5 0 number of deliveries of rural women DLR#2.2: 3.42% in CY16 0 attended by skilled health personnel in DLR#2.3: 5.13% in CYI7 0 public health facilities in the Program Area DLR#2.4: 7.26% in CY18 0 (3) DLI #3: Increase in DLR#3.1: 1.50% in CY15 0 number of new visits of children under 5 to DLR#3.2: 2.50% in CY16 0 a rural ESSP in the Program Area for DLR#3.3: 3.50% in CY17 0 curative care DLR#3.4: 5% in CY18 0 (4) DLI #4: Increase in DLR#4.1: 4.09% in CY15 0 number of patients with diabetes DLR#4.2: 8.62% in CY16 0 diagnosed and treated at a rural ESSP in the DLR#4.3: 13.10% in 0 Program Area CY17 0 DLR#4.4: 17.63% in CY18 (5) DLI #5: Increase in DLR#5.1: 1.30% in CYI5 0 number of visits to rural ESSPs in the DLR#5.2: 2.30% in CYI6 0 Program Area DLR#5.3: 3.30% in CYI7 0 -10- DLR#5.4: 4.30% in CY18 0 (6) DLI #6: % of rural DLR#61: 30% of the 0 health centers with CSCAs in the Program delivery services Area have participated in (CSCAs) in the the main biennial quality Program Area that assessment (concours participate in the main qualitd), in CY15 biennial quality assessment (concours DLR#6.2: The Borrower 0 qualite) has updated the guide of self-evaluation of CSCAs in a manner acceptable to the Bank DLR#6.3: The Borrower, 0 through its MoH, has approved/adopted the guide of self-evaluation updated under DLR#6.2 DLR#6.4: 44% of the 0 CSCAs in the Program Area have participated in the main biennial quality assessment (concours qualit) and have been assessed based on the guide of self-evaluation approved/adopted under DLR#6.3 (7) DLI #7. Establishment DLR#7.1: 'Urbanization' 0 of an HMIS in the process, data dictionary Program Area and data model complete; DLR#7.2: Masterplan for 0 an HMIS updated and validated DLR#7.3: The national 0 digitized health management information system on maternal and child health, family -Il- planning, and curative care (SMIPF-SC) has been operationalized in the 100% of public health centers of at least 4 regions within the Program Area DLR#7.4: The SMIIPF- 0 SC has been operationalized in the 100% of public health centers of all the regions within the Program Area (8) DLJ#8: Number of DLR#8.1: 229,000 PCR DLR#8.1: 7,812,500 PCR tests conducted tests have been conducted to diagnose COVID- to diagnose COVID-19 19 DLR#8.2: 400,000 DLR#8.2: 13,100,000 additional PCR test have From 229,000 PCR tests been conducted to conducted under diagnose COVID-19 DLR#8.1, for each additional 1,000 PCR tests conducted, USD 32,750 may be made available for withdrawal by the Borrower, up to the total amount allocated to the DLR (9) DLI#9: Number of DLR#9. 1: The DLR#9. 1: 0 health care facilities Borrower's MoH has designated COVID-19 adopted the guidelines for facilities and equipped the designation of a health as per MoH guidelines care facility as "COVID- 19 facility" in a manner acceptable to the Bank ("MoH Guidelines") DLR#9.2: at least 50 DLR#9.2: 14,000,000 health care facilities have For each health care been designated COVID- facility designated 19 facilities and equipped COVID-19 facility and as per MoH Guidelines equipped as per MoH Guidelines, USD 280,000 may be made available - 12- for withdrawal by the Borrower, up to the total amount allocated to the DLR (10) Front-end Fee to be Not applicable 87,500 paid pursuant to Section 2.03 of this Agreement in accordance with Section 2.07(b) of the General Conditions (11) Interest Rate Cap or Not applicable 0 Interest Rate Collar premium to be paid pursuant to Section 2.08(c) of this Agreement in accordance with Section 4.05 of the General Conditions TOTAL AMOUNT 35,000,000 B. Withdrawal Conditions; Withdrawal Period 1 . Notwithstanding the provisions of Part A of this Section, no withdrawal shall be made: (a) on the basis of DLRs achieved prior to the Signature Date, except that withdrawals up to an aggregate amount not to exceed USD 7,812,500 may be made on the basis of DLRs achieved prior to this date but on or after March 20, 2020; or/and (b) for DLRs#8.2, 9.1 and 9.2, until and unless the Borrower has furnished evidence satisfactory to the Bank that said DLR has been achieved. 2. Notwithstanding the provisions of Part B. 1(b) of this Section, the Borrower may withdraw an amount not to exceed USD 2,687,500 as an advance; provided, however, that if the DLRs in the opinion of the Bank, are not achieved (or only partially achieved) by the Closing Date, the Borrower shall refund such advance (or portion of such advance as determined by the Bank) to the Bank promptly upon notice thereof by the Bank. Except as otherwise agreed with the Borrower, the Bank shall cancel the amount so refunded. Any further withdrawals requested - 13 - as an advance under any Category shall be permitted only on such terms and conditions as the Bank shall specify by notice to the Borrower. 3. Notwithstanding the provisions of Part B.1(b) of this Section, if any of DLRs#8.2, 9.1 and 9.2 has not been achieved the Bank may, by notice to the Borrower: (a) reallocate all or a portion of the proceeds of the Loan then allocated to said DLR to any other DLR; and/or (b) cancel all or a portion of the proceeds of the Loan then allocated to said DLR. 4. The Closing Date is September 30, 2021. - 14 - SCHEDULE 3 Amortization Schedule The following table sets forth the Principal Payment Dates of the Loan and the percentage of the total principal amount of the Loan payable on each Principal Payment Date ("Installment Share"), Principal Payment Date Installment Share On each April 15 and October 15 Beginning October 15, 2025 through April 2.56% 15, 2044 On October 15, 2044 2.72% - 15- APPENDIX Definitions 1. "Action Plan" means the Borrower's plan dated February 25, 2015, and updated on June 5, 2020, and referred to in Section L.B.2 of Schedule 2 to this Agreement, as may be amended from time to time with the agreement of the Bank. 2. "Action Plan to Reduce Maternal, Neonatal, and Under Five Mortality" means the action plan adopted by the Borrower in September 2012 entitled "Plan d'action 2012 - 2016 pour accler la rdduction de la mortaliti maternelle el n6onatale - Fin du compte b rebours 2015." 3. "Anti-corruption Guidelines" means, for purposes of paragraph 5 of the Appendix to the General Conditions, the Bank's "Guidelines on Preventing and Combating Fraud and Corruption in Program-for-Results Financing," dated February 1, 2012, and revised July 10, 2015. 4. "Category" means a category set forth in the table in Section IV.A.2 of Schedule 2 to this Agreement. 5. "Concours qualiti" means the quality competition organized annually between health facilities involving a self-assessment, in which staff at participating health facilities complete standardized questionnaires that measure a range of quality indicators (user satisfaction, care accessibility and availability, rationalized use of resources, security and responsiveness, leadership, community participation, and institutional functionality), as well as an audit by peers. 6. "COVID-19" means the coronavirus disease caused by the 2019 novel coronavirus (SARS-CoV-2). 7. "CSCA" means Community Health Center with Delivery Unit (Centres de santd avec module d'accouchement). 8. "DHSA" means the hospitals and ambulatory care Division of the MoH (Direction des H6pitaux et les Soins Ambulatoires). 9. "Disbursement Linked Indicator" or "DLI" means in respect of a given Category, the indicator related to said Category as set forth in the table in Section IV.A.2 of Schedule 2 to this Agreement. 10. "Disbursement Linked Result" or "DLR" means in respect of a given Category, the result under said Category as set forth in the table in Section IV.A.2 of Schedule 2 to this Agreement, on the basis of the achievement of which, the amount of the Loan allocated to said result may be withdrawn in accordance with the provisions of said Section IV. - 16 - 11. "DPRF" means the Department of Planning and Financial Resources of the MoH. 12. "ESSP" means primary health care facilities (Etablissement de soins de santi primaires). 13. "General Conditions" means the "International Bank for Reconstruction and Development General Conditions for IBRD Financing, Program-for-Results Financing", dated December 14, 2018. 14. "GRM" means a grievance redress mechanism with documented and established mechanisms to record, address and monitor complaints. 15. "HMIS" means an infornation management system for the health sector. 16. "HRH" means human resources management in the health sector. 17. "Implementation Manual" means the Borrower's manual setting forth the technical, administrative and fiduciary procedures applicable to the Program. 18. "IGM" means, the inspection unit within the MoH (Inspection Gmirale Ministdrielle). 19. "MoH" means the Borrower's Ministry of Health, or any successor thereto. 20. "MoH Guidelines" means the guidelines referred to in DLR#9. 1. 21. "Morocco Medical Waste Regulations" means, collectively, the Arrd for the application of the recommendations of Dcret No.2-09139 and the Plan National de gestion des dichets mddicaux, to be adopted by the Borrower. 22. "NCDs" means non-communicable diseases. 23. "PCR" means Polymerase Chain Reaction. 24, "Program Area" means: (a) for DLRs#1-7, the Borrower's regions of Tanger- Tetouan-Al Hoceima, Oriental, F6s-Meknbs, Bdni Mellal-Khenifra, Marrakech- Safi, Dria-Tafilalet, and Souss-Massa; and (b) for DLRs#8 and 9: the Borrower's regions listed under (a), Casablanca-Settat and Rabat-Sald-Kdnitra, the Borrower's provinces of Guelmin, Tan-Tan and Sidi Ifni, and the municipality of Assa. 25. "Signature Date" means the later of the two dates on which the Borrower and the Bank signed this Agreement and such definition applies to all references to "the date of the Loan Agreement" in the General Conditions. - 17- 26. "Verification Protocol" means the verification protocol set out in Section LC of Schedule 2 to this Agreement and included in the Implementation Manual.