Common use of Review by the Bank of Procurement Decisions Clause in Contracts

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: (i) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 or more; (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (iv) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vi) each contract for consultants’ services provided by individual consultants estimated to cost the equivalent of $50,000 or more; (vii) all single source selection of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions: 1. Responsibility for general policy guidance and overall coordination of the carrying out of the Project shall be vested in the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision of the carrying out of Parts B, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Plan. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 or more; (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of International Competitive Bidding, Limited International Bidding or Direct Contracting; (b) the first contract awarded by each Project Agency under National Competitive Bidding; Bidding procedure and the first contract awarded by each Project Agency under the Shopping Procedures; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivc) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $EUR 100,000 or more; (v) the first two consultants’ contracts to be procured more and provide by selection based on Consultants Qualifications; (vi) each contract for consultants’ services provided by an individual consultants estimated to cost the equivalent of $EUR 50,000 or more; ; (viid) the first contract awarded by each Project Agency under the Least-Cost Selection method and all contracts above EUR 100,000 awarded under the said method, or under the Fixed-Budget Selection method, or under Commercial Practices procedures; (e) all single source selection Single Source contracts; and (f) each contract with the PMU staff or staff of consultants; and (viii) amendments a respective Project Agency or an RDI to contracts raising be financed from the contract value above the prior review threshold. (b) Loan proceeds. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions:. 1. Responsibility The Borrower shall delegate to MSES the responsibility for general policy guidance Project management and overall coordination coordination, including the overseeing the implementation by Project Agencies of their respective Parts of the carrying out of Project. 2. The Borrower shall ensure that the Project shall be vested in the Steering Committee, to be chaired implemented by the Minister of Commerce or his representative PMU, the Project Agencies and maintained by selected RDIs in accordance with the Borrower throughout the duration provisions of the Project PIP and the Operational Procedures (with membership respect to Parts B and terms C.2 of reference at all times satisfactory to the Project) and shall not amend, suspend, abrogate or waive the provisions of the PIP or the Operational Procedures without prior agreement with the Bank. 23. Responsibility for overall supervision of the carrying out of Parts BDuring Project execution, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout shall maintain the duration of the Project PMU within MSES with terms of reference at all times satisfactory to and scope of responsibilities agreed with the Bank. PCMU , qualified staff and other adequate resources, which shall be headed by a responsible for management of the Project coordinator and shall ensure that the administrativeactivities, procurement, disbursement, financial management, monitoring, reporting and coordination with Project Agencies. 4. The Borrower shall, through the PMU, cause each of the Project Agencies to: (a) maintain policies and procedures adequate to enable them to monitor and evaluate on an ongoing basis, in accordance with indicators acceptable to the Bank, the carrying out of the Project and the achievement of the objectives thereof; (b) prepare, under terms of reference agreed with the Bank, and furnish to the Bank, on or about May 31, 2007, a report integrating the results of the monitoring and evaluation activities performed pursuant to sub-paragraph (a) of this paragraph, on the progress achieved in the carrying out of the Project during the period preceding the date of said report and reporting arrangements are carried setting out the measures recommended to ensure the efficient carrying out of the Project and the achievement of the objectives thereof during the period following such date; and (c) review with the Bank, by June 30, 2007, or such later date as the Bank shall request, the report referred to in sub-paragraph (b) of this paragraph, and, thereafter, take all measures required to ensure the efficient completion of the Project and the achievement of the objectives thereof, based on the conclusions and recommendations of the said report and the Bank’s views on the matter. 5. For the purposes of carrying out Part A of the Project, the Borrower, through MSES, shall select RDIs based on the criteria set forth in the PIP and agreed upon with the Bank, and shall enter into agreements with each selected RDIs with terms and conditions agreed with the Bank and which shall include, without limitation: the obligation of RDI to carry out the activities to be financed out of the proceeds of the Loan with due diligence and efficiency and in accordance with the Project Implementation Planprovisions of the PIP and this Agreement, and to provide promptly as needed, funds, facilities, services and other resources required for carrying out such activities; the obligation of RDI to procure goods and services to be financed out of the Loan proceeds in accordance with the provisions of this Agreement and the PIP; the obligation of RDI to maintain a satisfactory financial management system, including maintaining records and accounts for expenditures financed from the proceeds of the Loan, and to conduct regular audits of such accounts and provide reports to the Borrower and to the Bank, all in accordance with the provisions of this Agreement; and the obligation of RDI to report to MSES and the Bank on the progress in carrying out the activities financed from the proceeds of the Loan and to enable representatives of the Borrower and of the Bank, if the Bank shall so request, to visit facilities or other sites financed from the proceeds of the Loan. 36. Not later than December 31, 2005, the Borrower shall enter into an agreement, referred to in paragraph 5 of this Schedule, with at least one eligible RDI, acceptable to the Bank. 7. The Borrower shall: (a) shall and shall cause COTUNACE each Project Agency to carry out Part B prepare and submit for the Bank’s approval business plans, including annual training and study tours plans in substance and format acceptable to the Bank. 8. The Borrower shall take all necessary actions to enable BI and other RDIs to open and maintain their respective institutional renewal accounts, on terms and conditions agreed with the Bank. 9. The Borrower, through MSES, shall complete a Science and Technology Policy Study in a format and substance as agreed with the Bank, endorse recommendations of the Project;said study by October 31 2005, and implement the approved policy thereafter. 10. The Borrower shall ensure that the Unity Through Knowledge Fund shall operate in accordance with the policies and operating and monitoring procedures agreed with the Bank. 1. For the purposes of this Schedule:

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the BorrowerRecipient, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) the first three contracts for goods and civil works under Parts A1 and C.4 of the Project regardless of its method of procurement and contract value; (b) the first three contracts for goods and civil works procured through National Shopping, National Competitive Bidding, and International Competitive Bidding regardless of the contract value; (c) each contract for goods and services (other than consultants’ services) civil works estimated to cost the equivalent of $200,000 US$2,000,000 or more; ; (iid) each contract for goods estimated to cost the equivalent of US$100,000 or more; (e) the first two three contracts for goods and services (other consultants’ services) services procured under Selection Based on the basis Consultants’ Qualifications, Selection of National Competitive Bidding; NGOs and Individual Consultants; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivf) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $US$100,000 or more; more for firms, and $50,000 or more for individuals; (v) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vig) each contract for consultants’ services provided by individual consultants estimated to cost procured under Single Source Selection regardless of the equivalent contract value; and (h) Terms of $50,000 or more; (vii) Reference for all single source selection consultant’s contracts regardless of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) and procurement method. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions:. 1. Responsibility for general policy guidance The Recipient shall: (a) designate and overall coordination maintain a unit within MEFEPEPN, throughout the implementation period of the carrying out of the Project shall be vested in the Steering CommitteeProject, to be chaired by the Minister of Commerce or his representative with such responsibilities, functions, staff and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times resources, satisfactory to the Bank, to be responsible for the implementation of Parts B and D of the Project; (b) maintain the ANPN with such responsibilities, functions, staff and resources, satisfactory to the Bank, to enable ANPN to carry out Parts A and C of the Project; (c) establish and thereafter maintain a joint committee composed of representatives of the ANPN and the unit of the MEFEPEPN, referred to in subparagraph (a) of this paragraph, to coordinate the overall Project implementation including preparation of consolidated work plans and budgets. 2. Responsibility The Recipient shall: (a) through MEFEPEPN, contract and maintain contractual relationships with respectively WCS and WWF for overall supervision the purpose of implementing Parts B and D of the carrying out Project; (b) cause ANPN to contract and maintain contractual relationships with respectively WCS and WWF for the purpose of implementing Parts B, C, D and E C of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation PlanProject. 3. The Borrower Recipient shall: : (a) cause COTUNACE through MEFEPEPN, and jointly with ANPN adopt and thereafter apply a PIM, satisfactory to carry out Part B the Bank which shall include, inter alia: (i) the detailed description of the Project; (ii) the administrative and financial procedures, including accounting, financial reporting and auditing procedures applicable to the Project; (iii) the Procurement Plan and procedures for procurement consistent with the provisions of this Agreement; (iv) the ESIA including the EMP; (v) the RPF; (vi) the IPDP; (vii) terms of reference for all technical advisory services, training and studies to be implemented under the Project; and (viii) procedures for the monitoring, supervision and reporting, including a BMETT; (b) not amend, delete, suspend or abrogate or waive any provision of the PIP without the prior approval of the Bank. 4. The Recipient shall, by June 30, 2006: (a) prepare, satisfactory to the Bank, through MEFEPEPN, and cause ANPN to prepare and adopt the respective training plans for MEFEPEPN and ANPN staff under Parts A(3), A(4), C(5) and D(2) and thereafter implement such plans satisfactory to the Bank; (b) cause ANPN to prepare a plan and terms of reference satisfactory to the Bank for contracting eco-guards under a three-year contract, including training and equipment of such eco-guards; and (c) After the expiration of such three-year contract, the Recipient shall include all such eco-guards in the payroll of the ANPN.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) the first two (2) contracts procured on the basis of Shopping and each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 350,000 or more; ; and (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivb) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) . In addition, the first two consultants’ contracts record of justification referred to be procured by selection based on Consultants Qualifications; (vi) in paragraph 5 of Appendix 1 to the Consultant Guidelines for each contract for consultants’ services provided by the employment of individual consultants estimated to cost the equivalent of $50,000 or more; (vii) all single source selection of consultants; and (viii) amendments more shall be subject to contracts raising Prior Review by the contract value above the prior review threshold. (b) Bank. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and Agreement, for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions: 1. The Borrower shall carry out the Project in accordance with the Project Implementation Plan and, except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision of the Project Implementation Plan if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the carrying out of the Project or the achievement of the objectives thereof. 2. Responsibility for general policy guidance and overall coordination of the carrying out of the Project shall be vested in the Steering Coordinating Committee, to be chaired by the Minister of Commerce Communication Technologies and Transport or his representative representative, and maintained by including, inter alia, representatives of, respectively, the Borrower’s Ministries of Development and International Cooperation, Finance, Justice and Human Rights, Social Affairs and Solidarity, Culture, Youth and Leisure, SERA, ANSI, ATI, INT, ISET’Com, SUP’Com, CNI, WSIS Commission and the Project Coordinator. The Borrower shall maintain said Committee throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision of , and thereafter, shall cause said Committee to meet at least on a semiannual basis to review progress in the carrying out of Parts Bthe Project. 3. Responsibility for coordination, C, D implementation and E supervision of the Project shall be vested in PCMUMCTT. To this end, MCTT shall be assisted by the PMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference qualified staff in sufficient number at all times satisfactory to the Bank. PCMU The PMU shall be headed by a Project coordinator Coordinator and shall ensure that be responsible for the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance under the Project. To this end, the PMU shall coordinate with the relevant participating ministries and entities to the Project Implementation Planand provide, as needed, assistance to said ministries and entities. 34. The PMU, through the Project Coordinator, shall be responsible for monitoring and evaluating progress in implementation of Project activities by each participating ministry and entity, on the basis of performance indicators agreed between the Borrower shall: (a) cause COTUNACE and the Bank. 5. No later than September 30, 2004, the Borrower shall recruit for the PMU a procurement specialist to carry out Part B of review all procurement-related documentation under the Project;, on the basis of experience, qualifications and terms of reference satisfactory to the Bank.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: (ia) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 500,000 or more; (iib) in the first two twelve (12) months of implementation the initial five (5) contracts for goods procured on the basis of National Competitive Bidding and services after the first twelve (other consultants’ services12) months, the initial two (2) contracts in each following twelve-month period for goods procured on the basis of National Competitive Bidding; (iiic) each contract for works estimated to cost the draft bidding documents equivalent of $5,000,000 or more; (d) in the first twelve (12) months of implementation the initial five (5) contracts for goods to be works procured by on the basis of National Competitive Bidding and after the first twelve (12) months, the initial two (2) contracts in each following twelve-month period for works procured on the basis of National Competitive Bidding;; and (ive) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) the first two consultants’ contracts . In addition, with respect to be procured by selection based on Consultants Qualifications; (vi) each contract for consultants’ services provided by the employment of individual consultants estimated to cost the equivalent of $50,000 or more; (vii) , the report on the qualifications and experience of all single source selection evaluated candidates, the terms of consultants; and (viii) amendments reference and the terms of employment of the consultants shall be subject to contracts raising prior approval by the contract value above the prior review threshold. (b) Bank. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions:. 1. Responsibility Henan shall maintain, and cause to be maintained, for general purposes of carrying out the Project, the following organizations, with terms of reference, staffing and other resources acceptable to the Bank, throughout the period of implementation of the Project: (a) The Project Steering Committee, chaired by a Vice Governor, which committee is responsible for providing overall policy guidance and support for Project implementation. (b) The Provincial Project Management Office (“PPMO”), which is established within the Henan Finance Department and responsible for overall coordination of the carrying out of Project coordination; providing procurement support and technical guidance to the Project shall be vested in the Steering Committee, to be chaired by the Minister Companies; and overall management of Commerce or his representative Loan disbursement and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision of the carrying out of Parts B, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the of Project Implementation Planimplementation. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) each contract for goods estimated to cost the equivalent of $250,000 or more, and works and services (other than consultants’ services) estimated to cost the equivalent of $200,000 5,000,000 or more; ; and (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivb) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) . In addition, the first two consultants’ contracts record of justification referred to be procured by selection based on Consultants Qualifications; (vi) in paragraph 5 of Appendix 1 to the Consultant Guidelines for each contract for consultants’ services provided by the employment of individual consultants estimated to cost the equivalent of $50,000 or more; (vii) all single source selection of consultants; and (viii) amendments more shall be subject to contracts raising Prior Review by the contract value above the prior review threshold. (b) Bank. All other contracts shall be subject to Post Review by the Bank. 1. Without In carrying out Parts A and B of the Project, Hubei Province shall: (a) take, or cause to be taken, all necessary actions to minimize to the extent possible any limitation involuntary loss by persons of shelter, productive assets or restriction upon any other provision access to productive assets or of this Agreement income or means of livelihood, temporarily or permanently; (b) carry out the EMPs, RAPs and for the purposes of Section 3.01 Resettlement Policy Framework, in a manner satisfactory to the Bank; and (c) furnish any proposed revision of the plans and the Resettlement Policy Framework referred to in sub-paragraph (b) above to the Bank for its prior approval. 2. In carrying out Parts A and B of the Project, Hubei Province shall: (a) maintain policies and procedures adequate to enable it to monitor and evaluate on an ongoing basis, in accordance with indicators acceptable to the Bank, the carrying out of the EMPs, RAPs, the Resettlement Policy Framework, and the EMDP, if any; and (b) prepare under terms of reference acceptable to the Bank, and furnish to the Bank: (i) an annual summary environmental monitoring report, by January 31 of each year, commencing January 31, 2005, and until completion of the Project; (ii) a semi-annual environmental monitoring report by January 31 and July 31 of each year, commencing January 31, 2005, and until completion of the Project; (iii) by January 31 and July 31 of each year until completion of the Project, commencing January 31, 2005, an internal monitoring report prepared by the appropriate agencies of Hubei Province on the implementation and impact of resettlement activities during the preceding one year or six-month period, as the case may be; and (iv) by January 31 and July 31 of each year until completion of the Project, commencing January 31, 2005, an external monitoring report prepared by an independent entity acceptable to the Bank on the implementation and impact of resettlement activities and the EMDP, if any, during the preceding year. 3. In carrying out Parts A and B of the Project, Hubei Province shall prepare, and provide to the Bank a quarterly progress report, in form and content satisfactory to the Bank, on the progress of civil works and highlighting any environmental issues, commencing January 14, 2005, and until completion of the Project. 4. In carrying out Part A of the Project, Hubei Province shall, by June 30, 2007, or such later date as the Bank shall otherwise agree, prepare and furnish to the Bank for its review and comment, an analysis and recommendations on the structure of toll rates on the Shiyan-Manchuangan Expressway, taking into consideration the results of other studies on toll-rate structures under Bank-financed highway projects in China and the experience with toll rates on major roads in China. 5. In carrying out Part A of the Project, Hubei Province shall furnish to the Bank, by December 31, 2007, an operations risk management plan, acceptable to the Bank. 6. In carrying out Part B of the Project, Hubei Province shall, prior to commencing works on any local road section selected pursuant to paragraph 7 of this AgreementSchedule, prepare in a manner and substance satisfactory to the Bank: (a) using indicators acceptable to the Bank, and furnish to the Bank for its prior approval, an economic and social benefits analysis and a technical analysis, including alternative engineering designs, proposed work plans and estimated costs; (b) an environmental impact assessment and, if necessary, an EMP; and (c) if necessary, and without limitation to the provisions of paragraph 1 of this Schedule: for any local road section which requires the acquisition of land, temporarily or permanently, prepare and implement a resettlement action plan satisfactory to the Bank, in accordance with the principles and procedures set forth in the Resettlement Policy Framework; furnish the same to the Bank for its approval; conduct a social assessment, satisfactory to the Bank to determine, inter alia, the Implementation Program necessity of an EMDP; if necessary, prepare and carry out such EMDP in a manner satisfactory to the Bank; and furnish any proposed revision of the plans referred to in this paragraph to the Bank for Parts Bits prior approval. 7. In carrying out Part B.1 of the Project, CHubei Province shall select local road sections for rehabilitation and upgrading in accordance with criteria acceptable to the Bank, D including the following: (a) the current condition of the road; (b) the lack of alternative transport infrastructure; (c) minimum daily existing traffic volume at least at: (i) 400 Medium Truck Equivalent (MTE) for Class IV roads; (ii) 500 MTE for Class III roads; and E (iii) 600 MTE for Class II roads; (d) expected impact of the rehabilitation/upgrading on: (i) the population’s access to education, health and other social activities; and (ii) the economic development, including facilitation of production and commercialization of local products; (e) contribution to Hubei Province’s plan to improve the functional responsiveness of the highway network; (f) strong support by the local government and the local residents; an expected economic rate of return higher than 12%; and minimizing to the extent possible any involuntary loss by persons of shelter, productive assets or access to productive assets or of income or means of livelihood, temporarily or permanently. 8. In carrying out Part B.1 of the Project, Hubei Province shall furnish to the Bank, by December 31, 2008, an assessment of the social impacts of the Project shall consist activities under such Part of the following provisionsProject. 9. In carrying out Part C.1 of the Project, Hubei Province shall: 1(a) carry out the training in accordance with a training program acceptable to the Bank; and (b) shall furnish to the Bank by January 31 of each year, commencing January 31, 2005, and until completion of the Project, a report on the training carried out over the preceding year. 10. Responsibility In carrying out Part C of the Project, Hubei Province shall: carry out the study on group management of projects by January 31, 2006, and, thereafter, furnish the recommendations of the study to the Bank, for general policy guidance comments, if any; carry out the study on new technologies in maintenance by June 30, 2007, and, thereafter, furnish the recommendations of the study to the Bank, for comments, if any; carry out the study on capital mobilization by December 31, 2007, and, thereafter, furnish the recommendations of the study to the Bank, for comments, if any; carry out the pilot study on expressway asset management by December 31, 2007, and, thereafter, furnish the recommendations of the study to the Bank, for comments, if any; carry out the study on the safety of commercial transport operations by December 31, 2007, and, thereafter, furnish the recommendations of the study to the Bank, for comments, if any; and overall coordination of by December 31, 2007, prepare the highway safety management plan, acceptable to the Bank. 11. Hubei Province shall: (a) maintain policies and procedures adequate to enable it to monitor and evaluate on an ongoing basis, in accordance with indicators satisfactory to the Bank, the carrying out of the Project shall be vested in and the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration achievement of the Project with membership and objectives thereof; (b) prepare, under terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision , and furnish to the Bank, on or about January 31 of each year, commencing January 31, 2005, and until completion of the Project, a report integrating the results of the monitoring and evaluation activities performed pursuant to paragraph (a) of this Section, on the progress achieved in the carrying out of Parts B, C, D the Project during the period preceding the date of said report and E setting out the measures recommended to ensure the efficient carrying out of the Project and the achievement of the objectives thereof during the period following such date; and (c) review with the Bank, by March 31 in each year, or such later date as the Bank shall be vested request, commencing March 31, 2005, and until completion of the Project, the report referred to in PCMUparagraph (b) of this Section, and, thereafter, take all measures required to be maintained by ensure the Borrower throughout the duration efficient completion of the Project with terms and the achievement of reference at all times satisfactory to the objectives thereof, based on the conclusions and recommendations of the said report and the Bank. PCMU shall be headed by a Project coordinator and shall ensure that ’s views on the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Planmatter. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) each contract for goods goods, works and services (other than consultants’ services) estimated to cost procured on the equivalent basis of $200,000 International Competitive Bidding or more; Direct Contracting, (iib) the first two contracts for goods and services (other consultants’ services) the first two contracts for works procured on the basis of National Competitive Bidding; ; (iiic) the draft bidding documents for goods to be first two contracts procured by National Competitive Bidding; on the basis of Shopping; and (ivd) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $EUR 100,000 or more; (v) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vi) each contract , or for consultants’ services provided by individual consultants estimated to cost the equivalent of $EUR 50,000 or more; (vii) all single source selection of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) . All other contracts shall be subject to Post Review by the Bank. 1. Without any limitation or restriction upon any other provision of this Agreement The Borrower shall assign responsibility for Project implementation to MOH which shall: (a) maintain the PMU with such staff and resources as shall be required for the purposes PMU to perform its duties in respect of Section 3.01 the overall management and implementation of the Project; (b) not later than May 31, 2005, establish a unit in each of the eight District Public Health Directorates, to support the PMU in implementation of Project activities at the local level; and (c) of this Agreementnot later than May 31, the Implementation Program 2005, establish Project Steering Committees for Parts B, C, D and E each Part of the Project comprising senior managers of MOH and other institutions, which shall consist of the following provisions: 1. Responsibility be responsible for general policy guidance advice and overall coordination of the carrying out of the support for Project shall be vested in the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bankactivities. 2. Responsibility for overall supervision For the purposes of carrying out Part C.2 of the carrying out of Parts BProject, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator through MOH shall: not later than September 30, 2005, establish an Evaluation Committee within MOH for appraising and shall ensure that the administrative, procurement, disbursement, financial management, monitoring selecting eligible Sub-projects and evaluation and reporting arrangements are carried out Beneficiaries in accordance with the Project Implementation Plan. 3. The Borrower shall: (a) cause COTUNACE procedures established in the Operational Manual; select Sub-loan Service Providers in accordance with the eligibility criteria and procedures set forth in the Operational Manual and in accordance with the provisions of Section III.A of Schedule 4 to carry out this Agreement; authorize each selected Sub-loan Service Provider to establish a revolving fund for provision of Sub-loans under Part B C.2 of the Project;Project (the Sub-loan Fund), which fund shall be replenished through withdrawals from the Loan Account from time to time, in accordance with the terms and procedures set forth in the Operational Manual; enter into an Administration Agreement with each Sub-loan Service Provider, under terms and conditions set forth in the Operational Manual and which shall have been approved by the Bank; cause each Sub-loan Service Provider to provide Sub-loans to selected Beneficiaries on the basis of a Sub-loan Agreement to be entered into between the respective Sub-loan Services Provider and a Beneficiary, on terms and conditions set forth in the Operational Manual; and not amend, abrogate or terminate any provisions of the Operational Manual without the Bank’s prior agreement.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: (ia) each contract for goods or works procured on the basis of International Competitive Bidding; (b) first contract for goods procured on the basis of National Competitive Bidding; (c) first contract for works procured on the basis of National Competitive Bidding; (d) each contract for works estimated to cost the equivalent of $5,000,000 or more; (e) each contract for goods or works estimated to cost the equivalent of $10,000 and procured on the basis of Direct Contracting; (f) each contract for consultants’ services (provided by a firm selected on the basis of procedures other than consultants’ services) Single Source Selection for assignments estimated to cost the equivalent of $200,000 or more; (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivg) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) the first two consultants’ contracts to be procured by selection based selected on Consultants Qualifications; (vi) each contract a Single Source Selection basis for consultants’ services provided by individual consultants assignments estimated to cost the equivalent of $50,000 or more. In addition, the following prior review procedures shall apply to each contract for the employment of individual consultants (other than consultants to be selected on a sole source basis) estimated to cost the equivalent of $50,000 or more: (i) the report on the comparison of the qualifications and experience of candidates, terms of reference and conditions of employment of the consultant shall be furnished to the Bank for its prior review and approval; (viiii) all single source selection of consultantsthe contract shall be awarded only after the Bank’s approval shall have been given; and (viiiiii) amendments the provisions of paragraph 3 of Appendix 1 to contracts raising the Consultant Guidelines shall apply to the contract; and (h) the following prior review procedures shall apply to each contract for the employment of individual consultants to be selected on a sole source basis: (i) the qualifications, experience, terms of reference and conditions of employment of the consultants shall be furnished to the Bank for its prior review and approval; (ii) the contract value above shall be awarded only after the prior review threshold.Bank’s approval shall have been given; and (biii) the provisions of paragraph 3 of Appendix 1 to the Consultant Guidelines shall apply to the contract. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions: 1. Responsibility for general policy guidance and overall coordination of the carrying out of the Project shall be vested in the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision of the carrying out of Parts B, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Plan. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the BorrowerRecipient, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (i) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 or more; (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (iva) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $US$100,000 or more; ; (v) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vib) each contract for consultants’ services provided by individual consultants individuals estimated to cost the equivalent of $US$50,000 or more; ; (viic) all single each contract for consultants services provided by individuals based on a sole-source selection basis and each contract for consultants services provided by firms on a single-source basis, regardless of consultants; and (viii) amendments to contracts raising the contract value above value, and (d) the prior review threshold. (b) first three contracts under the Sub-projects in Tianjin and each Project City. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision With respect to each contract not subject to the Bank’s prior review, prior to the selection of this Agreement and for the purposes of Section 3.01 (c) of this Agreementconsultants, the Implementation Program Recipient shall furnish the terms of reference for Parts B, C, D and E of said consultants to the Project shall consist of the following provisions:Bank for its no-objection. 1. Responsibility The Recipient shall, throughout the implementation of the Project, maintain the following organizations with terms of reference, staffing and resources acceptable to the Bank: (a) a Project Steering Committee comprising representatives of MOF and MOC, to be responsible for general providing policy guidance and on the Project issues; (b) a Project Leading Office to be responsible for the overall coordination of the carrying out implementation of the Project shall be vested among the different agencies involved in the Steering CommitteeProject; (c) a National Project Management Office, established by MOC, to be chaired by the Minister responsible for implementation, monitoring and evaluation of Commerce or his representative and maintained by the Borrower throughout the duration Part B of the Project, and guiding, supervising, coordinating, monitoring, and evaluation of the implementation of Parts A and C of the Project; and (d) a National Experts Group, comprising experts on heat supply, heat reform, building energy efficiency, environmental management, engineering, building administration, sociology, economics and business management, to be responsible for providing technical advice to the MOC, Tianjin and the Project Cities concerning the Project. 2. The Recipient, through MOC, shall carry out its Respective Part of the Project, and cause Tianjin and each Project City to carry out its Respective Part of the Project, in accordance with membership the Financial Management Manual, acceptable to the Bank, which shall include reporting requirements and terms financial management procedures, including audit procedures, in accordance with Article IV of reference at all times this Agreement. The Recipient shall not assign, amend, abrogate or waive the Financial Management Manual, or any portion thereof, without the prior approval of the Bank. 3. The Recipient shall carry out annual surveys and analysis on energy savings achieved in Tianjin and each Project City; and thereafter furnish a report on the outcome of said annual surveys on energy savings to the Bank no later than June 30 of each calendar year, beginning with June 30, 2006, in a manner satisfactory to the Bank. 24. Responsibility for overall supervision The Heat Reform and Building Energy Efficiency Program referred to in Parts A and C of the Project to be carried out by Tianjin and the Project Cities respectively, shall include, among others, the following: (a) the heat reform and heat system modernization, and building energy efficiency improvements; (b) a detailed time-bound action plan for the implementation of the program, including heat supply system modernization, heat reform, and building energy efficiency measures; (c) specific energy efficiency targets and performance indicators; and (d) application of innovative energy efficiency measures in development of new and large heating systems and major residential housing complex, or renovation of major residential housing complex. 5. For a Project City to participate in Part C of the Project and to be eligible for financing out of the proceeds of the GEF Trust Fund Grant, the following criteria and requirements should be met: (a) each Project City shall have been designated by the Recipient as a national pilot heat reform city; (b) each Project City shall have demonstrated their commitment to both the heat reform and building energy efficiency approaches of the HRBEE Program by developing a concrete time-bound action plan to implement both heat reform and building energy efficiency actions; (c) each Project City shall have the organization, management and resources required for the proper carrying out of Parts Bits Respective Part of the Project, Cincluding its abilities to organize both building energy efficiency and heat system development and reform activities in an integrated manner; and to this end; (i) shall have established a Local Project Management Office, D with terms of reference, staffing and E other resources acceptable to the Bank, to be responsible for managing its respective part of the Project in its jurisdiction; and (ii) shall be vested have provided training to the staff of its Local Project Management Office in PCMUfinancial management, to be maintained by procurement management; and project monitoring and evaluation; and (d) each Project city has entered into an Implementation Agreement with the Borrower throughout the duration of the Project with terms of reference at all times Recipient, satisfactory to the Bank. 6. PCMU The Recipient shall be headed by a enter into an Implementation Agreement with Tianjin and each selected Project coordinator City to carry out its Respective Part of the Project on terms and shall ensure that conditions acceptable to the administrative, procurement, disbursement, financial management, monitoring Bank and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Planprovisions set forth in the Annex to this Schedule. 37. The Borrower Recipient shall: : (ai) cause COTUNACE to carry out Part B Tianjin and each of the Project;Project cities to perform, in accordance with the provisions of the Implementation Agreement to which Tianjin or each of the Project Cities is a party, all of the obligations of Tianjin and each Project City therein set forth; (ii) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable Tianjin and each of the Project Cities to perform such obligations; and (iii) not take or permit to be taken any action which would prevent or interfere with such performance; and (b) exercise its rights under each of the Implementation Agreements in such manner as to protect the interests of the Recipient and the Bank and to accomplish the purposes of the GEF Trust Fund Grant, and except as the Bank shall otherwise agree, not assign, amend, abrogate, or waive any of the Implementation Agreements or any provision thereof.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: (ia) each contract for goods and services (other than consultants’ services) works estimated to cost the equivalent of $200,000 5,000,000 or more; (iib) the first two contracts contract for goods and services (other consultants’ services) works procured on the basis of National Competitive Biddingby each PIU using Shopping procedure; (iiic) the draft bidding documents each contract for goods estimated to be procured by National Competitive Biddingcost the equivalent of $500,000 or more; (ivd) the first contract for goods procured by each PIU using National Competitive Bidding procedure; (e) the first contract for goods procured by each PIU using Shopping procedure; (f) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more;procured using Quality- and Cost-Based selection procedure; and (vg) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vi) each contract for consultants’ services provided by procured using Consultants’ Qualifications selection procedure. In addition, the record of justification referred to in paragraph 5 of Appendix 1 to the Consultant Guidelines for each contract for the employment of individual consultants estimated to cost the equivalent of $50,000 or more; (vii) all single source selection more shall be subject to prior approval of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) Bank. All other contracts shall be subject to Post Review by the Bank. 1. Without any limitation or restriction upon any other provision of this Agreement and Guangxi shall cause Liuzhou to maintain, for the purposes of Section 3.01 carrying out the Project, the following organizations, with terms of reference, staffing and other resources acceptable to the Bank, throughout the period of implementation of the Project: (a) The Leading Group, which is composed of the Executive Vice Mayor of Liuzhou and representatives from various departments of the Liuzhou municipal government, responsible for providing policy guidance and inter-department coordination for implementation of activities under the Project. (b) The Project Management Office established within the Liuzhou Development and Reform Commission and headed by the Deputy Director of said commission, responsible for daily supervision and coordination of Project implementation activities. (c) The ESD Project Management Unit established within ESD and composed of this Agreementa director, the Implementation Program two procurement experts, a project management expert, a sanitation engineer, a resettlement expert and a financial expert, responsible for Parts B, C, D and E of the Project shall consist of the following provisions: 1. Responsibility for general policy guidance and overall coordination of the carrying out of the Project shall be vested in the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision of the carrying out implementation of Parts B, C, D E(1), E(3), E(4) and E F of the Project. (d) The EPB Project Management Unit established within EPB and composed of a director, two environment experts, a civil engineer and a financial expert, responsible for implementation of Parts D, E(1) and F of the Project. 2. Guangxi shall: (a) take, and shall be vested cause Liuzhou and LMWTC to take, all necessary actions to minimize to the extent possible any involuntary loss by persons of shelter, productive assets or access to productive assets or income or means of livelihood, temporarily or permanently in PCMUcarrying out the Project; (b) for this purpose, implement, and cause Liuzhou and LMWTC to implement the Resettlement Action Plan, in a manner satisfactory to the Bank; and (c) provide, and cause Liuzhou and LMWTC to provide, to the Bank for its prior concurrence, any proposed modification or waiver of any of the Resettlement Action Plan, prior to putting into effect such modification or waiver. 3. Guangxi shall implement, and shall cause Liuzhou and LMWTC to implement, the Environmental Management Plan in a manner satisfactory to the Bank and designed to ensure that the Project is implemented in accordance with sound environmental practices and standards. 4. Guangxi shall, and shall cause Liuzhou and LMWTC to: (a) maintain policies and procedures adequate to enable them to monitor and evaluate, in accordance with guidelines acceptable to the Bank, the implementation of the Resettlement Action Plan and the Environment Management Plan, the achievement of the objectives of said plans, including the engagement of experienced and qualified independent monitoring agencies acceptable to the Bank; (b) prepare, under terms of reference satisfactory to the Bank, and furnish to the Bank by January 31 and July 31 of each year, commencing on January 31, 2006, semi-annual reports of the results of such monitoring and evaluation activities, together with any revisions proposed to be maintained introduced into such Plans in order to achieve their respective objectives; and (c) introduce such revisions into such plans as shall have been agreed with the Bank. 5. Guangxi shall make the principal amount of the Loan available to Liuzhou under arrangements satisfactory to the Bank, which shall include, without limitation, the following principal terms. (a) Guangxi shall make available the principal amount to Liuzhou in Dollars (on the date, or respective dates, of withdrawal from the Loan Account) of the value of the currency or currencies so withdrawn on account of the Project. (b) Guangxi shall recover: (i) such principal amount so made available; and (ii) an amount equal to one percent (1%), or such other percentage as may be determined by the Borrower throughout the duration Bank from time to time pursuant to Section 2.04 of the Project Loan Agreement, of such principal amount, over a period of twenty (20) years, inclusive of a grace period of five (5) years. (c) Guangxi shall charge interest on such principal amount, withdrawn and outstanding from time to time at a rate equal to the rate of interest applicable from time to time to the Loan pursuant to Section 2.06 of the Loan Agreement. (d) Guangxi shall charge a commitment charge on such principal amount, not withdrawn from time to time at a rate equal to three fourths of one percent (3/4 of 1%) per annum. 6. Guangxi shall cause Liuzhou to relend a portion of the proceeds of the Loan, allocated in accordance with arrangements satisfactory to the Bank for the carrying out Parts A(1) through A(5), E(1), E(2) and F of the Project, under a subsidiary loan agreement to be entered into between Liuzhou and LMWTC: (i) on the principal terms set forth in Section I of Schedule 3 to this Agreement; and (ii) under conditions which shall have been approved by the Bank, and which shall include, without limitation, those set forth in Section II of Schedule 3 to this Agreement. (a) Guangxi shall ensure that Liuzhou causes LMWTC to: (i) perform, in accordance with the provisions of the Subsidiary Loan Agreement, all of the obligations of LMWTC herein set forth; (ii) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable LMWTC to perform such obligations; and (iii) not take or permit to be taken any action which would prevent or interfere with such performance. (b) Guangxi shall cause Liuzhou to exercise its rights under the Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower, the Bank, Guangxi and Liuzhou, and to accomplish the purposes of the Loan, and except as the Bank shall otherwise agree, not assign, amend, abrogate or waive any Subsidiary Loan Agreement or any provision thereof. LMWTC Revenue Requirements 8. With respect to LMWTC’s revenue requirements set forth in paragraphs 6 and 7 of Section II in Schedule 3 to this Agreement, in the event that any review carried out under said paragraphs 6 and 7 shows that LMWTC would not meet said requirements, Guangxi shall take, and shall cause Liuzhou to take, all necessary measures to enable Liuzhou to meet said requirements, including without limitation, adjustments of the structure or levels of LMWTC’s wastewater charges to cover LMWTC’s operating expenses and depreciation related to LMWTC’s assets. 9. Guangxi shall cause Liuzhou: (a) to furnish to the Bank by December 31, 2006, the results of a study, including recommendations, prepared in accordance with terms of reference at all times satisfactory acceptable to the Bank. PCMU shall be headed by a Project coordinator , on the management and shall ensure that financing of public toilets operation; and (b) implement said recommendations taking into account the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation PlanBank’s comments thereon. 310. The Borrower shallGuangxi shall cause Liuzhou: (a) cause COTUNACE to carry out Part B furnish to the Bank by December 31, 2007, the results of a study, including recommendations, prepared in accordance with terms of reference acceptable to the Project;Bank, on the strengthening of ESD’s institutional capacity and capacity for municipal solid waste management; and (b) to implement said recommendations taking into account the Bank’s comments thereon.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review prior review by the Bank: (ia) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 500,000 or more; (iib) each contract for civil works estimated to cost the equivalent of $500,000 or more; (c) the first two three contracts for goods and services (other consultants’ services) the first three contracts for civil works procured on the basis of through National Competitive BiddingBiddings during the first year of Project implementation and the first contract for goods and the first contract for civil works procured through National Competitive Biddings in each subsequent year under Part B of the Project; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivd) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more;; and (ve) the first two three contracts for consultants’ contracts services estimated to be procured by selection based on Consultants Qualifications; (vi) cost less than $100,000 equivalent each during the first year of Project implementation and the first contract for consultants’ services provided by individual consultants estimated to cost less than $100,000 equivalent each during the equivalent subsequent years of $50,000 or more; (vii) all single source selection of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) Project implementation. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions:. 1. Responsibility Zhejiang shall, throughout the period of implementation of its Respective Part of the Project, maintain, or cause to be maintained: (a) a Provincial Project Office with members, terms of reference, and other resources acceptable to the Bank, to be responsible for general policy guidance and overall coordination of the carrying out implementation of the Project shall be vested in the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision of the carrying out of Parts B, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Plan. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project; (b) the Provincial Hydropower Development and Management Center, with terms of reference, staffing and other resources acceptable to the Bank, to be responsible for overseeing implementation of Part B of Project; and (c) a Dam Safety Panel, with members, terms of reference, and other resources acceptable to the Bank, to be responsible for the tasks set forth in its Respective Project Implementation Plan. 2. Each of Zhejiang and IMNLYWPC shall: (i) carry out its Respective Part of the Project in accordance with its Respective Project Implementation Plan, in a manner and substance, satisfactory to the Bank; and (ii) provide to the Bank for its prior concurrence any proposed amendment to the provisions of said Project Implementation Plan, and, thereafter, put into effect such amendment as shall have been agreed with the Bank.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the BorrowerRecipient, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 or more; ; (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivb) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) more and the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vi) each contract for consultants’ services provided by a firm and selected on the basis of the consultant’s qualifications. In addition, with respect to the first contract for the employment of an individual consultant and each contract for the employment of individual consultants estimated to cost the equivalent of $50,000 100,000 or more; (vii) , the report on the qualifications and experience of all single source selection evaluated candidates, the terms of consultants; and (viii) amendments reference and the terms of employment of the consultants shall be subject to contracts raising prior approval by the contract value above the prior review threshold. (b) Bank. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision The Recipient shall take all steps necessary to ensure that the Project Steering Committee shall be maintained until completion of the Project. The Recipient shall, in accordance with the provisions of the Memorandum of Agreement, establish by December 31, 2006, and, thereafter, maintain until the completion of the Project, the Project Management Office, with terms of reference and staff and at all times acceptable to the Bank, including a Project Manager. The Recipient shall, until completion of the Project, maintain at its headquarters a procurement officer, acceptable to the Bank. The Recipient shall prepare and furnish to the Bank a Project management memorandum, acceptable to the Bank, setting forth the management tasks to be carried out by the Recipient under the Project, including the estimated cost of each task. The Recipient shall adopt and, thereafter apply in the implementation of the Project, the Project Implementation Plan, acceptable to the Bank, which shall include the description of: (a) implementation arrangements; (b) the procurement procedures set forth in Schedule 3 to this Agreement and for the purposes of Section 3.01 standard procurement documentation; (c) reporting requirements, financial management procedures and audit procedures as set forth in Article 4 of this Agreement; and (d) the Project Performance Indicators set forth in Schedule 5 to this Agreement, and shall not amend, suspend, abrogate, repeal or waive any provisions of the Project Implementation Plan without the prior agreement of the Bank. The Recipient shall cause the Project Steering Committee to: (a) furnish to the Bank for its review and comments not later than September 30 in each year, commencing September 30, 2007, and until completion of the Project, draft revisions to the Project Implementation Plan for the components of the Project not yet carried out, with emphasis on the activities to be carried out in the following calendar year, including the scope of the activities to be carried out, cost estimates, time based implementation schedules, financing plan, budget arrangements, and the relevant procurement plan; and (b) finalize the revised Project Implementation Plan by November 30 in each year, commencing November 30, 2007, taking into account the comments of the Bank thereon. In carrying out Part B.3 of the Project, the Recipient shall provide all required technical assistance to the Republic of Indonesia, Malaysia and the Republic of Singapore to ensure the production of the electronic navigational charts by March 31, 2008. In carrying out Part C of the Project, the Recipient shall provide the required technical assistance to ensure that the International Association of Independent Tanker Owners and the International Chamber of Shipping have each, by December 31, 2008, at least 60 and 100 ships, respectively, equipped with type-approved electronic chart display and information systems, including internet connectivity. In carrying out Part E of the Project, the Recipient shall: (a) by May 31, 2010, furnish to the Bank the draft final report on the technical, financial, economic, and legal feasibility of a scaled-up Marine Electronic Highway system for the entire Straits of Malacca and Singapore; and (b) by August, 2010, taking into account the comments of the Bank, furnish to potential participants and beneficiaries of the full-scale Marine Electronic Highway system the finalized feasibility study, including the design of an operational and financing plan and an institutional structure for the scaled-up Marine Electronic Highway system. The Recipient shall: (a) maintain policies and procedures adequate to enable it to monitor and evaluate on an ongoing basis, in accordance with the indicators set forth in Schedule 5 to this Agreement, the Implementation Program for carrying out of Parts BX, CX.0, D X.0, X.0, X and E of the Project shall consist and the achievement of the objectives thereof; (b) prepare, under terms of reference satisfactory to the Bank, and furnish to the Bank, on or about June 30 of each year, commencing June 30, 2007, a report integrating the results of the monitoring and evaluation activities performed pursuant to paragraph (a) of this Section, on the progress achieved in the carrying out of Parts X, X.0, X.0, X.0, X and E of the Project during the period preceding the date of said report and setting out the measures recommended to ensure the efficient carrying out of Parts X, X.0, X.0, X.0, X and E of the Project and the achievement of the objectives thereof during the period following provisionssuch date; and (c) review with the Bank, by September 30 of each year, commencing September 30, 2007, or such later date as the Bank shall request, the report referred to in paragraph (b) of this Section, and, thereafter, take all measures required to ensure the efficient completion of Parts X, X.0, X.0, X.0, X and E of the Project and the achievement of the objectives thereof, based on the conclusions and recommendations of the said report and the Bank’s views on the matter. The Recipient shall: 1. Responsibility for general policy guidance (a) prepare, under terms of reference satisfactory to the Bank, and overall coordination furnish to the Bank, on or about September 30, 2008, a report integrating the results of the monitoring and evaluation activities performed pursuant to paragraph 9(a) of this Schedule 4, on the progress achieved in the carrying out of the Project shall be vested Project, including an assessment of the commitment of the partners in the Steering CommitteeProject, the interest of other countries in the scaled-up marine electronic highway, evaluation of new technologies and their potential applicability and inclusion in the marine electronic highway, and determination of the need for Project restructuring, if any. (b) review with the Bank and with the parties to be chaired the Memorandum on Arrangements, by December 31, 2008, the Minister report referred to in paragraph (a) of Commerce or his representative and maintained by this Section, and, thereafter, take all measures required to ensure the Borrower throughout the duration efficient completion of the Project with membership and terms of reference at all times satisfactory to the Bank. 2. Responsibility for overall supervision achievement of the carrying out of Parts B, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Planobjectives thereof. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: : (ia) each contract for goods and services (other than consultants’ services) works estimated to cost the equivalent of $200,000 5,000,000 or more; ; (iib) the first two contracts each contract for goods estimated to cost the equivalent of $500,000 or more; (c) each contract for combined works and services goods estimated to cost the equivalent of $5,000,000 or more; and (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivd) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) . In addition, the first two consultants’ contracts record of justification referred to be procured by selection based on Consultants Qualifications; (vi) in paragraph 5 of Appendix 1 to the Consultant Guidelines for each contract for consultants’ services provided by the employment of individual consultants estimated to cost the equivalent of $50,000 or more; (vii) all single source selection more shall be subject to prior approval of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) Bank. All other contracts shall be subject to Post Review by the Bank. 1. Without any limitation or restriction upon any other provision of this Agreement Ningbo shall maintain, and cause to be maintained, for the purposes of Section 3.01 carrying out the Project, the following organizations, with terms of reference, staffing and other resources acceptable to the Bank, throughout the period of implementation of the Project: (a) The Leading Group, which is composed of the Vice Mayor of Ningbo and Directors from each of Ningbo’s Municipal Development Planning Commission (“MDPC”), Environmental Protection Bureau, Water Resources Bureau, Construction Bureau, and Finance Bureau, responsible for providing policy guidance and planning support for integrated water and environmental management throughout Ningbo. (b) The Project Management Office, established under MDPC and composed of a project manager, an experienced chief engineer and procurement specialist, a project accountant, an environmental specialist, a resettlement unit, and a translator, responsible for overall Project coordination and implementation. (c) The NWSC Project Management Unit established in NWSC to be responsible for the day-to-day implementation of NWSC’s Respective Parts of the Project. (d) The CMSC Project Management Unit established in CMSC to be responsible for the day-to-day implementation of CMSC’s Respective Parts of the Project. 2. Ningbo shall: (a) take, and shall cause each Project Company to take, all necessary actions to minimize to the extent possible any involuntary loss by persons of shelter, productive assets or access to productive assets or income or means of livelihood, temporarily or permanently in carrying out the Project; (b) for this Agreementpurpose, implement, and cause each Project Company to implement its Respective Resettlement Action Plan, in a manner satisfactory to the Bank; and (c) provide, and cause each Project Company to provide, to the Bank for its prior concurrence any proposed modification or waiver of its Respective Resettlement Action Plan, prior to putting into effect such modification or waiver. 3. Ningbo shall implement, and shall cause each Project Company to implement, the Implementation Program for Parts BEnvironmental Management Plan in a manner satisfactory to the Bank and designed to ensure that the Project is implemented in accordance with sound environmental practices and standards. 4. Ningbo shall, Cand shall cause each Project Company to: (a) maintain policies and procedures adequate to enable said Project Company to monitor and evaluate, D and E in accordance with guidelines acceptable to the Bank, the implementation of the Project shall consist Environmental Management Plan and the Respective Resettlement Action Plan and the achievement of the following provisions:objectives of said plans, including the engagement of experienced and qualified independent monitoring agencies acceptable to the Bank; 1. Responsibility for general policy guidance and overall coordination of the carrying out of the Project shall be vested in the Steering Committee(b) prepare, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration of the Project with membership and under terms of reference at all times satisfactory to the Bank, and furnish to the Bank by January 31 and July 31 of each year, commencing on July 31, 2005, semi-annual reports of the results of the monitoring and evaluation activities referred to in sub-paragraph (a) above, together with any revisions proposed to be introduced into said plans in order to achieve their respective objectives; and (c) introduce such revisions into said plans as shall have been agreed with the Bank. 5. Ningbo shall allocate to each Project Company a portion of the Loan under arrangements satisfactory to the Bank. 26. Responsibility for overall supervision Ningbo shall lend the portion of the proceeds of the Loan which was allocated to each Project Company pursuant to paragraph 5 of this Schedule for the purpose of carrying out of such Project Company’s Respective Parts B, C, D and E of the Project shall be vested in PCMU, under subsidiary loan agreements to be maintained entered into between Ningbo and each of CMSC (through Cixi City) and NWSC: (a) on the principal terms set forth in Section I of Schedule 3 to this Agreement; and (b) under conditions which shall have been approved by the Borrower throughout Bank, and which shall include, without limitation, those set forth in Section II of Schedule 3 to this Agreement. (a) Ningbo shall cause each Project Company to: (i) perform, in accordance with the duration provisions of its respective Subsidiary Loan Agreement, all of the obligations of said Project Company therein set forth; (ii) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable said Project Company to perform such obligations; and (iii) not take or permit to be taken any action which would prevent or interfere with such performance. Ningbo shall exercise (directly or through Cixi City in the case of the Subsidiary Loan Agreement with CMSC) its rights under each Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower, the Bank and Ningbo, and to accomplish the purposes of the Loan, and except as the Bank shall otherwise agree, not assign, amend, abrogate or waive said Subsidiary Loan Agreement or any provision thereof. Tariff Adjustments 8. With respect to each Project Company’s revenue requirements set forth in paragraphs 7, 8, 9 and 10 of Section II in Schedule 3 to this Agreement, Ningbo shall take, and shall cause to be taken, all necessary measures to enable each Project Company to meet said requirements, including without limitation, adjustments of the levels of NWSC’s water supply tariffs and CMSC’s wastewater tariffs by July 1, 2006 and September 1, 2008. 9. With respect to Part C(4) of the Project, Ningbo shall: (a) furnish to the Bank by December 31, 2006, a time-bound action plan, prepared in accordance with terms of reference at all times satisfactory acceptable to the Bank (including that said plan be prepared with consumer participation, balanced consideration be given to supply and demand alternatives, and economic, financial, social and environmental factors be taken into account), for the supply of water to municipal and industrial customers in Ningbo City; and (b) thereafter, implement said plan taking into account the Bank’s comments thereon. 00. Ningbo shall: (a) (i) undertake semi-annual reviews of the adequacy of the design and construction of the Zhougongzhai Dam, throughout the period of its construction and for two years after said dam is commissioned; (ii) prepare and furnish to the Bank, promptly upon the completion of each said review, a report of the results of said review, together with any recommended changes to be introduced into the design, construction or operation of the Zhougongzhai Dam; and (iii) thereafter, promptly introduce the changes recommended by said report, taking into account the views of the Bank on the matter; and (b) upon completion of the Zhougongzhai Dam: (i) undertake annual inspections of the Zhougongzhai Dam in order to identify any deficiencies in its design, construction or condition or in the quality and adequacy of the maintenance or methods of its operation, which may endanger its safety or the safety of downstream life, property or activities; and (ii) promptly rectify any such deficiencies. 11. PCMU shall be headed by a Project coordinator and Ningbo shall ensure that the administrative, procurement, disbursement, financial management, monitoring each of Zhougongzhai Dam and evaluation Jiaokou Dam is operated and reporting arrangements are carried out maintained in accordance with the Project Implementation Plan. 3sound engineering practices. The Borrower To this end, Ningbo shall: (a) cause COTUNACE prepare an emergency preparedness plan for each dam; (b) furnish the same to carry out Part B the Bank not later than December 31, 2006; and (c) thereafter, promptly adopt said plan, taking into account the views of the Project;Bank on the matter.

Review by the Bank of Procurement Decisions. (a) Except as the Bank shall otherwise determine by notice to the Borrower, the following contracts and specified matters shall be subject to Prior Review by the Bank: (ia) each contract for goods and services (other than consultants’ services) works procured pursuant to paragraph A of Section II of this Schedule estimated to cost the equivalent of $200,000 10,000,000 or more; and each contract for works procured pursuant to paragraph B.1 of Section II of this Schedule estimated to cost the equivalent of $1,000,000 or more; (iib) the first two contracts each contract for goods procured pursuant to paragraph A of Section II of this Schedule estimated to cost the equivalent of $1,000,000 or more; and services (other consultants’ services) each contract for goods procured on pursuant to paragraph B.1 of Section II of this Schedule estimated to cost of the basis equivalent of National Competitive Bidding$100,000 or more; and each contract for goods procured pursuant to paragraph B.2 of Section II of this Schedule, regardless of its contract value; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (ivc) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 750,000 or more; (v) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vid) each contract for consultants’ services provided by an individual consultants estimated to cost the equivalent of $50,000 200,000 or more; (vii) all single source selection of consultants; and (viiie) amendments each contract for consultants’ services procured based on single source and sole source basis pursuant to contracts raising the paragraphs B.2 and B.3 of Section III of this Schedule, regardless of its contract value above the prior review threshold. (b) value. All other contracts shall be subject to Post Review by the Bank. 1. Without any limitation or restriction upon any other provision MWCI shall maintain, throughout the period of implementation of the Project, its Project Delivery Team, managed and staffed with personnel in adequate number, with functions and responsibilities satisfactory to the Bank, which shall be responsible for the overall implementation of the Project. 2. MWCI shall carry out the Project in accordance with the Financial Management Manual, acceptable to the Bank, which shall include reporting requirements and financial management procedures, including audit procedures, in accordance with Article IV of this Agreement Agreement. MWCI shall not assign, amend, abrogate or waive the Financial Management Manual, or any portion thereof, without the prior approval of the Bank. 3. MWCI shall: (a) carry out the Project in accordance with the Environmental Management Plan, the Resettlement Action Plans, the Environmental and Social Assessment Framework, and the Land Acquisition, Resettlement and Rehabilitation Policy Framework, in a manner satisfactory to the Bank; (b) furnish any proposed revision of the safeguards documents referred to in the sub-paragraph (a) above to the Bank for the purposes of Section 3.01 its prior approval; (c) of this Agreement, the Implementation Program for Parts B, C, D maintain policies and E of the Project shall consist of the following provisions: 1. Responsibility for general policy guidance procedures adequate to enable it to monitor and overall coordination of evaluate on an ongoing basis the carrying out of the Project shall be vested safeguards measures set forth in the Steering Committeedocuments referred to in the sub-paragraph (a) above, in accordance with indicators acceptable to the Bank; and (d) commencing June 30, 2006, furnish reports of annual audits performed by an independent agency, acceptable to the Bank, to be chaired by monitor and evaluate compliance with the Minister of Commerce or his representative and maintained by the Borrower throughout the duration implementation of the Project safeguards measures set forth in the documents referred to in sub-paragraph (a) above, and take all actions necessary to ensure compliance with membership such measures taking into consideration the recommendations from such audits and terms the Bank’s comments thereon. 4. MWCI, shall, no later than December 31, 2007, carry out public information campaign on the environmental benefits of reference at all times sewage and sanitation services and the best practices of proper disposal of sewage, in a manner, satisfactory to the Bank. 25. Responsibility for overall supervision With respect to Part A. 1(i) of the carrying out Project: (a) MWCI shall not: (i) commence construction of Parts Bthe sewage treatment plant in Tapayan, CXxxxxxx, D and E Hagonoy, or Taguig under said Part of the Project shall be vested according to the technical design approved by MWCI in PCMUDecember 2004, to be maintained unless (A) the land tilting claims resulting from the construction of the dike, and the pond in each of the four above-mentioned localities implemented by DPWH, have been resolved in accordance with the applicable laws of the Guarantor and by the Borrower throughout the duration Guarantor’s relevant authorities; (B) a memorandum of the Project with terms of reference at all times understanding, satisfactory to the Bank. PCMU shall be headed , has been duly entered into between MWCI and the Metro Manila Development Authority (MMDA) for the operation of each flood retention pond mentioned above; and (C) MWCI has made appropriate arrangements according to the applicable laws of the Philippines, for securing public land necessary for construction of each of the sewage treatment plants mentioned above; and (ii) Commence constructions of the sewage treatment plant in Tapayan according to the above-mentioned technical design, unless the Displaced Persons resulting from the construction by a Project coordinator DPWH of the dike or of the realigned dike at the Lupang Arrienda (near the Tapayan Pond), in each case including the construction of the Tapayan Pond, have been compensated and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out rehabilitated in accordance with a resettlement action plan, satisfactory to the Project Implementation PlanBank, in conformity with the Land Acquisition, Resettlement, and Rehabilitation Policy Framework. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;

Review by the Bank of Procurement Decisions. (a) Except as the Bank The Procurement Plan shall otherwise determine by notice to the Borrower, the following set forth those contracts and specified matters which shall be subject to Prior Review by the Bank: (i) each contract for goods and services (other than consultants’ services) estimated to cost the equivalent of $200,000 or more; (ii) the first two contracts for goods and services (other consultants’ services) procured on the basis of National Competitive Bidding; (iii) the draft bidding documents for goods to be procured by National Competitive Bidding; (iv) each contract for consultants’ services provided by a firm estimated to cost the equivalent of $100,000 or more; (v) the first two consultants’ contracts to be procured by selection based on Consultants Qualifications; (vi) each contract for consultants’ services provided by individual consultants estimated to cost the equivalent of $50,000 or more; (vii) all single source selection of consultants; and (viii) amendments to contracts raising the contract value above the prior review threshold. (b) ’s Prior Review. All other contracts shall be subject to Post Review by the Bank. Without any limitation or restriction upon any other provision of this Agreement and for the purposes of Section 3.01 (c) of this Agreement, the Implementation Program for Parts B, C, D and E of the Project shall consist of the following provisions:. 1. Responsibility The Borrower shall, throughout the duration of the Project, maintain the PIU under terms of reference and with a composition satisfactory to the Bank. The PIU shall be responsible for general policy guidance overall Project oversight, supervision, monitoring, and overall coordination coordination. The Borrower shall ensure that the PIU is at all times: (i) staffed with key personnel to carry out its operations, including a Project Manager who is responsible for the day-to-day operations of the PIU; engineers; and specialists in financial management, and procurement; and (ii) provided with adequate resources and suitably qualified and experienced staff in adequate numbers. 2. The Borrower shall: (a) ensure that: (i) its Directorate for Engineering Studies is vested with the responsibility of preparing and supervising the preparation of the infrastructure designs associated with Parts A and B of the Project; its Directorate of Construction is vested with the responsibility of carrying out the civil works under Parts A and B of the Project; its General Studies Directorate is vested with the responsibility of supervising the carrying out of the corporate plan study under Part C of the Project; its Directorate of Organization is vested with the responsibility of supervising the organizational and human resources audit under Part C of the Project; its Directorate of Finance and Accounting is vested with the responsibility of supervising the development of the financial simulation model under Part C of the Project; its Directorate of Operations and Directorate of Information Systems are jointly vested with the responsibility of the carrying out of the Project shall be vested in the Steering Committee, to be chaired by the Minister of Commerce or his representative and maintained by the Borrower throughout the duration activities under Part C of the Project Project; and its Directorate of Human Resources and Directorate of Information Systems are jointly vested with membership the responsibility of the carrying out of activities under Part C of the Project; and (b) cause each of said Directorates to carry out its respective responsibilities consistent with this Agreement, all in a manner and terms of reference at all times substance satisfactory to the Bank. 2. Responsibility for overall supervision of the carrying out of Parts B, C, D and E of the Project shall be vested in PCMU, to be maintained by the Borrower throughout the duration of the Project with terms of reference at all times satisfactory to the Bank. PCMU shall be headed by a Project coordinator and shall ensure that the administrative, procurement, disbursement, financial management, monitoring and evaluation and reporting arrangements are carried out in accordance with the Project Implementation Plan. 3. The Borrower shall: (a) cause COTUNACE to carry out Part B of the Project;