The World Bank 1818 H Street N.W 3-1000INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Washington, D.C. 3 Cabpi Address: INTBAFRADINTERNATIONAL DEVELOPMENT ASSOCIATION U.S.A. L-" i able Address: INDEVAS

IV)c~rck L~~ 2016Dr. Caleb M. FundangaExecutive DirectorMacroeconomic and Financial Management Institute of

Eastern and Southern Africa (MEFMI)9 Earls Road, Alexandra ParkPO Box A1419, Avondale, HarareZimbabwe

Dear Dr. Ngalande,

Re: DMF II Grant to MEFMI - Grant No. TF0A2231 (Debt Management Facility Phase II)

Additional Instructions: Disbursement

I refer to the Letter Agreement ("Agreement") between Macroeconomic and FinancialManagement Institute of Eastern and Southerm Africa (MEFMI) ("Recipient"), and the International Bankfor Reconstruction and Development (IBRD) and the International Development Association (IDA)(collectively, "World Bank"), acting as administrator of grant funds provided by various Donors under DebtManagement Facility Phase II (DMF II TF072132), dated M6 rc J?, 2016. The Agreement providesthat the World Bank may issue additional instructions regarding the withdrawal of the proceeds of GrantTF0A2231 ("Grant"). This letter ("Disbursement Letter"), as revised from time to time, constitutes theadditional instructions.

The attached World Bank Disbursement Guidelines for Projects, dated May 1, 2006,("Disbursement Guidelines") (Attachment 1), are an integral part of the Disbursement Letter. The mannerin which the provisions in the Disbursement Guidelines apply to the Grant is specified below. Sections andsubsections in parentheses below refer to the relevant sections and subsections in the DisbursementGuidelines and, unless otherwise defined in this letter, the capitalized terms used have the meaningsascribed to them in the Disbursement Guidelines.

I. Disbursement Arrangements

(i) Disbursement Methods (section 2). The following Disbursement Methods may be used under theGrant:

* Reimbursement* Advance* Direct Payment

(ii) Disbursement Deadline Date (subsection 3.7). The Disbursement Deadline Date is 4 months afterthe Closing Date specified in the Grant Agreement. Any changes to this date will be notified by the WorldBank.

(iii) Disbursement Conditions (subsection 3.8). Please refer to the Withdrawal Condition(s) in Section

3.02 of the Annex to the Grant Agreement.

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II. Withdrawal of Grant Proceeds

(i) Authorized Signatures (subsection 3.1).

A letter in the Form attached (Attachment 2) should be furnished to the World Bank at the address indicatedbelow providing the name(s) and specimen signature(s) of the official(s) authorized to submit Applications:

The World Bank1818, H Street, N.W.Washington DC 20433United States of America

Attention: Senior Director, Macro-economics and Fiscal Management Global Practice(C/O Abha Prasad)

(ii) Applications (subsections 3.2- 3.3). Please provide completed applications for withdrawal, togetherwith supporting documents, through the World Bank's Client Connection, web-based portal, following theinstructions for electronic delivery. In the case the recipient does not have internet access, the World Bankmay permit the delivery of applications for withdrawal, together with supporting documents, in accordancewith subsection 3.3, to the following address:

The World Bank13th floor, Delta Center, Menengai Road,Upper Hill, PO Box 30: 77-00 100Nairobi, Kenya

Attention: Loan Department

(iii) Electronic Delivery (subsection 3.4) The World Bank may permit the Recipient to electronicallydeliver to the Association Applications (with supporting documents) through the Association's ClientConnection, web-based portal. The option to deliver Applications to the World Bank by electronic meansmay be effected if: (a) the Recipient has designated in writing, pursuant to the terms of subparagraph (i) ofthis Section, its officials who are authorized to sign and deliver Applications and to receive secureidentification credentials ("SIDC") from the World Bank for the purpose of delivering such Applicationsby electronic means; and (b) all such officials designated by the Recipient have registered as users of ClientConnection. If the World Bank agrees, the World Bank will provide the Recipient with SIDC for thedesignated officials. Following which, the designated officials may deliver Applications electronically bycompleting Form 2380, which is accessible through Client Connection(https://clientconnection.worldbank.or ). The Recipient may continue to exercise the option of preparingand delivering Applications in paper form. The World Bank reserves the right and may, in its solediscretion, temporarily or permanently disallow the electronic delivery of Applications by the Recipient.

(iv) Terms and Conditions of Use of SIDC to Process Applications. By designating officials to acceptSIDC and by choosing to deliver the Applications electronically, the Recipient confirms through theauthorized signatory letter its agreement to: (a) abide by the Terms and Conditions of Use of SecureIdentification Credentials in connection with Use of Electronic Means to Process Applications andSupporting Documentation ("Terms and Conditions of Use of SIDC") provided in Attachment [3]; and (b)to deliver the Terms and Conditions of Use of SIDC to each such official and to cause such official to abideby those terms and conditions.

(v) Minimum Value of Applications (subsection 3.5). The Minimum Value of Applications forReimbursements and Direct Payments is USD 50,000

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(vi) Advances (sections 5 and 6)

* Type ofDesignated Account (Subsection 5.3): Segregated

* Currency of Designated Account (subsection 5.4): USD

* Financial Institution at which the Designated Account Will Be Opened (subsection 5.5):Stanbic Bank Zimbabwe Limited

* Ceiling (subsection 6.1) Forecast of two quarters as provided in the Interim financial report

III. Reporting on Use of Grant Proceeds

(i) Supporting Documentation (section 4). Supporting documentation should be provided with eachapplication for withdrawal as set out below:

* For requests for Reimbursement:

o Interim Financial report in the form attached (Attachment 4)

o List of payments against contracts that are subject to The World Bank's prior review, inthe form attached (Attachment 5)

* For reporting eligible expenditures paid from the Designated Account:

o Interim Financial report in the form attached (Attachment 4)

o List of payments against contracts that are subject to the World Bank's prior review, inthe form attached (Attachment 5); and,

O A reconciliation of the Designated Account, in the form attached (Attachment 6), witha copy of the bank statement.

* For requests for Direct Payment: records evidencing eligible expenditures, e.g., copies ofreceipts, supplier invoices

(ii) Frequency of Reporting Eligible Expenditures Paid from the Designated Account (subsection 6.3):Monthly

IV. Other Disbursement Instructions:

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V. Other Important Information

For additional information on disbursement arrangements, please refer to the DisbursementHandbook available on the World Bank's public website at https://www.worldbank.org and its securewebsite "Client Connection" at https://clientconnection.worldbank.or. Print copies are available uponrequest.

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From the Client Connection website, you will be able to download Applications, monitor the near

real-time status of the Grant, and retrieve related policy, financial, and procurement information.

If you have not already done so, the World Bank recommends that you register as a user of theClient Connection website (https://clientconnection.worldbank.org). From this website you will be able todownload Applications, monitor the near real-time status of the Grant, and retrieve related policy, financial,and procurement information. All Recipient officials authorized to sign and deliver Applications byelectronic means are required to register with Client Connection before electronic delivery can be affected.For more information about the website and registration arrangements, please contact the World Bank byemail at <clientconnection@worldbank.org>.

If you have any queries in relation to the above, please contact WFALD-TF by sending an emailto WFALD-tf@worldbank.org and using the trust fund number as a reference.

Very truly yours,

INTERNATIONAL BANK FOR ONSTRUCTION AND DEVELOPMENT/INTERNATIONAL E LOPMENT ASSOCIATION

ByAnda Van eder

Acting Senior Dire rMacroeconomics and Fisc Management

Global Practice

Attachments

1. World Bank Disbursement Guidelines for Projects, dated May 1, 20062. Form for Authorized Signatures3. Terms and Conditions of Use ofSecure Identification Credentials in connection with Use of

Electronic Means to Process Applications and Supporting Documentation, dated March 1, 20134. Interim Financial Report5. Form of Payments Against Contracts Subject to the World Bank's Prior Review6. Designated Account Reconciliation Statement

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Attachment 1

= THE WORLD BANK

DISBURSEMENTGUIDELINESFOR PROJECTS

MAY 2006

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WORLD BANK

DISBURSEMENT GUIDELINESFOR PROJECTS

LOAN DEPARTMENTMay 1, 2006

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CONTENTS

Page

1. P u rp ose ......................................................... ................ .5

I Disbursement 'vIetho(ls-- ... ....... .................. ............... 6

I W itbdrawal of Loan Procceds,... ... ........ ............. 6

4 Supporting Documentation Requirements .................. 9

Designated Account-,..... ... - ........... ....................... A0

6. Ternis and Conditions Applicable to Advances .............. 12

7. Ineligi Expenditures ............. ..................................... 14

11 efu nd.: .................. ................ .............. ............... ....... 15

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World BankDisbursement Guidelines

for ProjectsMay 1, 2006

1.Purpose

1.1 The purpose of these Guidelines is to set out the Baiks

procedures for disbursernent of loan proceeds for projects.Specifically, the Guidelines xplain (a) the different methodsused by the Bank to disbursc loai proceeds. ib: the require-ments for withdrawal from the Loan Account. (ci the typesof supporting documentation that the borrower may be re-quired to provide to demoistrate the use of loan proceedsfor eligible expenditures, (d, the criteria for est ablishing des-ignated accounts, (i the terms and conditions applicable toadvances. ,f) the types of actions that the Bank may takeif it determines that loan proceceds are not needed or havebeen used for ineligible purposes. and (g, the consequene ofrefunds.

ank~ includes IBR) and IDA: "loan- iicluds credi and gram: -hor-rower" includes the borrower of an IBR D nui. IDA credit. or Pro-ect Prepa-ration 1aciity advanceand th roepient of a granTI: and -Loar A greernentircludes the agreemnt with the Bank providfing tor a crvdi. grant. or ad-vas:ee. ihese Dishursemeni Cuidelines apply to al! loans, credits. advancesunder the Project Preparation Facilty and grants financeci under it- [rn-

itutional D-veloprient iund and Coba] E nvironntr acilitv uless oth-erwise provided in Operational Policy 1020. 2 iI1nr'o ' l aOp' o0ts |forthcorning. bse Guidesims also apply to other recipeint-executed grants finmanced from trust funds unles<s. exceptonally he termrsof i he agrcernert with the donor make provision for differenu reqirements.l hey do not appli to Developmei Policy loantis.

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2. Disbursement Methods

2.1 The Bank establishes disbursement arrangericnts for an op-eration in consultation with the borrower and taking intoconsideration, inter alia. an assessment of the borrower'sfnancial management and procurement arrangemients. theprocurement plan and cash flow ieeds of the operation. andits disbursement experience with the borrower.

2.2 The Bank disburses proceeds from the Ioan Account estab-lished for each loan. to or on the order of the borrower_ usingone or more of the disbursement methods set forth below. asdetermined by the Bank.

(a) Reimbursement: The Bank rnayv reimburse the bor-rower for expeiiditures eligible for fiancing pursuant tothe Loan Agreement (-eligible expenditures"'t that theborrower has prefmanceid from its own resources.

(b) Advance: The 13ank may advance loan proceeds intoa designated account of the borrower to finance eligibleexpenditures as they are incurred and for which sup-porting documents will be provided at a later date (seesection 5. "Designated Accounts"'_

(c) Direct Payment: The Bank may make payments. atthe borrower's request, directly to a third party (e.g..supplier. contractor, consultant.: for eligible expendi-tures.

(d) Special Commitment: Thc Bank max' pay' amountsto a third party for cligible expenditures under specialcommitments eitered into. in writing. at the borrower'srequest and on terms and conditions agreed between theBaik and the borrower.

3. Withdrawal of Loan Proceeds

3.1 Authorized Signatures. Before loan proceeds may bewithdrawn or coiimmitted from the Loan Account. the au-

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thorized representative of the borrower (as designated in theLoan Agreeient) must furnish to the Bank (a) the name{ s)of the officialfs) authorized to sign applications for with-drawal and applications for a special cornmitnient (collec-tively. "Applications"), and ý b) the authenticated sptximiensignature(s) of the officialls). The borrower must iridicateclearly if more than one signature is required on Applica-tions and must notify the Bank promptly of any changt insignature authority.

3.2 Applications. Applications must be provided to the Bankin such form and inclide such information as the Bank mayreasoiail request. Application forms are available onlinefrom the Client Connection Web site at http:I nt ennnr-

on. worldbank. orq or from the Bank upon request.

3.3 For withdrawal from the Loan Account for advances. theborrower should provide an original signed application forwithdrawal. For withdrawal fron the Loan Accoint for re-imburscments and direct payments and for reporting on theiuse of advances. the borrower shoild provide an originalsigned application for withdrawal together with one copyof supporting doctiments (see section 1. "Supporting Doci-mentation Requirements'). For a special commitment fromthe Loan Accouint, the borrower should provide an originalsigned application for a special comritrnent together withone copy of the letter of eredit. The Bank reserves the rightnot to accept or review duplicate copies of Applications andsupporting docurments and may at its discretion return ordestrov the duplicates

3.4 Electronic Delivery. The Bank rmay authorize the bor-rower to use electronic means. in a manner and on terisand conditions specified by the Bank. to deliver Applicationsand supporting documenitation to the Bank. Applicationsand supporting documientatioi delivered in accordance withthis subsection will be deemed to have been provided to theBank for the purposes of satisfying the requirumernts of sitb-sections 3.2 and 3.3 of these Guidelines.

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3.5 Minimum Valuc of A pplications. The Bank establishesa minimum valuc for Applications for reimbursemerit. direct

paynenit. and special comrnitment. The Bank reserves theright not to accept Applicatiois that are below such mini-mum value.

3.6 Loan Disbursing Period. The Bank processes Appli-cations only after the Loari Agreement has been declaredeffective in accordance with the terms of the Loan AgreCe-ment. The expenditures for which the Applications aremade inust be:

(a) paid for (i) on or after the date of the Loan Agreement.,or (ii) in the case of operations that permit retroactive

fmancing. on or after the earlier date specified in theLoan Agreement for that purpose: and

(b) incurred on or before the closing date specified or re-ferred to in the Loan Agreemeni ( Closing Date- i. ex-cept as otherwise specihcally agreed with the Bank.

3.7 1 he loan disbursing period ends on t he final date est ablished

by the Bank for receipt by the Bank of applications for with-

drawal and supporting documentation (the "Disbursement

Deadline Date"). The Disbursement Deadline Date may bethe same as the Closing Date, or up to four nonths after the

Closinåg Date. Normallv. to support orderlv project comple-

tion and closure of the Loan Accoint. the Bank does not ac-cept applications for withdrawal or supporting documentation

received after the Disbursement Deadline Date. Yhe borrowershould promptly inforn the Bank of any expected implemen-tation delavs or exceptional administrative issues before these

dates. The Bank notifies the borrower of any exception that

the Bank may make to the Disbursement Deadline Date.

3.8 Disbursement Conditions. If the Loan Agreemnr t con-

tains a disbursement condition for a specific expenditure cat-

egorv. the Bank will disburse loan proceeds for that category

onilv after the disbursement condition has been fulfiled and

the Bank has notifed the borrower lo this effect.

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4. Supporting Documentation Requirements

4.1 The borrower provides supporting documentation to theBank to show that loan proceeds have been or are beingused to finance eligible expenditures.

4.2 For special corminitierits, the commercial bank provides itsconfirmnatiot directly to the Bank that conditions for releaseof payments comtmitted for withdrawal have beeni met.

4.3 Types of Supporting Documentation. The Bank re-quires either copies of the original documents evidencingeligible expenditures (-Records") or summary reports of ex-penditure f-Summary Reports") in such form and substanceas the Bank may specify. Records include such documentsas invoices and receipts. A Summary Report may be either

'a) the interim un-audited financial report required underthe Loan Agrement "Interim Financial Report"i or (b;a statement of expenditure summarizing eligible expendi-tures paid during a stated period ("Statement of Expendi-ture" }. In all cases, the borrower is responsible for retainingthe original documents evidencing eligible expenditures andmaking them.available for audit or inspection.

4.4 The Bank determines the types of supporting docunient ationthat the borrower should provide, taking into considerationthe disbursement method used. The supporting docurnenta-tion may be the following:

(a) For applications for reimbursement: Ji) InterimFinancial Reports. ii) Statements of Expenditure. iiii)Records. or (iv) Records required by the Bank for spe-cific expenditures and Statements of Expenditure for allother expenditures;

(b) For reporting on the use of advances: (i) InterimFinancial Reports. ii) Statements of Expenditure. liii

Records, or (iv) Records required by the Bank for spe-cific expei(itures and Statements of Expenditure for allother expendit ures;

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(c) For applications for direct payments: Records:and

(d) Any other supporting documentation that the Bankmay reuest by notice to the borrower.

4.5 Failure to Provide Audited Financial Statements. Ifthe borrower fails to provide any of the audited FinancialStatements required in accordance with, and within the pe-riod of time specified in. the Loan Agreement, the Bank mayat its discretion decide not to accept applications for with-

drawal supported by Summary Reports. even if such reportsare accompanied by Records.

5. Designated Accounts

5.1 The borrower may open one or more designated accountsinto which the Bank may. at the borrower's request. de-posit amounts withdrawn from the Loan Account for thepurpose of paying for eligible experditures as they are in-curred ("Designated Account"). Before the Bank authorizesestablishment of a Designated Account, the borrower rmuthave adequate administrative capability. internal controls.and accounting and auditing procedures to ensure effectiveuse of the Designated Account.

5.2 The Baik may decide not to permit the usc of DesignatedAccounts in new projects if the borrower has failed to re-fund undocumented advances in the Designated Account ofany other loan to. or guaranteed by. the borrower withintwo months after the Disbursement Deadline Date for suchloan.

5.3 Type of Designated Account. A Designated Account maybe established in one of the two ways set out below, as ap-propriate for the operation concerned. as determined andnotified by the Ba,nk.

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(a) Segregated Account: this is an account of the borrowerinto which only proceeds of the loan may be deposited;or

(b) Pooled Account: this is an account of the borrowerinto which the loan proceeds and proceeds of other fi-nancing for the operation (e.g.- borrower resources and/or financing by other development partiers) may be de-posited.

5.4 Currency of the Designated Account. Designated Ac-couits must be in a currency acceptable to the Bank. Incountries that have a freely convertible currency. DesignatedAccounts may be held in the currency of the borrower orany freely convertible currency The Bank may also agreeto local currency Designated Accouits when, intr ab1, thecountry s currency (even if not freely convertible is stableand the expenditures to be fimanced are primarily in lo-cal currencv. The borrower bears all risks associated withforeign exchange fluctuations between (a) the currency ofdenomination of the loan and that of the borrower's Desig-nated Account, and ib) the currency of denomination of the

borrower's Designated Account and the currency or currei-cies of project expeiiditures.

5.5 Financial Institution. Designated Accounts must beopened and maintained in a financial institution accept-able to the Bank on terms and conditions acceptable to theBank. To be acceptable to the Bank. the fimancial institutionproposed by the borrower should generally meet all the fol-lowing requirements:

(a) be fimiancially soud:

(b) be authorized to maintain the D)esignated Account inthe currency agreed between the Bank and the bor-rower:

(c) be audited regularly. and receive satisfactory audit re-ports:

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(d) be able to execute a large number of transactionspromptly:

(e) be able to perform a wide range of banking services sat-isfactorily:

(f) be able to provide a detailed statement of the Desig-nated Account:

(g) be part of a satisfactory correspondent banking network:and

(h) charge reasonable fees for its services.

5.6 The Bank reserves the right not to accept a financial insti-tution for the opening aid/or maintenance of a DesignatedAccount if such institution has asserted or asserts a claimto set off. seize. or attach the proceeds of any Bank loan ondeposit in a Designated Account maintained by it.

6. Terms and Conditions Applicable to Advances

6.1 Ceiling. The Bank notifies the borrower of the maximumamount of loan proceeds that may be on deposit in a Desig-nated Account (the "Cciling" }. The Bank. at its discretioi.mav establish the Ceiliug as either Ia) a fixed amount. or (b)an amount that is adjusted from time to time during projectimplemeitation based on periodic forecasts of project cashflow needs.

6.2 Applications for Advances. The borrower may apply foran advance in an amounit up to the Ceiling less the aggre-gate amnolunt of those advances previously received by theborrower for which the borrower has not yet provided sup-porting documentation. Normally, to support orderly closureof the Loan Account. the Bank does not advance loan pro-

ceeds into the Designated Account after the Closing Date.

6.3 RFequency of Reporting Eligible Expenditures Paidfrom the Designated Account. The borrower reports onthe use of loan proceeds advanced to the Designated Account

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at intervals specified by the Bank by notice to the borrowerf"Reporting Period"). The borrower should ensure that all

amounts deposited in the Designated Account are accountedfor and their use reported prior to the Disbursement Dead-line Date. After this date. the borrower must refund to theBank any advances still unaccounted for or remaining in theDesignated Account.

6.4 Withholding Advances. The Bank is not required to makeany deposit into the Designated Account if:

(a) The Bank deterimines that payment of the deposit wouldresult in exceeding the Ceiling (see subsection 6.2. "Ap-plications for Advances ):

(b) The Bank is not satisfied that the borrower's plannedproject expenditures justify the deposit. The Bank may.by notice to the borrower. adjust the amount it depositsor withhold further deposits into the Designated Ac-count until it is satisfied that the financial needs of theproject warrant further deposits:

(c) The borrower fails to take the action required pursuantto the determinations made by the Bank under subsec-tions 7.1 and 7.2 of these Guidelines.

(d) The borrower fails to provide any of the audited Firan-cial Statements required in accordance with. and withinthe period of time specified in. the Loan Agreement:

(e) The Bank determines that all further withdrawals ofloan proceeds should be made by the borrower directlvfrom the Loan Account: or

(f) The Bank has notified the borrower of its intention tosuspend in whole or in part. the borrower's right to makewithdrawals from the Loan Account.

6.5 Excess Advances. If at any time the Bank determines thatany amonT deposited in the Designated Account will not herequired to cover further payments for eligible expenditures

"Excess Amount"), it may, at its discretion, require theborrower to take one of the two actions listed below. Upon

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Vall Ith.ik D)i:ou us C Uilauds luM Pfri a 3

notification by the Baiik. the borrower miLst promptly takethe action requested:

(a) Provide evidence satisfactory to the Bank within a pe-riod specified by the Batk that the Excess Amount willIbe used to pay for eligible expenditures. If the evidenceis not furnished within the time period specified. theborrower must promptly refiund the Excess Amount tothe Bank: or

(b) Refund the Excess Amount promptly.

7. Ineligible Expenditures

7.1 Ineligible Expenditures Generally. If the Bank deter-mines that any amount of the loan was used to pay for anexpenditure that is not eligible pursuant to the Loan Agree-merit "ineligible expenditure"). the Baiik may. at its dis-cretion. require the borrower to take one of the two actionSlisted below. Upon notification by the Bank. the borrowerriust promptly take the action requested:

(a) Refund an equivalent amount to the Bank: or

(b) Except ionally. provide substnitute documentation exi-dencing other eligible expenditures.

7.2 Ineligible Expenditures Paid from the DesignatedAccount. If the Bank determines that any payment out ofthe DNesignated Account was not justified by the evidencefurnished to the Bank or was made for an ineligible expen-diture. the Baik may, at its discretion. require the borrowerto take one of the actions listed below. Upon notificationby the Baik. the borrower must promptly take the actionreqlested:

(a) Provide the additional evidence requested by the Bank:

(b) )eposit an equivalent amount into the Designated Ac-

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(c) Refund an equivalent amount to the Bank: or

(d) Exceptionally. provide substitute documentation evi-dencing other eligible expenditures.

8. Refunds

8.1 Borrower Decision to Refund. The borrower may. uponnotice to the Bank. refund all or any amount of the loan ondeposit in the Designated Account to the Bank for credit to

the Loan Account.

8.2 Consequence of Refunds. The Bank shall determinewhether refunds made to the Bank in accordance with sec-tions 6 and 7 and subsection 8.1 of these DisbursementGuidelines will be credited to the Loan Account for subse-quent withdrawal or for cancellation. Borrowers should beaware that refunds of loan proceeds may result in swap ter-mination fees and/or unwinding costs for amounts for whichthe interest rate basis or currency has been converted orhedged.

8.3 Other Obligations Unaffected by Refunds. Refunds ofamounts of the loan do not affect any remedies of the Bankunder the Loan Agreement.

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l I WORLD 1BANKThe Loan Departmiient

World 204nkI1818 HI S:reet, NWVWashmpyton, D( 20>433Emra il wbdisbursementtworLbank or

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Attachment 2

[Letterhead][Street address]

[City] [Country][DATE]

The World Bank1818, H Street, N.W.Washington DC 20433United States of America

Attention: Senior Director, Macro-economics and Fiscal Managment Global Practice

Dear Senior Director:

Re: DMF II Grant to MEFMI - Grant No. TF0A2231 (Debt Management Facility Phase I)

I refer to the Letter Agreement ("Agreement") between Macroeconomic and FinancialManagement Institute of Eastern and Southerm Africa (MEFMI) ("Recipient"), and the International Bankfor Reconstruction and Development (IBRD)/ International Development Association (IDA) ("WorldBank"), acting as administrator of grant funds provided by various Donors under Debt Management FacilityPhase II (DMF II TF072132), dated ,2016. For the purposes of Section 3.04 (b) of the StandardConditions, as defined in the Agreement, any [1one] of the persons whose authenticated specimen signaturesappear below is authorized on behalf of the Recipient to sign applications for withdrawal under this Grant.

For the purpose of delivering Applications to the World Bank, '[each] of the persons whoseauthenticated specimen signatures appears below is authorized on behalf of the Recipient, acting'[individually] 4 [jointly], to deliver Applications, and evidence in support thereof on the terms andconditions specified by the World Bank.

s[This confirms that the Recipient is authorizing such persons to accept Secure IdentificationCredentials (SIDC) and to deliver the Applications and supporting documents to the World Bank byelectronic means. In full recognition that the World Bank shall rely upon such representations andwarranties, including without limitation, the representations and warranties contained in the Terms andConditions of Use of Secure Identification Credentials in connection with Use of Electronic Means toProcess Applications and Supporting Documentation ("Terms and Conditions of Use of SIDC"), the

'Instruction to the Recipient when sending this letter to the World Bank: Stipulate if more than one person needs to signApplications, and how many or which positions, and if any thresholds apply. Please delete this footnote in final letter that is sentto the World Bank.

2 Instruction to the Recipient: Stipulate if more than one person needs to jointly sign Applications, if so, please indicate theactual number. Please delete this footnote in final letter that is sent to the World Bank.

Instruction to the Recipient: Use this bracket if any one of the authorized persons may sign; if this is not applicable, pleasedelete. Please delete this footnote in final letter that is sent to the World Bank.

4 Instruction to the Recipient: Use this bracket only if several individuals must jointly sign each Application; if this is notapplicable, please delete. Please delete this footnote in final letter that is sent to the World Bank.

s Instruction to the Recipient: Add this paragraph if the Recipient wishes to authorize the listed persons to accept Tokens andto deliver Applications by electronic means; if this is not applicable, please delete the paragraph. Please delete this footnote infinal letter that is sent to the World Bank.

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Recipient represents and warrants to the World Bank that it will cause such persons to abide by those termsand conditions.]

This Authorization replaces and supersedes any Authorization currently in the World Bank recordswith respect to this Agreement.

[Name], [position] Specimen Signature:

[Name], [position] Specimen Signature:

[Name], [position] Specimen Signature:

Yours truly,

/ signed /

Executive Director

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Attachment 3

Terms and Conditions of Use of Secure Identification Credentials

in connection with Use of Electronic Means

to Process Applications

and Supporting Documentation

March 1, 2013

The World Bank (Bank)6 will provide secure identification credentials (SIDC) to permit the Borrower7 todeliver applications for withdrawal and applications for special commitments under the Agreement(s) andsupporting documentation (such applications and supporting documentation together referred to in theseTerms and Conditions of Use as Applications) to the Bank electronically, on the terms and conditions ofuse specified herein.

SIDC can be either: (a) hardware-based (Physical Token), or (b) software-based (Soft Token). The Bankreserves the right to determine which type of SIDC is most appropriate.

A. Identification of Users.

1. The Borrower will be required to identify in a completed Authorized Signatory Letter (ASL) dulydelivered to and received by the Bank each person who will be authorized to deliver Applications.The Bank will provide SIDC to each person identified in the ASL (Signatory), as provided below.The Borrower shall also immediately notify the Bank if a Signatory is no longer authorized by theBorrower to act as a Signatory.

2. Each Signatory must register as a user on the Bank's Client Connection (CC) website(https://clientconnection.worldbank.or) prior to receipt of his/her SIDC. Registration on CC willrequire that the Signatory establish a CC password (CC Password). The Signatory shall not revealhis/her CC Password to anyone or store or record the CC Password in written or other form. Uponregistration as a CC user, the Signatory will be assigned a unique identifying account name.

B. Initialization of SIDC.

1. Prior to initialization of SIDC by a Signatory, the Signatory will acknowledge having read,understood and agreed to be bound by these Terms and Conditions of Use.

2. Where a Physical Token is to be used, promptly upon receipt of the Physical Token, the Signatorywill access CC using his/her account name and CC Password and register his/her Physical Tokenand set a personal identification number (PIN) to be used in connection with the use of his/herPhysical Token, after which the Physical Token will be initialized for use by the Signatory

6 "Bank" includes IBRD and IDA."Borrower" includes the borrower of an IBRD loan, IDA credit, or Project Preparation Facility advance and the

recipient of a grant.

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exclusively for purposes of delivering Applications. Where a Soft Token is to be used, theSignatory will access CC using his/her account name and CC Password and set a personalidentification number (PIN) to be used in connection with the use of his/her Soft Token, after whichthe Soft Token will be initialized for use by the Signatory exclusively for purposes of deliveringApplications. Upon initialization of the SIDC, the Signatory will be a "SIDC User". The Bank willmaintain in its database a user account (Account) for each SIDC User for purposes of managingthe SIDC of the SIDC User. Neither the Borrower nor the SIDC User will have any access to theAccount.

3. Prior to first use of the SIDC by the SIDC User, the Borrower shall ensure that the SIDC User hasreceived training materials provided by the Bank in use of the SIDC.

3. Use of SIDC.

Use of the SIDC is strictly limited to use in the delivery of Applications by the SIDC User in themanner prescribed by the Bank in the Agreement(s) and these Terms and Conditions. Any otheruse of the SIDC is prohibited.

The Bank assumes no responsibility or liability whatsoever for any misuse of the SIDC by theSIDC User, other representatives of the Borrower, or third parties.

The Borrower undertakes to ensure, and represents and warrants to the Bank (such representationand warranty being expressly relied upon by the Bank in granting SIDC) that each SIDC Userunderstands and will abide by, these Terms and Conditions of Use, including without limitation thefollowing:

4. Security

4.1. The SIDC User shall not reveal his/her PIN to anyone or store or record the PIN in writtenor other form.

4.2. The SIDC User shall not allow anyone else to utilize his/her SIDC to deliver an Applicationto the Bank.

4.3. The SIDC User shall always logout from CC when not using the system. Failure to logoutproperly can create a route into the system that is unprotected.

4.4. If the SIDC User believes a third party has learned his/her PIN or has lost his/her PhysicalToken he/she shall immediately notify clientconnectionAworldbank.org.

4.5. The Borrower shall immediately notify the Bank at clientconnection@worldbank.org of anylost, stolen or compromised SIDC, and take other reasonable steps to ensure such SIDC are disabledimmediately.

5. Reservation of Right to Disable SIDC

5.1. The Borrower shall reserve the right to revoke the authorization of a SIDC User to use aSIDC for any reason.

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5.2. The Bank reserves the right, in its sole discretion, to temporarily or permanently disable aSIDC, de-activate a SIDC User's Account or both.

6. Care of Physical Tokens

6.1. Physical Tokens will remain the property of the Bank.

6.2. The Bank will physically deliver a Physical Token to each Signatory designated to receiveone in a manner to be determined by and satisfactory to the Bank.

6.3. Physical Tokens contain delicate and sophisticated instrumentation and therefore should behandled with due care, and should not be immersed in liquids, exposed to extreme temperatures,crushed or bent. Also, Physical Tokens should be kept more than five (5) cm from devices thatgenerate electromagnetic radiation (EMR), such as mobile phones, phone-enabled PDAs, smartphones and other similar devices. Physical Tokens should be carried and stored separate from anyEMR device. At close range (less than 5 cm), these devices can output high levels of EMR thatcan interfere with the proper operation of electronic equipment, including the Physical Token.

6.4. Without derogating from these Terms and Conditions of Use, other technical instructions onthe proper use and care of Physical Tokens are available at http://www.rsa.com.

7. Replacement

7.1. Lost, damaged, compromised (in terms of 4.5, above) or destroyed Physical Tokens will bereplaced at the expense of the Borrower.

7.2. The Bank reserves the right, in its sole discretion, not to replace any Physical Token in thecase of misuse, or not to reactivate a SIDC User's Account.

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Attachment - 4

interim Financial Report Template

MEMFI, Proect P158441, TF#

Operating Cost/iiTrainingl Cat 1 Cumulative

Total Cat 2 Total for the Expenditure up to

Main activity aIn hous Travel incremental Quarter (S) the reporting period Projected Budget for

Budgetstaff cost cost ) the next six months

1 2 3 4 5-1+2+3+4) 6-PreviousCum+5

Opening Balance

Funds received from[ World Bank]

Co finance received for the period (if any)

Interest earned plus b/f

Total Fund

Project ActivitiesSystematice and regular application ofthe DebtManagement Performance assessment IDeMPAt tool 91,30.00

TA to support the Development of midtern MTDS with

the aid of MTDSTool kit 135,80000TAto support Domestic Debt MarketDevieopemt

15,40D.ODKnowledge Management and Training activities,througo outreacin and sensitiation events, research

and workshops targeting practioneers 611,706.00

Sub Total Actual Project Activity Expenditure 1a)

ApproudBdgetbwArte 854,706.00 446,58001 106,800.OD 233,880.00 67,446.00

Total Expenditwe of World Bank/Prograrn Grant c = a

Total Expenditure of Cofinanced Expenditure (if any)

Total Actual Cats for the Project including Cofinancing

rot PfoaectsAuner n-JU COfnMingUM

Closing Balance

WBGrant Funds Carried Forward

Interest carried over

Ca financing Grant Funds Carried Forward

Prepared by Authorized Signatory and Date

Note i;= Refer Grant agreement Art III 3.011iifor eligible expenditure underTraining Note i= Refer Grant Agreement Art 11 3 01 li)for eligible expenditure under Operating Cost

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Attachment 5

Payments Made during Reporting Period

Against Contracts Subject to the World Bank's Prior Review

Date ofWB's Non WB's Share ofObjection Amount Paid to Amt Paid to

Contract Contract Contract to Supplier during Supplier duringNumber Supplier Date Amount Contract Period Period

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Attachment 6DESIGNATED ACCOUNT RECONCILIATION STATEMENT

TRUST FUND NUMBERACCOUNT NUMBER WITH (BANK)

1. TOTAL ADVANCED BY WORLD BANK (OR COFINANCIER) $2 LESS: TOTAL AMOUNT RECOVERED BY WORLD BANK -$

3. EQUALS PRESENT OUTSTANDING AMOUNT ADVANCED TOTHE DESIGNATED ACCOUNT (NUMBER 1 LESS NUMBER 2) = $

4. BALANCE OF DESIGNATED ACCOUNT PER ATTACHED BANKSTATEMENT AS OF DATE $

5. PLUS: TOTAL AMOUNT CLAIMED IN THISAPPLICATION NO. +$ *

6. PLUS: TOTAL AMOUNT WITHDRAWN AND NOT YET CLAIMEDREASON: +$ *

7. PLUS: AMOUNTS CLAIMED IN PREVIOUS APPLICATIONSNOT YET CREDITED AT DATE OF BANK STATEMENTS

APPLICATION NO. AMOUNT *

SUBTOTAL OF PREVIOUSAPPLICATIONS NOT YET CREDITED + $

8. MINUS: INTEREST EARNED - $ *

9. TOTAL ADVANCE ACCOUNTED FOR (NO. 4 THROUGH NO. 9) = $

10. EXPLANATION OF ANY DIFFERENCE BETWEEN THE TOTALS APPEARING ON LINES 3 AND 9:

11. DATE: SIGNATURE:TITLE:

* ALL ITEMS SHOULD BE INDICATED ON THE BANK STATEMENT