On the ratification of the Loan Agreement (South-West Highway Development Project: Western Europe-Western China International Transit Corridor (TSAREC 1b and 6b)) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development

Home / RLA / On the ratification of the Loan Agreement (South-West Highway Development Project: Western Europe-Western China International Transit Corridor (TSAREC 1b and 6b)) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development

On the ratification of the Loan Agreement (South-West Highway Development Project: Western Europe-Western China International Transit Corridor (TSAREC 1b and 6b)) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development

Law of the Republic of Kazakhstan dated July 10, 2009 No. 172-IV

To ratify the Loan Agreement (South-West Highway Development Project: Western Europe-Western China International Transit Corridor (TSAREC 1b and 6b)) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development, signed in Astana on June 13, 2009.

President of the Republic of Kazakhstan N. Nazarbayev

LOAN No. 7681-KZ

Loan agreement

(South-West Highway Development Project: Western Europe-Western China International Transit Corridor (TSAREC 1b and 6b))

between

BY THE REPUBLIC OF KAZAKHSTAN

and

BY THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

Date June 13, 2009

LOAN No. 7681-KZ

LOAN AGREEMENT

Agreement dated June 13, 2009 between the REPUBLIC OF KAZAKHSTAN (the "Borrower") and the INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT ("Bank"). The Borrower and the Bank have hereby agreed on the following:

ARTICLE I GENERAL CONDITIONS; DEFINITIONS

1.01. The General Terms and Conditions (defined in the Addendum to this Agreement) are an integral part of this Agreement. 1.02. Unless the context otherwise requires, the terms used in this Agreement starting with capital letters have the meanings attributed to them in the General Terms and Conditions or in the Addendum to this Agreement.

ARTICLE II LOAN

2.01. The Bank agrees to provide the Borrower with an amount equal to two billion one hundred and twenty-five million US Dollars (US$ 2,125,000,000), which may be converted from time to time by Currency Conversion in accordance with the provisions of Section 2.07 of this Agreement (the "Loan") for the term and conditions set forth or referenced in this Agreement. In this Agreement, in order to assist in financing the project described in Appendix 1 to this Agreement (the "Project"). 2.02. The Borrower has the right to withdraw the Loan funds in accordance with Section IV of Appendix 2 to this Agreement. 2.03. The Bank's loan opening fee, payable by the Borrower, is one quarter of one percent (0.25%) of the Loan amount. The Borrower pays the Bank a commission for opening a loan no later than 60 days from the effective date. 2.04. The remuneration payable by the Borrower during each Interest Period will be calculated at a rate equal to the LIBOR rate for the Loan Currency plus a variable spread; provided that upon Conversion of all or any part of the principal amount of the Loan, the remuneration payable by the Borrower during the Conversion Period for such amount must be determined in accordance with the terms of Article IV of the General Terms and Conditions. Notwithstanding the above, if any portion of the withdrawn outstanding Loan balance remains unpaid on time and is not paid within thirty (30) days, the amount of remuneration payable by the Borrower must be calculated in accordance with the provisions of Section 3.02 (d) of the General Terms and Conditions. 2.05. The payment dates are May 15th and November 15th of each year. 2.06. The principal amount of the Loan will be repaid in accordance with the repayment schedule set out in Appendix 3 to this Agreement. 2.07. (a) The Borrower may at any time request any of the following Loan Terms Conversions in order to ensure sound debt management: (i) changing the Loan Currency of all or any part of the Loan Principal amount, both withdrawn and not withdrawn, to an Approved Currency; (ii) changing the interest rate basis applicable to all or any part of the withdrawn and outstanding principal amount of the Loan from a Floating Interest Rate to a Fixed Interest Rate and vice versa, and (iii) determining the limits of the Floating Interest Rate applicable to all or any part of the withdrawn and outstanding principal amount of the Loan by setting an upper or lower the limits of the Floating Interest rate. (b) Any modification requested pursuant to paragraph (a) of this Section, which is accepted by the Bank, will be considered a "Conversion" as defined in the General Terms and Conditions and will take effect in accordance with the provisions of Article IV of the General Terms and Conditions and the Conversion Guidelines.

ARTICLE III DRAFT

3.01. The Borrower declares its commitment to achieving the objectives of the Project and, for this purpose, implements the Project through the Ministry of Finance of the Republic of Kazakhstan in accordance with the provisions of Article V of the General Terms and Conditions. 3.02. Without prejudice to the provisions of Section 3.01 of this Agreement and unless otherwise agreed between the Borrower and the Bank, the Borrower shall ensure the implementation of the Project in accordance with the provisions of Annex 2 to this Agreement.

ARTICLE IV ENTRY INTO FORCE

4.01. Additional conditions for entry into force are as follows: (a) The MTK has entered into an agreement, satisfactory in form and substance for the Bank, with the CBM in order to implement the Project activities. (b) The Borrower, through the ITC, has adopted an Action Plan for the RPPC that is satisfactory to the Bank. 4.02. The deadline for the entry into force of this Agreement is the date following the expiration of one hundred and eighty (180) days after the date of this Agreement.

ARTICLE V REPRESENTATIVES; ADDRESSES

5.01. The Borrower's representative is the Minister of Finance. 5.02. Borrower's address:

Ministry of Finance Pobedy Avenue, 11 Astana, 010000 Republic of Kazakhstan

Telex: Fax number:

265126 (FILIN) (7)(7172) 717785

5.03. Bank's Address: International Bank for Reconstruction and Development 1818 N. Street, N.W. Washington, D.C. 20433 United States of America

Telegraphic address: Telex: Fax number:

INTBAFRAD 248423(MCI) or 1-202-477-6391

Washington, D.C. 64145(MCI)

AGREED in Astana, Republic of Kazakhstan, on the date and year indicated above.

REPUBLIC OF KAZAKHSTAN

Whom:

Authorized representative

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

Whom:

Authorized representative

APPENDIX 1

Project Description

The aim of the Project is to increase the efficiency of transport on the sections of the highway from the border of Kyzylorda and Aktobe regions to Shymkent, improve road management and improve road safety in Kazakhstan.

The project consists of the following parts:

Part 1 : Modernization and reconstruction of highway sections in Kyzylorda region

Construction works to support the modernization and reconstruction of highway sections in the Kyzylorda region, excluding the bypass road in Kyzylorda.

Part 2 : Modernization and reconstruction of highway sections in South Kazakhstan region (Kyzylorda region- Shymkent)

Construction works to support the modernization and reconstruction of highway sections in the South Kazakhstan region, including the bypass road in Kyzylorda.

Part 3 : Project Management Consultants

Provision of consulting services to assist the Ministry of Transport of the Republic of Kazakhstan in the implementation of the Project.

Part 4 : Institutional development and improvement of road safety and roadside development The service

(a) Providing consulting services to conduct research to: (i) review options for strengthening highway management and improving the condition of highways; (ii) train Committee of Highways staff to strengthen project management capacity; (iii) implement a highway management system; (iv) improve safety supervision environmental protection; (v) preparation of guidelines on road safety in design; (vi) conducting a physical audit of the safety of the road network; (vii) creating methodologies to identify the most dangerous accident sites; (viii) assessing the social cost of accidents; (ix) strengthening the capacity of the ITC institutes to conduct research in the field of accidents; and (x) preparing action plans for the development of roadside services along the road sections under the Project.

(b) Provision of goods and equipment for the highway management system.

Part 5 : Supervision of construction works

Provision of consulting services for the supervision of construction works in Part 1 and Part 2 of the project.

APPENDIX 2

Project Implementation

Section I. Implementation mechanisms

A. Institutional arrangements

The Borrower implements the Project in accordance with the following institutional and other mechanisms:

1. The Borrower, through the Ministry of Transport and Communications of the Republic of Kazakhstan (hereinafter referred to as the Ministry of Transport and Communications of the Republic of Kazakhstan), implements the Project with the help of the CBM in accordance with the requirements, criteria, organizational mechanisms and operational procedures specified in the Project Implementation Guide, the Action Plan for the RPPK, the Resettlement Policy Document and the EIA, and cannot transfer, make changes, cancel or waive any provisions of the Project Implementation Guide, the RPPC Action Plan, the Resettlement Policy Document and the EIA without the prior consent of the Bank. 2. The Borrower, through the Ministry of Finance of the Republic of Kazakhstan, (a) prepares, prior to the start of any work under the Draft Resettlement Action Plans, satisfactory to the Bank, in accordance with the Resettlement Policy Document; and (b) implements the Project in accordance with the Resettlement Action Plans; and (c) cannot make changes, cancel or waive any provisions of the relevant Resettlement Action Plans without the prior consent of the Bank. 3. The Borrower, through the Ministry of Finance of the Republic of Kazakhstan, (a) prepares Environmental Action Plans satisfactory to the Bank in accordance with the EIA prior to the start of any work under the Project; and (b) implements the Project in accordance with the relevant Environmental Action Plans; and (c) may not amend, cancel or abandon anyor the provisions of the relevant Environmental Action Plans without the prior consent of the Bank. 4. Throughout the entire Project implementation period, the Borrower must ensure that the CBM is maintained in a structure, with resources and in accordance with technical specifications satisfactory to the Bank. 5. The Borrower, through the ITC, must: (i) take all necessary measures, including providing access to all necessary project-related information, to assist in conducting an independent procurement audit; and (ii) act without delay based on the results and recommendations of such audit within the Terms of Reference acceptable to the Bank.

B. Countering corruption

The Borrower will ensure the implementation of the Project in accordance with the provisions of the Anti-Corruption Guidelines.

Section II. Monitoring reporting and Project evaluation

A. Project Reports

1. The Borrower monitors and evaluates the progress of the Project, and prepares Project reports in accordance with the provisions of Section 5.08 of the General Terms and Conditions and based on indicators agreed with the Bank. Each Project report must cover a period of one calendar quarter and be submitted to the Bank no later than 45 (forty-five) days after the end of the period covered by this report. 2. No later than December 31, 2010 and thereafter, the Borrower, through the Ministry of Finance of the Republic of Kazakhstan, jointly with the Bank conducts an annual analysis of the progress made in the implementation of the Project (hereinafter referred to as the annual review). The annual review includes, among other things: (a) progress towards achieving the Project objectives; and (b) overall Project performance in accordance with the outcome indicators. 3. At least four (4) weeks before the Annual Review, the Borrower, through the Ministry of Finance of the Republic of Kazakhstan, will submit to the Bank a separate report describing the status of implementation of each component of the Project and a summary report on the overall implementation of the Project.

B. Financial management, financial reporting and auditing

1. The Borrower is required to maintain or ensure the maintenance of a financial management system in accordance with the provisions of Section 5.09 of the General Terms and Conditions. 2. Without prejudice to the provisions of Part A of this Section, the Borrower is required to prepare and submit to the Bank, no later than 45 (forty-five) days after the end of each calendar quarter, interim unaudited financial reports on the Project for that quarter that are satisfactory to the Bank in form and content. 3. The Borrower is required to audit its Financial Statements in accordance with the provisions of Section 5.09 (b) of the General Terms and Conditions. Each audit of financial statements should cover a period of one financial year of the Borrower. The audited financial statements for each such period must be submitted to the Bank no later than six months after the end of the relevant period.

Section III. Purchases

A. General provisions

1. Goods and Works. All goods and works required for the Project and financed from the Loan funds are purchased in accordance with the requirements contained or referenced in Section I of the Procurement Manual, as well as in accordance with the provisions of this Section. 2. Consulting services. All consultant services required for the Project and financed from the Loan funds are purchased in accordance with the requirements contained or referenced in Sections I and IV of the Guidelines for the Selection and Hiring of Consultants by Borrowers of the World Bank, as well as in accordance with the provisions of this Section. 3. Definitions. The terms beginning with capital letters used below in this Section to describe certain procurement methods or the Bank's review methods for certain contracts correspond to certain methods described in the Procurement Manual or the Consultant Manual, as appropriate.

B. Specific methods of procurement of goods and works

1. International competitive bidding. Unless otherwise provided in paragraph 2 below, the procurement of goods and works is carried out under contracts awarded in accordance with International Competitive Bidding procedures. 2. Other methods of purchasing goods and works. The table below shows the procurement methods, except for International Competitive Bidding, that can be used in relation to goods and works. The procurement plan should contain the circumstances in which a particular method can be used.

Purchasing method

(a) National competitive bidding, in accordance with the additional provisions set out in the Appendix to this Annex 2

(b) Free trade procurement

C. Specific methods of procurement of consultants' services

1. Selection based on quality and cost. Unless otherwise provided in paragraph 2 below, consulting services are procured under contracts awarded in accordance with a selection procedure based on quality and cost. 2. Other methods of purchasing consultants' services. The table below shows the procurement methods, other than Selection based on quality and cost, that can be used to purchase consultant services. The procurement plan should contain the circumstances in which a particular method can be used.

Purchasing method

(a) Quality-based selection

(b) Selection with a fixed budget

(d) Selection based on the qualifications of consultants

(e) Single-source purchases

(f) The procedures set out in paragraphs 5.2 and 5.3 of the Consultant Guidelines for the selection of individual consultants

D. Review of procurement decisions by the Bank

The Procurement Plan should specify those contracts that are subject to Preliminary review by the Bank. All other contracts are subject to Review by the Bank after the fact.

Section IV. Withdrawal of loan funds from the account

A. General provisions

1. The Borrower may withdraw the Loan funds in accordance with the provisions of Article II of the General Terms and Conditions, this Section, and those additional instructions specified by the Bank in the notification to the Borrower (including the "World Bank Guidelines for the Disbursement of Project Funds" dated May 2006, periodically reviewed by the Bank and applicable to this Agreement in accordance with such instructions), for financing Eligible expenses according to the table in paragraph 2 below. 2. The table below identifies the categories of Eligible Expenses that can be financed from the Loan (the "Category"), the allocated Loan amounts for each Category, and the percentage of expenses to be financed as Eligible Expenses for each Category.

Category

Allocated Loan amount (in dollar terms)

Share of expenses to be financed (including taxes)

(1) Work on Part 1 of the Project

1 134 300 000

85 %

(2) Work on Part 2 of the Project

747 200 000

85 %

(3) Consultant services for Part 3 of the Project

5 500 000

85 %

(4) Consultant services for Part 4 of the Project

2 100 000

85 %

(5) Consulting services for Part 5 of the Project

46 800 000

85 %

(6) Products for Part 4 of the Project

900 000

85 %

(7) Unallocated expenses

188 200 000

TOTAL AMOUNT

2 125 000 000

B. Withdrawal conditions; withdrawal period

1. Regardless of the provisions of Part A of this Section, funds should not be withdrawn from: (a) the Loan account until the Bank has paid the full amount of the bank commission.; and (b) for Category (2) expenses, until the Borrower conducts a study that examines options for strengthening the Committee of Highways and improving the overall condition of the highway network, and agrees with the Bank on a mechanism for measures to strengthen the Committee of Highways and improve the overall condition of the national highway network, taking into account the results of this study; and (b) for payments made prior to the date of this Agreement. 2. The closing date is December 31, 2013.

Addition TO APPENDIX 2

The Borrower's National Competitive Bidding procedures may be used to purchase goods and works under this Project, subject to the following provisions:

A. Participation of State-owned enterprises

State-owned enterprises in the Borrower's territory have the right to participate in auctions only if they can officially confirm their legal and financial independence, if they operate on the basis of commercial law and are not organizations dependent on the agency concluding the contract as the customer. In addition, they will be subject to the same requirements regarding bids and guarantees as other bidders.

B. Tender documentation

Organizations engaged in procurement must use a standard package of tender documentation for the purchase of goods and works acceptable to the Bank.

C. Opening and evaluation of bids:

(a) bids are opened publicly, immediately after the deadline for submitting bids; (b) bids should be evaluated in strict accordance with the monetary criteria stated in the tender documentation; (c) preferences should not be applied to domestic suppliers; (d) the contract should be awarded to a qualified bidder who submitted a competitive bid with the lowest price and basically meeting the requirements, while negotiations are not conducted.

D. Price adjustment

Contracts for construction work designed for a long period (more than 18 (eighteen) months) must contain an appropriate price adjustment clause. Contracts for construction work that are not designed for a long period (18 (eighteen) months or less) do not require the inclusion of an appropriate price adjustment clause.

E. Cancellation of bidding results

The recognition of the competitive bidding as invalid and the invitation to submit new bids may be made only with the prior consent of the Bank.

F. Rejection of individual bids

Each individual bid can be rejected only in the following cases:: (a) the bidder does not meet the qualification requirements; (b) the bidder does not accept the correction of an arithmetic error contained in his tender application made by the Tender Commission of the organization conducting the procurement; and (c) the bidder does not meet the requirements of the tender documentation.

APPENDIX 3 Repayment schedule

1. The following table shows the Repayment Dates of the principal debt and interest payments on the entire Loan amount due on each Repayment Date of the principal debt (the "Share of the next Payment"). If the Loan funds are fully withdrawn on the first Repayment Date of the Principal debt, the principal amount of the Loan that will be repaid by the Borrower on each such Repayment Date will be determined by the Bank by multiplying: (a) the Loan Amount withdrawn on the first Repayment Date of the principal debt and (b) the Share of the next payment on each Date repayment of the principal debt, if necessary, the amounts to be repaid must be adjusted to deduct any amounts referred to in paragraph 4 of this Annex to which Currency Conversion applies.

The date of payment of the principal debt

The percentage of the next payment (in percentage terms)

May 15 and November 15 of each year, starting from May 15, 2014 to November 15, 2033

2.5 %

2. If the Loan funds are not fully withdrawn on the first Repayment Date of the Principal debt, the principal amount of the Loan that will be repaid by the Borrower on each such Repayment Date will be determined as follows: (a) To the extent that any Loan funds have been withdrawn on the first Repayment Date of the Principal Debt, the Borrower must repay the Loan Amount withdrawn on that date in accordance with paragraph 1 of this Annex. (b) Any amounts withdrawn after the first Repayment Date of the principal debt must be repaid on each Repayment Date of the principal debt after the date of such withdrawal in amounts determined by the Bank by multiplying the amount of each such withdrawal by a fraction, the numerator of which is the initial amount of the Share of the next payment indicated in the table in paragraph 1 of this Annex for that Date. repayment of the principal debt ("The initial amount of the Share of the next payment"), and the denominator of which is the sum of all remaining Initial Amounts of the Share of the next payments on or after the Repayment Date of the Principal debt, if necessary, the amounts to be repaid must be adjusted to deduct any amounts referred to in paragraph 4 of this Annex to which Currency Conversion applies. 3. (a) Loan amounts withdrawn within two calendar months prior to any Repayment Date of the principal debt, solely for the purpose of calculating the amounts of the principal debt payable on any Repayment Date of the principal debt, will be considered withdrawn and outstanding on the second Repayment Date of the principal debt after the withdrawal date and will be repaid on each Repayment Date of the principal debt starting from the second Repayment Date of the principal debt after the withdrawal date. (b) Notwithstanding the provisions of subparagraph (a) of this paragraph, if at any time the Bank adopts a payment billing system in which invoices are issued on or after the relevant Principal Repayment Date, the provisions of this subparagraph will not apply to any withdrawals made after the adoption of such billing system. 4. Notwithstanding the provisions of paragraphs 1 and 2 of this Annex, after the currency Conversion of all or any part of the withdrawn Loan amount into the Approved Currency, the amount thus converted into the Approved Currency, which is due on any Repayment Date of the Principal debt occurring during the Conversion Period, must be determined by the Bank by multiplying such amount in the currency of its denomination directly before conversion to or: (i) an exchange rate that reflects the amounts of the principal debt in an Approved Currency payable by the Bank under Currency Hedging Transactions, (ii) the currency component of the Screen Rate, if the Bank decides to do so in accordance with the Conversion Guidelines.

addition

Section I. Definitions

1. "Anti-Corruption Guidelines" means "Guidelines for the Prevention and Control of Fraud and Corruption in Projects Funded by IBRD Loans and MAP Loans and Grants" dated October 15, 2006. 2. "Category" means the category specified in the table of Section IV of Annex 2 to this Agreement. 3. "Committee of Highways" means the highway management body established in the ITC on January 1, 2008 By Government Decree No. 1193 dated December 6, 2007 "On certain issues of the Ministry of Transport and Communications of the Republic of Kazakhstan", and responsible for the republican highway network, and any of its legal successors or successors. 4. "Consultant Guide" means the "Guidance on the Selection and Recruitment of Consultants by World Bank Borrowers", published by the Bank in May 2004 and revised in October 2006. 5. "Environmental Impact Assessment" or "EIA" means the final environmental impact assessment report prepared and disclosed by the Borrower as of February 26, 2009 and satisfactory to the Bank, which includes, inter alia: (i) a detailed description of the facilities where the Project activities will be conducted, (ii) potential and the actual adverse environmental impact of the measures referred to in paragraph (i) above, and (iii) the general Plan of action, which defines the measures to be taken during the implementation of the Project aimed at reducing, elimination or compensation of the adverse environmental consequences of the Project. 6. "Environmental Action Plans" or "APMs" means documents for specific facilities accepted by the Borrower and satisfactory to the Bank in accordance with the EIA and in accordance with Paragraph 3 of Section IA of Annex 2 to this Agreement, in relation to the work to be carried out by the Borrower within the framework of the Project and defining in detail measures to manage potential environmental risks., mitigation, reduction and/or compensation of the negative environmental impact associated with the implementation of Project activities, along with adequate institutional mechanisms, monitoring and reporting mechanisms capable of ensuring an adequate level of compliance with the conditions and receiving regular information on their compliance, with the possibility of periodically making changes and additions with the prior written consent of the Bank; and the term "BPM" refers to one of these documents. 7. "RPPC Action Plan" means an Action Plan for Project Management and Anti-Corruption that is satisfactory to the Bank and is subject to acceptance by the Borrower, through the ITC, in accordance with Section 4.01 (b) of this Agreement, to strengthen control over financial management and increase transparency and legality of procurement procedures conducted under the Project. 8. "General Terms and Conditions" means the "General Terms and Conditions for Loans of the International Bank for Reconstruction and Development" dated July 1, 2005 (as amended until February 12, 2008). 9. "MTK" means the Ministry of Transport and Communications of the Borrower or any of its legal successors or assigns. 10. "KUP" is a Project Management Consultant, a legal entity acceptable to the Bank and referred to in Section 4.01 (a) of this Agreement, engaged in providing consulting services to support the Ministry of Finance of the Republic of Kazakhstan in Project management and implementation. 11. "Procurement Manual" means the "Procurement Manual for IBRD Loans and MAP Loans", published by the Bank in May 2004 and revised in October 2006. 12. "Procurement Plan" means the Borrower's procurement plan for the Project dated January 30, 2009, referred to in paragraph 1.16 of the Procurement Manual and paragraph 1.24 of the Consultant Manual, which may be adjusted periodically in accordance with the provisions of these paragraphs. 13. "Project Implementation Guidelines" means the guidelines adopted by the Borrower, through the ITC, on March 17, 2009 and satisfactory to the Bank, defining the operational and administrative responsibilities, procedures and rules for the implementation of the Project, including financial management guidelines that comply with the terms of this Agreement, national legislation and the instructions of the Borrower, which may be amended from time to time and additions with the prior written consent of the Bank. 14. "Resettlement Action Plans" means locality-specific documents, including any Abridged Resettlement Action Plans adopted by the Borrower and in accordance with Paragraph 2 of Section IA of Annex 2 to this Agreement, and satisfactory to the Bank, which contain, among other things, a program of activities, measures and strategies for compensation and resettlement of people, including mechanisms compensation and resettlement, budget and cost estimates, as well as sources of financing, together with adequate institutional, monitoring and reporting mechanisms, capable of ensuring the proper level of fulfillment of conditions and regular information on their fulfillment for each individual site; and "Resettlement Action Plan" means one such plan. 15. "Resettlement Policy Document" means a document prepared, approved and published by the Borrower on May 1, 2008, adjusted and published by the Borrower on March 18, 2009 and published on the Infoshop website on March 25, 2009, which defines resettlement procedures, institutional mechanisms, eligibility criteria, rights and compensation, including assessment procedures, public consultations and participation, monitoring, evaluation and disclosure criteria that should be applied when preparing a Resettlement Action Plan.

Section II. Changes to the General Terms and Conditions

The following changes have been made to the General Terms and Conditions: 1. To formulate Paragraph (a) of Section 2.07 as follows: "Section 2.07. Advance payment for preparation for refinancing; Capitalization of the Loan opening fee and remuneration (a) If the Loan Agreement provides for the payment of an Advance from the Loan funds provided by the Bank or the Association ("Preparation Advance"), the Bank, on behalf of the Party to the Loan Agreement, must withdraw from the Loan Account on or after the Effective Date the amount necessary for repayment the withdrawn and outstanding advance amount on the day of withdrawal of this amount from the Credit Account and pay all accrued and unpaid fees from the advance amount on that date, if applicable. The Bank will pay this amount withdrawn in this way in its favor or in favor of the Association, depending on the circumstances, and must cancel the outstanding amount of the advance." 2. To formulate Paragraph (1) of Section 7.02 as follows: "Section 7.02. Suspension of the Agreement by the Bank ... (1) Non-compliance with the requirements. The Bank or Association has declared the Borrower (other than the Member State) or the Project's executive agency ineligible to receive any financing from the Bank or Association or otherwise participate in the preparation or implementation of any project funded in whole or in part by the Bank or Association as a result of the Bank or Association's determination that the Borrower or the Project's executive agency participates in fraudulent, corrupt, coercive actions or in collusion in connection with the use of funds of any financing, provided by a Bank or Association." 3. (a) The definition of the term "Conversion Date" should read as follows: "Conversion Date" means, in relation to a conversion, the execution date (as defined in this document) or any other such date requested by the Borrower and acceptable to the Bank, from which date the conversion takes effect and for which the provisions of the Guidelines apply thereafter. by conversion."(b) The definition of the term "floating rate" should read as follows: "(c) when converting a currency into an Approved Currency in the amount of the remaining Loan amount after withdrawal, for which interest is calculated at a floating rate during the conversion period, the floating interest rate applicable to such amounts is either: (i) the amount of: (A) LIBOR, or any other base rate that may be agreed between the Borrower and the Bank relative to the Approved Currency; plus (C) the LIBOR spread or any other another base rate, if any, payable by the Bank as part of Currency Hedging Transactions related to the aforementioned currency conversion,; or (ii) the currency component of the Screen Rate, if the Bank makes such a decision in accordance with the Conversion Guidelines.".

I hereby certify that this translation corresponds to the text of the Loan Agreement (South-West Highway Development Project: Western Europe-Western China International Transit Corridor (CAREC - 1b and 6b)) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development in English, signed in Astana on June 13, 2009 of the year.

Head of the HR and Document Management Department of the Ministry of Finance of the Republic of Kazakhstan N. Shabanov

The RCPI's note. The text of the Agreement in English is attached below.

President

Republic of Kazakhstan

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