Millennium Challenge Corporation Notice of Entering Into a Bribe With the Republic of Senegal

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21 October 2009

[Federal Register: October 21, 2009 (Volume 74, Number 202)]
[Notices]
[Page 54349-54375]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21oc09-126]

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Part IV

Millennium Challenge Corporation

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Notice of Entering Into a Compact With the Republic of Senegal; Notice

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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 09-18]

Notice of Entering Into a Compact With the Republic of Senegal

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

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SUMMARY: In accordance with Section 610(b)(2) of the Millennium
Challenge Act of 2003 (Pub. L. 108-199, Division D), the Millennium
Challenge Corporation (MCC) is publishing a summary and the complete
text of the Millennium Challenge Compact between the United States of
America, acting through the Millennium Challenge Corporation, and the
Republic of Senegal. Representatives of the United States Government
and the Republic of Senegal executed the Compact documents on September
16, 2009.

Dated: September 23, 2009.
Henry Pitney,
Acting General Counsel, Millennium Challenge Corporation.

Summary of Millennium Challenge Compact With the Republic of Senegal

The five-year Millennium Challenge Compact with the Republic of
Senegal (``Compact'') will provide up to $540 million to reduce poverty
and accelerate economic growth. The Compact aims to enable improved
agricultural productivity and to expand access to markets and services
through critical infrastructure investments in roads and irrigation
sectors (``Program'').

1. Roads Rehabilitation Project ($324 million)

The Roads Rehabilitation Project seeks to expand access to markets
and services and reduce transportation time and costs by improving the
condition of certain strategic roads. Specifically, the project will
support the rehabilitation and upgrading of portions of National Road
No. 2 (RN2), the northernmost road in Senegal, which borders the
Senegal River, and National Road No. 6 (RN6), located in Casamance, the
poorest region of Senegal, in the south. The government of Senegal has
prioritized both roads in its Road Sector Master Plan, and their
rehabilitation is in line with the national policy of increasing growth
through road creation, renovation, and maintenance. The RN2 serves as
the primary road to transport and export products from irrigation areas
along the Senegal River, thereby complementing the Compact's Irrigation
and Water Resources Management Project (described below). The RN2 is
also a strategic road, connecting Dakar harbor to Mauritania and Mali,
and to southern cities in Senegal. The RN6 is the only road available
to transport local agricultural products from Casamance to the rest of
Senegal. It is also a strategic road, connecting Senegal with Guinea
Bissau, Guinea (Conakry), and Mali. The improvement of both roads is
expected to stimulate domestic and trans-border traffic and commerce.
The primary activities for the Roads Rehabilitation Project are as
follows:
The RN2 activity will rehabilitate and upgrade
approximately 120 kilometers of road, from Richard Toll to Ndioum (a
primarily agricultural and agricultural processing area of Senegal),
and replace or upgrade associated structures, such as bridges and
culverts, to eliminate flooding, improve road safety, and provide
reliable, year-round access to markets, schools, and hospitals,
including during the rainy seasons.
The RN6 activity will rehabilitate and upgrade
approximately 256 kilometers of road, from Ziguinchor to the crossroads
at the town of Kounkane, and will replace or upgrade associated
structures, resulting in reduced transport costs and time and improved
access to markets and social services.

2. Irrigation and Water Resources Management Project ($170 million)

The Irrigation and Water Resources Management Project--comprising
infrastructure investments in the Senegal River Delta and Department of
Podor areas--seeks to improve the productivity of the agricultural
sector by extending and improving the quality of the irrigation system
in certain agriculture-dependent areas of northern Senegal. The Project
conforms to Senegal's 1998 Master Plan for poverty reduction and
agricultural development in the Senegal River Valley and is designed to
address the following three factors contributing to low agricultural
yields: (i) Poor quality of the existing irrigation and drainage
infrastructure; (ii) insufficient delivery of available water to
agricultural areas; and (iii) lack of an appropriate drainage system,
which leads to soil salinity. Specifically, the project will support
investments in the Senegal River Valley intended to: (i) Increase the
volume of irrigation water in the Senegal River Valley to develop
approximately 8,500-10,500 hectares of additional irrigated land; (ii)
eliminate the risk of abandonment of approximately 26,000 hectares of
existing irrigable land; and (iii) provide additional supply of water
for human and animal use in the project areas. The project will also
support a land tenure security activity, to provide for, or maintain, a
secure land tenure environment for all of the inhabitants of the region
directly affected by the project. The project may also invest in
complementary social safeguard measures, such as day care centers and
multi-purpose livestock centers.

3. Administration

The Compact also includes program management and oversight costs
estimated at $42 million over a five-year timeframe, including the
costs of administration, management, auditing, fiscal and procurement
agent services, environmental and social oversight, and funding to
facilitate Compact implementation. In addition, the cost of monitoring
and evaluation of the Compact is budgeted at approximately $4 million.

4. Intended Beneficiaries and Expected Results

Compact Program:
Approximately 138,600 households, or approximately 1.66
million individuals within those households, are estimated to benefit
from the Compact Program within twenty years. These estimates assume
some overlap among beneficiaries in the Senegal River Valley.
The largest number of beneficiaries--approximately 1.1
million--would be located in the Casamance. About 75% of the Program
beneficiaries in the Casamance are expected to come from households
living on less than 2 dollars per person per day. An estimated 42% of
total Program beneficiaries in the Casamance live on $1.25 per person
per day, or less. Although Program activities in the Casamance are
expected to cast a wider net over beneficiaries, about 38% of total
benefits generated by the Program would accrue to beneficiaries in that
region. The Program would be an important preliminary contribution to
the development of the Casamance and greatly facilitate other future
investment there.
Approximately 62% of Program benefits would accrue to
beneficiaries in the Senegal River Valley. Here, approximately 45% of
total beneficiaries are expected to be from households subsisting on
less than $2 per person per day and 25% from households living on
$1.25, or less. Whereas Program investments in the Senegal River Valley
will affect the welfare of a smaller number of people than in the
south, the investments are expected to

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extend significantly and solidify gains in the reduction of poverty in
the north.
Roads Rehabilitation Project:
The RN2 Road Activity is expected to benefit approximately
21,000 households or 250,000 individuals over the next 20 years. Over
the life of the investment, total average benefits per beneficiary for
the RN2 are approximately $870.
The RN6 Road Activity would benefit some 102,000
households or approximately 1.1 million people over the next 20 years.
Over the life of the investment, total average benefits per beneficiary
for the RN6 are approximately $530.
Irrigation and Water Resources Management Project:
Beneficiaries of the Irrigation and Water Resources
Management Project include households, owners or shareholders of
farming enterprises, and households that have individuals employed in
the operation of enterprise farms.
Over the course of the investment, the Project would
benefit approximately 22,390 households, or 268,700 individuals,
through participation in own agricultural production or employment in
agriculture.
Assuming that households, on average, are comprised of
twelve persons cultivating two hectares of irrigated land, the scale of
net revenue from a holding would have a substantial impact on the
welfare of poor households. Average future revenues of about purchasing
power parity (``PPP'') $4,470 per two-hectare farm would increase
household incomes by more than PPP $1 per person per day. For
households subsisting with incomes of PPP $1.25 or less per person per
day, this increment would move households from being extremely poor to
being near poor (not far below or above PPP $2 per person per day).

Millennium Challenge Compact Between The United States of America
Acting Through the Millennium Challenge Corporation and the Republic of
Senegal

Table of Contents

Article 1. Goal and Objectives
Section 1.1 Compact Goal
Section 1.2 Program Objective
Section 1.3 Project Objectives
Article 2. Funding and Resources
Section 2.1 Program Funding
Section 2.2 Compact Implementation Funding
Section 2.3 MCC Funding
Section 2.4 Disbursement
Section 2.5 Interest
Section 2.6 Government Resources; Budget
Section 2.7 Limitations of the Use of MCC Funding
Section 2.8 Taxes
Article 3. Implementation
Section 3.1 Program Implementation Agreement
Section 3.2 Government Responsibilities
Section 3.3 Policy Performance
Section 3.4 Government Assurances
Section 3.5 Implementation Letters
Section 3.6 Procurement
Section 3.7 Records; Accounting; Covered Providers; Access
Section 3.8 Audits; Reviews
Article 4. Communications
Section 4.1 Communications
Section 4.2 Representatives
Section 4.3 Signatures
Article 5. Termination; Suspension; Refunds
Section 5.1 Termination; Suspension
Section 5.2 Refunds; Violation
Section 5.3 Survival
Article 6. Compact Annexes; Amendments; Governing Law
Section 6.1 Annexes
Section 6.2 Amendments
Section 6.3 Inconsistencies
Section 6.4 Governing Law
Section 6.5 Additional Instruments
Section 6.6 References to MCC Web site
Section 6.7 References to Laws, Regulations, Policies and
Guidelines
Section 6.8 MCC Status
Section 6.9 English Language
Section 6.10 Counterparts; Electronic Delivery
Article 7. Entry Into Force
Section 7.1 Domestic Requirements
Section 7.2 Conditions Precedent to Entry Into Force
Section 7.3 Date of Entry Into Force
Section 7.4 Compact Term
Section 7.5 Provisional Application
Article 8. Additional Government Covenants
Section 8.1 Additional Government Resources
Section 8.2 Procurement
Annex I: Program Description
Schedule 1--Delta Activity Construction Activities
Schedule 2--Form of MCA-Senegal Decree
Annex II: Multi-Year Financial Plan Summary
Annex III: Description of the Monitoring and Evaluation Plan
Annex IV: Conditions to Disbursement of Compact Implementation
Funding
Annex V: Definitions
Annex VI: Specific Tax Exemption Mechanisms
Schedule A--Value Added Tax (VAT)
Schedule B--Customs Duties
Schedule C--Corporate Income Tax
Schedule D--Individual Income Tax
Schedule E--Fuel Tax
Schedule F--Registration Tax, Registration Fees and Stamp Duty

Millennium Challenge Compact

Preamble

This Millennium Challenge Compact (this ``Compact'') is between the
United States of America, acting through the Millennium Challenge
Corporation, a United States government corporation (``MCC''), and the
Republic of Senegal (``Senegal''), acting through its Government (the
``Government'') (individually a ``Party'' and collectively, the
``Parties'').
Recalling that the Government consulted with the private sector and
civil society of Senegal to determine the priorities for the use of
Millennium Challenge Account assistance and developed and submitted to
MCC a proposal for such assistance focused on poverty reduction; and
Recognizing that MCC wishes to help Senegal implement a program to
achieve the goal and objectives described herein (the ``Program'');
Capitalized terms used herein shall have the meanings specified in
Annex V hereto.
The Parties hereby agree as follows:

Article 1. Goal and Objectives

Section 1.1 Compact Goal

The goal of this Compact is to reduce poverty in Senegal through
economic growth (the ``Compact Goal'').

Section 1.2 Program Objective

The objective of the Program (as further described in Annex I) (the
``Program Objective'') is to enable improved agricultural productivity
and to expand access to markets and services through critical
infrastructure investments in roads and irrigation sectors.

Section 1.3 Project Objectives

The objectives of the Projects (as further described in Annex I)
(each a ``Project Objective'' and collectively, the ``Project
Objectives'') are as follows:
(a) The objective of the Roads Rehabilitation Project is to expand
access to markets and services by improving the condition of certain
strategic roads and reducing transportation time and costs.
(b) The objective of the Irrigation and Water Resources Management
Project is to improve the productivity of the agricultural sector by
extending and improving the quality of the irrigation system in certain
agriculture-dependent areas of northern Senegal.

Article 2. Funding and Resources

Section 2.1 Program Funding

MCC hereby grants to the Government, under the terms of this
Compact, an amount not to exceed Five Hundred Thirty Five Million
United States Dollars (US$535,000,000) (``Program Funding'') for use by
the Government to implement the Program. The allocation of Program
Funding uses is generally described in Annex II to this Compact.

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Section 2.2 Compact Implementation Funding

(a) MCC hereby grants to the Government, under the terms of this
Compact, in addition to the Program Funding described in Section 2.1,
an amount not to exceed Five Million United States Dollars
(US$5,000,000) (``Compact Implementation Funding'') under Section
609(g) of the Millennium Challenge Act of 2003, as amended (the ``MCA
Act''), for use by the Government as agreed by the Parties, which may
include use for the following purposes:
(i) financial management and procurement activities;
(ii) administrative activities including start-up costs such as
staff salaries and administrative support expenses such as office
equipment, and computers and other information technology or capital
equipment; and
(iii) other Compact implementation activities approved by MCC.
The allocation of Compact Implementation Funding among uses is
generally described in Annex II to this Compact.
(b) Notwithstanding Section 7.3 of this Compact, this Section 2.2
and any other provisions of this Compact necessary to make use of
Compact Implementation Funding for the purposes set forth herein, shall
be effective, for purposes of Compact Implementation Funding only, as
of the date this Compact is signed by MCC and the Government.
(c) Each Disbursement of Compact Implementation Funding is subject
to satisfaction of the conditions to such disbursement as set forth in
Annex IV.
(d) If, after the first anniversary of this Compact entering into
force, MCC determines that the full amount of Compact Implementation
Funding under Section 2.2(a) of this Compact exceeds the amount which
reasonably can be utilized for the purposes and uses set forth in
Section 2.2(a) of this Compact, MCC, by written notice to the
Government, may withdraw the excess amount, thereby reducing the amount
of the Compact Implementation Funding as set forth in Section 2.2(a)
(such excess, the ``Excess CIF Amount''). In such event, the amount of
Compact Implementation Funding granted to the Government under Section
2.2(a) will be reduced by the Excess CIF Amount, and MCC will have no
further obligations with respect to such Excess CIF Amount.
(e) MCC, at its option by written notice to the Government, may
elect to grant to the Government an amount equal to all or a portion of
such Excess CIF Amount as an increase in the Program Funding, and such
additional Program Funding will be subject to the terms and conditions
of this Compact and any relevant supplemental agreement applicable to
Program Funding.

Section 2.3 MCC Funding

Program Funding and Compact Implementation Funding are collectively
referred to in this Compact as ``MCC Funding.''

Section 2.4 Disbursement

In accordance with this Compact and the Program Implementation
Agreement, MCC will disburse MCC Funding for expenditures incurred in
furtherance of the Program (each instance, a ``Disbursement''). Subject
to the satisfaction of all applicable conditions, the proceeds of such
Disbursements will be made available to the Government, at MCC's sole
election, by (a) deposit to one or more bank accounts established by
the Government and acceptable to MCC (each, a ``Permitted Account'') or
(b) direct payment to the relevant provider of goods, works or services
for the implementation of the Program. MCC Funding may be expended only
to cover Program expenditures as provided in this Compact and the
Program Implementation Agreement.

Section 2.5 Interest

The Government will pay to MCC any interest or other earnings that
accrue on MCC Funding (whether by directing such payments to a bank
account outside Senegal that MCC may from time to time indicate or as
otherwise directed by MCC).

Section 2.6 Government Resources; Budget

(a) The Government will provide all funds and other resources, and
will take all actions, that are necessary to carry out the Government's
responsibilities and obligations under this Compact.
(b) The Government will use its best efforts to ensure that all MCC
Funding it receives or is projected to receive in each of its fiscal
years is fully accounted for in its annual budget on a multi-year
basis.
(c) The Government will not reduce the normal and expected
resources that it would otherwise receive or budget from sources other
than MCC for the activities contemplated under this Compact and the
Program.
(d) Unless the Government discloses otherwise to MCC in writing,
MCC Funding will be in addition to the resources that the Government
would otherwise receive or budget for the activities contemplated under
this Compact and the Program.

Section 2.7 Limitations on the Use of MCC Funding

The Government will ensure that MCC Funding (or any refunds or
reimbursements of MCC Funding paid by the Government in accordance with
this Compact that MCC permits to be used in connection with the
Program) will not be used for any purpose that would violate United
States law or policy, as specified in this Compact or as further
notified to the Government in writing or by posting from time to time
on the MCC Web site at http://www.mcc.gov (the ``MCC Web site''),
including but not limited to the following purposes:
(a) for assistance to, or training of, the military, police,
militia, national guard or other quasi-military organization or unit;
(b) for any activity that is likely to cause a substantial loss of
United States jobs or a substantial displacement of United States
production;
(c) to undertake, fund or otherwise support any activity that is
likely to cause a significant environmental, health, or safety hazard,
as further described in MCC's environmental and social guidelines
posted from time to time on the MCC Web site or otherwise made
available to the Government by MCC (the ``MCC Environmental
Guidelines''); or
(d) to pay for the performance of abortions as a method of family
planning or to motivate or coerce any person to practice abortions, to
pay for the performance of involuntary sterilizations as a method of
family planning or to coerce or provide any financial incentive to any
person to undergo sterilizations or to pay for any biomedical research
which relates, in whole or in part, to methods of, or the performance
of, abortions or involuntary sterilization as a means of family
planning.

Section 2.8 Taxes

(a) Unless the Parties otherwise specifically agree in writing, the
Government will ensure that each of the following is free from the
payment or imposition of any existing or future taxes, duties, levies,
contributions, or other similar charges (``Taxes'') of or in Senegal
(including any such Taxes imposed by a national, regional, local, or
other governmental or taxing authority of or in Senegal) (i) the
Program; (ii) MCC Funding; (iii) interest or earnings on MCC Funding;
(iv) any Project or activity implemented under the Program; (v) MCA-
Senegal (or MFG-

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MCA prior to MCA-Senegal's establishment); (vi) goods, works, services,
technology, and other assets and activities under the Program or any
Project; (vii) persons and entities that provide such goods, works,
services, technology, and assets, or perform such activities; and
(viii) income, profits, and payments with respect thereto. The Parties
acknowledge and agree that ``Taxes'' include, among other things, value
added and other transfer taxes (including exemption therefrom with
credit), profit and income taxes, property and ad valorem taxes, import
and export duties and taxes (including for goods imported and re-
exported for personal use), withholding taxes, payroll taxes, social
security and social insurance contributions.
(b) Without limiting the generality of the definition of Taxes as
set forth in Section 2.8(a), the Parties hereby agree that the
following taxes, duties, fees, and similar charges are also
specifically included in the definition of ``Taxes'' requiring
exemptions in accordance with this Compact: (i) Customs duties and
associated fees (including redevances statistiques (RS, currently 1%),
droits de douanes (DD, currently 0-20%), TVA (VAT, currently 18%), les
droits des chargeurs (COSEC, currently 0.20%), and les
pr[eacute]l[egrave]vements communautaires de l'UEMOA ou de la CEDEAO
(for example, PCS, currently, 1% and CEDEAO, currently 0.5%)); (ii)
value added taxes (VAT); (iii) taxes on petroleum products, including
but not limited to the tax speciale sur hydrocarbons; (iv) registration
and stamp taxes; (v) taxes on the corporate income of professional,
accounting or consulting firms (``benefices non commerciaux'') derived
from Compact-related work; (vi) taxes on the corporate income of
companies or other legal persons (``benefices industriels et
commerciaux'') derived from Compact-related work; and (vii) taxes on
the personal income of individuals working under the Compact.
(c) Unless otherwise agreed by MCC in writing, set forth in Annex
VI are procedures that the Government will implement to effectuate the
exemption from Taxes required by Section 2.8(a) and Section 2.8(b)
above with respect to each of the Taxes addressed therein. To the
extent that there are Taxes not addressed in Annex VI, whether
currently in force or established in the future, that MCC determines,
in its sole discretion, are not being exempted by the Government in
accordance with this Section 2.8, the Government hereby agrees that it
will implement appropriate procedures (approved in writing by MCC) to
ensure that such additional Taxes are exempted in accordance with this
Section 2.8. For the avoidance of doubt, the identification (or lack of
identification) of Taxes in Annex VI, or the description (or lack of
description) of procedures to implement the required exemption from
such Taxes in Annex VI, shall in no way limit the scope of the tax
exemption required by this Section 2.8.
(d) Unless otherwise agreed in writing by the Parties, the
provisions of Section 2.8(a) and 2.8(b) shall not apply to income Taxes
on, and contributions with respect to, individuals or legal persons who
are nationals of Senegal, provided that such Taxes and contributions
are not discriminatory and are generally applicable to all nationals in
Senegal.
(e) In complying with the tax exemption obligations set forth
herein, the Government will exempt MFG-MCA, MCA-Senegal, the Fiscal
Agent, the Procurement Agent, and/or any other provider of goods,
services, or works in connection with the Program from any obligation
imposed by the laws of Senegal to withhold any Taxes from any payments
made to any natural persons or legal persons working under the Program
to the extent that such natural persons or legal persons are not
nationals of Senegal.
(f) For the purposes of Section 2.8(d) and 2.8(e), the term
``national'' means natural persons who are citizens or permanent
residents of Senegal and legal persons who are formed under the laws of
Senegal (excluding MCA-Senegal, MFG-MCA and any other entity formed for
the purpose of implementing the Government's obligations hereunder);
provided that in determining if a natural person is a permanent
resident of Senegal or if a legal person has been formed under the laws
of Senegal, the taxable status of such individual or legal person shall
be based on its status at the time it is awarded or executes a Compact-
related agreement or contract, and such initial determination shall not
change regardless of: (i) The type of agreement or contract used to
employ or engage such individual, company, or other legal person, (ii)
any laws of Senegal that purport to change such status based on period
of contract performance or period of time residing and/or working in
Senegal, and/or (iii) any requirement under the laws of Senegal that a
company or other legal person must establish a branch office in
Senegal, or otherwise register or organize itself under the laws of
Senegal, in order to provide goods, services, or works in Senegal.
(g) The Government will from time to time execute and deliver, or
cause to be executed and delivered, such other instructions,
instruments or documents, and to take or cause to be taken such other
actions as may be necessary or appropriate in the determination of MCC
in order to implement this Section 2.8 of the Compact. Such further
assurances may include, without limitation, (i) passage of an
``arret[eacute] d'application'' (or such similar document (or
documents) having the same legal effect), in form and substance
satisfactory to MCC to provide specific instructions to Government
agents with respect to their role in the implementation of the
exemption from Taxes required by this Compact; or (ii) provision of an
attestation d'exoneration to appropriate beneficiaries of the tax
exemption described in this Compact.
(h) If a Tax has been levied and paid contrary to the requirements
of this Section 2.8, or any agreement entered into pursuant to this
Section 2.8, the Government will refund promptly to MCC (or to another
party as designated by MCC) the amount of such Tax in United States
Dollars or the currency of Senegal within thirty (30) days (or such
other period as may be agreed in writing by the Parties) after the
Government is notified in writing (whether by MCC, MFG-MCA, or MCA-
Senegal) that such Tax has been paid.
(i) No MCC Funding, proceeds thereof, or Program assets may be
applied by the Government in satisfaction of its obligations under this
Section 2.8.

Article 3. Implementation

Section 3.1 Program Implementation Agreement

Prior to entry into force, the Government and MCC will enter into
an agreement relating to, among other matters, implementation
arrangements, fiscal accountability and disbursement, and use of MCC
Funding (the ``Program Implementation Agreement'' or ``PIA''). The
Government will implement the Program in accordance with the Compact
and the PIA.

Section 3.2 Government Responsibilities

(a) The Government has principal responsibility for overseeing and
managing the implementation of the Program.
(b) The Government hereby designates MCA-Senegal, an entity to be
established through passage of a decree substantially in the form and
substantially on the terms of the form of decree set forth in Schedule
2 to Annex

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I, as the accountable entity to implement the Program and to exercise
and perform the Government's rights and responsibilities with respect
to the oversight, management, and implementation of the Program,
including, without limitation, managing the implementation of Projects
and their Activities, allocating resources, and managing procurements.
Such entity will be referred to herein as ``MCA-Senegal,'' and will
have the authority to bind the Government with regard to all Program
activities. Prior to MCA-Senegal's establishment, the Government hereby
designates the Mission de Formulation et du Gestion du MCA Senegal
(``MFG-MCA''), established by Decret N\o\ 2008-53 dated January 29,
2008, to act on behalf of the Government with respect to the Compact
and the Program. For the avoidance of doubt, the designation of MCA-
Senegal (and MFG-MCA prior to MCA-Senegal's establishment) as set forth
in this Section 3.2(b) will not relieve the Government of any of its
obligations or responsibilities as set forth hereunder, under any
related agreement (including, upon execution thereof, the PIA), or in
the Program Guidelines, for which the Government remains fully
responsible. MCC hereby acknowledges and consents to the designation in
this Section 3.2(b).
(c) The Government will ensure that no law or regulation in Senegal
now or hereinafter in effect makes or will make unlawful or otherwise
prevent or hinder the performance of any of the Government's
obligations under this Compact, the PIA, or any other related agreement
or any transaction contemplated hereby or thereby.
(d) The Government will ensure that any assets or services funded
in whole or in part (directly or indirectly) by MCC Funding will be
used solely in furtherance of this Compact and the Program unless
otherwise agreed by MCC in writing.
(e) The Government will take all necessary or appropriate steps to
achieve the Program Objective and Project Objectives during the Compact
Term.
(f) The Government will fully comply with the Program Guidelines,
as applicable, in its implementation of the Program.

Section 3.3 Policy Performance

In addition to undertaking the specific policy, legal, and
regulatory reform commitments identified in Annex I (if any), the
Government will seek to maintain and to improve its level of
performance under the policy criteria identified in Section 607 of the
MCA Act, and the selection criteria and methodology used by MCC.

Section 3.4 Government Assurances

The Government assures MCC that:
(a) as of the date this Compact is signed by the Government, the
information provided to MCC by or on behalf of the Government in the
course of reaching agreement with MCC on this Compact is true, correct
and complete in all material respects;
(b) this Compact, upon its ratification by the Government, does
not, and will not, conflict with any other international agreement or
other obligation of the Government or any of the laws of Senegal; and
(c) the Government will not invoke any of the provisions of its
internal law to justify or excuse a failure to perform its duties or
responsibilities under this Compact.

Section 3.5 Implementation Letters

From time to time, MCC may provide guidance to the Government in
writing on any matters relating to this Compact, MCC Funding, or
implementation of the Program (each, an ``Implementation Letter''). The
Government will apply such guidance in implementing the Program.
Without limiting the foregoing, either Party may, through its Principal
Representative or any Additional Representative, as the case may be,
initiate discussions that may result in a jointly agreed-upon
Implementation Letter to confirm and record their mutual understanding
on aspects related to the implementation of this Compact, the PIA, or
other related agreements.

Section 3.6 Procurement

The Government will ensure that the procurement of all goods,
works, and services by the Government, or any applicable provider
providing goods, works, and services, to implement the Program will be
consistent with the program procurement guidelines posted from time to
time on the MCC Web site (the ``MCC Program Procurement Guidelines'').
The MCC Program Procurement Guidelines include, among others, the
following requirements:
(a) open, fair, and competitive procedures must be used in a
transparent manner to solicit, award and administer contracts and to
procure goods, works, and services;
(b) solicitations for goods, works, and services must be based upon
a clear and accurate description of the goods, works, and services to
be acquired;
(c) contracts must be awarded only to qualified contractors that
have the capability and willingness to perform the contracts in
accordance with their terms on a cost effective and timely basis; and
(d) no more than a commercially reasonable price, as determined,
for example, by a comparison of price quotations and market prices,
will be paid to procure goods, works, and services.

Section 3.7 Records; Accounting; Covered Providers; Access

(a) Government Books and Records. The Government will maintain, and
will use its best efforts to ensure that all Covered Providers maintain
accounting books, records, documents, and other evidence relating to
the Program adequate to show, to MCC's satisfaction, the use of all MCC
Funding (``Compact Records''). In addition, the Government will furnish
or cause to be furnished to MCC, upon its request, all such Compact
Records.
(b) Accounting. The Government will maintain and will use its best
efforts to ensure that all Covered Providers maintain Compact Records
in accordance with generally accepted accounting principles prevailing
in the United States, or at the Government's option and with MCC's
prior written approval, other accounting principles, such as those (i)
prescribed by the International Accounting Standards Board, or (ii)
then prevailing in Senegal. Compact Records must be maintained for at
least five (5) years after the end of the Compact Term or for such
longer period, if any, required to resolve any litigation, claims or
audit findings or any statutory requirements.
(c) Providers and Covered Providers. Unless the Parties agree
otherwise in writing, a ``Provider'' is (i) any entity of the
Government that receives or uses MCC Funding or any other Program asset
in carrying out activities in furtherance of this Compact or (ii) any
third party that receives at least US$50,000 in the aggregate of MCC
Funding (other than as salary or compensation as an employee of an
entity of the Government) during the Compact Term. A ``Covered
Provider'' is (i) a non-United States Provider that receives (other
than pursuant to a direct contract or agreement with MCC) US$300,000 or
more of MCC Funding in any Government fiscal year or any other non-
United States person or entity that receives, directly or indirectly,
US$300,000 or more of MCC Funding from any Provider in such fiscal
year, or (ii) any United States Provider that receives (other than
pursuant to a direct contract or agreement with MCC) US$500,000 or more
of MCC Funding in any Government fiscal year or any other

[[Page 54355]]

United States person or entity that receives, directly or indirectly,
US$500,000 or more of MCC Funding from any Provider in such fiscal
year.
(d) Access. Upon MCC's request, the Government, at all reasonable
times, will permit, or cause to be permitted, authorized
representatives of MCC, an authorized United States inspector general,
the United States Government Accountability Office, any auditor
responsible for an audit contemplated herein or otherwise conducted in
furtherance of this Compact, and any agents or representatives engaged
by MCC or the Government to conduct any assessment, review, or
evaluation of the Program, the opportunity to audit, review, evaluate,
or inspect facilities and activities funded in whole or in part by MCC
Funding.

Section 3.8 Audits; Reviews

(a) Government Audits. Except as the Parties may otherwise agree in
writing, the Government will, on at least a semi-annual basis, conduct,
or cause to be conducted, financial audits of all disbursements of MCC
Funding covering the period from signing of this Compact until the
earlier of the following December 31 or June 30 and covering each six-
month period thereafter ending December 31 and June 30, through the end
of the Compact Term. In addition, upon MCC's request, the Government
will ensure that such audits are conducted by an independent auditor
approved by MCC and named on the list of local auditors approved by the
Inspector General of MCC (the ``Inspector General'') or a United
States-based certified public accounting firm selected in accordance
with the ``Guidelines for Financial Audits Contracted by MCA'' (the
``Audit Guidelines'') issued and revised from time to time by the
Inspector General, which are posted on the MCC Web site. Audits will be
performed in accordance with the Audit Guidelines and be subject to
quality assurance oversight by the Inspector General. Each audit must
be completed and the audit report delivered to MCC no later than ninety
(90) days after the first period to be audited and no later than ninety
(90) days after each June 30 and December 31 thereafter, or such other
period as the Parties may otherwise agree in writing.
(b) Audits of United States Entities. The Government will ensure
that agreements between the Government or any Provider, on the one
hand, and a United States nonprofit organization, on the other hand,
that are financed with MCC Funding state that the United States
nonprofit organization is subject to the applicable audit requirements
contained in OMB Circular A-133 issued by the United States Government
Office of Management and Budget (``OMB''). The Government will ensure
that agreements between the Government or any Provider, on the one
hand, and a United States for-profit Covered Provider, on the other
hand, that are financed with MCC Funding state that the United States
for-profit organization is subject to audit by the applicable United
States Government agency, unless the Government and MCC agree otherwise
in writing.
(c) Corrective Actions. The Government will (i) use its best
efforts to ensure that Covered Providers take, where necessary,
appropriate and timely corrective actions in response to audits, (ii)
consider whether a Covered Provider's audit necessitates adjustment of
the Government's records, and (iii) require each such Covered Provider
to permit independent auditors to have access to its records and
financial statements as necessary.
(d) Audit by MCC. MCC will have the right to arrange for audits of
the Government's use of MCC Funding.
(e) Cost of Audits, Reviews or Evaluations. MCC Funding may be used
to fund the costs of any audits, reviews, or evaluations required under
this Compact.

Article 4. Communications

Section 4.1 Communications

Any document or communication required or submitted by either Party
to the other under this Compact must be in writing and, except as
otherwise agreed with MCC, in English. For this purpose, the address of
each Party is set forth below.
To MCC:
Millennium Challenge Corporation, Attention: Vice President,
Compact Implementation, (in each case, with a copy to the Vice
President and General Counsel), 875 Fifteenth Street, NW., Washington,
DC 20005, United States of America, Facsimile: (202) 521-3700,
Telephone: (202) 521-3600, E-mail: VPImplementation@mcc.gov (Vice
President, Compact Implementation), VPGeneralCounsel@mcc.gov (Vice
President and General Counsel).
To the Government:
Ministry of Economy and Finance, Rue Rene Ndiaye, BP 4017, Dakar,
Senegal, Tel: +221 (33) 822 2899, Fax: +221 (33) 822 4195.
with a copy to:
To MFG-MCA (until MCA-Senegal's establishment), Avenue Bourguiba,
Immeuble Gamma, 3eme etage, Dakar, Senegal, Tel: +221 (33) 869 1665,
Fax: +221 (33) 825 0887.
Upon establishment of MCA-Senegal, MCA-Senegal will notify the
Parties of its contact details.

Section 4.2 Representatives

For all purposes of this Compact, the Government will be
represented by the individual holding the position of, or acting as,
the Minister of Economy and Finance of Senegal, and MCC will be
represented by the individual holding the position of, or acting as,
Vice President, Compact Implementation (each of the foregoing, a
``Principal Representative''). Each Party, by written notice to the
other Party, may designate one or more additional representatives
(each, an ``Additional Representative'') for all purposes other than
signing amendments to this Compact. The Government hereby irrevocably
designates the Director General of MFG-MCA as an Additional
Representative, to be replaced by the Director General of MCA-Senegal,
upon the establishment of MCA-Senegal. A Party may change its Principal
Representative to a new representative that holds a position of equal
or higher rank upon written notice to the other Party.

Section 4.3 Signatures

With respect to all documents other than this Compact or an
amendment to this Compact, a signature delivered by facsimile or
electronic mail will be binding on the Party delivering such signature
to the same extent as an original signature would be.

Article 5. Termination; Suspension; Refunds

Section 5.1 Termination; Suspension

(a) Either Party may terminate this Compact without cause in whole
by giving the other Party thirty (30) days' written notice. MCC may
also terminate this Compact without cause in part by giving the
Government thirty (30) days' written notice.
(b) MCC may, immediately, upon written notice to the Government,
suspend or terminate this Compact or MCC Funding, in whole or in part,
and any obligation related thereto, if MCC determines that any
circumstance identified by MCC as a basis for suspension or termination
(whether in writing to the Government or by posting on the MCC Web
site) has occurred, which circumstances include but are not limited to
the following:
(i) The Government fails to comply with its obligations under this
Compact, the PIA, or any other agreement or arrangement entered into by
the Government in connection with this Compact or the Program;

[[Page 54356]]

(ii) an event or series of events has occurred that MCC determines
makes it probable that the Program Objective or any of the Project
Objectives will not be achieved during the Compact Term or that the
Government will not be able to perform its obligations under this
Compact;
(iii) a use of MCC Funding or continued implementation of this
Compact or the Program violates or would violate applicable law or
United States Government policy, whether now or hereafter in effect;
(iv) the Government or any other person or entity receiving MCC
Funding or using assets acquired in whole or in part with MCC Funding
is engaged in activities that are contrary to the national security
interests of the United States;
(v) an act has been committed or an omission or an event has
occurred that would render Senegal ineligible to receive United States
economic assistance under Part I of the Foreign Assistance Act of 1961,
as amended (22 U.S.C. 2151 et seq.), by reason of the application of
any provision of the Foreign Assistance Act of 1961 or any other
provision of law;
(vi) the Government has engaged in a pattern of actions
inconsistent with the criteria used to determine the eligibility of
Senegal for assistance under the MCA Act; or
(vii) the Government or another person or entity receiving MCC
Funding or using assets acquired in whole or in part with MCC Funding
is found to have been convicted of a narcotics offense or to have been
engaged in drug trafficking.
(c) All Disbursements will cease upon expiration, suspension, or
termination of this Compact; provided, however, MCC may permit MCC
Funding to be used, in compliance with this Compact and the PIA, to pay
for (i) reasonable expenditures for goods, works, or services that are
properly incurred under or in furtherance of the Program before
expiration, suspension, or termination of this Compact, and (ii)
reasonable expenditures (including administrative expenses) properly
incurred in connection with the winding up of the Program within one
hundred twenty (120) days after the expiration, suspension, or
termination of this Compact, so long as, with respect to (i) and (ii)
herein, the request for such expenditures is submitted within ninety
(90) days after such expiration, suspension, or termination.
(d) Subject to Section 5.1(c), upon the expiration, suspension, or
termination of this Compact, (i) any amounts of MCC Funding not
disbursed by MCC in accordance with the Compact and the PIA will be
automatically released from any obligation in connection with this
Compact, and (ii) any amounts of MCC Funding disbursed to the Permitted
Account by MCC but not expended before the expiration, suspension or
termination of this Compact, plus accrued interest thereon will be
returned to MCC within thirty (30) days after the Government receives
MCC's request for such return; provided, however, that if this Compact
is suspended or terminated in part, MCC may request a refund for only
the amount of MCC Funding allocated to the suspended or terminated
portion.
(e) MCC may reinstate any suspended or terminated MCC Funding under
this Compact if MCC determines that the Government or other relevant
person or entity has committed to correct each condition for which MCC
Funding was suspended or terminated.

Section 5.2 Refunds; Violation

(a) If any MCC Funding, any interest or earnings thereon, or any
asset acquired in whole or in part with MCC Funding is used for any
purpose in violation of the terms of this Compact or the PIA, including
but not limited to any violation of the Program Guidelines, then MCC
may require the Government to repay to MCC in United States Dollars the
value of the misused MCC Funding, interest, earnings, or asset, plus
interest within thirty (30) days after the Government's receipt of
MCC's request for repayment. The Government will not use MCC Funding,
proceeds thereof or Program assets to make such payment.
(b) Notwithstanding any other provision in this Compact or any
other agreement to the contrary, MCC's right under this Section 5.2 for
a refund will continue during the Compact Term and for a period of (i)
five years thereafter or (ii) one year after MCC receives actual
knowledge of such violation, whichever is later.

Section 5.3 Survival

The Government's responsibilities under Sections 2.4, 2.6, 2.7,
2.8, 3.7, 3.8, 5.1(c), 5.1(d), 5.2, 5.3, 6.2, 6.4, 6.9, and 8.1 of this
Compact will survive the expiration, suspension or termination of this
Compact.

Article 6. Compact Annexes; Amendments; Governing Law

Section 6.1 Annexes

Each annex to this Compact constitutes an integral part hereof, and
references to ``Annex'' mean an annex to this Compact unless otherwise
expressly stated.

Section 6.2 Amendments

(a) The Parties may amend this Compact only by a written agreement
signed by the Principal Representatives.
(b) Without formally amending this Compact, the Government hereby
acknowledges and agrees that the Parties, may, through the Principal
Representatives or any Additional Representative, as the case may be,
in writing, modify any Annex to this Compact to (i) suspend, terminate,
or modify any project described in Annex I (each, a ``Project'' and
collectively, the ``Projects'') or to create a new project, (ii) change
the allocations of funds among the Projects, the Project activities, or
any activity under Program administration or monitoring and evaluation,
or between a Project identified as of the signature of this Compact and
a new project, (iii) modify the terms of Section B.3 of Annex I, or
(iv) add, delete, or waive any condition precedent described in Annex
IV, provided that any such modification described in (i) through (iv)
(1) is consistent in all material respects with the Program Objective,
(2) does not cause the amount of Program Funding to exceed the
aggregate amount specified in Section 2.1 of this Compact (as may be
modified by operation of Section 2.2(e) of this Compact), (3) does not
cause the amount of Compact Implementation Funding to exceed the
aggregate amount specified in Section 2.2(a) of this Compact, (4) does
not cause the Government's responsibilities or contribution of
resources to be less than specified in this Compact, (5) does not
extend the Compact Term, and (6) in the case of a modification to
change allocations of funds among Projects or the creation of a new
project, does not materially adversely affect any activity under
Program administration or monitoring and evaluation.
(c) Any modification of any annex to this Compact executed in
accordance with Section 6.2(b), or any modification of any other
provision of this Compact pursuant to Section 6.2(a), shall be binding
on the Government without the need for further action by the
Government, any further parliamentary action, or satisfaction of any
additional domestic requirements of Senegal.

Section 6.3 Inconsistencies

In the event of any conflict or inconsistency between:
(a) any annex to this Compact and any of Articles 1 through 8, such
Articles 1 through 8 will prevail; or
(b) this Compact and any other agreement between the Parties
regarding the Program, this Compact will prevail.

[[Page 54357]]

Section 6.4 Governing Law

This Compact is an international agreement and as such will be
governed by the principles of international law.

Section 6.5 Additional Instruments

Any reference to activities, obligations, or rights undertaken or
existing under or in furtherance of this Compact or similar language
will include activities, obligations, and rights undertaken by or
existing under or in furtherance of any agreement, document, or
instrument related to this Compact and the Program.

Section 6.6 References to MCC Web site

Any reference in this Compact, the PIA, or any other agreement
entered into in connection with this Compact, to a document or
information available on, or notified by posting on the MCC Web site
will be deemed a reference to such document or information as updated
or substituted on the MCC Web site from time to time.

Section 6.7 References to Laws, Regulations, Policies, and Guidelines

Each reference in this Compact, the PIA, or any other agreement
entered into in connection with this Compact, to a law, regulation,
policy, guideline, or similar document (including but not limited to
the Program Guidelines) will be construed as a reference to such law,
regulation, policy, guideline, or similar document as it may, from time
to time, be amended, revised, replaced, or extended and will include
any law, regulation, policy, guideline, or similar document issued
under or otherwise applicable or related to such law, regulation,
policy, guideline, or similar document.

Section 6.8 MCC Status

MCC is a United States government corporation acting on behalf of
the United States government in the implementation of this Compact. MCC
and the United States government have no liability under this Compact,
the Program Implementation Agreement, or any related agreement, are
immune from any action or proceeding arising under or relating to any
of the foregoing documents, and the Government hereby waives and
releases all claims related to any such liability. In matters arising
under or relating to this Compact, the Program Implementation
Agreement, or any related agreement neither MCC nor the United States
government will be subject to the jurisdiction of the courts of Senegal
or of any other jurisdiction or of any other body.

Section 6.9 English Language

This Compact is executed in English and in the event of any
ambiguity or conflict between this official English version and any
translation prepared for the convenience of the Parties, this official
English version will prevail.

Section 6.10 Counterparts; Electronic Delivery

(a) Counterparts. This Compact, and any amendment or other
agreements arising out of this Compact, may be executed in one or more
counterpart signatures, and each counterpart when so executed and
delivered shall be an original instrument, but such counterparts
together shall constitute a single agreement.
(b) Electronic Delivery. A signature to this Compact shall be
delivered only as an original signature. With respect to all other
signatures, including for an amendment or any other agreements arising
out of this Compact, a signature delivered by facsimile or electronic
mail in accordance with Section 4.1 of this Compact shall be deemed an
original signature and shall be binding on the Party delivering such
signature, and the Parties hereby waive any objection to such signature
or to the validity of the underlying document, certificate, notice,
instrument, or agreement on the basis of the signature's legal effect,
validity or enforceability solely because it is in facsimile or
electronic form.

Article 7. Entry Into Force

Section 7.1 Domestic Requirements

Before this Compact enters into force, the Government will take all
necessary steps to ensure that immediately upon this Compact entering
into force (a) this Compact and the PIA and all of the provisions of
this Compact and the PIA are valid and binding and are in full force
and effect in Senegal, (b) this Compact, the PIA and any other
agreement entered into in connection with this Compact to which the
Government and MCC are parties are international agreements under
international law such that the Government may not invoke the
provisions of its internal law as justification for failure to perform
its obligations thereunder, and (c) no laws of Senegal (other than the
constitution of Senegal), whether now or hereafter in effect, will take
precedence or prevail over the terms of this Compact or the PIA.

Section 7.2 Conditions Precedent to Entry Into Force

Before this Compact enters into force:
(a) the PIA must have been executed by the parties thereto;
(b) The Government must have delivered to MCC:
(i) a certificate, in form and substance satisfactory to MCC,
signed and dated by the Principal Representative of the Government, or
such other duly authorized representative of the Government acceptable
to MCC, certifying that the Government has satisfied the requirements
of Section 7.1;
(ii) a legal opinion from the Secretariat General du Gouvernement
of Senegal (or such other legal representative of the Government
acceptable to MCC), in form and substance satisfactory to MCC; and
(iii) complete, certified copies of all decrees, legislation,
regulations, or other governmental documents relating to the
Government's domestic requirements for this Compact to enter into force
and the satisfaction of Section 7.1, which MCC may post on its Web site
or otherwise make publicly available; and
(c) MCC must determine that after signature of this Compact, the
Government has not engaged in any action or omission that is
inconsistent with the eligibility criteria for MCC Funding.

Section 7.3 Date of Entry Into Force

This Compact will enter into force on the later of (a) the date of
the last letter in an exchange of letters between the Principal
Representatives confirming that each Party has completed its domestic
requirements for entry into force of this Compact and (b) the date that
all conditions set forth in Section 7.2 have been satisfied.

Section 7.4 Compact Term

This Compact will remain in force for five years after its entry
into force, unless terminated earlier under Section 5.1 (the ``Compact
Term'').

Section 7.5 Provisional Application

Upon signature of this Compact and until this Compact has entered
into force in accordance with Section 7.3, the Parties will
provisionally apply the terms of this Compact and the PIA; provided
that, no Program Funding will be made available or disbursed before
this Compact enters into force.

Article 8. Additional Government Covenants

Section 8.1 Additional Government Resources

(a) Without limiting the generality of Section 2.6(a), the
Government will contribute, through provision in the law containing the
annual governmental

[[Page 54358]]

budget for Senegal, an amount necessary and adequate to cover all costs
associated with the following (no MCC Funding, proceeds thereof, or
Program assets may be applied by the Government in satisfaction of its
obligations under this Section 8.1(a)):
(i) The staffing and operations of a ``Cellule d'Appui au MCA-
Senegal'' (as further described in Annex I);
(ii) consultant services, including but not limited to, any such
services already contracted by MFG-MCA for the purpose of producing
detailed designs in connection with the Roads Rehabilitation Project;
the independent audit required in connection with the Irrigation and
Water Resources Management Project as described in the PIA; and any
other consultant services in connection with the Program that will not
be financed with MCC Funding but are required for the successful
implementation of the Program, as may be required by MCC from time to
time;
(iii) any incurred severance costs or other financial liabilities
triggered by termination or expiration of the MFG-MCA or MCA-Senegal
employee contracts, pursuant to the terms of such contracts; and
(iv) required office space for MFG-MCA, MCA Senegal, the ``Cellule
d'Appui au MCA-Senegal,'' and the MCC resident country mission.

Section 8.2 Procurement

The Government, including MCA-Senegal (and MFG-MCA prior to MCA-
Senegal's establishment), will exclusively use the MCC Program
Procurement Guidelines in connection with Program procurements financed
with MCC Funding. With respect to Program procurements financed by the
Government, the Government, including MCA-Senegal (and MFG-MCA prior to
MCA-Senegal's establishment), will ensure that such procurements are
consistent with the general principles set forth in Section 3.6 of this
Compact.
In Witness Whereof, the undersigned, duly authorized by their
respective governments, have signed this Compact this 16th day of
September 2009.
Done at Washington, DC.
For Millennium Challenge Corporation, on behalf of the United
States of America, Name: Darius Mans, Title: Acting Chief Executive
Officer.
For the Republic of Senegal, Name: Abdoulaye Diop, Title: Minister
of Economy and Finance.

Annex I Program Description

This Annex I describes the Program that MCC Funding will support in
Senegal during the Compact Term.

A. Program Overview

1. Background and Consultative Process
With a population of approximately 12 million inhabitants, the west
African nation of Senegal was originally declared eligible for MCC
assistance in 2004. Senegal shares borders in the north with
Mauritania, in the east with Mali and in the south with Guinea and
Guinea-Bissau, and the Gambia runs through its center, spatially
separating its Casamance region (the ``Casamance'') from the rest of
Senegal's territory. Based on national poverty reduction and food
security priorities contained in the Government's 1998 Master Plan for
agricultural development in the Senegal River Valley (the ``Valley'')
and the Government's Road Sector Master Plan, and confirmed in broad-
based Government consultations that occurred from February through July
2008, the Program focuses on poverty reduction in the Valley in
northern Senegal, and the Casamance in southern Senegal.
The Valley has been targeted by the Government, numerous donors,
and nongovernmental organizations (``NGOs'') for investment, both to
encourage economic growth in this region and to increase Senegal's food
security in years to come. The Valley, like the Casamance, is rich in
agricultural production, especially for rice, the principal staple of
the Senegalese diet. The Valley benefits from a very favorable
environment for intensive irrigation; however, low agricultural yields
have been a persistent problem due to the poor quality of the existing
irrigation and drainage infrastructure; insufficient delivery of
available water to agricultural areas; and lack of an appropriate
drainage system. The Irrigation and Water Resources Management Project
will address these constraints.
The Casamance is the poorest region of Senegal, but also has the
highest potential for economic development after the Valley. The
Casamance is rich in natural resources and has the potential for
enormous agricultural productivity, which could contribute
significantly both to national growth and food security in the entire
country. The Government identified the Casamance's poor road transport
network, which leaves few means for goods and services currently
produced in the region to be exported nationally or regionally, as a
major constraint to economic development in the region. The Roads
Rehabilitation Project will address this constraint.
2. Description of Program and Beneficiaries
The Program Objective is to enable improved agricultural
productivity and to expand access to markets and services through
critical infrastructure investments in the roads and irrigation
sectors. The Program consists of the Roads Rehabilitation Project and
the Irrigation and Water Resources Management Project as further
described in this Annex I.
By 2029, the Program is expected to benefit approximately 1.66
million individuals, or approximately 138,600 households. The largest
number of beneficiaries--approximately 1.1 million--would be located in
the Casamance. About 75% of the Program beneficiaries in the Casamance
are expected to come from households living on less than 2 dollars per
person per day. An estimated 42% of total Program beneficiaries in the
Casamance live on US$1.25 per person per day, or less. Although Program
activities in the Casamance are expected to cast a wider net over
beneficiaries, about 38% of total benefits generated by the Program
would accrue to beneficiaries in that region. Approximately 62% of
Program benefits would accrue to beneficiaries in the Valley. Here,
approximately 45% of total beneficiaries are expected to be from
households subsisting on less than US$2 per person per day and 25% from
households living on US$1.25, or less. Whereas Program investments in
the Valley will affect the welfare of a smaller number of people than
in the south, they together are expected to extend significantly and
solidify gains in the reduction of poverty in the north. The Program
would be an important preliminary contribution to the development of
the Casamance and greatly facilitate other future investment there.
3. Environmental and Social Accountability
The two Projects, both of which are classified as Category A due to
potential site-specific environmental and social impacts, will be
implemented in compliance with the MCC Environmental Guidelines, MCC's
guidance on the integration of gender in program implementation
delivered by MCC to the Government or posted on the MCC Web site (the
``MCC Gender Policy''), and the MCC Guidance on the Implementation of
Resettlement Activities (or any other MCC policy comparable to the
World Bank's Operational Policy on Involuntary Resettlement in effect
as of July 2007 (``OP 4.12'') notified to the Government

[[Page 54359]]

from time to time) (the ``MCC Resettlement Guidance''). The Government
will also ensure that the Projects comply with all national
environmental laws and regulations, licenses and permits, except to the
extent such compliance would be inconsistent with this Compact. The
Government will: (a) Undertake and complete any environmental review
required by MCC or under the laws of Senegal; (b) implement to MCC's
satisfaction environmental and social mitigation measures identified in
such environmental review; and (c) commit to fund environmental
mitigation, (including costs of resettlement) in excess of MCC Funding
not specifically provided for in the budget for any Project. The
Government will ensure that all construction contractors develop,
implement and monitor an HIV/AIDS awareness program acceptable to MCC.

B. Description of the Projects

Set forth below is a description of each of the Projects that the
Government will implement, or cause to be implemented, using MCC
Funding to advance the applicable Project Objective. In addition,
specific activities that will be undertaken within each Project (each,
an ``Activity''), including sub-activities, are also described. To the
extent that there are cost savings with respect to a Project's
implementation, such savings, with express written approval by MCC, may
be used to expand the scope of any activity undertaken as part of the
Program, consistent with the Program Objective and subject to the
limitations set forth in Section 6.2 of this Compact.
1. Roads Rehabilitation Project
(a) Summary of Project and Activities.
The Roads Rehabilitation Project is designed to increase
beneficiary access to domestic and international markets through
improved road quality and a reduction in travel times and costs. The
road sector plays a critical role in Senegal. About 99% of goods
produced in Senegal are transported by roads, and 95% of domestic
travel is done by road. The roads addressed by the Roads Rehabilitation
Project, national road no. 2 (``RN2'') and national road no. 6
(``RN6''), are prioritized in the Government's Road Sector Master Plan,
and their rehabilitation is in line with the national policy of
increasing growth through road creation, renovation, and maintenance to
facilitate transport of manufactured products, minerals, and
agricultural production, and to encourage tourism throughout the
country.
The RN2 is the northernmost road of Senegal, bordering the Senegal
River. It links the capital city of Dakar to St. Louis, the second
largest city of Senegal, and continues toward the eastern region of
Senegal to the city of Kidira, close to the border with Mali. The RN2
serves as the primary road to transport and export products from
irrigation areas along the Senegal River. It is also a strategic
connector road from Dakar Harbor to Mauritania and Mali and to southern
cities in Senegal. The RN6 links Senegal with Guinea Bissau, Guinea
(Conakry), and Mali. The RN6 is also a strategic road that allows
transportation of local agricultural products and other goods and
services from the Casamance to the rest of Senegal without having to
travel through the Gambia. The RN6 provides the only domestic land
access to and from the Casamance. For local agricultural producers to
transport their products from the Casamance to the rest of Senegal, the
only land alternative to the RN6 is a road through the Gambia and a
ferry boat across the Gambia River.
The Roads Rehabilitation Project consists of the following
Activities:
(i) RN2 Road Activity.
MCC Funding will be used to rehabilitate and upgrade approximately
120 kilometers of the RN2 road, from Richard Toll to Ndioum, and
replace or upgrade associated structures, such as bridges and culverts,
to eliminate flooding and improve road safety. The RN2's improvement is
expected to stimulate domestic and trans-border traffic and commerce
generally as well as specifically provide reliable, year-round access
to markets, schools, and hospitals, including during the rainy seasons,
throughout the primarily agricultural and agricultural processing area
where the Activity is focused. Specifically, MCC Funding will support:
(1) Construction Costs. These costs include, without limitation,
pavement strengthening, road widening, road safety improvements,
replacement or upgrading of associated structures, such as bridges and
culverts, and any activity associated with the environmental management
plan developed with respect to the Activity.
(2) Non-Construction Costs. These costs include, without
limitation, studies, construction supervision, implementation of any
resettlement action plan developed with respect to the Activity, and
other project management costs to be incurred in connection with the
RN2 Road Activity.
(ii) RN6 Road Activity.
MCC Funding will be used to rehabilitate and upgrade approximately
256 kilometers of the RN6 road from Ziguinchor, and replace or upgrade
associated structures of the RN6. Specifically, MCC Funding will
support:
(1) Construction Costs. These costs include, without limitation,
pavement strengthening, road widening, road safety improvements, and
replacement or upgrading of associated structures, such as bridges and
culverts, and any activity associated with the environmental management
plan developed with respect to the Activity.
(2) Non-Construction Costs. These costs include, without
limitation, studies, construction supervision, implementation of any
resettlement action plan developed with respect to the Activity, and
other project management costs to be incurred in connection with the
RN6 Road Activity.
(b) Beneficiaries.
The RN2 Road Activity is expected to benefit approximately 21,000
households or 250,000 individuals over the next 20 years. At present
there are about 9,290 households, or 111,500 beneficiaries residing
along the RN2. The RN6 Road Activity would affect some 102,000
households or approximately 1.1 million people over the next 20 years.
At present there is a population of about 44,000 households, or 474,000
people along the road; but about 15,600 households outside the road
catchment would also initially benefit, as much traffic also originates
and ends outside the particular segments of the RN6 being upgraded by
the RN6 Road Activity. Over the life of the investment, total average
benefits per beneficiary for the RN2 are approximately US$870.
Similarly, total average benefits per beneficiary for the RN6 are
approximately US$530.
(c) Environmental and Social Mitigation Measures.
The RN2 Road Activity and the RN6 Road Activity are classified as
``Category A.'' The Activities will produce site-specific and possibly
cumulative environmental and social impacts. Environmental impact
assessments have been initiated for both Activities; both will produce
environmental management plans. The Roads Project will be implemented
in accordance with MCC Environmental Guidelines, the MCC Gender Policy,
and the MCC Resettlement Guidance, which will ensure that any necessary
mitigation measures will be taken with respect to the issues identified
in the environmental impact assessments and environmental management
plans.
(d) Donor Coordination.
The Roads Rehabilitation Project conforms both to the Economic
Community of West African States' standards, as well as to standards
used

[[Page 54360]]

by other donors in projects that link to Program investments. The two
donor organizations also involved in road construction are the European
Union (``EU'') for the RN2 and the African Development Bank for the
RN6. The U.S. Agency for International Development (``USAID'') is not
significantly involved in investments in the road sector in Senegal.
(e) Sustainability.
Senegal has appropriate laws, structures, capacity, systems, and
governance to continually improve sustainability of the road sector.
The Government has shown willingness to strengthen the maintenance
funding regime, and the country has shown much progress in its
maintenance funding performance. An autonomous agency, the Agence
Autonome de Transports Routiers, or the Independent Agency for Road
Transportation (``AATR''), was created with the assistance of other
donors to take responsibility for road development and maintenance in
Senegal. AATR has been the beneficiary of rapid capacity development
measures with the support of other donors. As a result, the agency is
now operating with technically capable staff within both its
headquarters and its regional offices. Several institutional
strengthening measures have been implemented by AATR, including the
systemization of road inventory and road condition, and prioritization
of maintenance activities based on traffic, condition, cost-benefit,
and hydraulics. Maintenance funding has been increasing rapidly since
1989. The available road maintenance funds were 3 billion CFA in 1989;
15 billion CFA in 1995; 18 billion CFA in 2007; and 37 billion CFA in
2009. As a result of this increase in maintenance funding, road
conditions have improved significantly: only 35% of paved roads were
deemed to be in ``good'' or ``average'' condition in 2000, but 60% were
deemed to be in 2007.
The Government has created a road fund managed by an autonomous
unit and governed by a board of directors with members from the public
and private sectors (the ``Road Fund''). In 2008, the Road Fund was
migrated to a second generation fund, whereby fuel levy collections
were deposited directly through adoption of a funding law. The law
allows for fuel levies of about 35 CFA for super diesel, 32 CFA for
diesel, and 16 CFA for gasoline.
Nevertheless, there is a persistent gap between the need for
maintenance and available funds. The 2009 budget gap is currently 26%;
the 2009 available maintenance budget provides only 74% of the annual
road maintenance funding actually required for 2009. As part of the
Program, the Government has agreed on a schedule to reduce and
eventually eliminate any annual funding gap by 2015. Measurable
progress monitors are set forth in the Program Implementation Agreement
as conditions precedent to disbursement for the Roads Rehabilitation
Project.
(f) Policy, Legal and Regulatory Reforms.
There are no policy, legal, or regulatory reforms required to
implement the Roads Rehabilitation Project, other than those that may
be required with respect to the Government's need to satisfy conditions
precedent in connection with reducing the funding gap with respect to
the road maintenance fund.
2. Irrigation and Water Resources Management Project
(a) Summary of Project and Activities.
The Valley, the other region in Senegal rich in agricultural
production, benefits from a very favorable environment for intensive
irrigation for several reasons. First, there is a long irrigation
history and experience in the Valley (some irrigation schemes have
existed for more than 30 years). Second, the region has strong
Government support and a reliable institution for maintenance and
technical support through the regional, semi-autonomous agency
responsible for all aspects of agricultural development in the Valley,
the Soci[eacute]t[eacute] Nationale d'Am[eacute]nagement et
d'Exploitation des Terres du Delta du fleuve S[eacute]n[eacute]gal et
des Vall[eacute]es du fleuve S[eacute]n[eacute]gal et de la
Fal[eacute]m[eacute] (``SAED''). Third, farmer associations, supported
by SAED, have demonstrated their capability to manage and maintain
large irrigation schemes. Finally, organized commercialization exists
throughout the region, although improvements are still required along
the value chain.
Optimal agricultural production in the Valley could supply Senegal
with more than a significant share of its agricultural products,
especially rice, the principal staple of the Senegalese diet. However,
low agricultural yields have resulted in several thousand hectares of
abandoned land. Three factors contribute directly to low yields: (i)
Poor quality of the existing irrigation and drainage infrastructure;
(ii) insufficient delivery of available water to agricultural areas;
and (iii) lack of an appropriate drainage system, which leads to soil
salinity.
The Irrigation and Water Resources Management Project--comprising
infrastructure investments in the Senegal River Delta (the ``Delta'')
and Department of Podor (the ``Podor'') areas--conforms to Senegal's
1998 Master Plan for poverty reduction and agricultural development in
the Valley and is designed to address the factors contributing to low
agricultural yields described above. The Project will: (1) Increase the
volume of irrigation water in the Valley to develop approximately
8,500-10,500 hectares of additional irrigated land; (2) eliminate the
risk of abandonment of approximately 26,000 hectares of existing
irrigable land; and (3) provide additional supply of water for human
and animal use in the Delta, Podor, and adjoining areas. The Project
will also rehabilitate drainage canals, which will further eliminate
the risk of abandonment of irrigated land, as well as increase crop
yields. The Project will also support a land tenure security activity,
to provide for, or maintain, a secure land tenure environment for all
of inhabitants of the region directly affected by the Project. The
Project may also invest in complementary social safeguard measures.
The Irrigation and Water Resources Management Project consists of
the following Activities:
(i) Delta Activity.
Irrigation in the Delta, situated in the northwestern section of
Senegal, is heavily influenced by the operation level of the Diama Dam,
situated at the mouth of the Senegal River. Currently, 31,080 hectares
represents the total theoretically irrigable land in the area of the
Delta targeted by the Project. However, due to insufficient water
delivery and poor drainage, only 11,800 hectares are cultivated at any
time over the year. MCC Funding will be used for improvements to the
irrigation and drainage channels in the Delta. Specifically, MCC
Funding will support:
(1) Irrigation and Drainage Construction Activities. With respect
to irrigation, these consist of weed removal, dredging, profiling of
berms, and increasing levee heights, along with the rehabilitation or
replacement of associated structures and pumping stations along eight
irrigation sections. With respect to drainage, these consist of
construction of a pump station, a bridge, a siphon, elevation of the
levees and construction of compensatory channels. More details with
respect to the Delta Activity construction activities are set forth in
Schedule 1 attached to this Annex I.
(2) Non-Construction Activities. These costs include, without
limitation, studies, construction supervision, and other project
management costs to be incurred in connection with the Delta Activity.
(ii) Podor Activity.

[[Page 54361]]

Senegal's 1998 Master Plan for poverty reduction and agricultural
development in the Valley specifies the installation of 28 irrigation
sites in the Podor, and one of these sites is at N'Gallenka. The Podor
Activity, focused on the site of N'Gallenka, expands the Program's
irrigation investments east of the Delta, into an area that is far more
economically depressed than the Delta. The N'Gallenka site was chosen
because of its high potential for rice production, sufficiency of water
resources, available population, cost of dikes per hectare, and
existing irrigation facilities. Furthermore, demonstration of the cost-
effectiveness of irrigation expansion in Podor should attract other
private sector and donor investment in this area of high potential
returns. MCC Funding will be used for the development of primary and
secondary irrigation and drainage channels, and associated structures
at the N'Gallenka site. Specifically, MCC Funding will support the
construction costs associated with the development of the primary and
secondary irrigation and drainage channels and associated structures,
as well as related non-construction costs (studies, construction
supervision, and other project management costs).
(iii) Social Safeguard Measures Activity.
The Government is actively seeking support to strengthen irrigation
investments in the Valley with social development activities designed
to diversify current livelihood strategies, slow emigration from the
Delta, link Podor to markets, and improve the ability of women and
youth to take advantage of the economic opportunities presented by the
improved prospects for agricultural production. The Program may support
the Government's efforts by financing certain social safeguard measures
directly related to the Irrigation and Water Resources Management
Project. Specifically, MCC Funding may be used for the construction of
day care facilities, as well as the construction and initial operation
of agricultural storage and information centers, and livestock
multipurpose centers. In each case, these social safeguard measures are
intended to complement the objectives of the Irrigation and Water
Resources Management Project and/or to mitigate potential adverse
impacts of the Project. For instance, the day care facilities should
allow women to spend more time engaged in revenue-generating activities
on the newly irrigated lands that will be allocated through the
Project, while still providing their children with quality care. The
agricultural storage and information centers are intended to provide
much-needed price information and technical resources to decrease crop
loss due to poor storage conditions. Finally, the livestock
multipurpose centers are intended to provide much-needed technical
resources and supplies to livestock owners, thereby reassuring
pastoralists that might otherwise be marginalized by the Project
because of the reduced amount of rangeland available for their herds.
It should be noted that any use of MCC Funding for the Social Safeguard
Measures Activity is entirely contingent upon the following three
conditions being met: (1) Provision by the Government of any
supplemental information required by MCC, in form and substance
satisfactory to MCC, to enable MCC to make a funding decision with
respect to this Activity (this may include, inter alia, a comprehensive
operational plan for each measure that describes diligenced costs,
staffing and equipment information and requirements, and information on
day-to-day operations and maintenance of the centers, both during the
Compact Term and afterwards); (2) a decision by MCC in writing agreeing
to fund the Activity, in whole or in part, together with any conditions
to such agreement; and (3) satisfaction of the first two conditions
prior to the third anniversary of this Compact's entry into force.
(iv) Land Tenure Security Activity.
To improve the investment climate in the Project area and to
mitigate the potential for land conflict due to increased demand for
irrigated land as a result of the Irrigation and Water Resources
Management Project, the Land Tenure Security Activity will support
development and implementation of transparent, fair, and efficient
processes for land allocation to ensure equitable and secure access to
land in the irrigated perimeters. It will also equip local authorities
with tools, such as manuals of procedures and land registries, to
improve land management, and reinforce capacity through communication
and training on the newly provided tools as well as existing land
management tools. The Land Tenure Security activity will primarily
support the allocation and formalization of land use rights by local
rural councils (``CRs'') and local communal councils (``CCs'')
according to existing Senegalese land law. Specifically, MCC Funding
will support:
(1) Design and implementation of a participatory and multi-step
process for allocation by the CRs and CCs to producer groups and
individual producers of parcels in irrigated perimeters developed or
improved through the Irrigation and Water Resources Management Project.
Land allocations will be formalized according to Senegalese land law
through award of titres d'affectation (land certificates) to all
holders of land rights in the irrigated perimeters. The process will
include documentation of existing rights, identification and mapping of
improved parcels, development of criteria for selection of
beneficiaries, and transparent selection followed by award of the
titres d'affectation and recordation of all land allocations in
registers to be maintained by the CRs and CCs.
(2) Reinforcement of land management capacity of CRs (and CCs),
producer groups (GIEs and GPFs), and selected government agencies
responsible for supporting rural community land management. Activities
will center on development of new tools designed to adapt and more
efficiently apply Senegalese land law in the context of the Valley,
including a land allocation manual and land registry, and training on
existing tools such as land occupation and allocation plan (``POAS'')
and the Charter for the Irrigated Domain (``CDI'').
(b) Beneficiaries.
Beneficiaries of the Irrigation and Water Resources Management
Project include households, owners or shareholders of farming
enterprises, and households that have individuals employed in the
operation of enterprise farms. The Project would benefit approximately
22,390 households, or 268,700 individuals, through participation in own
agricultural production or employment in agriculture. Assuming that
households would, on average, cultivate two hectares of irrigated area,
the scale of net revenue from a holding would have a substantial impact
on the welfare of poor households. Average household size is about
twelve persons. Average future revenues of about purchasing power
parity (PPP) US$4,470 per two-hectare farm would increase household
incomes by more than PPP US$1 per person per day. For households
subsisting with incomes of PPP US$1.25 or less per person per day, this
increment would move households from being extremely poor to being near
poor (not far below or above PPP US$2 per person per day). It is
estimated that the full development of the irrigated areas targeted by
the Project will provide employment for approximately 9,000 households
(benefits accruing to approximately 105,000 persons).
(c) Environmental and Social Mitigation Measures.

[[Page 54362]]

The Irrigation and Water Resources Management Project is classified
as ``Category A.'' Environmental impact assessments have been
initiated, and they will produce environmental management plans. The
Project will be implemented in accordance with MCC Environmental
Guidelines, the MCC Gender Policy, and the MCC Resettlement Guidance,
which will ensure that any necessary mitigation measures will be taken
with respect to the issues raised above.
(d) Donor Coordination.
The Government, from the earliest days of project identification
and development, partnered and coordinated with all of the stakeholders
in the Valley to ensure that (i) MCC's investments would be
complementary to other existing and planned investments throughout the
region, and (ii) would be supported by Government agencies, donors, and
NGOs. All donors have endorsed the Program investments in the Valley
because they recognize the need for significant investment in the
region's infrastructure to complement their own investments. The
current field-level focal points for donor coordination and
collaboration are SAED and the Support Program for Local Development,
respectively responsible for implementation of programs sponsored by
the World Bank (``PDMAS'') and the Agence Fran[ccedil]aise de
D[eacute]veloppement (the French Development Agency (``AFD'')).
The principal donors investing in the region are USAID, the U.S.
Department of Agriculture (``USDA''), the EU, AFD, the Japanese
Development Agency, and the World Bank. USAID, for example, is
increasing agricultural productivity through improvements to the
agricultural value chain, including improving the quality and
availability of inputs, cold storage and warehousing, and access to
credit, and it is also implementing a natural resource management
program that focuses on forest management for the production of select
products (timber, resin, fruit, and crafts) for regional and
international markets. The USDA, through its ``Food for Progress''
program, partners with NGOs such as Counterpart International to work
directly with farmers and farmers' associations to provide training in
agricultural best practices. AFD's ``Programme d'Appui aux
Communaut[eacute]s Rurales'' (``PACR''), or ``Technical Assistance
Program for Rural Communities,'' shares common objectives and
geographical focus with the Land Tenure Security Activity; accordingly,
MCC and AFD expect to coordinate closely implementation of the
respective initiatives and target opportunities for synergy.
(e) Sustainability.
SAED is responsible for maintaining primary and secondary
irrigation systems throughout the Valley. SAED's considerable human
resources, technical capacity and experience have been enhanced in
recent decades through the agency's central role in implementation of
several international donor-sponsored programs, such as the PDMAS
project and specific activities of the PACR. It also provides technical
assistance and training to farmers for them to maintain tertiary
irrigation systems.
However, project maintenance activities in the Delta are funded
with fees collected from farmers, and with funds provided by the
Government to cover the gap between annual maintenance costs and total
fees collected. Fee collection from farmers in the Delta zone is poor,
with a collection efficiency of only 30%. Poor collection is primarily
attributable to unreliable water supply and inadequate water
availability. A lack of transparency in collection is also a
contributor to poor collection efficiency. In order to improve
collection of water user fees and to make more maintenance funds
available for SAED to undertake required, periodic maintenance work,
the Government will take specific steps agreed by MCC to improve
collection of water user fees; these include the Government conducting
an independent audit of maintenance, including roles, responsibilities,
current arrangements, service performance and collection performance,
as well as a financial analysis of maintenance, with the objective of
identifying principal issues and recommending an action plan to improve
sustainability (the ``Irrigation Maintenance Action Plan''). The
Irrigation Maintenance Action Plan must be approved by the Ministry of
Agriculture and implementation of the action plan--with measurable
targets and a progress monitoring mechanism to evaluate performance and
outcomes of implementation--will be monitored throughout the Compact
Term.
(f) Policy, Legal and Regulatory Reforms.
There are no policy, legal, or regulatory reforms required to
implement the Irrigation and Water Resources Management Project other
than those that may be required by the Irrigation Maintenance Action
Plan and implementing measures arising out of the Land Tenure Security
Activity, such as the passage of an arr[ecirc]t[eacute] by the
appropriate administrative authorities establishing land allocation
committees and describing land allocation principles.
3. Implementation Framework
(a) Overview.
The implementation framework and the plan for ensuring adequate
governance, oversight, management, monitoring and evaluation, and
fiscal accountability for the use of MCC Funding are summarized below.
MCC and the Government will enter into the Program Implementation
Agreement, and any other agreements in furtherance of this Compact, all
of which, together with this Compact, set out certain rights,
responsibilities, duties and other terms relating to the implementation
of the Program.
(b) MCC.
MCC will take all appropriate actions to carry out its
responsibilities in connection with this Compact and the Program
Implementation Agreement, including the exercise of its approval rights
in connection with the implementation of the Program.
(c) MCA-Senegal (and, prior to its establishment, MFG-MCA).
The Government will establish MCA-Senegal through passage of a
decree in substantially the form and on substantially the terms of the
form of decree set forth in Schedule 2 to this Annex I (the
``Establishment Decree''). In accordance with Section 3.2(d) of this
Compact, MCA-Senegal will act on the Government's behalf to implement
the Program and to exercise and perform the Government's rights and
responsibilities with respect to the oversight, management, and
implementation of the Program, including, without limitation, managing
the implementation of Projects and their Activities, allocating
resources, and managing procurements. The Government will ensure that
MCA-Senegal takes all appropriate actions to implement the Program,
including the exercise and performance of the rights and
responsibilities designated to it by the Government pursuant to this
Compact and the Program Implementation Agreement. Without limiting the
foregoing, the Government will also ensure that MCA-Senegal has full
decision-making autonomy, including, inter alia, the ability, without
consultation with, or the consent or approval of, any other party, to
(i) enter into contracts in its own name, (ii) sue and be sued, (iii)
establish an account in a financial institution in the name of MCA-
Senegal and hold MCC Funding in that account, (iv) expend MCC Funding,
(v) engage one or more fiscal agents who will act on behalf of MCA-
Senegal on terms acceptable to MCC, (vi) engage one or more procurement
agents who

[[Page 54363]]

will act on behalf of MCA-Senegal, on terms acceptable to MCC, to
manage the acquisition of the goods, works, and services required by
MCA-Senegal to implement the activities funded by this Compact, and
(vii) competitively engage one or more auditors to conduct audits of
its accounts. In accordance with Section 3.2(d) of this Compact, MFG-
MCA, established by D[eacute]cret N[ordm] 2008-53 dated January 29,
2008, will act on behalf of the Government with respect to the Compact
and the Program until MCA-Senegal is established. For the avoidance of
doubt, the Government will take all appropriate actions to ensure that
MCA-Senegal is established as soon as possible after the ratification
of this Compact, and, in any event, in accordance with the applicable
condition precedent to the disbursement of Compact Implementation
Funding set forth in Annex IV to this Compact.
MCA-Senegal will be administered and managed by the following
bodies: (1) Le Conseil de Surveillance, acting as its board of
directors (the ``Board''); (2) la Direction G[eacute]n[eacute]rale,
acting as its management unit (the ``Management Unit''); and (3) le
Comit[eacute] des Parties Prenantes, acting as its stakeholders
committee (the ``Stakeholders Committee''). The governance of MCA-
Senegal will be set forth in more detail in the Establishment Decree,
the Program Implementation Agreement, and the internal regulations of
MCA-Senegal (``MCA-Senegal Bylaws''), which will, collectively, set
forth the responsibilities of the Board, the Management Unit, and the
Stakeholders Committee. The MCA-Senegal Bylaws will be developed and
adopted in accordance with MCC's Guidelines for Accountable Entities
and Implementation Structures, published on the MCC Web site (the
``Governance Guidelines''), and will be in form and substance
satisfactory to MCC.
(i) Board (le Conseil de Surveillance).
(1) Composition. MCA-Senegal will be governed by the Board, which
will consist of voting members representing those Government ministries
and civil society and private sector organizations set forth in the
Establishment Decree. The Board will also consist of those non-voting
observers set forth in the Establishment Decree. All voting members
will be named in writing by their respective Government ministries and
civil society and private sector organizations, as applicable, and must
be sufficiently senior and qualified to make decisions on behalf of
their respective ministries and civil society and private sector
organizations, as applicable. Each voting member named to serve on the
Board, and any replacement for any voting member or any alteration of
the size or composition of the Board, shall be subject to MCC prior
approval.
(ii) Roles and Responsibilities. The Board will be responsible for
overseeing the implementation of the Program and will have final
decision-making authority over the implementation of the Program. The
Board will meet regularly; the frequency of meetings will be set forth
in the MCA-Senegal Bylaws and will be in accordance with the Governance
Guidelines. The specific roles of the voting members and non-voting
observers will be set forth in the Establishment Decree and the MCA-
Senegal Bylaws.
(iii) Management Unit (la Direction G[eacute]n[eacute]rale).
(1) Composition. The Management Unit, which will be led by a
competitively selected Director General, will be composed of
competitively recruited Directors with expertise in the key components
of the Program, including, without limitation, a Roads Director, an
Irrigation and Water Resources Management Director, and a Land Tenure
Security Director, as well as a Deputy Director General, a Chief
Financial Officer, a General Counsel, and other key Directors,
including, without limitation, an Environmental and Social Assessment
Director, a Procurement Director, a Monitoring and Evaluation Director,
and a Communications Director. The Management Unit will also include
such other managers and officers as may be agreed by the Government and
MCC, including, without limitation, an internal auditor and a Human
Resources Officer. The Directors will be supported by appropriate
additional staff to enable the Management Unit to execute its roles and
responsibilities.
(iv) Roles and Responsibilities. The Management Unit will be based
in Dakar, Senegal, and will be responsible for managing the day-to-day
implementation of the Program, with oversight from the Board. The
Management Unit will serve as the principal link between MCC and the
Government, and will be accountable for the successful execution of the
Program, each Project, and each Activity. As a Government entity, MCA-
Senegal will be subject to Government audit requirements. As a
recipient of MCC Funding, MCA-Senegal will also be subject to MCC audit
requirements.
(v) Stakeholders' Committee (le Comit[eacute] des Parties
Prenantes).
(1) Composition. Pursuant to the Establishment Decree, the
composition of the Stakeholders Committee will be determined by the
Board in accordance with the Governance Guidelines and subject to MCC
approval. Without limiting the foregoing, the Establishment Decree
provides that the Stakeholders Committee will be composed of, inter
alia, Program beneficiaries, regional and local government
representatives, entities with an interest or involvement in the
implementation of the Program, key NGOs, and any applicable civil
society and private sector representatives. In addition, the Board may
establish regional, informal stakeholders committees in the project
intervention zones composed of, inter alia, Program beneficiaries,
regional and local government representatives, entities with an
interest or involvement in the implementation of the Program, key NGOs,
and any applicable civil society and private sector representatives.
The establishment and composition of any such regional, informal
stakeholders committees will also be subject to MCC approval.
(2) Roles and Responsibilities. Consistent with the Governance
Guidelines, the Stakeholders Committee (and any informal, regional
stakeholders committees established by the Board) will be responsible
for continuing the consultative process throughout implementation of
the Program. While the Stakeholders Committee (and any informal,
regional stakeholders committees established by the Board) will not
have any decision-making authority, it will be responsible for, inter
alia, reviewing, at the request of the Board or the Management Unit,
certain reports, agreements, and documents related to the
implementation of the Program in order to provide advice and input to
MCA-Senegal regarding the implementation of the Program.
(d) The ``Cellule d'Appui au MCA-S[eacute]n[eacute]gal.''
As referenced in Article 8 of the Compact, the Government will
contribute to the Program, inter alia, through the establishment of and
financial support for a ``Cellule d'Appui au MCA-
S[eacute]n[eacute]gal'' (the ``Cellule''). Exclusively Government-
funded and exclusively Government-run, the Cellule's focus would be
distinct from, but related to, the Program. The Cellule will contain
staff to perform certain functions, which may include, but are not
limited to, the following:
(i) Guichet Unique. Certain Cellule staff will be engaged to assist
MCA-Senegal and contractors working on the Program with navigating the
tax exemption procedures to ensure that they benefit from the tax
exemptions provided by the Compact.

[[Page 54364]]

(ii) Administration and Finance. Certain Cellule staff will be
engaged to perform administration and finance functions with respect to
the Cellule's operations, any mesures d'accompagnement described in
paragraph b above, the start up or closure of MCA-Senegal, and any
Government financial obligations arising out of the Compact, including,
but not limited to, Sections 2.6(a) or 8.1 of the Compact.
(iii) Monitoring Eligibility Criteria. Certain Cellule staff will
be engaged to monitor and evaluate Senegal's level of performance under
the policy criteria identified in Section 607 of the MCA Act, and the
selection criteria and methodology used by MCC.
(iv) Mesures d'Accompagnement. To the extent the Government
undertakes certain social development activities outside of the Program
in the Project areas (such activities may be designed to, inter alia,
diversify current livelihood strategies, slow emigration from the
Delta, link Podor to markets, and improve the ability of women and
youth to take advantage of the economic opportunities presented by an
improved environment for agricultural production), the Cellule may
contain staff to manage the implementation of such social development
activities.
(e) Implementing Entities.
Subject to the terms and conditions of this Compact and any other
related agreements entered into in connection with this Compact, the
Government and MCC have identified certain principal public
institutions that may or will serve as implementing entities (each, an
``Implementing Entity'') to implement and carry out certain Projects
and/or Activities (and/or any component thereof) in furtherance of this
Compact. Such Implementing Entities include, but are not limited to,
(i) AATR, for the Roads Rehabilitation Project and (ii) SAED, for the
Irrigation and Water Resources Management Project. The Government will
ensure that the roles and responsibilities of each Implementing Entity
and other appropriate terms are set forth in an agreement between MCA-
Senegal and each Implementing Entity, which agreement must be in form
and substance satisfactory to MCC (each an ``Implementing Entity
Agreement'').
(f) Fiscal Agent.
Unless MCC otherwise agrees in writing, the Government will engage
a fiscal agent (a ``Fiscal Agent''), who will be responsible for
assisting the Government with its fiscal management and assure
appropriate fiscal accountability of MCC Funding, and whose duties will
include those set forth in the Program Implementation Agreement.
(g) Procurement Agent.
Unless MCC otherwise agrees in writing, the Government will engage
one or more procurement agents (each, a ``Procurement Agent'') to carry
out and certify specified procurement activities in furtherance of this
Compact. The roles and responsibilities of each Procurement Agent will
be set forth in the Program Implementation Agreement or such agreement
as the Government enters into with each Procurement Agent, which
agreement shall be in form and substance satisfactory to MCC. Each
Procurement Agent will adhere to the procurement standards set forth in
the MCC Program Procurement Guidelines and ensure procurements are
consistent with the procurement plan adopted by the Government pursuant
to the Program Implementation Agreement, unless MCC otherwise agrees in
writing.

Schedule 1 of Annex I Delta Activity Construction Activities

The work on the main irrigation channels of the Delta Activity
consists of weed removal, dredging, profiling of berms, and increasing
levee heights, as well as the rehabilitation or replacement of the
associated structures and pumping stations of the following sections:

----------------------------------------------------------------------------------------------------------------
Irrigation section Length/targeted flow rate Associated improvements
----------------------------------------------------------------------------------------------------------------
Gorom Amont........................ 25 km/30 m3s-1............. Ronkh Intake: increase of gravity flow
capacity from 20m3s-1 to 30m3s-1 by reopening
two additional gates and increase of pumping
capacity from 8.3m3s-1 to 20m3s-1.
Gorom Aval......................... 22 km/23 m3s-1............. Intake G: construction of an additional
control bridge with four gates to increase
the gravity flow capacity from 20m3s-1 to
40m3s-1; Rehabilitation of the Boundoum Dam
Bridge.
Lampsar Amont...................... 20 km...................... Replacement of the Boundoum Bridge with a
control bridge.
Lampsar Aval....................... 24 km/12 m3s-1............. Replacement of the Lampsar Bas Bridge with a
control bridge; Repairs on the Bango Bridge.
Ngalam............................. 8 km....................... Rehabilitation of the Ndiaoudoun Bridge.
Djawel............................. 4 km....................... Rehabilitation of the Djawel Bridge.
Kassack............................ 20 km...................... Rehabilitation of the Demba and Diambar
Bridges.
Djeuss............................. ........................... Partial transformation into a main drainage
channel.
----------------------------------------------------------------------------------------------------------------

Schedule 2 to Annex I Form of MCA-Senegal Decree

Republic of Senegal

One People--One Goal--One Faith
Order No. * * * establishing the Millennium Challenge Account
Senegal (hereinafter, ``MCA-Senegal'').
The President of the Republic,
Having regard to Constitution of the Republic of Senegal
(hereinafter, ``Senegal''), and in particular articles 43 and 76
thereof;
Having regard to the Millennium Challenge Compact (hereinafter, the
``Compact'') signed on [insert signature and date] between the Republic
of Senegal (hereinafter ``Senegal''), acting through its government
(hereinafter, the ``Government'') and the government of the United
States of America, acting through the Millennium Challenge Corporation
(hereinafter, ``MCC);
Having regard to Law No. [insert number and date] whereby the
National Assembly authorized the President of Senegal to ratify the
Compact;
Having regard to Letter No. [insert number and date] whereby the
President ratified the Compact;
Having regard to Order No. 2008-53 of January 29, 2008 establishing
the Mission to Develop and Manage the Millennium Challenge Account
Senegal;
Whereas the Compact establishes the general terms and conditions
under which MCC offers to grant an amount not to exceed [insert amount
in words and figures] to the Government for a program to reduce poverty
in Senegal through economic growth (hereinafter, the ``Program'');
Considering the Government's commitment established in the Compact
(Annex I: Program description) to establish a separate legal entity
with financial autonomy to coordinate and execute the Program;

[[Page 54365]]

Orders

Article 1: Establishment; Legal Capacity

An autonomous entity, ``MCA-Senegal'' is hereby established as a
juristic person with financial autonomy to assume responsibility for
managing the Program for Senegal. MCA-Senegal shall be a unit within
the Office of the Prime Minister. MCA-Senegal shall have full legal
capacity and financial autonomy, including, inter alia, the ability to
enter into contracts and agreements; to open, maintain and close bank
accounts; to recruit personnel through competitive processes and
terminate them; and to appear as a party to legal proceedings.

Article 2: Responsibilities of MCA-Senegal

MCA-Senegal shall:
Assume responsibility, on behalf of the Government, for
overseeing the activities associated with management and implementation
of the Program;
Represent the Government, in consultation with the
responsible Government agencies, in negotiations with MCC regarding
technical, financial and administrative issues relating to the Compact;
Execute legal instruments on behalf of the Government in
its relationships with stakeholders or other persons involved in
managing, monitoring and implementing the Program for the Government.

Article 3: MCA-Senegal Management Bodies

In performing its functions, MCA-Senegal shall be supported by a
deliberative body, an executive body and an advisory body:
The Supervisory Board shall serve as the deliberative
body,
The Management Unit (direction g[eacute]n[eacute]rale)
shall serve as the executive body,
The Stakeholders Committee shall serve as the advisory
body.
No member of the Supervisory Board, the Management Unit or the
Stakeholders Committee or other representative of MCA-Senegal shall
have a direct or indirect conflict of interest with the performance of
the functions for which MCA-Senegal is responsible.

Article 4: Powers of the Supervisory Board

The MCA-Senegal Supervisory Board shall have the broadest powers to
act in all circumstances and make decisions concerning the objectives,
policies, administration and oversight of the Management Unit's
operations.
To this end, the Supervisory Board shall:
Determine the strategic objectives of the Program,
Approve the administrative organization of MCA-Senegal,
Approve any decision to dissolve MCA-Senegal or modify its
structure,
Adopt the MCA-Senegal annual activity report prepared by
the Executive Director,
Approve the MCA-Senegal annual budget,
Approve the financial statements prepared by the Executive
Director within three months after the close of the fiscal year,
Recruit the Executive Director,
Approve the Executive Director's contract, the Management
Unit organization chart and the form of employment contract for key
personnel,
Terminate the Executive Director and approve the
termination of executive or key personnel of MCA-Senegal,
Approve plans to award contracts, and
Perform all other tasks prescribed by MCC directives or
the internal regulations of the Supervisory Board.
The decisions of the Supervisory Board shall be subject to MCC's no
objection.

Article 5: Composition of the Supervisory Board

The Supervisory Board shall be composed of the following members
with voting rights (individually a ``Member''):
A representative of the Prime Minister,
A representative of the Minister of Foreign Affairs,
A representative of the Minister of Economy and Finance,
A representative of the Minister of Infrastructure,
A representative of the Minister of the Environment,
A representative of the Minister of Decentralization and
Local Authorities,
A representative of the Minister of Justice,
A representative of the Minister of Agriculture,
A representative of the Minister of Social Development and
Gender,
Two representatives from the most representative employer
organizations,
Two representatives from the most representative society
organizations, including one woman.
Each Member shall have one vote.
The following individuals shall serve in an advisory capacity on
the Supervisory Board as nonvoting permanent observers:
A representative of MCC,
The Executive Director of MCA-Senegal.
The Supervisory Board Members representing the Government shall be
designated in writing by their respective ministers. They shall have
the authority and powers to represent their ministries and make all
decisions during Supervisory Board meetings. The term of office of a
Member representing the Government shall expire with that of the
minister concerned or following the respective minister's written
decision to replace the Member.
The Members representing civil society and employer organizations
shall be designated in writing by their organization's deliberative
body. The Members representing civil society and employer organizations
shall have all powers in the context of their mission to act on behalf
of their organization. The term of office of a Member representing a
civil society or employer organization shall expire following the
written decision of the respective organization's deliberative body to
replace the Member.
The terms of Supervisory Board members shall commence upon their
appointment.
MCC's no objection shall be required for any proposal or
modification of the Supervisory Board's composition.

Article 6: Supervisory Board Operations

The Supervisory Board shall meet as often as required and at least
once each quarter. It shall be convened by a representative of the
Office of the Prime Minister or at the request of at least four (4)
Members. The rules governing the procedures for convening meetings,
establishing a quorum and adopting decisions shall be established by
the internal regulations.
The Executive Director of MCA-Senegal shall serve as secretary of
the Supervisory Board.
The Members of the Supervisory Board shall receive no remuneration.
However, each Member of the Supervisory Board shall be entitled to
reimbursement of reasonable expenses incurred in connection with
attendance at Supervisory Board meetings, in accordance with MCC
directives.
The Supervisory Board may decide to retain the services of experts
and specialists to assist it in performing its functions. Such experts
and specialists shall participate in Supervisory Board meetings in an
advisory capacity.
The Supervisory Board may, if necessary, establish committees
formed of Members and/or observers to which it may delegate tasks
related to its functions.

[[Page 54366]]

Article 7: Stakeholders Committee

The Stakeholders Committee shall be an advisory body responsible
for monitoring projects and providing technical assistance to the
Management Unit and Supervisory Board, to which it may also provide
opinions.
The Stakeholders Committee shall consist of the project
beneficiaries, the entities involved in or having an interest in
Program execution, and representatives from the Government, employer
organizations and civil society.
The members of the Stakeholders Committee representing the
Government shall be appointed by their respective ministries, and the
members representing employer and civil society organizations by their
respective organizations.
The Supervisory Board shall designate the members of the
Stakeholders Committee and determine its composition and operating
procedures.
The Supervisory Board may decide to establish local stakeholder
subcommittees in the Program's area of influence. The members of such
subcommittees shall be designated under the same terms and conditions
as the national Stakeholders Committee.

Article 8: Management Unit

MCA-Senegal shall be managed by a Management Unit headed by an
Executive Director. The Executive Director shall be recruited by the
Supervisory Board in accordance with MCC directives.
The process of recruiting members of the Management Unit personnel
shall be subject to MCC's no objection.
The key personnel of MCA-Senegal shall be recruited or terminated
by the Executive Director in accordance with MCC directives and subject
to the Supervisory Board's approval.
The Executive Director shall provide day-to-day oversight and
supervision of MCA-Senegal's operations and shall serve as the
Additional Representative within the meaning of the Compact. He shall
prepare the work of the Supervisory Board and implement the policies it
establishes.
The duties of the Executive Director shall include:
Exercising administrative and management authority over
all personnel and departments of MCA-Senegal,
Reporting to interested parties, including the Supervisory
Board and the Stakeholders Committee, on progress in implementing the
Program,
Preparing and executing the MCA-Senegal budget in
accordance with the provisions of article 9,
Preparing an annual activity report and submitting it to
the Supervisory Board for approval,
Preparing the financial statements and submitting them to
the Supervisory Board for approval,
Performing all other tasks prescribed by MCC directives or
the Supervisory Board.

Article 9: MCA-Senegal Budget

MCA-Senegal shall have a budget outlining its receipts and
expenditures.
MCA-Senegal's receipts shall consist of the budget appropriation
provided in the Compact. MCA-Senegal's funding shall also consist of an
annual budget appropriation from the Government as provided by the
Compact and related agreements, which shall be managed by the MCA-
Senegal Support Unit (Cellule d'Appui) provided in the Compact.
All MCA-Senegal funding, whether provided under the Compact or by
the Government, shall be used exclusively to fulfill the
responsibilities of MCA-Senegal as described in article 2.
In accordance with article 8, the budget shall be prepared and
executed by the Executive Director under the supervision of the
Supervisory Board.

Article 10: Audit and Oversight

MCA-Senegal shall be subject to audits by the Inspector General of
Finance, the Auditor General (Inspection G[eacute]n[eacute]rale d'Etat)
and the Court of Auditors (Cour des Comptes) as provided, inter alia,
by Law No. 90-07 June 26, 1990. As provided by the Compact and related
agreements and MCC directives, it shall also be subject to audits by
independent firms, MCC, the Inspector General of the United States
Agency for International Development, and the United States Government
Accountability Office.

Article 11: Effects of the Order

This order repeals Order No. 2008-53 of January 29, 2008
establishing the Mission to Develop and Manage the Millennium Challenge
Account Senegal (hereinafter, ``MFG-MCA''). The Government of Senegal
shall replace the MFG-MCA in the exercise of its rights and the
performance of its legal and contractual obligations, including
employer and tax obligations and monies payable by MFG-MCA to service
providers; however, provided it expressly indicates its intent to do
so, MCA-Senegal may: (1) Receive the benefit of services performed for
MFG-MCA and exercise the rights attached to those powers (without
assuming any obligations); or (2) assume the obligations and rights
that had been performed for the benefit of MG-MCA.

Article 12: Transitory Provisions

Without prejudice to the other provisions of this order, the
Supervisory Board shall meet either at the request of at least four
Members or at the initiative of the Prime Minister or his
representative until the internal regulations of the Supervisory Board
are adopted.
The meetings of the Supervisory Board shall be convened by the
Prime Minister or his representative, who shall chair the meetings.
The Supervisory Board shall have a quorum if one-half of its
Members are present or represented. The decisions of the Supervisory
Board, other than the decision to adopt the internal regulations, shall
be adopted by an absolute majority of the Members present or
represented. An absolute majority of the Supervisory Board Members
shall be required to adopt the internal regulations or written
decisions.

Article 13: Execution of the Order

The Prime Minister, the Minister of Foreign Affairs; the Minister
of Economy and Finance; the Minister of the Interior; the Minister of
the Environment and Protection of Nature, Retention Basins and
Artificial Lakes; the Minister of Infrastructure and National Planning;
the Minister of Decentralization and Local Authorities; the Minister of
Justice; the Minister of Social Development and Gender; each with
respect to his or her ministry, shall be responsible for executing this
order, which shall be published in the Official Journal.\1\
---------------------------------------------------------------------------

\1\ The exact titles to be confirmed.

---------------------------------------------------------------------------
Executed at Dakar, this----------

By the President of the Republic
Abdoulaye Wade
The Prime Minister

Annex II Multi-Year Financial Plan Summary

This Annex II summarizes the Multi-Year Financial Plan for the
Program.

1. General

A multi-year financial plan summary (``Multi-Year Financial Plan
Summary'') is attached hereto as Exhibit A. By such time as specified
in the PIA, the Government will adopt, subject to MCC approval, a
Multi-Year Financial Plan that includes, in addition to the multi-year
summary of estimated MCC Funding and the Government's contribution of
funds and resources, the

[[Page 54367]]

annual and quarterly funding requirements for the Program (including
administrative costs) and for each project, projected both on a
commitment and cash requirement basis.

Exhibit A--Multi-Year Financial Plan Summary
[Multi-year financial plan (US$)]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Project CIF Year 1 Year 2 Year 3 Year 4 Year 5 Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
1. Irrigation & Water Resources Management Project:..........
Infrastructure Activity
Land Tenure Security Activity
Social Safeguard Measures
Sub-Total............................................ 0 19,812,280 69,915,184 63,538,624 16,667,272 75,500 170,008,860
2. Roads Rehabilitation Project:
National Road 2
National Road 6
Sub-Total............................................ 0 48,695,302 101,844,436 95,320,317 56,859,947 21,342,497 324,062,499
3. Monitoring and Evaluation (M&E):
Monitoring and Evaluation
Sub-Total............................................ 0 571,500 771,500 546,500 671,500 1,196,500 3,757,500
4. Program Administration and Audit \1\:
MCA-Senegal
Fiscal Agent/Procurement Agent
Audit
Sub-Total............................................ 5,000,000 7,248,022 7,324,764 7,403,964 7,383,539 7,810,852 42,171,141
------------------------------------------------------------------------------------------
Grand Total...................................... 5,000,000 76,327,104 179,855,884 166,809,405 81,582,258 30,425,349 540,000,000
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ These amounts do not include any costs required to be borne by the Government pursuant to the Compact, including, but not limited to Sections 2.6(a)
and Section 8.1 of the Compact.

Annex III Description of the Monitoring and Evaluation Plan

This Annex III (this ``M&E Annex'') generally describes the
components of the Monitoring and Evaluation Plan (``M&E Plan'') for the
Program. The actual content and form of the M&E Plan will be agreed to
by MCC and the Government, and may be modified from time to time
without requiring an amendment to this Annex III.

1. Overview

MCC and the Government will formulate, agree to and the Government
will implement, or cause to be implemented, an M&E Plan that specifies
(a) how progress toward the Compact Goal, Program Objective and Project
Objectives will be monitored, (``Monitoring Component''), (b) a process
and timeline for the monitoring of planned, ongoing, or completed
Project Activities to determine their efficiency and effectiveness, and
(c) a methodology for assessment and rigorous evaluation of the
outcomes and impact of the Program (``Evaluation Component'').
Information regarding the Program's performance, including the M&E
Plan, and any amendments or modifications thereto, as well as progress
and other reports, will be made publicly available on the Web site of
MCA-Senegal and elsewhere.

2. Program Logic

The M&E Plan will be built on a logic model which illustrates how
the Program, Projects and Activities contribute to poverty reduction
and economic growth in Senegal. In sum, the goal of the Program is to
contribute to economic growth and poverty reduction by: (a) increasing
household and firm incomes through increased irrigated agricultural
production and productivity on irrigated perimeters; and (b) increasing
household and firm access to domestic and international markets through
improved road quality and reduced travel times and costs.

3. Monitoring Component

To monitor progress toward the achievement of the impact and
outcomes, the Monitoring Component of the M&E Plan will identify (a)
the Indicators (as defined below), (b) the definitions of the
Indicators, (c) the sources and methods for data collection, (d) the
frequency for data collection, (e) the party or parties responsible,
and (f) the timeline for reporting on each Indicator to MCC.
Further, the Monitoring Component will track changes in the
selected Indicators for measuring progress towards the achievement of
the objectives during the Compact Term. Before the initiation of
implementation activities for each Project, MCA-Senegal will collect
baseline data on the selected Indicators or verify already collected
baseline data.
(a) Indicators. The M&E Plan will measure the results of the
Program using quantitative, objective and reliable data
(``Indicators''). Each Indicator will have benchmarks that specify the
expected value and the expected time by which that result will be
achieved (``Target''). The M&E Plan will be based on a logical
framework approach that classifies Indicators as goal, outcome, output,
and process milestones. The Compact Goal Indicators (``Goal
Indicators'') will measure the general contribution of the Projects to
the national economic growth and poverty reduction. Second, the Project
Objective and outcome Indicators (``Project Objective and Outcome
Indicators'') will measure the final result of each Project. Third,
output Indicators and process milestones (``Activity Indicators'') will
measure the early and intermediate results of the Project Activities.
For each Project Objective and Outcome Indicator and each Activity
Indicator, the M&E Plan will define a strategy for obtaining and
verifying the value of such Indicator prior to undertaking any activity
that affects the value of such Indicator (such value, a ``Baseline'').
All Indicators will be disaggregated by gender, income level and age,
and beneficiary types to the extent practicable. Subject to prior
written approval from MCC, MCA-Senegal may add Indicators or refine the

[[Page 54368]]

definitions and Targets of existing Indicators.
(i) Goal. The M&E Plan will contain the Goal Indicators listed
below specifying the definition, baseline, and end of Compact Target
for each. The economic analysis estimates that:
Over a 20-year period, the Irrigation and Water Resources
Management Project is expected to contribute to an average increase in
net revenue of 35% among beneficiaries.
Over a 20-year period, benefits of the RN2 Road Activity
are expected to be comparable to an average increase of 13 percent of
annual consumption among the catchment area population (5 kilometers on
either side of the road).\2\
---------------------------------------------------------------------------

\2\ Note: some of the beneficiaries of the RN2 will overlap with
those of the Irrigation and Water Resources Management Project.
---------------------------------------------------------------------------

Over a 20-year period, benefits of the RN6 Road Activity
are expected to be comparable to an average increase of 9 percent of
annual consumption among the catchment area population (5 kilometers on
either side of the road).
(ii) Project Objective and Outcome Indicators and Activity
Indicators. The M&E Plan will contain Project Objective and Outcome
Indicators, which will measure the two Projects and are listed below
with their definitions, baselines and targets. Prior to the initiation
of implementation of an Activity, MCC and MCA-Senegal will agree on a
final set of Activity Indicators. The M&E Plan will contain these
Indicators or will be amended to contain these Indicators.

Irrigation and Water Resources Management Project Objective and Outcome Indicators
----------------------------------------------------------------------------------------------------------------
Irrigation and water resources Baseline Year 5
management project Indicator Definition value target
----------------------------------------------------------------------------------------------------------------
Project Objective: Increased Volumes of irrigated rice Total quantity of rice 55,000 263,000
irrigated agricultural production production (Tons). cultivated by year on the
and productivity on newly irrigated areas
irrigated perimeters in the Delta (irrigation and dry
and N'Gallenka. season).
Agricultural cropping Total number of hectares 0.95 1.50
intensity. cultivated by year/Total
irrigated area.
Area of land under Total number of hectares 11,800 \3\
irrigation (hectares). of land using irrigation 39,740
for agricultural
production.
----------------------------------------------------------------------------------------------------------------
Outcomes Indicator Definition Baseline Year 5
value target
----------------------------------------------------------------------------------------------------------------
Increased efficiency of water Efficiency of irrigation Water flow over time in 13 65
infrastructure for irrigated infrastructure (m\3\/s). the Lampsar canal.
agriculture.
Improved land tenure management on Percent of allocated Total numbers of parcels 0 \5\ 100%
irrigated perimeters. parcels with ``titres with land titles (i.e.,
d'affectation'' \4\. ``titres d'affectation'')/
total numbers of parcels
allocated.
Percent of ``titres Total numbers of 0 100%
d'affectation'' registered land titles
registered at the CRs. (i.e., ``titres
d'affectation'')/total
numbers of parcels
allocated.
Percent of new land Total numbers of new 0 95%
conflicts resolved. conflicts resolved/total
numbers of new conflicts
registered.
----------------------------------------------------------------------------------------------------------------

Roads Rehabilitation Project Objective and Outcome Indicators
--------------------------------------------------------------------------------------------------------------------------------------------------------
National road 2 Indicator Definition Baseline value Year 5 target
--------------------------------------------------------------------------------------------------------------------------------------------------------
Activity Objective: Increased Average Annual Daily Total number of vehicles on RichardToll-Ndioum: 870 RichardToll-Ndioum: 1240.
access to domestic and Traffic. rehabilitated road.
international markets.
Transport times............ Travel time saved due to TBD \6\................ 50% reduction.
improved conditions on
rehabilitated road.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Outcomes Indicator Definition Baseline value Year 5 target
--------------------------------------------------------------------------------------------------------------------------------------------------------
Improved road quality.............. International Roughness Measurement of pavement RichardToll-Ndioum: 8.4 RichardToll-Ndioum: 2.4.
Index (proxy for vehicle roughness on rehabilitated
operating costs). road.
Extended road network.............. Kms of road rehabilitated.. Total number of kilometers 0...................... 120 km.
of road rehabilitated.
--------------------------------------------------------------------------------------------------------------------------------------------------------
National road 6 Indicator Definition Baseline value Year 5 target
--------------------------------------------------------------------------------------------------------------------------------------------------------
Activity Objective: Increased Average Annual Daily Total number of vehicles on Ziguinchor-Tanaf: 540.. Ziguinchor-Tanaf: 680.
access to domestic and Traffic. rehabilitated road. Tanaf-Kolda: 820....... Tanaf-Kolda: 1490
international markets. Kolda-Kounkane: 1200... Kolda-Kounkane: 1850.

[[Page 54369]]

Transport times............ Travel time saved due to TBD.................... 50% reduction.
improved conditions on
rehabilitated road.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Outcomes Indicator Definition Baseline value Year 5 target
--------------------------------------------------------------------------------------------------------------------------------------------------------
Improved road quality.............. International Roughness Measurement of pavement 15..................... 2.5.
Index (IRI) (proxy for roughness on rehabilitated
vehicle operating costs). road.
Extended road network.............. Kms of road rehabilitated.. Total number of kilometers 0...................... 260 km \7\.
of road rehabilitated.
--------------------------------------------------------------------------------------------------------------------------------------------------------

(b) Data Collection and Reporting. The M&E Plan will establish
guidelines for data collection and reporting, and identify the
responsible parties. Compliance with data collection and reporting
timelines will be conditions for Disbursements for the relevant Project
Activities as set forth in the Program Implementation Agreement. The
M&E Plan will specify the data collection methodologies, procedures,
and analysis required for reporting on results at all levels. The M&E
Plan will describe any interim MCC approvals for data collection,
analysis, and reporting plans.
---------------------------------------------------------------------------

\3\ Incremental increase of 19,490 hectares rehabilitated and
8,000 hectares in extension in the Delta region, and 440 hectares in
extension in N'Gallenka. All hectares are expected to be formalized
under the land tenure security activity.
\4\ See the Land Tenure Security Activity section of this
document for definitions of French terms.
\5\ The total number of parcels to be allocated and registered
will be determined by the land allocation criteria.
\6\ Baseline values for travel times will be available with
final results of the ongoing studies.
\7\ Final value to be confirmed.
---------------------------------------------------------------------------

(c) Data Quality Reviews. As determined in the M&E Plan or as
otherwise requested by MCC, the quality of the data gathered through
the M&E Plan will be reviewed to ensure that data reported are as
valid, reliable, and timely as resources will allow. The objective of
any data quality review will be to verify the quality and the
consistency of performance data across different implementation units
and reporting institutions. Such data quality reviews also will serve
to identify where those levels of quality are not possible, given the
realities of data collection.
(d) Management Information System. The M&E Plan will describe the
information system that will be used to collect data, store, process
and deliver information to relevant stakeholders in such a way that the
Program information collected and verified pursuant to the M&E Plan is
at all times accessible and useful to those who wish to use it. The
system development will take into consideration the requirement and
data needs of the components of the Program, and will be aligned with
MCC existing systems, other service providers, and ministries.
(e) Role of MCA-Senegal. The monitoring and evaluation of this
Compact spans across two discrete Projects and will involve a variety
of governmental, non-governmental, and private sector institutions.
MCA-Senegal holds full responsibility for implementation of the M&E
Plan. MCA-Senegal will oversee all Compact-related monitoring and
evaluation activities conducted for each of the Projects, ensuring that
data from all implementing entities is consistent, accurately reported
and aggregated into regular Compact performance reports as described in
the M&E Plan.

4. Evaluation Component

The Evaluation Component of the M&E Plan will contain three types
of evaluations: Impact Evaluations, Project Performance Evaluations,
and Special Studies. Plans for each type of evaluation will be
finalized before any Disbursement for specific Program or Project
activities. The Evaluation Component of the M&E Plan will describe the
purpose of the evaluation, methodology, timeline, required MCC
approvals, and the process for collection and analysis of data for each
evaluation. The results of all evaluations will be made publicly
available in accordance with MCC's guidelines for monitoring and
evaluation plans posted from time to time on the MCC Web site (the
``MCC Policy for Monitoring and Evaluation of Compacts and Threshold
Programs'').
(a) Impact Evaluation. The M&E Plan will include a description of
the methods to be used for impact evaluations and plans for integrating
the evaluation method into Project design. Based on in-country
consultation with stakeholders, the strategies outlined below were
jointly determined as having the strongest potential for rigorous
impact evaluation. The M&E Plan will further outline in detail these
methodologies. Final impact evaluation strategies are to be jointly
determined before the approval of the M&E Plan. The following is a
summary of the potential impact evaluation methodologies:
(i) Irrigation and Water Resources Management Project.
An impact evaluation will be conducted to estimate the causal
relationship between the project and its objective of increasing
agricultural production and productivity; as well as its long-term goal
of increasing household and firms' incomes. The evaluation will likely
use a difference-in-difference methodology comparing three geographic
zones: (1) Areas expected to benefit from the irrigation systems
rehabilitation under the project, (2) areas that will benefit from
irrigation systems extension, and (3) a comparison area that is not
covered by the Compact. Surveys conducted in all three areas before and
after the project will allow rigorous analysis to estimate the
project's incremental contribution to the targeted objectives and
goals.
(ii) Roads Rehabilitation Project.
Similarly, a difference-in-difference methodology will be used to
estimate the causal relationship between road rehabilitation and
increased economic activity. Surveys will be conducted before and after
road rehabilitation in two zones: (1) one area within five kilometers
of each side of the road \8\; (2) one area outside of the five
kilometer corridor. Analyzing conditions among the two groups over two
points in time will allow estimates of the project's incremental
impact.
---------------------------------------------------------------------------

\8\ The economic analysis used 5 kilometers on either side of
the road as an estimated ``catchment area'' of beneficiaries.
---------------------------------------------------------------------------

(b) Final Evaluation. The M&E Plan will make provision for Final
Project level evaluations (``Final Evaluations''). With the prior
written approval of MCC, MCA-Senegal (or MCC independently) will engage
independent evaluators to

[[Page 54370]]

design the Final Evaluations to be conducted at the end of each
Project. The Final Evaluations will review progress during Compact
implementation and provide a qualitative context for interpreting
monitoring data. They must at a minimum (i) evaluate the efficiency and
effectiveness of the Project Activities; (ii) determine if and analyze
the reasons why the Compact Goal, Program Objective and Project
Objective(s) were or were not achieved; (iii) identify positive and
negative unintended results of the Program; (iv) provide lessons
learned that may be applied to similar projects; and (v) assess the
likelihood that results will be sustained over time.
(i) Special Studies. The M&E Plan will include a description of the
methods to be used for special studies funded through this Compact or
by MCC. Plans for conducting the special studies will be determined
jointly between MCA-Senegal and MCC before the approval of the M&E
Plan. The M&E Plan will identify and make provision for any other
special studies, ad hoc evaluations, and research that may be needed as
part of the monitoring and evaluating of this Compact. Either MCC or
MCA-Senegal may request special studies or ad hoc evaluations of
Projects, Project Activities, or the Program as a whole prior to the
expiration of the Compact Term. When MCA-Senegal engages an evaluator,
the evaluator will be externally contracted and independently source
selected by MCA-Senegal. The aforementioned engagement will be subject
to the prior written approval of MCC, following a tender in accordance
with the MCC Program Procurement Guidelines, and in accordance with any
relevant Implementation Letter or supplemental agreement. Contract
terms must ensure non-biased results and the publication of results.
(c) Request for Ad Hoc Evaluation or Special Study. If MCA-Senegal
requires an ad hoc independent evaluation or special study at the
request of the Government for any reason, including for the purpose of
contesting an MCC determination with respect to a Project or Activity
or to seek funding from other donors, no MCC Funding or MCA-Senegal
resources may be applied to such evaluation or special study without
MCC's prior written approval.

5. Other Components of the M&E Plan

In addition to the Monitoring and Evaluation Components, the M&E
Plan will include the following components for the Program, Projects
and Project Activities, including, where appropriate, roles and
responsibilities of the relevant parties and providers:
(a) Costs. A detailed cost estimate for all components of the M&E
Plan.
(b) Assumptions and Risks. Any assumption or risk external to the
Program that underlies the accomplishment of the Program Objective,
Project Objectives and Activity outcomes. However, such assumptions and
risks will not excuse any Party's performance unless otherwise
expressly agreed to in writing by the Parties.

6. Implementation of the M&E Plan

(a) Approval and Implementation. The approval and implementation of
the M&E Plan, as amended from time to time, will be in accordance with
this Annex III, the Program Implementation Agreement and any other
relevant supplemental agreement, and the MCC Policy for Monitoring and
Evaluation of Compacts and Threshold Programs.

Annex IV Conditions to Disbursement of Compact Implementation Funding

This Annex IV sets forth the conditions precedent applicable to
Disbursements of Compact Implementation Funding (each a ``CIF
Disbursement''). Capitalized terms used in this Annex IV and not
defined in this Annex IV or in the Compact have the meanings assigned
to such terms in the form of Program Implementation Agreement attached
to the Compact as Annex VII. Upon execution of the Program
Implementation Agreement, each CIF Disbursement shall be subject to the
terms and conditions of the Program Implementation Agreement
(including, without limitation, Section 3.3 thereof).

1. Conditions to All CIF Disbursements (Including the Initial CIF
Disbursement)

Each of the following conditions precedent must have been met to
MCC's satisfaction prior to each CIF Disbursement:
(a) Delivery by MFG-MCA (or, upon its establishment, MCA-Senegal)
to MCC of a complete, correct, and fully executed Disbursement Request
for the relevant Disbursement Period, together with any applicable
Periodic Reports covering such Disbursement Period, in each case in
form and substance satisfactory to MCC and submitted in accordance with
the Reporting Guidelines. Each Disbursement Request shall include the
following reference number: GR09SEN09010.
(b) MCC is satisfied, in its sole discretion, that: (i) Each
activity being funded by such CIF Disbursement is necessary, advisable,
or is otherwise consistent with the goal of facilitating the
implementation of the Compact; (ii) there has been no violation of, and
the use of the requested funds for the purposes requested will not
violate, the limitations on the use or treatment of (x) MCC Funding, as
set forth in this Compact, including under Section 2.7, or (y) Compact
Implementation Funding; (iii) no material default or breach of any
covenant, obligation, or responsibility of the Government or MFG-MCA
(or, upon its establishment, MCA-Senegal) under this Compact, the
Program Implementation Agreement, any supplemental agreement, or any
Program Guidelines has occurred or is continuing; and (iv) any Taxes
paid with MCC Funding through the date ninety (90) days prior to the
start of the applicable Disbursement Period have been reimbursed by the
Government in full in accordance with this Compact.
(c) MCC is satisfied, in its sole discretion, that MFG-MCA (or,
upon its establishment, MCA-Senegal) is sufficiently mobilized in order
for MFG-MCA (or MCA-Senegal, as the case may be) to be able to fully
perform its obligations and act on behalf of the Government.
(d) MFG-MCA (or, upon its establishment, MCA-Senegal), shall have
adopted a Procurement Plan, in form and substance satisfactory to MCC,
with respect to the Compact Implementation Funding, and such
Procurement Plan remains in full force and effect.
(e) MFG-MCA (or, upon its establishment, MCA-Senegal), shall have
adopted an Fiscal Accountability Plan, in form and substance
satisfactory to MCC, and such Fiscal Accountability Plan remains in
full force and effect.

2. Conditions to Specific CIF Disbursements (and Each CIF Disbursement
Thereafter)

Each of the following conditions precedent must have been met to
MCC's satisfaction prior to the applicable CIF Disbursement:
(a) Prior to any CIF Disbursement on or after January 1, 2010, MCA-
Senegal shall be fully formed and in good standing under the laws of
Senegal.
(b) Prior to any CIF Disbursement on or after January 1, 2010, the
Fiscal Agent shall have been duly appointed, and MCA-Senegal shall have
duly executed the Fiscal Agent Agreement, and such agreement shall be
in full force and effect without modification, alteration, rescission,
or suspension of any kind, unless otherwise agreed by MCC, and no
material default has occurred or is continuing thereunder.

[[Page 54371]]

(c) Prior to any CIF Disbursement on or after January 1, 2010, the
Procurement Agent shall have been duly appointed, and MCA-Senegal shall
have duly executed the Procurement Agent Agreement, and such agreement
shall be in full force and effect without modification, alteration,
rescission, or suspension of any kind, unless otherwise agreed by MCC,
and no material default has occurred or is continuing thereunder.
(d) Prior to any CIF Disbursement on or after January 1, 2010, the
Bank shall have been duly appointed, and MCA-Senegal and the Fiscal
Agent shall have duly executed the Bank Agreement, and such agreement
shall be in full force and effect without modification, alteration,
rescission, or suspension of any kind, unless otherwise agreed by MCC,
and no material default has occurred or is continuing thereunder.
(e) Prior to the deposit of any CIF Disbursement into any Permitted
Account in accordance with an approved Disbursement Request, MCC shall
have received satisfactory evidence of the establishment of such
Permitted Account.

Annex V Definitions

AATR has the meaning provided in paragraph 1(e) of Part B of Annex
I.
Additional Representative has the meaning provided in Section 4.2.
Activity has the meaning provided in Part B of Annex I.
Activity Indicators has the meaning provided in paragraph 3(a) of
Annex III.
AE has the meaning provided in Schedule A of Annex VI.
AFD has the meaning provided in paragraph 2(d) of Part B of Annex
I.
Approval Documents has the meaning provided in Schedule B of Annex
VI.
Audit Guidelines has the meaning provided in Section 3.8(a).
Baseline has the meaning provided in paragraph 3(a) of Annex III.
Bilateral Agreement has the meaning provided in Schedule A of Annex
VI.
Board has the meaning provided in paragraph 3(c) of Part B of Annex
I.
Casamance has the meaning provided in paragraph 1 of Part A of
Annex I.
CCs has the meaning provided in paragraph 2(a)(iv) of Part B of
Annex I.
Cellule has the meaning provided in paragraph 3(d) of Part B of
Annex I.
CIF Disbursement has the meaning provided in Annex IV.
CDI has the meaning provided in paragraph 2(a)(iv)(2) of Part B of
Annex I.
Compact has the meaning provided in the Preamble.
Compact Contract has the meaning provided in Schedule C of Annex
VI.
Compact Goal has the meaning provided in Section 1.1.
Compact Implementation Funding has the meaning provided in Section
2.2(a).
Compact Records has the meaning provided in Section 3.7(a).
Compact Term has the meaning provided in Section 7.4.
Covered Provider has the meaning provided in Section 3.7(c).
CRs has the meaning provided in paragraph 2(a)(iv) of Part B of
Annex I.
DD has the meaning provided in Schedule B of Annex VI.
Delta has the meaning provided in paragraph 2(a) of Part B of Annex
I.
DGD has the meaning provided in Schedule B of Annex VI.
DGID has the meaning provided in Schedule A of Annex VI.
Disbursement has the meaning provided in Section 2.4.
Establishment Decree has the meaning provided in paragraph 3(c) of
Part B of Annex I.
EU has the meaning provided in paragraph 1(d) of Part B of Annex I.
Evaluation Component has the meaning provided in paragraph 1 of
Annex III.
Excess CIF Amount has the meaning provided in Section 2.2(d).
Exempt Person has the meaning provided in Schedule D of Annex VI.
Exempt Vendor has the meaning provided in Schedule C of Annex VI.
Fuel Approval Documents has the meaning provided in Schedule E of
Annex VI.
Final Evaluations has the meaning provided in paragraph 4(b) of
Annex III.
Fiscal Agent has the meaning provided in paragraph 3(f) of Part B
of Annex I.
Goal Indicators has the meaning provided in paragraph 3(a) of Annex
III.
Government has the meaning provided in the Preamble.
Governance Guidelines has the meaning provided in paragraph 3(c) of
Part B of Annex I.
Implementation Letter has the meaning provided in Section 3.5.
Implementing Entity has the meaning provided paragraph 3(e) of Part
B of Annex I.
Implementing Entity Agreement has the meaning provided in paragraph
3(e) of Part B of Annex I.
Indicators has the meaning provided in paragraph 3(a) of Annex III.
Inspector General has the meaning provided in Section 3.8(a).
Irrigation Maintenance Action Plan has the meaning provided in
paragraph 2(e) of Part B of Annex I.
Management Unit has the meaning provided in paragraph 3(c) of Part
B of Annex I.
M&E Annex has the meaning provided in Annex III.
M&E Plan has the meaning provided in Annex III.
MCA Act has the meaning provided in Section 2.2(a).
MCA-Senegal has the meaning provided in Section 3.2(b).
MCA-Senegal Bylaws has the meaning provided in paragraph 3(c) of
Part B of Annex I.
MCC has the meaning provided in the Preamble.
MCC Environmental Guidelines has the meaning provided in Section
2.7(c).
MCC Funding has the meaning provided in Section 2.3.
MCC Gender Policy has the meaning provided in paragraph 3 of Part A
of Annex I.
MCC Policy for Monitoring and Evaluation of Compacts and Threshold
Programs has the meaning provided for in paragraph 4 of Annex III.
MCC Program Procurement Guidelines has the meaning provided in
Section 3.6.
MCC Resettlement Guidance has the meaning provided in paragraph 3
of Part A of Annex I.
MCC Web site has the meaning provided in Section 2.7.
MFG-MCA has the meaning provided in Section 3.2(b).
MoEF has the meaning provided in Schedule A of Annex VI.
Monitoring Component has the meaning provided in paragraph 1 of
Annex III.
Multi-Year Financial Plan Summary has the meaning provided in
paragraph 1 of Annex II.
NGOs has the meaning provided in paragraph 1 of Part A of Annex I.
OMB has the meaning provided in Section 3.8(b).
OP 4.12 has the meaning provided in paragraph 3 of Part A of Annex
I.
PACR has the meaning provided in paragraph 2(d) of Part B of Annex
I.
Party and Parties has the meaning provided in the Preamble.
PDMAS has the meaning provided in paragraph 2(d) of Part B of Annex
I.
Permitted Account has the meaning provided in Section 2.4.
POAS has the meaning provided in paragraph 2(a)(iv)(2) of Part B of
Annex I.
Podor has the meaning provided in paragraph 2(a) of Part B of Annex
I.
Principal Representative has the meaning provided in Section 4.2.
Procurement Agent has the meaning provided in paragraph 3(g) of
Part B of Annex I.
Program has the meaning provided in the Preamble.
Program Funding has the meaning provided in Section 2.1.

[[Page 54372]]

Program Guidelines means collectively the Audit Guidelines, the MCC
Environmental Guidelines, the Governance Guidelines, the MCC Program
Procurement Guidelines, the Reporting Guidelines, the MCC Policy for
Monitoring and Evaluation of Compacts and Threshold Programs, and any
other guidelines, policies or guidance papers from time to time
published on the MCC Web site.
Program Implementation Agreement or PIA has the meaning provided in
Section 3.1.
Program Objective has the meaning provided in Section 1.2.
Project(s) has the meaning provided in Section 6.2(b).
Project Objective(s) has the meaning provided in Section 1.3.
Project Objective and Outcome Indicators has the meaning provided
in paragraph 3(a) of Annex III.
Provider has the meaning provided in Section 3.7(c).
RN2 has the meaning provided in paragraph 1(a) of Part B of Annex
I.
RN6 has the meaning provided in paragraph 1(a) of Part B of Annex
I.
Road Fund has the meaning provided in paragraph 1(e) of Part B of
Annex I.
SAED has the meaning provided in paragraph 2(a) of Part B of Annex
I.
Senegal has the meaning provided in the Preamble.
Stakeholder's Committee has the meaning provided in paragraph 3(c)
of Part B of Annex I.
Target has the meaning provided in paragraph 3(a) of Annex III.
Taxes has the meaning provided in Section 2.8(a).
TE has the meaning provided in Schedule B of Annex VI.
Temporary Admission Request has the meaning provided in Schedule B
of Annex VI.
United States Dollars means the lawful currency of the United
States of America.
US$ means United States Dollars.
USAID has the meaning provided in paragraph 1(d) of Part B of Annex
I.
USDA has the meaning provided in paragraph 2(d) of Part B of Annex
I.
Valley has the meaning provided in paragraph 1 of Part A of Annex
I.
Vendor has the meaning provided in Schedule A of Annex VI.

Annex VI Specific Tax Exemption Mechanisms

Schedule A Value Added Tax (VAT) \9\
---------------------------------------------------------------------------

\9\ To the extent that VAT is imposed at the port of entry
(``bureau d'entr[eacute]e'') on imported goods, together with custom
duties, the applicable tax exemption procedures are described in
Schedule B below.
---------------------------------------------------------------------------

Legal Basis for Exemption

1. The Compact.
2. The Agreement dated May 13, 1961, by and between the United
States Government and the Government relating to Economic, Financial
and Technical Assistance, which entered into force on May 13, 1961 (the
``Bilateral Agreement'').
3. Applicable provisions of the Code G[eacute]n[eacute]ral des
Imp[ocirc]ts.
4. Applicable textes d'application.

Beneficiaries of Exemption

MFG-MCA (to be replaced by MCA-Senegal, both of which shall be
referred to herein collectively as ``MCA-Senegal''), each Implementing
Entity and any individuals or legal persons providing services, goods
or works in connection with the Compact Program (each a ``Vendor'').

Procedures

A. Local Purchases by MCA-Senegal
MCA-Senegal requests a final invoice free of VAT (``hors
TVA'') for the services, goods or works to be purchased from the
applicable supplier.\10\
---------------------------------------------------------------------------

\10\ For efficiency, the request should reflect the amount of
goods needed for several months.
---------------------------------------------------------------------------

MCA-Senegal submits the final invoice to the ``Direction
Generale des Impots et Domaines'' (``DGID'') of the Ministry of Economy
and Finance (``MoEF''), requesting exoneration from VAT, together with
(i) a reference to the registered Compact or (ii) a copy of the
instrument of Compact ratification and the applicable Compact tax
provisions. For the avoidance of doubt, MCA-Senegal may also submit the
final invoice together with a copy of its ``Attestation d'Exoneration''
(``AE'') and a copy of the Compact.
Within forty-eight (48) hours, DGID stamps the final
invoice and returns the same to MCA-Senegal and the purchase(s) can be
made by MCA-Senegal free of VAT (``hors TVA'').
B. Local Purchases by Any Implementing Entity or Any Vendor
The Implementing Entity/Vendor requests a final invoice
free of VAT (``hors TVA'') for the goods or services to be purchased
from the applicable supplier.\11\
---------------------------------------------------------------------------

\11\ For efficiency, the request should reflect the amount of
goods needed for several months.
---------------------------------------------------------------------------

The Implementing Entity/Vendor submits the final invoice
to MCA-Senegal for approval and onward submission to DGID.
MCA-Senegal submits a request to DGID with the final
invoice, requesting exoneration from VAT, together with (i) a reference
to the registered Compact or (ii) a copy of the instrument of Compact
ratification and the applicable Compact tax provisions. For the
avoidance of doubt, MCA-Senegal may also submit the final invoice
together with a copy of its AE and a copy of the Compact.
Within forty-eight (48) hours, DGID stamps the final
invoice and returns the same to MCA-Senegal.
MCA-Senegal delivers the stamped, final invoice to the
Implementing Entity/Vendor as soon as practicable and the purchase(s)
can be made by the Implementing Entity/Vendor free of VAT (``hors
TVA'').

Schedule B Customs Duties

Legal Basis for Exemption

1. The Compact.
2. The Bilateral Agreement.
3. Applicable provisions of the Code des Douanes.
4. Applicable textes d'application.

Beneficiaries of the Exemption

MCA-Senegal, each Implementing Entity and any Vendor importing
goods in connection with the Compact Program.

Procedures

A. Purchases of Imported Goods by MCA-Senegal
MCA-Senegal obtains a pro forma invoice free of all
customs duties, including but not limited to VAT and any other
applicable Taxes (``hors taxes--hors douane''), for the specific items
being imported for Compact-related work, and completes a ``Titre
d'Exoneration'' (``TE''), which can be obtained from the Chamber of
Commerce.\12\
---------------------------------------------------------------------------

\12\ The TE is actually completed by MCA-Senegal's
``Commissionnaire Agr[eacute][eacute] en Douane'' with the
appropriate customs codes for each item to be imported.
---------------------------------------------------------------------------

MCA-Senegal properly signs the TE and submits a request to
the ``Direction Generale des Douanes'' (``DGD'' of the MoEF requesting
the exoneration of all customs duties, including but not limited to VAT
and any other applicable Taxes (``hors taxes--hors douane''), on the
goods to be imported. The TE and seven (7) copies of the pro forma
invoice are attached to the request.
Within forty-eight (48) hours, the DGD stamps the TE, and
the pro forma invoices, and returns all of the documents (collectively,
the ``Approval Documents'') to MCA-Senegal.
MCA-Senegal provides the Approval Documents to its
``Commissionnaire Agr[eacute][eacute] en Douane'' to prepare a
``Declaration de Douane'' (``DD''), which can be obtained at the

[[Page 54373]]

port of entry. The ``Commissionnaire Agr[eacute][eacute] en Douane''
files the DD, together with the Approval Documents, with the ``Bureau
Des Douanes d'Importation.''
Within seventy-two (72) hours, the imported goods can be
retrieved free of all customs duties, including but not limited to VAT
and any other applicable Taxes (``hors taxes--hors douane'').
B. Purchases of Imported Goods by Any Implementing Entity or Any Vendor
The Implementing Entity/Vendor submits a request to MCA-
Senegal, which shall include (i) seven (7) copies of a pro forma
invoice free of all customs duties, including but not limited to VAT
and any other applicable Taxes (``hors taxes--hors douane''), for the
specific items being imported for Compact-related work and (ii) a
completed TE.\13\
---------------------------------------------------------------------------

\13\ The TE is actually completed by the Implementing Entity/
Vendor's ``Commissionnaire Agr[eacute][eacute] en Douane'' with the
appropriate customs codes for each item to be imported.
---------------------------------------------------------------------------

MCA-Senegal, on the Implementing Entity/Vendor's behalf,
submits a request to DGD requesting the exoneration of all customs
duties, including but not limited to VAT and any other applicable Taxes
(``hors taxes--hors douane''), on the goods to be imported. The TE and
the pro forma invoices are attached to the request.
Within forty-eight (48) hours, the DGD stamps the Approval
Documents and returns the Approval Documents to MCA-Senegal.
MCA-Senegal provides the stamped Approval Documents to the
Implementing Entity/Vendor as soon as practicable.
The Implementing Entity/Vendor provides the Approval
Documents to its ``Commissionnaire Agr[eacute][eacute] en Douane'' to
prepare a DD, which can be obtained at the port of entry. The
``Commissionnaire Agr[eacute][eacute] en Douane'' files the DD,
together with the Approval Documents, with the ``Bureau Des Douanes
d'Importation.''
Within seventy-two (72) hours, the imported goods can be
retrieved free of all customs duties, including but not limited to VAT
and any other applicable Taxes (``hors taxes--hors douane'').
C. Temporary Admission of Equipment, Including but Not Limited to
Automobiles and Household Goods, by Vendors \14\
---------------------------------------------------------------------------

\14\ The Government permits the temporary, tax exempt admission
of equipment, including but not limited to automobiles and household
goods, if such equipment will be re-exported upon the earlier of (i)
the completion of the applicable contract or (ii) the expiration or
termination of the Compact; provided that such equipment, including
but not limited to automobiles and household goods, is used solely
for Compact-related work. If the equipment, including but not
limited to automobiles and household goods, is later sold in Senegal
or is used in Senegal in connection with work that is not related to
the Compact Program, then the pro rata share of the applicable Taxes
must be paid at such time in accordance with the laws of Senegal.
---------------------------------------------------------------------------

The Vender obtains a pro forma invoice free of all customs
duties, including but not limited to VAT and any other applicable Taxes
(``hors taxes--hors douane''), for the equipment, including but not
limited to automobiles and household goods, to be imported and prepares
a ``temporary admission of equipment'' request (a ``Temporary Admission
Request'').
MCA-Senegal, on the Vendor's behalf, submits the Temporary
Admission Request and seven (7) copies of the pro forma invoice to the
Director of Studies and Legislation within DGD as soon as practicable.
Within seventy-two (72) hours, DGD stamps the Temporary
Admission Request and the pro forma invoices, which permits the
applicable equipment to be imported free of all customs duties,
including but not limited to VAT and any other applicable Taxes (``hors
taxes--hors douane''), for a period of twelve (12) months.
MCA-Senegal provides the stamped Temporary Admission
Request to the Vendor as soon as practicable.
The Vendor, through its ``Commissionnaire
Agr[eacute][eacute] en Douane,'' completes the procedures for the
importation of goods set forth in Section B of this Schedule B.
Thereafter, COTECNA, the control structure approved by the
Government (or any successor entity thereto), must validate the
purchase price of the equipment, as indicated on the pro forma invoice.
COTECNA will identify the origin of the equipment, obtain the actual
price of such equipment, and issue a certificate of value, confirming
or denying the price set forth in the pro forma invoice. If the
purchase price is denied, COTECNA S[eacute]n[eacute]gal saisira COTECNA
du pays d'origine du mat[eacute]riel [agrave] importer qui contactera
[agrave] son tour le fournisseur dudit mat[eacute]riel pour avoir son
prix r[eacute]eUne fois ce prix obtenu, COTECNA S[eacute]n[eacute]gal
fournit alors l'avis de notification qui confirme ou infirme le prix
d[eacute]clar[eacute]; et dans ce cas, un redressement peut [ecirc]tre
effectu[eacute] pour porter la vraie valeur dans la d[eacute]claration
de douane en admiDGD will correct the purchase price as set forth in
the Temporary Admission Request and in its internal records. The time
required for COTECNA to validate the purchase price of the equipment
varies, but in any case shall not delay the time required for DGD to
stamp the Temporary Admission Request and the pro forma invoice.
The stamped Temporary Admission Request also exempts the
applicable equipment from any fees and/or charges associated with the
``service des mines,'' including without limitation any registration,
sticker and/or license fees.
The Temporary Admission Request must be renewed every
twelve (12) months until the earlier of (i) the completion of the
applicable agreement or contract, (ii) the end of the work related to
the Compact Program and/or (iii) the expiration or termination of the
Compact.
If the duration of the work related to the Compact Program
exceeds twelve (12) months, the Vendor shall submit two requests to
MCA-Senegal (for onward submission to the Director of Studies and
Legislation within the DGD) prior to the expiration of original
Temporary Admission Request:
[cir] A request for exemption from any Taxes payable on the
consumption of equipment previously admitted by the DGD; and
[cir] A request for renewal of the Temporary Admission Request.
Upon the earlier of (i) the completion of the applicable
agreement or contract, (ii) the end of the work related to the Compact
Program and/or (iii) the expiration or termination of the Compact, the
equipment must be re-exported or placed in a bonded warehouse. DGD must
provide prior authorization for the equipment to be released for
consumption in Senegal, and the pro rata share of any applicable Taxes
must be paid at such time in accordance with the laws of Senegal.

Schedule C Corporate Income Tax

Legal Basis for Exemption

1. The Compact.
2. The Bilateral Agreement.
3. Applicable provisions of the Code G[eacute]n[eacute]ral des
Imp[ocirc]ts.
4. Applicable textes d'application.

Beneficiaries

All Vendors (including companies or other legal persons), other
than Vendors formed under the laws of Senegal (each an ``Exempt
Vendor''); provided that in determining if a Vendor has been formed
under the laws of Senegal for the purposes of this Schedule C, the
status of such Vendor shall be based on its status as of the time it is
awarded or executes a Compact-related agreement or contract, and such
initial determination shall not change regardless of: (i) The type of
agreement or contract used to employ or engage such Vendor, (ii) any
laws of Senegal

[[Page 54374]]

that purport to change such status based on period of contract
performance or period of time residing and/or working in Senegal and/or
(iii) any requirement under the laws of Senegal that a company or other
legal person must establish a branch office in Senegal, or otherwise
register or organize itself under the laws of Senegal, in order to
provide goods, services or works in Senegal.

Procedures

Any Exempt Vendor earning only Compact-related corporate
income in Senegal in any given fiscal year shall be exempt from paying
any applicable Taxes on such Compact-related corporate income and shall
declare such Compact-related corporate income in its year-end tax
filing with DGID solely for informational purposes.
Any Exempt Vendor earning Compact-related corporate income
and non-Compact-related corporate income in any given fiscal year
shall:
[cir] Submit and register each Compact-related contract or
agreement (each a ``Compact Contract'') with DGID, together with a
certification from MCA-Senegal confirming that the goods, services or
works to be provided under the Compact Contract form a part of the
Compact program.
[cir] At the end of any such fiscal year, the Exempt Vendor shall
be permitted to exclude, the gross income derived from any Compact
Contract(s) (as verified by the registered Compact Contract(s)) for the
purposes of determining its corporate income tax liability in Senegal
for any such fiscal year. The Exempt Vendor shall declare such Compact-
related gross corporate income in its year-end tax filing wth DGID
solely for informational purposes.
[cir] For example, if an Exempt Vendor earned US$100,000 of gross
corporate income under a Compact Contract(s) and an additional
US$500,000 in other Senegal-related gross corporate income, the Exempt
Vendor shall be permitted to exclude, the US$100,000 for the purposes
of determining its corporate income tax liability in Senegal for such
fiscal year.

Schedule D Individual Income Tax

Legal Basis for Exemption

1. The Compact.
2. The Bilateral Agreement.
3. Applicable provisions of the Code G[eacute]n[eacute]ral des
Imp[ocirc]ts.
4. Applicable textes d'application.

Beneficiaries

All individuals, other than citizens and permanent residents of
Senegal, working in connection with the Compact Program (each an
``Exempt Person''); provided that in determining if an individual is a
permanent resident for the purposes of this Schedule D, the status of
such individual shall be based on his/her status as of the time that
such individual is awarded or executes a Compact-related agreement or
contract, and such initial determination shall not change regardless
of: (i) The type of contract used to employ or engage such individual
and/or (ii) any laws of Senegal that purport to change such status
based on period of contract performance or period of time residing and/
or working in Senegal.

Procedures

Any Exempt Person earning only Compact-related personal
income in Senegal in any given fiscal year shall be exempt from paying
any applicable Taxes on such Compact-related personal income, and shall
declare such Compact-related personal income in its year-end tax filing
with DGID solely for informational purposes.
Any Exempt Person earning Compact-related personal income
and non-Compact-related personal income in any given fiscal year shall
be permitted to exclude the gross amount of such Compact-related
personal income for the purposes of determining his/her personal income
tax liability in Senegal for any such fiscal year. The Exempt Person
shall declare such Compact-related gross personal income in its year-
end tax filing with DGID solely for informational purposes.

Schedule E Fuel Tax

Legal Basis for Exemption

1. The Compact.
2. The Bilateral Agreement.
3. Applicable provisions of the Code G[eacute]n[eacute]ral des
Imp[ocirc]ts.
4. Applicable provisions of the Code des Douanes.
5. Applicable textes d'application.

Beneficiaries

Any fuel purchased for use exclusively in connection with the
Compact Program.

Procedures

A. Purchases of Fuel by MCA-Senegal Through Gas Coupons
MCA-Senegal obtains a pro forma invoice from a Senegal-
based oil company for a particular quantity of fuel free of all of
customs duties, including but not limited to VAT, the ``tax speciale
sur hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane''), and completes a TE, which can be obtained from the Chamber
of Commerce.\1\
---------------------------------------------------------------------------

\1\ The TE is actually completed by MCA-Senegal's
``Commissionnaire Agr[eacute][eacute] en Douane'' with the
appropriate customs code.
---------------------------------------------------------------------------

MCA-Senegal properly signs the TE and submits a request to
DGD requesting the exoneration of all customs duties, including but not
limited to VAT, the ``tax speciale sur hydrocarbons'' and any other
applicable Taxes (``hors taxes--hors douane''), on the fuel to be
imported. The TE and seven (7) copies of the pro forma invoice are
attached to the request.
Within seventy-two (72) hours, DGD stamps the TE and the
pro forma invoices (collectively, the ``Fuel Approval Documents'') and
returns the same to MCA-Senegal.
Thereafter, MCA-Senegal submits the Fuel Approval
Documents to DGID requesting the exoneration of any additional Taxes.
Within seventy-two (72) hours, DGID stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
The stamped Fuel Approval Documents shall entitle MCA-
Senegal to purchase free from customs duties, including but not limited
to VAT, the ``tax speciale sur hydrocarbons'' and any other applicable
Taxes (``hors taxes--hors douane''), for the price set forth in the pro
forma invoice, gas coupons from the Senegal-based oil company equal to,
in the aggregate, the quantity of fuel represented on the pro forma
invoice.
Subject to the specific terms of the arrangement with the
Senegal-based oil company, the gas coupons can be redeemed at the oil
company's various gas stations in Senegal. Each coupon entitles the
bearer to the quantity of fuel set forth on such coupon.
B. Purchase of Fuel by Implementing Entities/Vendors Through Gas
Coupons
The Implementing Entity/Vendor submits a request to MCA-
Senegal, which shall include (i) seven (7) copies of a pro forma
invoice from a Senegal-based oil company for a particular quantity of
fuel free of all of customs duties, including VAT, the ``tax speciale
sur hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane''), and (ii) a completed TE.\2\
---------------------------------------------------------------------------

\2\ The TE is actually completed by the Implementing Entity/
Vendor's ``Commissionnaire Agr[eacute][eacute] en Douane'' with the
appropriate customs code.
---------------------------------------------------------------------------

MCA-Senegal, on the Implementing Entity/Vendor's behalf,
submits a request to DGD requesting the exoneration of all customs,
including VAT, the ``tax speciale sur

[[Page 54375]]

hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane''), on the fuel to be imported. The TE and pro forma invoices
are attached to the request.
Within seventy-two (72) hours, DGD stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
Thereafter, MCA-Senegal submits the Fuel Approval
Documents to DGID requesting the exoneration of any additional Taxes.
Within seventy-two (72) hours, DGID stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
MCA-Senegal provides the stamped Fuel Approval Documents
to the Implementing Entity/Vendor as soon as practicable.
The stamped Fuel Approval Documents shall entitle the
Implementing Entity/Vendor to purchase free from customs duties,
including but not limited to VAT, the ``tax speciale sur hydrocarbons''
and any other applicable Taxes (``hors taxes--hors douane''), for the
price set forth in the pro forma invoice, gas coupons from the Senegal-
based oil company equal to, in the aggregate, the quantity of fuel
represented on the pro forma invoice.
Subject to the specific terms of the arrangement with the
Senegal-based oil company, the gas coupons can be redeemed at the oil
company's various gas stations in Senegal. Each coupon entitles the
bearer to the quantity of fuel set forth on such coupon.
C. Purchases of Fuel by MCA-Senegal To Be Imported in Bulk
MCA-Senegal obtains a pro forma invoice from an oil
company for a particular quantity of fuel free of all of customs
duties, including but not limited to VAT, the ``tax speciale sur
hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane''), and completes a TE.\3\
---------------------------------------------------------------------------

\3\ The TE is actually completed by MCA-Senegal's
``Commissionnaire Agr[eacute][eacute] en Douane'' with the
appropriate customs code.
---------------------------------------------------------------------------

MCA-Senegal properly signs the TE and submits a request to
DGD requesting the exoneration of all customs duties, including but not
limited to VAT, the ``tax speciale sur hydrocarbons'' and any other
applicable Taxes (``hors taxes--hors douane''), on the fuel to be
imported. The TE and seven (7) copies of the pro forma invoice are
attached to the request.
Within seventy-two (72) hours, DGD stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
Thereafter, MCA-Senegal submits the Fuel Approval
Documents to DGID requesting the exoneration of any additional Taxes.
Within seventy-two (72) hours, DGID stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
MCA-Senegal provides the Fuel Approval Documents to its
``Commissionnaire Agr[eacute][eacute] en Douane'' to prepare a DD,
which can be obtained at the port of entry. The ``Commissionnaire
Agr[eacute][eacute] en Douane'' files the DD, together with the Fuel
Approval Documents, with the ``Bureau Des Douanes d'Importation.''
Within seventy-two (72) hours, the fuel can be retrieved
free of all of customs duties, including VAT, the ``tax speciale sur
hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane'').
D. Purchases of Fuel by an Implementing Entity/Vendor To Be Imported in
Bulk
The Implementing Entity/Vendor submits a request to MCA-
Senegal, which shall include (i) seven (7) copies of a pro forma
invoice from an oil company for a particular quantity of fuel free of
all of customs duties, including VAT, the ``tax speciale sur
hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane''), and (ii) a completed TE.\4\
---------------------------------------------------------------------------

\4\ The TE is actually completed by the Implementing Entity/
Vendor's ``Commissionnaire Agr[eacute][eacute] en Douane'' with the
appropriate customs code.
---------------------------------------------------------------------------

MCA-Senegal, on the Implementing Entity/Vendor's behalf,
submits a request to DGD requesting the exoneration of all customs,
including VAT, the ``tax speciale sur hydrocarbons'' and any other
applicable Taxes (``hors taxes--hors douane''), on the fuel to be
imported. The TE and pro forma invoices are attached to the request.
Within seventy-two (72) hours, DGD stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
Thereafter, MCA-Senegal submits the Fuel Approval
Documents to DGID requesting the exoneration of any additional Taxes.
Within seventy-two (72) hours, DGID stamps the Fuel
Approval Documents and returns the same to MCA-Senegal.
MCA-Senegal provides the stamped Fuel Approval Documents
to the Implementing Entity/Vendor as soon as practicable.
The Implementing Entity/Vendor provides the Fuel Approval
Documents to its ``Commissionnaire Agr[eacute][eacute] en Douane'' to
prepare a DD, which can be obtained at the port of entry. The
``Commissionnaire Agr[eacute][eacute] en Douane'' files the DD,
together with the Fuel Approval Documents, with the ``Bureau Des
Douanes d'Importation.''
Within seventy-two (72) hours, the fuel can be retrieved
free of all of customs duties, including VAT, the ``tax speciale sur
hydrocarbons'' and any other applicable Taxes (``hors taxes--hors
douane'').

Schedule F Registration Tax, Registration Fees and Stamp Duty

Legal Basis for Exemption

1. The Compact.
2. The Bilateral Agreement.
3. Applicable provisions of the Code G[eacute]n[eacute]ral des
Imp[ocirc]ts.
4. Applicable textes d'application.

Beneficiaries

MCA-Senegal and any Vendors, for any act or transaction related to
the Compact Program that is subject to registration fees, stamp duty
and/or any other registration taxes.

Procedures

A. MCA-Senegal
At the time MCA-Senegal presents the applicable Compact
Contract to DGID to be stamped and/or registered, MCA-Senegal shall
present a copy of the Compact
Upon presentation of such documentation, DGID shall stamp
and/or register the applicable Compact Contract without charge and free
from any applicable Taxes.
B. Vendors
At the time a Vendor presents the applicable Compact
Contract to DGID to be stamped and/or registered, the Vendor shall
present a copy of the Compact, together with a certification from MCA-
Senegal confirming that the goods, services or works to be provided
under the Compact Contract form a part of the Compact program.
Upon presentation of such documentation, DGID shall stamp
and/or register the applicable Compact Contract without charge and free
from any applicable Taxes.

[FR Doc. E9-23328 Filed 10-20-09; 8:45 am]

BILLING CODE 9211-03-P