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Jtslamlt j!lebelopment J}ank

LOAN AGREEMENT

BE '!WEEN

THE GOVERNMENT OF THE REPUBLIC OF INDONESIA

AND

THE ISLAMIC DEVELOPMENT BANK, JEDDAH

FOR

FINANCING PART OF TilE FOREIGN EXCHANGE COST
OF FISHERIES INFRASTRUCTURE SECTOR PROJECT

.........

LOAN AGREEMENT BETWEEN THE GOVERNMENT OF THE
REPUBLIC OF INDONESIA AND THE ISLAMIC DEVELOPMENT

BANK FOR FINANCING PART OF THE FOREIGN EXCHANGE
COST OF FISHERIES INFRASTRUCTURE SECTOR PROJECT
Agreement dated the
to the

29th of

11th of

June

1985

Shawal

1405H

corresponding

between the Government of the

Republic of Indonesia (hereinafter called the ''Borrower") and
the Islamic Development Bank (hereinafter called the ''Bank").
Whereas, the Borrower has requested the Bank to assist in the
financing of the Fisheries Infrastructure Sector Project
(hereinafter called the "Project") as described in Schedule-!!
to this Agreement by making the Loan as hereinafter provided;
Whereas, one of the purposes of the Bank is to assist its
member countries by way of making loans for financing
productive projects and programmes;
Whereas, the Project is considered to be technically sound,
economically and financially justified;
Whereas, the Borrower has concluded with the Asian Development
Bank a Loan Agreement to assist in financing part of the
Project on the terms and conditions set forth in the Loan
Agreement entered into between the Borrower and the Asian
Development Bank (ADB) (hereinafter called "Other Agreements");
Whereas, the Bank has agreed on the basis, inter alia, of the
foregoing, to make the Loan to the Borrower upon the terms and
conditions hereinafter set forth;

- 2 -

NOW, THEREFORE, the parties hereto agree as follows

ARTICLE - I
General Conditions, Definitions
Section 1. 01

General Conditions.

The parties to this

Agreement accept all the provisions of the General Coditions
applicable to Loan and Guarantee Agreements of the Bank dated
8-11-1976 (hereinafter called "the General Conditions"), with
the same force and effect as if they were fully set forth herein.
Section 1. 02

Definitions.

Whenever used in this Agreement,

unless the context otherwise requires, the several terms defined
in the General Conditions have the respective meanings therein
set forth and the following additional terms have the following
meanings :
(a)

"Executing Agency" means the Directorate General of
Fisheries within the Ministry of Agriculture of the
Borrower or any successor thereto;

(b)

"Other Agreements" means the ADB Agreement referred
to in the Preamble;

(c)

"Project" and references to "parts" thereof mean the
Project and parts thereof described in Schedule-II
to this Agreement.

II

- 3 -

ARTICLE - II
The Loan
Section 2.01

Amount.

The Bank agrees to lend to the

Borrower, from its ordinary resources, an amount not
exceeding the equivalent to ID. 7,000,000/-(Islamic Dinars
Seven Million) only equivalent to approximately

US$ 7.4

Million (U.S.Dollars Seven Million and Four Hundred Thousand).
The Islamic Dinar as defined in Article 4(l)(a) of the Agreement
establishing the Bank is equivalent to One Special Drawing
Right of the International Monetary Fund.
Section 2.02

Except as the Bank shall otherwise agree

contracts for goods and services to be financed out of the
proceeds of this Loan, shall be procured in accordance with
procedures set by the Bank.

In this regard, the Borrower

shall abide by Regulations of the Organization of African
Unity and the Arab League concerning Boycott of South Africa
and Israel.
ARTICLE - III

Amortization, Service Fee
and Places of Payments
Section 3.01

Amortization.

The Borrower shall repay the

principal amount of the Loan in 25 (twenty-five) years
including a 6 (six) year grace period, commencing from the
date of this Agreement, in 38 (thirty-eight) equal and
consequtive semi-annual instalments as set forth in Schedule-I(A)
to this Agreement.

- 4 -

Section 3.02
(a)

Service Fee.

The Borrower shall pay to the Bank a Service Fee of an
amount equivalent to ID. 3,307,500/-(Islamic Dinars
Three Million Three Hundred and Seven Thousand and Five
Hundred) only, in accordance with Schedule-I(B) to this
Agreement.

(b)

The Service Fee will accrue from the date of commitment
as defined in Section 9.02 of this Agreement.

Section 3.03

Places of Payments.

All payments including

repayments of the principal shall be considered duly made when
funds constituting such payments are credited to an account

indicated for this purpose by the Bank.
Section 3.04

Without prejudice to the generality of the

provision of Section 3.03, all payments hereunder shall be
deemed duly paid :
(a)

If such payment is made in U.S. Dollars when either of
the following Banks confirms to the IDB the receipt of
such payment in the Islamic Development Bank's account
with it :
(i)

Account No. 001591.11
Saudi International Bank
99 Bishopsgate, London EC 2M 3'IB
Telex Numbers : 8812261, 8812262

(ii)

Account No. B 10507
Arab Banking Corporation
P.O. Box : 5698, Manama, B·a hrain
Telex Numbers : 9385, 9431/2/3
9442 ABCBAH BN

_(

- 5 -

(b)

If such payment is made in French Francs, when the

I

following Bank confirms to the IDB the receipt of

II

such payment in the Islamic Development Bank's
account with it

I

II
I

Account No. 96965.9.001.00
Union De Banques Arabes Et
Francaises (U.B.A.F.)
190, Avenue Charles De Gaulle
92523 Neuilly Cedex, France
Telex Number : 610334 UBAFRA
(c)

I

If such payment is made in Pounds Sterling, when the
following Bank confirms to the !DB the receipt of such

l
I

payment in the Islamic Development Bank's account with
it :
Account No. 708372
Gulf International Bank
2 -6 Canon Street, London EC 4M 6XP
Telex Numbers :
8813326, 8812889

ARTICLE - IV
Withdrawals and Use of
The Proceeds of The Loan
Section 4.01

Withdrawals.

The amount of the Loan may be

withdrawn by the Borrower subject to Schedule-III and other
provisions of this Agreement, the General Conditions, and the
disbursement procedures of the Bank, for the purposes set forth
in this Agreement, for expenditure made in respect of the
reasonable cost of goods and services required and to be
financed under this Agreement.

f.

!I
- 6 -

Section 4.02

Date of Requesting First Disbursement.

If prior

to 31st December 1985, or such later date as shall be agreed
between the Borrower and the Bank, the Borrower has no submitted
a request to the Bank to make the first disbursement, the Bank
may terminate this Agreement upon due notice thereof to the
Borrower.
Section 4.03

Closing Date.

31st December 1991, or such later

date as shall be agreed between the Borrower and the Bank is
the closing date of withdrawal from the Loan for the purpose of
Section 6.03(c) of the General Conditions.
Section 4. 04

Use of the Proceeds of the Loan.

All amounts

withdrawn by the Borrower from the Loan Account shall be used
solely for the purposes of the Project financed by the Bank.
ARTICLE - V
Execution of The Project
Section 5.01

The Borrower undertakes to :
1/

(a)

Execute the Project and conduct its operations and

i

affairs through the Executing Agency with due
diligence and efficiency and in accordance with
sould administrative, financial engineering and
economic practices, under the supervision of
qualified and experienced management and personnel
and in accordance with the investment schedule,
budgets, plans and specifications submitted to and
approved by the Bank;

_

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(b)

Submit to the Bank, for the Bank's approval, in such
detail as the Bank may reasonably request, any envisaged
important modifications to the budget, plans and
specifications of the project as well as any substantial
changes in any contract for services or procurement of
goods relating to the execution of the Project.

Section 5.02

Without any limitation or restriction upon any

of its other obligations under this Agreement the Borrower
shall allow the Bank a reasonable time period to comment on
any substantial changes or any extension of the stipulated
time in any contract for services or procurement of goods
relating to the execution of the Project.
ARTICLE - VI

Additional Pre-requisites Before
Disbursement by The Bank

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Section 6.01

The Borrower shall, prior to submitting the first !

application for withdrawal, indicate the procedure it proposes

I

to follow or causes to be followed for completitive bidding

!j

pursuant to Section 2.02 of this Agreement and obtain the Bank's

II

approval thereof.
ARTICLE - VII

Particular Covenants
Section 7. Ol

The Borrower shall make available promptly as

needed all sums including local currency cost and cost overruns
which shall be required for the carrying out of the Project, on
terms and conditions satisfactory to the Bank.

- 8 -

Section 7. 02

Except as the Bank shall otherwise agree, the

Borrower shall award all contracts financed from the proceeds
of this Loan for the execution of the Project through
international competitive bidding and shall seek the prior
approval of the Bank for the awarding of any contract whose
value exceeds the equivalent of one hundred fifty thousand of
Islamic Dinars (150,000 ID).
Section 7.03

The Borrower shall furnish to the Bank promptly

upon their approval by the Borrower the studies of, and the
plans and specifications for, the project, the schedule of its
execution and any material modifications subsequently made
therein, in such detail as the Bank shall from time to time
request.
Section 7.04

The Borrower shall establish and maintain records·

adequate to identify the goods financed out of the proceeds of
the Loan to disclose their use in the Project, to record the
progress of the Project, and to reflect in accordance with
consistently maintained sound accounting practices the operations
and financial position of the Executing Agency.

Section 7.05

The Borrower shall afford all reasonable

opportunity for accredited representatives of the Bank to make
visits for purposes related to tte Loan, and to inspect the
Project, the goods and any relevant records and documents; and
shall furnish to the Bank all such information as the Bank
shall reasonably request concerning the expenditure of the
proceeds of the Loan, the Project, the goods and the operations
and financial position of _the Executing Agency.

I

I
- 9 -

Section 7.06

The Borrower undertakes for the purpose of

carrying out and operating the Project, to make appropriate
arrangements that the Executing Agency will at all times
function under rules and regulations in form and substance
satisfactory to the Bank and have such powers, management
and administration as are necessary for the diligent and
efficient carrying out and operation of the Project.
Section 7.07

The Borrower shall insure or cause to be

insured with reputable insurers all goods financed out of
the proceeds of the Loan.

Such insurance shall cover marine,

transit and other risks incident to purchase and importation
of the goods into the territory of the Borrower and delivery
thereof to the site of the Project, and shall be for such
amounts, as are consistent with sound commercial practices.
Such insurance shall be payable in the currency in which the
cost of the goods insured thereunder are payable, or in freely
convertible currency.
Section 7. 08

The Borrower shall take all such action as

deemed necessary to make available as and when needed all
such land and rights in respect of land as shall be required
for carrying out the Project and shall furnish to the Bank,
at its request, evidence satisfactory to the Bank that such
land and rights in respect of land are available for purposes
related to the Project.
Section 7.09

The Borrower shall take all action which shall

be necessary on its part to enable the Executing Agency to
execute the Project and shall not take, or permit to be taken

ｾ＠

----

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- 10 -

any action which would prevent or interfere with the execution
or operation of the Project or the performance of any of the
provisions of this Agreement.

ARTICLE - VIII

Reports
Section 8.01
(a)

The Borrower and the Bank shall cooperate fully to
ensure that the purposes of the Loan will be
accomplished.

To that end, each of them shall

furnish to the other all such information as it
shall reasonably request with regard to the general
s ta tus of the Loan •

On

the part of the Borrower ,

such information shall including information with
respect to financial and economic conditions in the
territory and the balance of payments position of
the Borrower •
(b)

The Borrower and the Bank shall from time to time at
the request of either party, exchange views through
their representatives with regard to matters relating
to the purposes of the Loan, the maintenance of the
services thereof and the performance by the Borrower
of its obligations under this Agreement.

- 11 -

Section 8. 02
(a)

The Borrower undertakes to ensure submission or cause
to be submitted to the Bank, to the latter's entire
satisfaction and at the times specified for each, the
following reports :
(i)

Within thirty (30) days after the end of each
calendar quarter, or within such other period
as the parties may agree, reports on the
execution of the project in such manner as
the Bank may from time to time specify;

(ii)

Such other reports as the Bank may reasonably
request regarding the investment of the amounts
of the loan disbursed and the progress of the
project;

(iii) Promptly after completion of the Project, but
in any event not later than six months after
the closing date or such later date as may be
agreed for this purpose between the Borrower
and the Bank, the Borrower shall prepare and
furnish to the Bank a completion report, of
such scope and in such detail as the Bank
shall reasonably request, on the execution
and initial operation of the Project.
(b)

The documents described in this Section shall be
certified at the option of the Bank, in such manner
as the Bank may reasonably require.

.. 12 -

ARTICLE -- IX
Effectiveness and Commitment Date
Effectiveness.

Section 9.01

This Agreement shall not become

effective tmtil
(A)

(1)

Evidence satisfactory

to

the Bank shall have

been furnished that the execution and delivery
of this Agreement on behalf of the Borrower
have been duly authorised or ratified by all
necessary governmental action;
(2)

The Borrower shall have furnished a Legal
Opinion acceptable to the Bank emanating
from a Government Legal Authority declaring
tm t the Loan Agreement has been authorized
and properly signed on behalf of the Borrower.
The declaration shall state that the Agreement
constitutes a binding obligation on the
Borrower in accordance with its terms.

(B)

A letter be issued by the Ministry of Finance or any
other duly authorized organ of the Government to the
Central Bank or the entity that performs the ftmctions
of a Central Bank instructing the Central Bank or the
entity that performs the functions of a Central Bank
that payment by the Government under this Agreement of
the loan and service fee instalments shall be effected
by the Central Bank or the entity that performs the
ftmctions of a Central Bank on the dates on which they
fall due.

A copy of this Letter of Authorisation

together with an acknowledgement from the Central Bank

,_ it

- 13 or the entity that performs the functions of a Central
Bank indicating that it has received the said Letter
of Authorisation and that it will adhere to the
instructions contained therein, shall be forwarded by
the Government to the Bank.

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(C)

All conditions precedent to the Borrower's right to

j'

obtain funds under other Agreements have been fulfilled .
Section 9.02

Commitment Date.

The date of commitment shall

be ninety (90) days after the date of this Agreement or the date
on which all conditions relevant to effectiveness shall have
been fulfilled by the Borrower, whichever is earlier.
ARTICLE - X
Miscellaneous Provisions
Section 10.01

Authorized Representatives.

The Minister of

Finance of the Borrower and such person or persons as he
shall designate in writing are designated as the authorised
representatives of the Borrower for the purposes of Section
10.03 of the General Conditions.
Section 10.02

Date of the Agreement.

For all purposes of

this Agreement, the date thereof shall be that appearing in
the preamble thereto.
Section 10.03

Address.

The following addresses are specified

for the purposes of Section 10.01 of the General Conditions
For the Government of the Republic
of Indonesia :
Ministry of Finance
C/0. Directorate General
for International Monetary Affairs
P.O. Box
21
Indonesia
Jakarta

- 14 Alternate address for cablegrams
and radiograms
Cable
Telex

FINMINISTRY JAKARTA
44319 DEPKEU IA/45799 DJMLN

For the Islamic Development Bank
P.O. Box : 5925
Jeddah : 21432
Kingdom of Saudi Arabia
Alternate address for cablegrams
and radiograms
Cable
Telex

BANKISLAMI JEDDAH
401137 ISDB SJ

IN WITNESS WHEREOF, the Bank and the Borrower, each acting
through its authorized representatives, have signed this
Agreement in the English language on the date and year above
written.

FOR AND ON BEHALF OF
THE GOVERNMENT OF
THE REPUBL C OF INDONESIA

---...

HAJI ACHMAD TIRTOSUDIRO
AMBASSADOR OF THE REPUBLIC OF
INDONESIA TO THE KINGDOM OF
SAUDI ARABIA.

FOR AND ON BEHALF OF
THE ISLAMIC DEVELOP.MENI'
BANK :

ＭＧｾ Ｍ ｾ

ｲ ｾＧ＠

A{r

DR. AHMAD MOHAMED ALI
PRESIDENT

ｾ＠

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SCHEDULE - I (A)

'

LOAN REPAYMENT
Country
Project
Amount
Effectiveness
Repayment Period
Grace Period
No.

Date of Payment

II

Indonesia
Fisheries Infras true ture Sector ProjectJJ
I

ID. 7,000,000/-

II'

j

25 Years
6 Years

Date of Payment as per
Existing Agreement

Amount in ID

-

1
2
:_3

-

4

-

5

-

6
7
8

-

9
.I 10
11

-

-

12

-

13

184,210.50

14
15

184,210.50
184,210.50

16

184,210.50

17

184,210.50

18

184,210.50
184,210.50

20
21

184,210.50

22

184,210.50

I
j

II
j

184,210.50

ｾ＠

ｾＩ＠
!:

I

-

19

l

..
..
.
..
..
.

i

__//

-

- 2 No.

Date of Payment

Date of Payment as
Existing Agreement

AmOl.mt in ID

23

184,210.50

24
25
26
27
28
29

184,210.50
184,210.50
184,210.50
184,210.50
184,210.50
184,210.50

30
31

184,210.50
184,210.50

32
33

184,210.50
184,210.50

34
35
36
37

184,210.50
184,210.50

38
39

184,210.50
184,210.50

40
41

184,210.50
184,210.50

42

184,210.50
184,210.50

184,210.50
184,210.50

43

47

184,210.50
184,210.50
184,210.50
184,210.50

48
49

184,210.50
184,210.50

44
45
46

so
Total

7,

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SCHEDULE

-

I(B)

II

I
II

SERVICE FEE

..

Cotmtry

.
..

Project
Amotmt

I

Effectiveness
Service Fee
No.

I

I

Due Date

.
..

Indonesia

j

Fisheries Infrastructure Sector Project

li
ｾ＠ j

I
I

3 Percent
Payment Date

II
Amount in ID

1

105,000.00

2

105,000.00

3

105,000.00

4

105,000.00

5

105,000.00

6

105,000.00

7

105,000.00

8

105,000.00

9

105,000.00

10
11

105,000.00

12

105,000.00

13
ＱＰＵＬｾ＠

14

102,236.80

15

99,473.68

16

96,710.53

17

93,947.37

18

91,184.21

19

88,421.06

20
21

85,65 7. 90
82,894.75

22

80,131.58

23

77,368.43

ｾ＠

j,

I
I

Ｂｾ＠

105,000.00
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")

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Ｍｾ

ＴＷ＠
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- 2 -

II

SCHEDUlE

-

I (B)

I

SERVICE FEE
No.

II

Due Date

Payment Date

24
25
26

I
I'

Amount in ID

74,605.27
71,842.11

27

69,078.96
66,315.80

28
29

63,552.64
60,789.48

30
31

58,026.32
55,263.17

32
33
34
35

52,500.01
49,736.85
46,973.69
44,210.54

36
37
38

41,447.38
38,684.22

I

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r.I

35,921.06
33,157.91

39
40
41
42
43

30,394.75
27,631.59
24,868.43
22,105.28

44
45

19,342.12
16,578.96

46

13,815.80

47

11,052.65

48
49

8,289.49
5,526.33

50

2,763.17
Total
1

.

q

/

ｾ＠

1)

I

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3,307,500.00
/

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］ｾ

］ｾＭ

SCHEDULE - II
The main objective of the project is to support the
Government's efforts in developing the Fisheries Sector by
providing the necessary infrastructure facilities, and by
strengthening the Directorate General of Fisheries.
The project is a part of this sectoral programme of
infrastructure development covering a large number of
sub-projects scattered over a wide geographical area.
The components covered would particularly consist of the
following :
(a)

New Fishing Ports.
Studies, investigation and detailed designs of basic
infrastructures including preparation of tender
documents for 6 new fishing ports of which construction
will be tm.dertaken in 3 locations.

(b)

Rehabilitation and Expansion or Completion of Existing
Fishing Ports.
Studies, investigation and detailed design including
preparation of tender documents for rehabilitation or
expansion of 10 existing fishing ports. Construction
will be undertaken in 5 locations.

(c)

New Construction or Rehabilitation or Expansion of Fish
Landing Centres.
Studies, investigation and design and preparation of
tender documents for 50 fish landing centres. Construction work will be undertaken in 25 such centres.

Ｍﾷｾ＠

- 2 -

(d)

Strengthening of Directorate General of Fisheries
to Implement and Manage Infrastructure Projects.
This will be done by setting up of a Project Management
Office and by recruiting long term resident consultants
(282 man-months) and short term Specialists (18 man-months !
to strengthen PMO and arranging both local and foreign
training of 89 staff of Directorate General of Fisheries.

(e)

Equipment Procurement.
Will involve procurement of

4 dredgers and associated

equipment for maintenance of harbour basins and channels •

.. .......

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SCHEDULE - I I I

II

Allocation and Withdrawal
of Proceeds of the Loan

II

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The table below sets forth the categories of goods,
services and other items to be financed out of the proceeds
of the loan allocation of the amounts of the loan to each
category :
Category

I
II

Description

Amotm t of Loan
Allocated (in ID M)

Civil Works for
2 new Fishing Ports

4.40

Contingencies

2.60
Total

7. 00

.... .....

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