OFFICIAL DOCUMENTS THE WORLD BANK IBRD* IDA I WORLD BANKGROUP Ethiopia Country Office Africa Avenue, Bole Road Tel: (251-11) 5176000 Addis Ababa, Ethiopia Fax: (251-11) 6627717 March 9, 2018 Ref: WB/CD/082/03/09/2018 H.E. Dr. Abraham Tekeste Minister Ministry of Finance and Economic Cooperation Addis Ababa Dear Dr. Abraham, Re: IDA Financing IDA 6158 and IDA scale up Financing IDA 6157 (Ethiopia Electrification Program) Additional Instructions: Disbursement I refer to the Financing Agreements between the Federal Democratic Republic of Ethiopia (the "Recipient") and the International Development Association (the "Association") for the above referenced Program. The General Conditions, as defined in the Financing Agreements provides that the Recipient may from time to time request withdrawals of Credit and SUF credit Account in accordance with the Disbursement and Financial Information Letter, and such additional instructions as the Association may specify from time to time by notice to the Recipient. The General Conditions also provide that the Disbursement and Financial Information Letter may set out Program specific financial reporting requirements. This letter constitutes such Disbursement and Financial Information Letter ("DFIL"), and may be revised from time to time. I. Disbursement Arrangements, Withdrawal of Credits, and Reporting of Uses of Credits. (for both Credit and SUF Credit) (i) Schedule 1. The table in Schedule 1 sets out the disbursement methods which may be used by the Recipient, conditions, information on registration of authorized signatures, processing of withdrawal applications, and instructions on documentation and reporting of advances. (ii) Withdrawal Applications. Applications for withdrawal from either the Credit or the SUF Credit Accounts ("Withdrawal Applications") of amounts of the Credits allocated to individual Disbursement Linked Results ("DLR") may, pursuant to the provisions of Section IV ofSchedule 2 of the Credit Agreements, be sent to the Association at any time after the Association has notified the Recipient in writing that it has accepted evidence of achievement of the specific DLR. Or (iii) Withdrawal Amount. The Withdrawal Application may be for an amount not to exceed the amount of the credit and/or SUF Credit confirmed by the Association for the specific DLR in respect of which the withdrawal is requested, as specified in the Association's notice to the Recipient. G WORLD BANK GROUP H.E. Dr. Abraham Tekeste - 2 - March 9, 2018 (iv) Prior Results. The Association confirms that it has received evidence satisfactory to it that the DLRs referred to in any category of the Table in the Credit Agreements have been achieved. Consequently, the Recipient may withdraw the amount of SDR 22,700,000 from Credit (not applicable for SUF) allocated to said categories after the Credit Agreement has been declared effective. (v) Advances and Recovery ofAdvances. The Recipient may, in accordance with provisions of the Financing Agreements, request advances of amounts of the Financing allocated to DLRs that have not yet been achieved using the Form attached (Attachment 1). The aggregate amount of all such advances made in respect of amounts allocated to DLRs from IDA financing may not exceed the equivalent of a total of SDR of 42,900,000 of the Credit (not applicable for SUF Credit), of which the equivalent of (a) SDR of 42,500,000 is available for EEU for all DLRs except DLRs 3.1 through 3.6 and 5.12 through 5.16, and the equivalent of (b) SDR of 400,000 is available for MoWIE for DLRs 3.1 through 3.6 and 5.12 through 5.16 only. The Association records an amount of the advance as disbursed for an achieved DLR ("recovered") after it has notified the Recipient of its acceptance of the evidence of achievement of the DLR for which the advance was provided. The amount so reclassified becomes available for further advances in accordance with the preceding paragraph. (vi) Electronic Delivery. Section 10.01 (c) of the General Conditions. The Association may permit the Recipient to electronically applications (with supporting documents) through the Association's web-based portal (https://clientconnection.worldbank.org) "Client Connection". This option may be effected if the officials designated in writing by the Recipient who are authorized to sign and deliver Applications have registered as users of "Client Connection". The designated officials may deliver Applications electronically by completing the Form 2380, which is accessible through "Client Connection". By signing the Authorized Signatory Letter, the Recipient confirms that it is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Association by electronic means. The Recipient may continue to exercise the option of preparing and delivering Applications in paper form. The Association reserves the right and may, in its sole discretion, temporarily or permanently disallow the electronic delivery of Applications by the Recipient. By designating officials to use SIDC and by choosing to deliver the Applications electronically, the Recipient confirms through the authorized signatory letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, available in the Association's public website at https://worldbank.org and "Client Connection"; and (b) to cause such official to abide by those terms and conditions. H.E. Dr. Abraham Tekeste - 3 - March 9, 2018 II. Financial Reports and Audits. Section 5.09 of the General Conditions. (i) Financial Reports. The Recipient, through the EEU and MoWIE, will prepare and furnish to the Bank not later than sixty (60) days after the end of each Ethiopian calendar quarter, interim unaudited financial reports ("IFR") for the Project covering the quarter. Two separate sets required, one for MoWIE and another for EEU. (ii) Audits. Recipient, through the MoWIE and EEU, will have the Program financial statements related to the Program audited in accordance with the provisions of Section 5.09 of the General Conditions by an auditor with qualifications, experience and terms of reference satisfactory to the Association. Each audit of the Financial Statements must cover the period of one fiscal year of the Recipient, commencing with the fiscal year in which the first withdrawal was made. The audited Financial Statements for each such period must be furnished to the Bank not later than six (6months after the end of such period. Two separate audit reports are required, one for MoWIE and another for EEU. III. Other Important Information. For additional information on disbursement arrangements, please refer to the Loan Handbook available on the Association website (http://www.worldbank.org/) and "Client Connection". The Association recommends that you register as a user of "Client Connection". From this website you will be able to prepare and deliver Applications, monitor the near real-time status of the Loan, and retrieve related policy, financial, and procurement information. For more information about the website and registration arrangements, please contact the Association by email at clientconnection&worldbank.orz. If you have any queries in relation to the above, please contact Maiada Kassem, Finance Officer at wfaldafr(@wordlbank.or , with copy to Stella Chepkorir, Finance Analyst at schepkorir@worldbank.or, using the above reference. Sincerelr Carolyn Turk Country Director for Ethiopia, Sudan and South Sudan Africa Region H.E. Dr. Abraham Tekeste -4- March 9, 2018 Attachments 1. Form of Authorized Signatory Letter 2. Interim unaudited Financial Report (IFR) 3. Sample Form for Advances 4. Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, dated March 1, 2013 5 Schedule 1 : Disbursement Provisions Country FEDERAL DEMOCRATIC REPUBLIC Closing Date Section IV.B.4 of Schedule 2 to Credit OF ETHIOPIA the Loan Agreement. Recipient FEDERAL DEMOCRATIC REPUBLIC SUF Credit OF ETHIOPIA Number Name of the Program Ethiopia Electrification Program Disbursement Six months after the closing date. Deadline Date Disbursement Methods Methods Supporting Documentation Reimbursement (financing of Yes Confirmation issued by the World Bank achieved results) Advance Yes Request in the format provided in Attachment 2 of the DFIL Financial Institution - National Bank of Ethiopia Ceiling Not Applicable Name Currency USD Amount Not Applicable The World Bank Delta Centre, 13th Floor, Menengai Road Nairobi, Kenya Tel: +254 20 2936 000 Attention: Loan Operations-Anthony Okwako Not applicable Not applicable 6 Attachment 1 Form of Authorized Signatory Letter [Letterhead] Ministry of Finance [Street address] [DATE] The World Bank 1818 H Street, N.W. Washington, D.C. 20433 United States of America Attention: [Country Director] Re: IDA Financing IDA 6158 and IDA scale up Financing IDA 6157 (Ethiopia Electrification Program) I refer to the Financing Agreement between the International Development Association (the "Association") and [name of Recipient] (the "Recipient"), dated , providing the above Financing. For the purposes of Section 2.02 of the General Conditions as defined in the Agreement, any '[one] of the persons whose authenticated specimen signatures appear below is authorized on behalf of the Recipient to sign applications for withdrawal under this Financing. For the purpose of delivering Applications to the Association, 2[each] of the persons whose authenticated specimen signatures appears below is authorized on behalf of the Recipient, acting 3[individually] 4[jointly], to deliver Applications, and evidence in support thereof on the terms and conditions specified by the Association. s[This confirms that the Recipient is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Association I Instruction to the Borrower: Stipulate if more than one person needs to sign Applications, and how many or which positions, and if any thresholds apply. Please delete this footnote in final letter that is sent to the Bank 2 Instruction to the Borrower: Stipulate if more than one person needs to jointly sign Applications, if so, please indicate the actual number. Please delete this footnote in final letter that is sent to the Bank I Instruction to the Borrower: Use this bracket if any one of the authorized persons may sign; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Bank. 4 Instruction to the Borrower: Use this bracket onlyif several individuals must jointly sign each Application; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Bank I Instruction to the Borrower: Add this paragraph if the Borrower wishes to authorize the listed persons to accept Secure Identification Credentials and to deliver Applications by electronic means; if this is not applicable, please delete the paragraph. Please delete this footnote in final letter that is sent to the Bank 7 by electronic means. In full recognition that the Association shall rely upon such representations and warranties, including without limitation, the representations and warranties contained in the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation ("Terms and Conditions of Use of SIDC"), the Recipient represents and warrants to the Association that it will cause such persons to abide by those terms and conditions.] This Authorization replaces and supersedes any Authorization currently in the Association records with respect to this Agreement. [Name], [position] Specimen Signature: [Name], [position] Specimen Signature: [Name], [position] Specimen Signature: Yours truly, / signed / [Position] 8 Attachment 2 Interim unaudited Financial Report (IFR) Attached Separately 9 Attachment 3 Sample Form for Advances [Ministry/Implementing Agency Letterhead] [Date] Loan Department - [name of Regional Center] The World Bank [address of regional center] Attention: [name of regional center team lead] Subject: Re: IDA Financing -j name ofproject] -Request for Advance Dear Sir/Madam, We refer to the Financing Agreement between the International Development Association (the "Association") and [name of Recipient] (the "Recipient") dated [Date of Signing] providing for the above Financing. In accordance with the provisions of the Disbursement Letter and Schedule 2, Section IV, B.3 of the Financing Agreement, to support the implementation of the above Program and to facilitate the achievement of the planned results, we request an Advance in the amount of [insert amount] 1. [We request that the Advance be disbursed in [currency requested for disbursement] equivalent to the Total Advance Requested above.]2 We acknowledge that the amount disbursed will be charged to the Financing Account in the currency of the Financing at the rate of exchange in effect at the time of disbursement. Sincerely, [Name, Position]3 The Proposed Advance should be in the currency of the DLI/DLR as set out in the disbursement table in the legal agreement, and in accordance with provisions in the Disbursement Letter. Normally, this is the currency of commitment of the credit. 2 Use this text to designate the currency of the Advance if it should be different from the currency set out in the disbursement table in the legal agreement. To be signed by a representative of the implementing/coordinating agency of the recipient, OR by the person(s) authorized on behalf of the recipient to sign applications for withdrawal under the financing as set out in the applicable Authorized Signatory Letter. 10 Attachment 4 Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation March 1, 2013 The World Bank (Bank)' will provide secure identification credentials (SIDC) to permit the Borrower2 to deliver applications for withdrawal and applications for special commitments under the Agreement(s) and supporting documentation (such applications and supporting documentation together referred to in these Terms and Conditions of Use as Applications) to the Bank electronically, on the terms and conditions of use specified herein. SIDC can be either: (a) hardware-based (Physical Token), or (b) software-based (Soft Token). The Bank reserves the right to determine which type of SIDC is most appropriate. A. Identification of Users 1. The Borrower will be required to identify in a completed Authorized Signatory Letter (ASL) duly delivered to and received by the Bank each person who will be authorized to deliver Applications. The Bank will provide SIDC to each person identified in the ASL (Signatory), as provided below. The Borrower shall also immediately notify the Bank if a Signatory is no longer authorized by the Borrower to act as a Signatory. 2. Each Signatory must register as a user on the Bank's Client Connection (CC) website (https://clientconnection.worldbank.or ) prior to receipt of his/her SIDC. Registration on CC will require that the Signatory establish a CC password (CC Password). The Signatory shall not reveal his/her CC Password to anyone or store or record the CC Password in written or other form. Upon registration as a CC user, the Signatory will be assigned a unique identifying account name. B. Initialization of SIDC 1. Prior to initialization of SIDC by a Signatory, the Signatory will acknowledge having read, understood and agreed to be bound by these Terms and Conditions of Use. 2. Where a Physical Token is to be used, promptly upon receipt of the Physical Token, the Signatory will access CC using his/her account name and CC Password and register I "Bank" includes IBRD and IDA. 2 "Borrower" includes the borrower of an IBRD loan, IDA credit, or Project Preparation Facility advance and the recipient of a grant. 11 his/her Physical Token and set a personal identification number (PIN) to be used in connection with the use of his/her Physical Token, after which the Physical Token will be initialized for use by the Signatory exclusively for purposes of delivering Applications. Where a Soft Token is to be used, the Signatory will access CC using his/her account name and CC Password and set a personal identification number (PIN) to be used in connection with the use of his/her Soft Token, after which the Soft Token will be initialized for use by the Signatory exclusively for purposes of delivering Applications. Upon initialization of the SIDC, the Signatory will be a "SIDC User". The Bank will maintain in its database a user account (Account) for each SIDC User for purposes of managing the SIDC of the SIDC User. Neither the Borrower nor the SIDC User will have any access to the Account. 3. Prior to first use of the SIDC by the SIDC User, the Borrower shall ensure that the SIDC User has received training materials provided by the Bank in use of the SIDC. C. Use of SIDC 1. Use of the SIDC is strictly limited to use in the delivery of Applications by the SIDC User in the manner prescribed by the Bank in the Agreement(s) and these Terms and Conditions. Any other use of the SIDC is prohibited. 2. The Bank assumes no responsibility or liability whatsoever for any misuse of the SIDC by the SIDC User, other representatives of the Borrower, or third parties. 3. The Borrower undertakes to ensure, and represents and warrants to the Bank (such representation and warranty being expressly relied upon by the Bank in granting SIDC) that each SIDC User understands and will abide by, these Terms and Conditions of Use, including without limitation the following: 4. Security 4.1. The SIDC User shall not reveal his/her PIN to anyone or store or record the PIN in written or other form. 4.2. The SIDC User shall not allow anyone else to utilize his/her SIDC to deliver an Application to the Bank. 4.3. The SIDC User shall always logout from CC when not using the system. Failure to logout properly can create a route into the system that is unprotected. 4.4. If the SIDC User believes a third party has learned his/her PIN or has lost his/her Physical Token he/she shall immediately notify clientconnection@worldbank.or. 4.5. The Borrower shall immediately notify the Bank at clientconnectiongworldbank.orR of any lost, stolen or compromised SIDC, and take other reasonable steps to ensure such SIDC are disabled immediately. H.E. Dr. Abraham Tekeste - 12 - March 9, 2018 5. Reservation of Right to Disable SIDC 5.1. The Borrower shall reserve the right to revoke the authorization of a SIDC User to use a SIDC for any reason. 5.2. The Bank reserves the right, in its sole discretion, to temporarily or permanently disable a SIDC, de-activate a SIDC User's Account or both. 6. Care of Physical Tokens 6.1. Physical Tokens will remain the property of the Bank. 6.2. The Bank will physically deliver a Physical Token to each Signatory designated to receive one in a manner to be determined by and satisfactory to the Bank. 6.3. Physical Tokens contain delicate and sophisticated instrumentation and therefore should be handled with due care, and should not be immersed in liquids, exposed to extreme temperatures, crushed or bent. Also, Physical Tokens should be kept more than five (5) cm from devices that generate electromagnetic radiation (EMR), such as mobile phones, phone- enabled PDAs, smart phones and other similar devices. Physical Tokens should be carried and stored separate from any EMR device. At close range (less than 5 cm), these devices can output high levels of EMR that can interfere with the proper operation of electronic equipment, including the Physical Token. 6.4. Without derogating from these Terms and Conditions of Use, other technical instructions on the proper use and care of Physical Tokens are available at http://www.rsa.com. 7. Replacement 7.1. Lost, damaged, compromised (in terms of 4.5, above) or destroyed Physical Tokens will be replaced at the expense of the Borrower. 7.2. The Bank reserves the right, in its sole discretion, not to replace any Physical Token in the case of misuse, or not to reactivate a SIDC User's Account.