Treaty (27 March 1998)

March 27, 1998

RIDER NO 2 TO THE FINANCING AGREEMENT OF 10/05/1992 BETWEEN THE EUROPEAN COMMUNITY AND THE GOVERNMENT OF THE REPUBLIC OF THE PHILIPPINES "EARTHQUAKE REHABILITATION PROGRAMME"

COUNTRY : Republic of the Philippines INSTITUTION : Ministry of Health RIDER No 02 TO THE Financing Agreement OF 10/05/1992 Commission of the European FINANCE : Communities TITLE[1] :Earthquake Rehabilitation Programme Rider No :PHL/B7-3000/97/0595-02 Accounting :ALA/90/21 No Previous contract amount : 20,000,000 ECU (including previous riders) Estimated total rider N° 02 : 2,600,000 ECU amount New total contract amount : 22,600,000 ECU Date of signature : ...............................

RIDER N° 2 to THE FINANCING AGREEMENT of THE EARTHQUAKE REHABILITATION PROGRAMME HEALTH COMPONENT (ALA/90/21)

The Commission of the European Communities, hereinafter referred to as "The Commission1 acting for and on behalf of the European Community, hereinafter referred to as "The COMMUNITY" of the one part, and the Government of the Republic of the Philippines, hereinafter referred to as "THE RECIPIENT" of the other part, HAVE AGREED AS FOLLOWS : The project duration is extended until the 31 December 1999, and the cost estimates will be adapted to the projects requirements by transfer of residual funds from the agriculture and the studies component, by additional funds and the reallocation of funds for the Pilot Outreach and the contingencies. With the exception of the following revised articles, all other parts of this Financial Agreement and Rider 1 remain unchanged.

Art. 2 COMMITMENT OF THE COMMUNITY The commitment of THE COMMUNITY is fixed at 22.600.000 ECU, hereinafter referred to as "The EC GRANT". This commitment is subject to an expiry date, after which any balance of funds remaining available under THE EC GRANT shall automatically be cancelled. THE COMMISSION may however, depending on the circumstances, agree to an appropriate extension of this expiry date, should such an extension be requested and properly justified by THE RECIPIENT.For the project, the expiry date of THE EC GRANT is hereby set at 31 December 2000 (Thirty-first of December Two Thousand). SIGNATURES For the Recipient : Signature ___________________ Name (Sgd.) DOMINGO L. SIAZON, JR. Secretary of Foreign Affairs Date(*) March 27 1998 For the Commission of the European Communities : Signature (Sgd.) Manuel Marin Gonzalez Date (*) 17-02-1998 ANNEX A TECHNICAL AND ADMINISTRATIVE PROVISIONS

CHAPTER I

PROJECT DEFINITION

1.1. Project content and overall objective

Chapter 1 article 1.1.

Par. 2, second item will read as follows: - a Health Component, which will assist in the construction of one provincial hospital (in Agoo, La Union province). This component will be implemented by the Department of Health (DoH) until 31 December 1999 with a financial provision from the EC grant of 13.502.000 ECU.

CHAPTER II

PROJECT COMPOSITION

2.1. Project components 2.1.2. for the health component: - design, construction and equipment of a new provincial hospital at Agoo (La Union province); - consultancy services for the design, supervision and management of the works 2.2. Project inputs 2.2.2 for the health component: - design services and civil works for the construction on the provincial hospital concerned ; - equipment and furnishings of this hospital;- consultancy services for the supervision and management of the design, construction, equipment and commissioning of the hospital ; - personnel and recurrent costs for the operation of the hospital (Government contribution) Art 2.3 Time schedule The Project as a whole will be implemented until 31 December 1999. The Health component will be implemented until 31 December 1999, with the exception of the final acceptance of the work and goods, foreseen in the course of 2000. Art 2. 4 Project inputs The services of an independent civil engineer adviser to be placed under the authority of the Commission Delegation in Manila for the duration of this component amounts to 34 m/m. Art.2.5 Cost estimates 2.5.1 EC grant Agriculture 6.885.000 ECU component Health component 13.502.000 ECU Studies component 2.213.000 ECU ________________ TOTAL 22.600.000 ECU Detailed cost estimate is given in Appendix A.2 attached hereto DETAILED IMPLEMENTATION PROVISIONS relating to ERP (ALA/90/21) : HEALTH COMPONENT A.2.2 Financing The total direct cost of this component is estimated at 13.502.000 ECU, to be provided entirely under the EC grant. In addition, the Government of the Philippines will cover the full costs of the land required for the hospital, the additional water surveys, the access road, as well as the full costs of their staffing, operating and maintenance. As per Article 1, Annex A of the 1984 Framework Agreement between the Government of the Philippines and the European Commission, any expenditure over and above the commitment of the Community shall be borne by the Recipient. A2.7 Cost Estimates Design and Construction 8.600.000 ECU Equipment 2.350.000 ECU Supervision 1.870.000 ECU subtotal 12.820.000 ECU Contingencies 682.000 ECU Total 13.502.000 ECU These figures do not include the counterpart contribution of the Government, which will cover the entire cost of land, the additional water surveys, the access road, and the costs of staffing, operating and maintaining the hospital, as well as the normal salary costs of permanent government personnel assigned to the project.NB: The Community disbursements for the implementation of these projects will be executed after verification of the conformity of the expenses with the needs established in the Work Programme and in accordance with the availability of annual budgetary appropriations A2.8 Implementing authorities A2.8.1 General The hospital component will be executed by the Department of Health (DoH). It will be implemented by contract, supervised and managed by consultants to be appointed by the Commission. These consultants will act under the authority of a Project Director, who shall act as the Contracting Authority's Representative, and who shall be appointed by DoH for this purpose. It is foreseen that this Project Director shall be the Head of the Infrastructure Service of DoH. A2.9 Implementation, financial and procurement procedures A2.9.1 General A2.9.1.1Hospital component The hospital component shall be implemented by contract as set out in Article A2.8.1 above Summary of budget costs F/M COST or rounded up HEADINGS nb BUDGET ESTIMATEto contract incl in incl in TA DESIGN & Design works variations Constr. 8.114.235 CONSTRUCTION Construction orders 4950.000 455.000 subtot 1 4.950.000 8.569.235 8.600.000 Hospital EQUIPMENT 1.750.000 2.331.853 2.350.000 Equipment incl in Constr. 951.335 design incl in 294.565 SUPERVISION TA Consultant suprevision subtot 2 620.000[*] incl in in conting subtot 2 subtot 2 1.400.000 PILOT subtot 1.200.000 by others OUTREACH 1+2 9.300.000 1.500.000 equivalent CONTINGENCIES 810.000 FM total 10.800.000 to 6% FM + -500.000 RIDER 1 to FM Rider 1 10.300.000 total REMAINING FUNDS & INTERESTS from Agricultural & Studies Comp. 730.000 ADDITIONAL FUNDS to requests 20.000.000 13% 2.600.000 _________ REVISED TOTAL 13.630.00012.766.988 __________ rounded up 13.630.000 to : ECU[1] The Title, the Contract No. and the Accounting "No. must be quoted in all correspondence and on all payment documents. (*) The "Date of the Signature" of the rider shall be the latter of the two signature dates [*] Remaining funds and interest from Agricultural & Studies component are estimated at 730.000 ECU and will be notified following closure of the different accounts.