9 DE SETEMBRO DE 1983

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capital resources excepting, however, the special reserve provided for in article 20 of this Agreement; 6) At the time it is made, the amount of any specific investment referred in the preceding sub-paragraph shall not exceed a percentage of equity capital of the institution or undertaking concerned, which the Board of Governors shall have fixed for any investment to be made by virtue of paragraph I, c), of article 14 of this Agreement. In no event shall the Bank seek to obtain by such an investment a controlling interest in the institution or undertaking concerned.

Article 16

Provision of currencies for direct loans

In making direct loans, the Bank shall furnish the borrower with currencies other than the currency of the member in whose territory the project concerned is to be carried out (the latter currency hereinafter to be called «local currency»), which are required to meet foreign exchange expenditure on that project; provided always that the Bank may, in making direct loans, provide financing to meet local expenditure on the project concerned:

a) Where it can do so by supplying local currency without selling any of its holdings in gold or convertible currencies; or

6) Where in the opinion of the Bank local expenditure on that project is likely to cause undue Joss or strain on the balance of payments of the country where that project is to be carried out and the amount of such financing by the Bank does not exceed a reasonable portion of the total local expenditure incurred on that project.

Article 17 Operational principles

1 — The operations of the Bank shall be conducted in accordance with the following principles:

a):

i) The operations of the Bank shall, except in special circumstances, provide for the financing of specific projects, or groups of projects, particulary those forming part of a national or regional development programme urgently required for the economic or social development of its regional members. They may, however, include global loans to, or guarantees of loans made to, African national development banks or other suitable institutions, in order that the latter may finance projects of a specified type serving the purpose of the Bank within the respective fields of activities of such banks or institutions;

(V) In selecting suitable projects, the Bank shall always be guided by the provisions of paragraph 1, a), of article 2 of this Agreement and by the potencial contribution of the project concerned to the purpose of the Bank rather than by the type of the project. It shall, however, pay special attention to the selection of suitable multinational projects;

b) The Bank shall not provide for the financing

of a project in the territory of a member if that member objects thereto;

c) The Bank shall not provide for the financing

of a project to the extent that in its opinion the recipient may obtain the finance or facilities elsewhere on terms that the Bank considers are reasonable for the recipient;

d) The proceeds of any loan, investment or other

financing undertaken in the ordinary operations of the Bank shall be used only for procurement in member countries of goods and services produced in member countries, except in any case in which the Board of Directors, by a vote of the directors representing not less than two-thirds of the total voting power, determines to permit procurement in a non-member country or of goods and services produced in a non-member country in special circumstances making such procurement appropriate, as in the case of a non-member country in which a significant amount of financing has been provided to the Bank; provided, however, that with respect to any increase of capital stock, the Board of Governors may provide that procurement of goods and services with the proceeds of such increase be restricted to those countries which participate in such increase;

e) In making or guaranteeing a loan, the Bank

shall pay due regard to the prospects that the borrower and the guarantor, in any, will be in a position to meet their obligations under the loan;

/) In making or guaranteeing a loan, the Bank shall be satisfied that the rate of interest and other charges are reasonable and such rate, charges and the schedule for the repayment of principal are appropriate for the project concerned;

g) In the case of a direct loan made by the Bank, the borrower shall be permitted by the Bank to draw its funds only to meet expenditure in connexion with the project, as it is actually incurred;

It) The Bank shall make arrangements to ensure that the proceeds of any loan made or guaranteed by it are used only for the purposes for which the loan was granted, with due attention to considerations of economy and efficiency;