Board Resolution No. 071/2014

BOARD RESOLUTION NO. 071/2014

SUBJECT: MONETARY OPERATIONS MANAGEMENT — APPROVES MODIFICATIONS TO THE FINANCIAL CONDITIONS OF THE EXTRAORDINARY CONCESSIONAL CREDIT OF Bs1,633,372,800.00 IN FAVOR OF THE MINISTRY OF ECONOMY AND PUBLIC FINANCE (MEFP) FOR THE CONSTRUCTION OF THE CABLE TRANSPORT SYSTEM (TELEFERICO) IN THE CITIES OF LA PAZ AND EL ALTO.

HAVING SEEN:

The Political Constitution of the State promulgated on February 7, 2009.

Law No. 1670 of the Central Bank of Bolivia (BCB) of October 31, 1995.

Law No. 261 of July 15, 2012.

Law No. 291 Modifying the General State Budget — Management 2012 of September 22, 2012.

Ministerial Resolution of the MEFP No. 213 of March 28, 2014.

The Specific Regulation for the Granting of Credit established in Law No. 261, approved by Board Resolution of the Central Bank of Bolivia (BCB) No. 159/2012 of August 28, 2012, modified by Board Resolutions No. 194/2012 and 050/2014 of November 20, 2012, and May 20, 2014.

Board Resolution of the BCB No. 018/2013 of February 26, 2013.

The note from the Ministry of Public Works, Services and Housing (MOPSV) CITE: MOPSV/DESP.0976/2012 of August 9, 2012.

The notes from the MEFP CITE: MEFP/VTCP/DGCP/UEPS-872, 1232/2012 and 570/2014 of August 24 and November 14, 2012, and May 29, 2014, respectively.

Report from the Monetary Operations Management CITE: BCB-GOM-SOSP-DCE-INF-2014-28 of June 2, 2014.

Report from the Legal Affairs Management CITE: BCB-GAL-SANO-INF-2014-192 of June 5, 2014.

Act No. 031/14 of the BCB Board session of June 10, 2014, which in point 5 determines that the Highest Authority of the Institution has determined to accept the credit request to be granted to the MEFP.

The note CITE: MEFP/VTCP/DGCP/UEPS-971/2014 - 2479 of July 1, 2014, through which the MEFP accepts the financial conditions for the granting of the credit for the construction of the teleferico in the cities of La Paz and El Alto.

CONSIDERING:

That the Political Constitution of the State (CPE), approved by Referendum on January 25, 2009, and promulgated on February 7, 2009, in numeral 6 of Article 9, establishes that it is the aim and function of the State to promote and guarantee the responsible and planned use of natural resources, and to boost their industrialization, through development and strengthening of the productive base in its different dimensions and levels. Likewise, in numeral 10 of paragraph I of Article 158 and Article 322, it establishes that the Plurinational Legislative Assembly has the attribute to approve the contracting of public debt.

That Article 322 of the Political Constitution of the State provides that the Plurinational Legislative Assembly will authorize the contracting of public debt when the capacity to generate income to cover capital and interest is demonstrated, and the most advantageous conditions in rates, terms, amounts, and other circumstances are technically justified. Public debt will not include obligations that have not been expressly authorized and guaranteed by the Plurinational Legislative Assembly.

That Law No. 261, in its Article 2, authorizes the MEFP to contract a credit under concessional conditions with the BCB in national currency for an amount up to Bs1,633,372,800.00 (ONE THOUSAND SIX HUNDRED THIRTY-THREE MILLION THREE HUNDRED SEVENTY-TWO THOUSAND EIGHT HUNDRED 00/100 BOLIVIANOS) destined for the construction of the Cable Transport System (Teleferico) in the cities of La Paz and El Alto, for which the BCB is excepted from the application of Articles 22 and 23 of Law No. 1670 of October 31, 1995.

That it corresponds to the Ministry of Public Works, Services and Housing to evaluate and monitor the resources of the credit to be granted by the BCB in favor of the MEFP, destined for the construction of the Cable Transport System (Teleferico) in the cities of La Paz and El Alto.

That Law No. 291, in its Article 10, authorizes the General Treasury of the State — TGN, to effect the transfer of resources to the MEFP, for the payment of the debt emerging from the credit to be contracted with the BCB, for the construction of the Cable Transport System (Teleferico) in the cities of La Paz and El Alto; as well as for the constitution of the necessary backing guarantees required by the respective loan contract.

That Ministerial Resolution of the MEFP No. 213 updates the degree of concessionality, establishing at least twenty-five percent (25%) for the internal credit authorized by Law No. 261.

That Board Resolution of the BCB No. 159/2012 approves the Specific Regulation for the Granting of Credit established in Law No. 261.

That Board Resolution No. 194/2012 approves modifications to Articles 2, 3, 9, and 10 of the Specific Regulation for the Granting of Credit established in Law No. 261, referring to the credit request, acceptable guarantees, conditions for disbursements, and registration and accreditation of the use and destination of the credit resources, respectively.

That Board Resolution No. 050 modifies Article 6 of the Specific Regulation for the Granting of Credit established in Law No. 261, referring to financial conditions, and incorporates the procedure to define the Discount Rate and the Degree of Concessionality of credits under concessional conditions within the framework of Financial Laws or other specific laws.

That Board Resolution of the BCB No. 018/2013 approves the request for an extraordinary concessional credit of Bs1,633,372,800.00 in favor of the MEFP for the construction of the Cable Transport System (Teleferico) in the cities of La Paz and El Alto, establishing its financial conditions.

That through note CITE: MOPSV/DESP.0976/2012, the MOPSV requests the MEFP to prioritize actions before the BCB for the signing of the corresponding Credit Contract.

That through note CITE: MEFP/VTCP/DGCP/UEPS-1232/2012-4589, the MEFP requests the granting of a credit under concessional conditions under the financial conditions manifested in note MEFP/VTCP/DGCP/UEPS-872/2012, as well as the elaboration of the credit contract considering as guarantee of the credit the automatic debit from the TGN accounts in the Single Treasury Account.

That through note CITE: MEFP/VTCP/DGCP/UEPS-570/2014, the MEFP requests to modify the financial conditions approved by the BCB Board through Board Resolution No. 018/2013, specifying the new financial conditions to which the credit will be subject and submits a new disbursement schedule and payment plan.

That the Monetary Operations Management recommends in its report CITE: BCB-GOM-SOSP-DCE-INF-2014-28 to consider the scenarios presented for the approval of the financial conditions of the credit requested by the MEFP.

That the Legal Affairs Management concludes in its report CITE: BCB-GAL-SANO-INF-2014-192 that the request presented by the MEFP is legally appropriate, since the applicable regulations have been complied with and the required documentation has been presented according to the Specific Regulation for the Granting of Credit established in Law No. 261.

That through point 5 of Act No. 031/2014, the BCB Board determines to accept the credit request to the MEFP for the construction of the Cable Transport System (Teleferico) in the cities of La Paz and El Alto.

That through note CITE: MEFP/VTCP/DGCP/UEPS-971/2014 - 2479, the MEFP communicates that the financial conditions approved by the BCB Board are in accordance with Ministerial Resolution No. 213 and requests to proceed with the corresponding procedures for the subscription of the corresponding credit contract.

That by virtue of what is provided in Article 44 of Law No. 1670, the BCB Board is the competent instance to authorize the granting of the extraordinary credit in favor of the MEFP, in order to comply with what is expressly provided in Laws No. 261 and No. 291.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Modify the financial conditions approved through Board Resolution No. 018/2013 of February 26, 2013, under the following terms and conditions:

Total Credit Amount: Bs1,633,372,800.00 (One Thousand Six Hundred Thirty-Three Million Three Hundred Seventy-Two Thousand Eight Hundred 00/100 Bolivianos).

Currency: Bolivianos.

Term: 30 years.

Grace Period on Principal: 0 years.

Interest Rate: 0.29% (zero point twenty-nine percent) (Base 30/360*).

Interest Payment: Annual.

Principal Payment: Fixed annual installments.

Deadline for Disbursements: December 31, 2015.

Guarantees: Automatic debit from a specific TGN account.

• Base 30/360: represents the total number of days elapsed between one date and another for the computation of interest, assuming 12 months of 30 days each totaling 360 days.

Article 2.- Authorize the President of the BCB to sign the respective credit contract, according to the approved conditions and terms.

[Signatures]

Article 3.- The Presidency and the General Management are in charge of the execution and compliance of this Resolution.

La Paz, July 1, 2014