JOINT VENTURE ITALKYR CJSC

Location:

Kyrgyz Republic

Project number:

3703

Business sector:

Property and tourism

Notice type:

Private

Environmental category:

B

Approval date:

04 Nov 1997

Status:

Completed

PSD disclosed:

06 Oct 1996

 

Project Description

The operation will enable Italkyr to refurbish the Hotel Kyrgyzstan, an existing hotel located in the centre of Bishkek, converting it into a four-star international standard hotel.

The proceeds of the senior loan will be used to reconstruct the Hotel Kyrgyzstan, providing the country with a vital accommodation facility for international business travellers, and thereby supporting private sector development and foreign investment. The hotel will also support the development of the nascent Kyrgyz tourism sector.

Transition Impact

The project will support the Kyrgyz Government's privatisation of Hotel Kyrgyzstan, which until now has been owned and operated by the state. The project represents the first limited-recourse financing of a sizeable hotel development in Central Asia not to benefit from any sovereign or export credit guarantees. As such, the project will have a strong demonstration impact, providing a "best practice" model for financing other hotel developments and refurbishments in the region.

The project will facilitate technology transfer in the construction industry. In addition, the employees of the hotel will benefit from know-how transfer in customer service, marketing, and hospitality and catering management.

The Client

Italkyr is a Kyrgyz closed joint-stock special purpose company to be established by Hyatt International Corporation (a privately owned high-quality international hotel operator which, together with Hyatt Hotels Corporation, operates over 190 hotels and resorts worldwide) and C.A.V. Ital, a consortium of 55 Italian companies.

EBRD Finance

The EBRD will provide a senior loan of US$ 8.0 million (ECU 7.3 million) to Italkyr.

Project Cost

US$ 19.0 million (ECU 17.4 million).

Environmental Impact

The project involves the provision of a US$ 8 million loan for the refurbishment and operation of the Hotel Kyrgyzstan, located in the centre of Bishkek. The project was screened B/0, requiring an Environmental Analysis of the environmental impact associated with the renovation and subsequent operation of the hotel. The analysis highlighted the following issues:

  • The hotel has obtained all the relevant approvals and environmental permits for building and land use, construction, water supply, waste-water disposal, solid waste disposal, electricity and occupational health and safety. The local health and fire authorities will conduct inspections and testing as necessary once the renovation of the hotel is complete.
  • The hotel design will not include any harmful materials detrimental to the environment and health, such as asbestos, urea or formaldehyde, nor any equipment containing substances such as PCBs. The design includes environmentally beneficial elements, such as the insulation of walls and pipes to reduce heating loss and so save energy.
  • The renovation activities have been and continue to be conducted in accordance with the requirements of the local Sanitary Inspection Unit of the Department of Health, which has visited the site to ensure that there are no outstanding hazards. All applicable requirements for health, safety and fire protection during construction have been followed.
  • All stripping and demolition work carried out so far has not had a significant impact on the local environment.
  • The environmental impact of the hotel during operation will be minimal. The involvement of an environmentally proactive operator, such as Hyatt, will bring environmental benefits to the project. For example, as many waste materials as possible, such as paper, will be sent for recycling. Hyatt will ensure that the hotel is operated in accordance with best international practice.
  • The renovation of the hotel has been well publicised through local media, and no negative comments have been received from the public.

The sponsor will provide the Bank with an Annual Environmental Report documenting, among other things, any environmental issues, such as incidences of non-compliance, and updating the Bank on environmental initiatives taken by the hotel.

Technical Cooperation

None

Company Contact

 

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requestors’ identities may be kept confidential, upon request.

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