A syndicated loan of EUR 105 million loan to Izmir Metropolitan Municipality. The proceeds will be used for the construction of the Fahrettin Altay-Narlidere metro line with a total length of 7.2 kilometers including underground stations and electromechanical works.
The construction of a new metro line is part of city's extension of its urban rail network to meet increasing demand, providing an environmentally friendly alternative to private vehicles.
ETI score: 80
The project's transition impacts will be derived from Green Economy Transition (GET). Metro development in Izmir represents a major investment in zero-emission transport at the local level, and as such is a strong contributor to piloting GET in the municipal sector. The project will serve as a demonstration case of GET applied to urban transport, particularly by promoting the sustainable cities concept. It will contribute to sustainable transport through providing an alternative solution to the use of buses, minibuses, taxis and private vehicles, significantly contributing to the reduction of air pollutants and GHG emissions.
MUNICIPALITY OF IZMIR
With a population of nearly 4.2 million, Izmir is the third largest metropolitan municipality in Turkey. The Fahrettin Altay-Narlidere Metro Line will be operated by the city's municipal public transport company, Izmir Metro A.i.
EBRD Finance Summary
Under an A/B loan structure of up to EUR 105.0 million to the city, including an anticipated B-Loan of up to EUR 25 million.
The remainder of the project cost is expected to be financed by the other parallel lenders and the City's contributions from its budget.
Total Project Cost
Environmental and Social Summary
The extension of the rail system in Izmir will expand public transport provision, leading to social and environmental benefits including reduced or avoided emission of CO2 and other air pollutants. The most significant impacts will occur during project construction, including generation of construction waste, dust, noise, air emissions and additional traffic. The contractors will need to carefully manage construction safety and minimise the disruption to local communities and businesses. Health and safety issues including design and maintenance of the railway system in line with EU standards, occupational health and safety and labour issues such as working at confined space, working hours, employee grievance management and relationship with worker organizations, and community safety issues will be reviewed to ensure compliance with the Bank's performance requirements. Fire prevention and the emergency response capacity of Izmir Metro will also be assessed as part of the appraisal process. As the line will be constructed using a 'tunnel boring' method and pass underground, no resettlement is required for the current design. This will be confirmed during due diligence. The environmental and social appraisal will be carried out by consultants financed by technical cooperation funds, who will also develop a stakeholder engagement plan and a grievance mechanism for the project. Information will be also collected to identify gender gaps with respect to service provision and career opportunities at Izmir Metro with a view to establishing interventions and structuring the dialogue with the client to address these gaps.
Technical Cooperation and Grant Financing
Pre-signing: Technical, financial, and environmental and social due diligence will be carried out for the project (EUR 200,000 in total). This technical co-operation is funded from the EBRD's Infrastructure Project Preparation Facility.
Post-signing: Corporate Development: This assignment will include assistance to Izmir Metro with corporate accounting and management practices, review of existing Public Service Contract performance and monitoring indicators, asset management practices, operation of park-and-ride facilities and further efficiency improvements as well as with all related procurement processes for the metro line extension. The estimated cost of the assignment is EUR 275,000, proposed to be financed by an international donor or the EBRD's Shareholder Special Fund.
Green City Action Plan: This assignment includes the development of a Green City Action Plan to prioritise investments in Izmir in pursuit of a green agenda. The cost of the assignment, EUR 300,000, is financed by EBRD's Shareholder Special Fund.
Company Contact Information
Mehmet Oguz Ergenekon
İzmir Büyükşehir Belediyesi Cumhuriyet Bulvarı No:1 Konak/ IZMIR
PSD last updated
09 Apr 2020
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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More information on the EBRD’s practices in this regard is set out in the ESP.
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Access to Information Policy (AIP)
The AIP 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 following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.
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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).
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