DFF - Tuyauto Gestamp Morocco

Location:

Morocco

Project number:

50102

Business sector:

Manufacturing and Services

Notice type:

Private

Environmental category:

B

Approval date:

01 Sep 2020

Status:

Approved

PSD disclosed:

19 Nov 2020

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

Provision of EUR 10 million loan to Tuyauto Gestamp Morocco SA, to support its investment in metal assembly facility in Morocco.

Project Objectives

The Project enables the Borrower to (i) expand capacity and (ii) introduce the activity of cold stamping of metal frames, a process that occurs prior to their already existing welding and assembly processes.

Transition Impact

ETI score: 76

The use of proceeds will enable training of young women and men to contribute the socioeconomic advance and people empowerment.

The Project will assist to the policy dialogue on a new PPP model to improve vocational training in the Moroccan automotive sector.

The Project will also introduce an innovative production process leading to competitiveness improvements.

Client Information

TUYAUTO GESTAMP MOROCCO SA

Tuyauto Gestamp Morocco SA (the "Borrower") is a joint stock company established in Morocco and owned for 50% by Gestamp Automocion S.A, a listed tier-1 producer of automotive parts domiciled in Spain, and for 50% by Tuyauto S.A., a family-owned tier-1 producer of automotive parts domiciled in Morocco.

EBRD Finance Summary

The EUR 10m loan complements the outstanding loan extended to the Borrower in 2018 to finance the investment programme.

Total Project Cost

The proceeds will be used for equipment acquisition, building construction, as well as land acquisition related to the Borrower's investment programme.

Additionality

The Bank is additional because of the combination of the following factors: financing structure, ability to offer follow up loans for future phases, and ability to bridge financing gap as a result of adverse market conditions due to COVID-19.

Standard setting: Client, in line with its ESG strategy, makes use of EBRD expertise on higher inclusion and gender standards and/or equal opportunities action plans.

Environmental and Social Summary

Categorised B (ESP 2014). In-house Environmental and Social (E&S) due diligence was carried out by means of review of the Project and COVID-19 Questionnaires, together with an information package supplied by the Client; review of the 2019 AESR; as well as phone interviews with the Client's Management. TGM is an existing client of the Bank (first transaction signed in 2018) and its E&S performance has been satisfactory to date as evidenced by annual reporting on environmental and social matters. The results of the 2018 ESDD indicated that there are high HSE standards at the Gestamp Corporate level, and that these standards will be replicated on the Moroccan sites. The environmental and social impacts associated with the construction and operation of a second automotive parts manufacturing plant are readily identified, and will be managed in line with the Bank's PRs by the implementation of a supplementary Environmental and Social Action Plan (ESAP). The supplementary ESAP ensures that the actions captured in the 2018 ESAP are expanded to the second plant. The supplementary ESAP is under discussion with the Client and will be agreed before signing. 

The Client is a JV between Gestamp and Tuyauto, but it was confirmed that Gestamp standards will apply. Gestamp has high corporate standards in place, including a commitment to ISO14001 certification for the new sites. The Client confirmed that the same E&S Management System will apply to both activities (assembly in the first plant and cold stamping in the second plant). The 2018 ESAP actions related to PR2 (labour review by an external labour auditor, grievance mechanism, HR Policy) will be expanded to the second plant, as confirmed in the additional ESAP. Energy supply to the new plant will be provided by the grid (no air emissions), and water consumption will not exceed 5m3/day since the machinery will be equipped with closed loop systems. 100% of the non-hazardous waste (wooden pallets, cardboards, scrap metal) are recycled. The second plant is located in an industrial area, adjacent to the first plant that started production in 2019.The land has been purchased and land titles have been obtained by TGM.

The review of the COVID-19 questionnaire confirmed that TGM has measures in place to limit the spread of COVID-19 (such a minimum presence of workforce with mandatory measures relating to hygiene and physical distancing, and temporary shutdown of the first plant and the construction of the second plant). Some contracts were temporarily suspended and replaced by the government help put in place (representing 70% of salary). 

The Bank will monitor implementation of the ESAP through review of annual Environmental and Social Reports (AESR) and communications with the Company as necessary.

Technical Cooperation and Grant Financing

None

Company Contact Information

nullhttp://www.tuyauto.ma/

PSD last updated

19 Nov 2020

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

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.

Specific requests for information can be made using the EBRD Enquiries form.

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 more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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