GrCF2 W2 - Sarajevo Public Transport e-Mobility

Location:

Bosnia and Herzegovina

Project number:

52520

Business sector:

Municipal and environmental infrastructure

Notice type:

State

Environmental category:

B

Approval date:

02 Nov 2021

Status:

Signed

PSD disclosed:

10 Nov 2021

As per section 1.4.2 (iii) of the Directive on Access to Information: "For Projects approved by Bank management where the Board of Directors has delegated the approval authority, the PSD shall be disclosed at the start of the relevant no-objection notification period to a member country of the Bank in accordance with Article 13 (iii) of the Agreement Establishing the EBRD."

Project Description

The acquisition and implementation of an adaptive traffic management system ("ATMS"), including construction of a traffic management center ("TMC"), and acquisition of up to 5 new trams in Sarajevo. The project is part of the EBRD's Green Cities Framework 2 Window 2 (the"framework") and was identified as a priority project under the Canton's Green City Action Plan ("GCAP").

Project Objectives

The project aims to alleviate traffic congestion and minimise transport-based emissions and environmental pollution. Increasing the efficiency of tram operations will reduce the fleet's electricity consumption and, together with an effect from modality shift and reduced idling times and congestion of vehicles, will result in an estimated reduction of 68,642 tCO2e (tonnes of carbon dioxide equivalent) of Green House Gas ("GHG") emissions. The project is also a follow-on investment under the Sarajevo GCAP, which identified local air quality, lack of public transport infrastructure and current transport policies as priority challenges to address through investments and policy actions.

Transition Impact

ETI score: 70

The project will primarily help to promote the Green transition quality through the acquisition and implementation of an ATMS which will significantly reduce traffic GHG emissions by reducing congestion and promoting a modal shift to public transport. The project will result in a reduction of GHG emissions estimated to over of 32 per cent and a reduction in other pollutants including SOx, NOx and particulate matter (PM2.5 and PM10).

The project will also support the Competitiveness objective through the successful implementation of a new technological solution for traffic management, which will reduce congestion, increase traffic safety and enhance the punctuality, capacity and efficiency of public transport by prioritising trams on intersections.

Client Information

BOSNIA AND HERZEGOVINA SOVEREIGN

The Borrower is Bosnia and Herzegovina ("Borrower").

EBRD Finance Summary

EUR 17,000,000.00

A sovereign loan of up to EUR 17m to the borrower ("loan"). The loan will be on-lent through a legislated cascade of sub-loans from BiH via the Federation of Bosnia and Herzegovina ("FBiH") to the Sarajevo Canton ("Canton") and divided into two tranches:

(i) Tranche 1 - up to EUR 7.0 million to finance the purchase and installation of the ATMS and construction of the TMC; and

(ii) Tranche 2 - up to EUR 10.0 million to finance the purchase of up to 5 new trams, uncommitted (the commitment is subject to the Bank's sole discretion).

Total Project Cost

EUR 20,600,450.00

The total estimated project cost is EUR 20.6 million including capital investments and donor-funded technical assistance (consultancy services).

Additionality

The additionality sources are: (i) the financing structure; (ii) the policy, sector, institutional or regulatory change; and (iii) standard-setting: helping projects and clients achieve higher standards, including higher inclusion of women in the public transport sector.

Environmental and Social Summary

Categorised B (2019 ESP). The implementation of ATMS and acquisition of up to 5 (five) new trams (Tranche 2) is expected to improve the reliability of public transport and thus contribute in addressing Sarajevo's severe air quality issue. This is a follow-on to the previously approved project on acquisition of new trams under OpID: 51784. Environmental and social due diligence ("ESDD") was carried out by independent consultants to update findings from the previous project and focused on existing management systems, current and past operational performance, existing operations and facilities and potential Environmental and Social ("E&S") issues associated with the project. The scope of the ESDD was limited by the fact that the future of the existing public transport company (KJKP GRAS) is uncertain and that trams and trolleybuses will be transferred to a new public transport company. This transaction is therefore structured to only involve the Canton as the owner of the newly acquired trams and the Ministry of Transport as the owner and operator of the ATMS. Labour issues regarding the restructuring or potential dissolution of KJKP GRAS are high risk and will need to be thoroughly addressed under the new transaction. The new transaction will provide technical assistance aimed at helping the Canton with establishing the new company, staffing, set-up and implementation of the necessary policies and procedures, including the Gender Action Plan. This TC will also need to ensure alignment with Performance Requirements ("PR") 2 requirements and national law, in particular as they relate to retrenchment and back-pay owed to workers.

ESDD initially focused on KJKP GRAS and concluded that the company operates in line with national environmental, occupational health and safety ("OHS"), but is still struggling to have a corporate E&S and OHS policy and formal E&S and OHS management system. While the ESAP has been further updated to include a specific set of actions aimed at developing an effective set of internal policies and guidance to cover identification, appraisal and management of key E&S and OHS risks including pollution prevention and control at the maintenance depot; emergency preparedness and response including community safety; contractor oversight and road traffic safety, implementation responsibility will reside with the Canton until such time when clarity about KJKP GRAS can be achieved.

The Project is expected to contribute to reduction in CO2 emissions and emission from other pollutants (SO2, NOx, PM2.5, PM10), noise reduction, improvement of road safety and minimised congestion impact.

The ESDD showed that KJKP GRAS undertakes stakeholder engagement on a regular basis and has a public grievance mechanism in place. A project-specific grievance mechanism has been developed as part of the Stakeholder Engagement Plan ("SEP"), though it is not clear who will be responsible for its implementation.

The Bank will monitor the Project's E&S performance in accordance with the Bank's PRs through review of reports and monitoring visits as required, and will be informed by the due diligence and monitoring of the new transactions.

Technical Cooperation and Grant Financing

TC1: Corporate Environmental and Social Due Diligence - financed by the EBRD Shareholder Special Fund ("SSF").

TC2: Technical and Economic Due Diligence - financed by the SSF.

TC3: Designs of ATMS and TMC - assistance to the Canton with the design of ATMS and TMC - tol be financed by the Central European Initiative Fund ("CEI").

TC4: Procurement & Project Implementation Support - to be financed by the CEI.

Company Contact Information

Emir Hota
emir.hota@ms.ks.gov.ba
+387(0)33 562-058
+387(0)33 562-059
www.ms.ks.gov.ba
71 000 Sarajevo, Reisa Dzemaludina Causevica 1

PSD last updated

10 Nov 2021

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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