A sovereign loan of up to EUR 50.6 million to Georgia (tranched) to be on-lent to the city of Tbilisi (the "City") for the benefit of Tbilisi Transport Company Ltd (the "Company"), a municipal company operating buses, the metro system and cable cars in Tbilisi.
The investment will improve the reliability, safety and efficiency of public transport through the upgrade and rehabilitation of 12 metro stations (the "Project").
The Project is part of a broader programme aiming to assist the City in reforming its management of public transport by financing the renewal of bus and metro systems, and network restructuring.
ETI score: 70
The Project is part of Green Cities 2 ("GrCF2") and a follow-on investment to the Tbilisi Green City Action Plan ("GCAP").
The GrCF2's primary goal is to achieve significant environmental improvements and promote the Green transition quality in the targeted cities. The GrCF2 also aims to build necessary capacity and facilitate better coordination between and buy-in from various stakeholders in the relevant cities in order to improve the governance, operational efficiency and financial sustainability of the targeted investments and initiatives. Under the GrCF2, the Bank will put further emphasis on implementation of GCAPs, with at least half of all sub-investments expected to be follow-on transactions addressing critical environmental challenges identified by the GCAPs. Notably, Tbilisi was one of the first three cities to join EBRD Green Cities and one of the first to complete a GCAP. As of today, the City is actively implementing more than 89 per cent of measures from its GCAP with both EBRD support and its own funds.
The overall transition impact of the Project will come from the Green and Well-Governed transition impact qualities. The Project will help to promote the Green transition quality by encouraging a shift to public transport systems and thus, mitigating the impacts of the City's transport sector on the environment. It will also be another step the City is taking to implement its GCAP and to meet commitments made to other sustainability initiatives and programmes. In addition, the Project will promote the Well-Governed transition quality through improved asset management practices.
Georgia represented by the Ministry of Finance.
The Project will be implemented by the City and the Company.
EBRD Finance Summary
€50.6 million sovereign loan to Georgia, in two tranches:
- Tranche 1 of up to EUR 30.305 million for the rehabilitation of the first batch of metro stations (to be committed at signing); and
- Tranche 2 of up to EUR 20.295 million for the rehabilitation of the second batch of metro stations (to be committed at a later stage).
Total Project Cost
The EBRD loan will be co-financed by an investment grant of up to EUR 5 million from the Green Climate Fund.
The Project will also benefit from the technical cooperation assignments to support project preparation and implementation.
The Project will be another step for the City to implement the GCAP and to meet commitments made to other sustainability initiatives and programmes.
EBRD offers financing that is not available in the market from commercial sources on reasonable terms and conditions. Moreover, EBRD expertise in the sector will support application of enhanced standards.
Environmental and Social Summary
The Project is Categorised B under the Environmental and Social Policy (2019). Risks and impacts associated with the Project have been confirmed to be site specific, readily identifiable and can be addressed by adoption of appropriate mitigation measures. Environmental and Social Due Diligence has been undertaken as part of the Feasibility Study ("FS") and has identified risks and impacts that may be associated with the programme of modernisation and rehabilitation works. However, as the FS presents a preliminary design of works only at this stage, further refinement of the Environmental and Social ("E&S") assessment and associated mitigation measures will be required to be developed in line with the Project cycle.
Construction is related to the risks and impacts associated with the work of construction contractor such as noise, dust, vibration, hazardous materials (including asbestos) and worker occupational safety and the interface with the public. This will require careful management through the development of an Environmental and Social Management System and associated E&S Management Plans, particularly the Contractor Management Plan and a comprehensive Stakeholder Engagement Plan. There is also the potential for temporary business disruption to small scale metro station vendors located in areas that will be subject to rehabilitation works. It is expected that these impacts can be managed through appropriate consultation and mitigation measures that are included in the Environmental and Social Action Plan ("ESAP"). At the same time, the ESAP also requires these impacts to be further assessed during detailed design and, if deemed necessary, a Livelihood Restoration Plan to be developed in line with the EBRD's requirements during the subsequent phases of the Project, prior to implementation. For three stations, further assessment of vibration will be required to verify that there will be no damage to the integrity of the nearby buildings.
The ESAP has been developed and includes the requirements to fully quantify any residual risks, develop and implement all required management plans as mitigation measures. A Project Implementation Unit ("PIU") will be established for the programme of works and the ESAP requires the PIU to develop a comprehensive set of plans and adequately supervise the construction works and contractor(s) prior to any impacts occurring. Such safeguards have been included in the design phase documents and the Bank will closely monitor the adoption of the ESAP by the PIU and the subsequent phases of the Project throughout.
Technical Cooperation and Grant Financing
The following technical co-operation ("TC") assignments are envisaged as part of this Project:
- Feasibility Study. The cost of the assignment is EUR 460,060, financed by the EBRD Shareholder Special Fund (the "SSF").
- Procurement Support. The estimated cost of the assignment is up to EUR 74,900 proposed to be financed by an international donor and/or the SSF.
- Project Implementation Support. The estimated cost of the assignment is up to EUR 2,300,000, expected to be financed partly from the loan proceeds and partly by an international donor and/or the SSF.
- Development of the Asset Management Plan. The estimated cost of the assignment is up to EUR 450,000, proposed to be financed by an international donor and/or the SSF.
Company Contact Information
Tbilisi Transport Company 2, Station Square, Tbilisi 0112, Georgia
PSD last updated
23 Dec 2022
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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).
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.
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