The provision of a senior loan of up to €28 million to Uzbekistan Airports JSC ("UzAirports"), fully owned by the Government of Uzbekistan. The proceeds of the loan will be used to finance the priority investment programme in Tashkent International Airport and selected regional airports (the Project).
The Project envisages financing of the priority investment programme, i.e. acquisition of specialised equipment for airfield maintenance and terminal/airside equipment to replace current obsolete equipment. The Project aims to address the growing demand for good quality airport services in Uzbekistan, in particular in Tashkent International Airport ("TAS").
ETI score: 65
Primary TI Quality: Competitive. UzAirports is planning a complete business processes overhaul, including labour restructuring. This will result in at least a 5 per cent decline in operational costs (cost of goods sold and administrative expenses), while operational costs make up approximately 50 per cent of total costs. The specific measures and associated benchmarks will be defined during due diligence. This will be supported by a targeted TC to introduce best industry practices in terms of business processes management.
Secondary TI Quality: Well-governed. Despite being the largest airport in Uzbekistan, TAS does not meet international airport infrastructure standards. The required measures will be identified and an Environmental and Social Action Plan ("ESAP") will be agreed with ESD and CSD. This will require the company to adopt the occupational health and safety standards of ISO 45001 for airport operations. Introduction of a holding-wide Master Plan will be covenanted. This will establish a strategic road map for all potential investment and private sector participation in airport infrastructure, increasing capex efficiency and thus potential revenue. The Master Plan will also identify PPP potential and feasibility for regional airports.
UZBEKISTAN AIRPORTS JSC
EBRD Finance Summary
Total Project Cost
The EBRD offers financing that is not available in the market from commercial sources on reasonable terms and conditions, e.g. a longer tenor/grace period that is rarely available in the market. The EBRD helps to mitigate physical transition risks and take climate action, such as to identify and manage physical climate risks and build resilience to them. Client seeks/makes use of the EBRD expertise on policy/sector know how through the development of holding-wide Master Plan, which will streamline investment and prioritise investment needs and overall strategic development. The EBRD provides expertise, innovation, knowledge and/or capabilities that are material to the timely realisation of the Project's objectives, including support to strengthen the capacity of the Client.
Environmental and Social Summary
Categorised B. The Project involves financing the replacement of obsolete airport equipment. It is understood no civil engineering works will be financed under this transaction. ESDD will review compliance of the current operations with national E&S legislation, noise, air quality, fuel storage and handling of hazardous substances, occupational H&S and labour management. Operational safety management systems and its compliance with International Civil Aviation Organisation ("ICAO") and EU safety will be assessed as part of ESDD. Corporate E&S capacity to operate the airport in line with the EBRD PRs will be assessed. An ESAP will be prepared and approved with counterparties to address any gaps identified. The potential for a Gender Action Plan will be considered.
Technical Cooperation and Grant Financing
TC 1: Technical and E&S due diligence. An independent consultant will focus on the review of project specification and costs, EIRR, implementation arrangements and an assessment of the client's capacity. The estimated cost of the assignment is up to EUR 75,000, proposed to be financed by an international donor or the EBRD Shareholder Special Fund ("SSF").
TC 2: Business processes optimisation. An independent consultant will focus on the review of current business processes management and propose an optimisation plan for TAS, in addition to the assessment of the potential for private sector participation and liberalisation. The estimated cost of the assignment is up to EUR 300,000, proposed to be financed by and international donor or the SSF.
TC 3: Procurement Advisory. Consultancy services to support the Client's advance procurement of the equipment. The estimated cost of the assignment is up to EUR 75,000, proposed to be financed by an international donor or the SSF, or the team budget.
TC 4: Master Plan. Introduction of a Master Plan is proposed to improve UzAirports investment and strategic decision making, as well as monitor TC2 implementation. The exact scope and tasks are to be agreed with the Client before FRM stage. The estimated cost of the assignment is up to EUR 500,000, proposed to be financed by international donor or the SSF.
Company Contact Information
+998 555 01 47 47 Ext. 4644
Qumariq 13, Tashkent-3 Airport Republic of Uzbekistan
PSD last updated
08 Aug 2023
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