The EBRD is providing a long-term loan of up to EUR 5.3 million to Glass Container Company JSC (GCC), one of the largest glass bottle producers in Moldova. The loan will be used to finance part of the modernisation of GCC's existing factory, comprising an investment into a new melting furnace and two new production lines.
The project's objective is to improve the quality of the factory's final products, expand its product range that will facilitate export to western markets, as well as to increase its production and energy efficiency.
ETI score: 80
The project's transition impact potential will derive from demonstration of successful restructuring. The company will introduce new technology and new products which will remove the existing bottlenecks in production after the rebuilding of the glass furnace and purchase of two new forming machines with higher specifications.
GLASS CONTAINER COMPANY SA
EBRD Finance Summary
A corporate loan facility of up to EUR 5.3 million and additional EUR 2.2 million to be co-financed by the International Cooperation and Development Fund (TaiwanICDF).
Total Project Cost
The total cost of the project is EUR 13.5 million of which EUR 5 million will also be co-financed by a local commercial bank.
Environmental and Social Summary
Categorised B (ESP 2014). The environmental and social impacts associated with investments into a new furnace and equipment upgrades at an existing glass plant have been shown to be site-specific and effectively mitigated via implementation of the agreed Environmental and Social Action Plan (ESAP). Environmental and social due diligence (ESDD) was undertaken in-house and included an environmental and safety audit of the existing facilities, an assessment of the proposed furnace reconstruction project, a review of the company's environmental and social (E&S) management systems and operational practices, regulatory compliance status, and overall capacity to implement the project in line with EBRD's performance requirements. ESDD has confirmed that the company generally meets requirements of the local E&S legislation and has an E&S structure in place to deliver the project in compliance with EBRD performance requirements.
The plant is located within the industrial zone in the suburb of Chisinau, with no sensitive receptors in the vicinity. The nearest residential areas are about 1 km from the site. GCC's full factory modernisation program, entails the rebuilding of the old melting furnace, purchase of two new production machine-lines, including the hot-end and cold-end equipment. The investments will include both the acquisition of new equipment, as well as construction works, and will be carried out using the European furnace designs, European materials and employ a European furnace constructor for a turn-key project (as a result of the internal GCC tender, furnace design and construction will be made by Techglass from Poland and for IS forming machines and other components of the production lines - Bottero from Italy) in order to ensure the quality of the works.
The major issues identified during ESDD that require mitigation measures include inconsistent environmental and safety monitoring and controls, specifically in terms of polluting substances emissions and discharges, insufficient enforcement of the safe operational practices, lack of the consistent stakeholder and grievance management.
A number of recommendations were formulated into an Environmental and Social Action Plan (ESAP) covering a number of areas from the improvement of the current corporate E&S management system to more site-specific actions. These include, amongst others, enforcement of safe labour practices, reduction of dust and NOx emissions, water pollution prevention, energy management system implementation, improved environmental and safety monitoring, implementation of the Stakeholder Engagement Plan and grievance mechanisms.
Technical support funds will also be provided to support the Company in the improvement of the Environmental and Safety Management Systems in line with ISO 14001 and OHSAS 18001 requirements.
The Project will be monitored by the Bank on an annual basis through the Annual Environmental and Social Reports.
Technical Cooperation and Grant Financing
It is envisaged that part of the capital expenditures will be eligible for a grant from Finance and Technology Transfer Facility for Climate Change, utilizing donor funding provided by the Global Environment Facility (GEF).
The project will benefit from the technical cooperation support under the EU DCFTA SME Direct Facility as follows:
- Legal due diligence and technical feasibility;
- Financial management and reporting;
- Implementation of the Environmental Action Plan.
In addition, the project will be supported by international advisory services under the EBRD's Enterprise Growth Programme focusing on export promotion and product expansion to EU markets; development of long-term management, operations and market and strategies.
Company Contact Information
Boris Crivoi (Chief Financial Officer)
+ 373 22 89 58 00
+ 373 22 89 58 01
201 Uzinelor str., Chisinau city, Republic of Moldova, MD2064
The Project supported an extensive modernisation program at the Company's production facility in Chisinau, Moldova, consisting of (i) the ground-up reconstruction of the glass-melting furnace, (ii) purchase of two new production machine-lines to replace the 20+ year's old existing ones, (iii) as well as acquisition of new quality control equipment. The company increased its production capacity to more than 60 thousand tonnes of glass in 2020 and exported more than 70% of the sold production.
The delivery against the transition impact monitoring benchmarks, which contribute to the Competitive and Green transition qualities, are well on track and nearing completion. Under the Green quality, the Project has contributed to significant reduction of the Company's natural gas consumption in 2020 by around 3.7 million cubic meters, which corresponds to over 7,000 tons of CO2 savings, while under the Competitive quality it achieved a successful turnaround following relaunch of production and improved operational and financial performance.
The project also ensured adherence to strict environmental, energy-efficiency and social standards. Inter alia, Environmental and Social Action Plan (ESAP) agreed for the Project stipulates achievement of the air emission levels compatible with the WB standards and IED BAT requirements for the sector. The Client has implemented emission monitoring program that has demonstrated that such standards have been largely achieved. Other improvements achieved under ESAP implementation, included strengthening of the Environmental and Social Management systems, health and safety practices, social and labour protection.
PSD last updated
08 Dec 2021
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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