Georgia Solid Waste Management Project

Location:

Georgia

Project number:

48098

Business sector:

Municipal and environmental infrastructure

Notice type:

State

Environmental category:

B

Approval date:

06 Jul 2016

Status:

Repaying

PSD disclosed:

08 Feb 2016

Project Description

A sovereign loan of € 10.0 million to Georgia ("Borrower"), on-lent to the Municipal Development Fund of Georgia ("MDFG," "MDF" or "Company"), a state owned agency for implementation and monitoring of infrastructure projects under the Ministry of Regional Development and Infrastructure. MDF, in turn, concluded transfer agreements with 66 participating municipalities, the beneficiaries.

The sovereign loan was co-financed by a capital grant of € 2.0 million from the Bank's Shareholder Special Fund ("SSF").

The proceeds of the loan and the grant financed acquisition of a new fleet of solid waste collection vehicles as well solid waste containers that have been distributed among 66 participating municipalities.

Project Objectives

The primary project objective is to improve and modernise solid waste management in the Country through the purchase of i) the new fleet of modern rear loaded solid waste vehicles and solid waste containers.

In addition, the project aims to support municipalities in enhancement of public awareness on sanitary handling of solid waste through Stakeholder Participation Programme ("SPP") and to support Municipal Development Fund ("MDF") in implementation of Environmental and Social Action Plan (ESAP) in order to enhance environmental, social and occupational health and safety measures in the municipalities of Georgia

Transition Impact

ETI score: 60

The project was signed with an ETI of 60. The transition impact of the investment derives from the facilitation of a significant increase in the waste collection coverage in Georgia. The project was expected to reduce informal dumping and support the sector-wide shift towards EU-compliant land-filling with significant environmental benefits. Through enhanced planning procedures and improved revenue collection within the benefitting municipalities, the financial and operational sustainability of the sector was expected to improve. The project also supports a stakeholder participation programme aimed at strengthening public awareness and promotes disclosure of the performance of operators and municipalities with an expected strengthening of disciplinary pressure and performance in the sector.

As of December 2020, the majority of TI benchmarks of the project have been achieved and the Risk was therefore reduced to Medium (new PTI of 75).

Client Information

GEORGIA SOVEREIGN

The Borrower is Georgia represented by the Ministry of Finance. The Project is implemented by the Municipal Development Fund ("MDF") of Georgia. The beneficiaries are 66 participating municipalities of Georgia.

EBRD Finance Summary

EUR 10,000,000.00

€10,000,000

Total Project Cost

EUR 12,000,000.00

€10 million sovereign loan to Georgia co-financed by a capital grant of €2 million provided by EBRD Shareholder Special Fund ("SSF") plus €450,000 additional technical assistance to support project preparation and implementation.

Additionality

The Bank offers financing not available from the commercial sources on reasonable terms and conditions. The Bank creates financing structure within affordability limits by combining its loan with a capital grant. In addition, the Bank's expertise in the sector supports application of enhanced standards.  

Environmental and Social Summary

Categorised B (ESP 2014). Acquisition and operation of solid waste vehicles and containers is expected to have mostly beneficial effects. The project will support overall improvement of waste management practices and enhance people's daily lives by reducing health hazards caused by unsanitary waste handling. Any potential adverse environmental and social impacts are expected to be site-specific and manageable through implementation of ESAP.

The Environmental and Social Due Diligence ("ESDD") has been undertaken by ESD and included a review of the applicable environmental, safety and social requirements, current waste management practices as well as an analysis of environmental and social impacts and benefits associated with the project to ensure the proposed specifications for the equipment will meet EU requirements. In the course of ESDD the site visits and meetings were carried out in the Solid Waste Management Company of Georgia, selected municipalities, Ministry of Regional Development and Infrastructure and the Ministry of Environmentin order to determine the arrangement that would make it possible to implement the Project in line with the Bank's requirements.

The potential issues identified during the ESDD included the lack of general waste management awareness, insufficient enforcement of the safety and health requirements, traffic and driving safety, and lacking infrastructure for security of the SW collection vehicles.

An agreement has been reached with the Borrower on the specific institutional arrangements to ensure that the Project is duly implemented throughout the whole lifecycle in compliance with the EBRD'S ESP. In that respect Municipal Development Fund (MDF) will be acting as the PIU helping municipalities implement EBRD's ESP and ESAP requirements and help in delivering the required TC support as well as performing periodic monitoring and annual reporting.

An ESAP has been developed and agreed to address the identified issues and includes requirements to comply with national health and safety rules, improvements of driving safety, development and implementation of the Solid Waste Management Plans.

The project will be closely monitored by EBRD through a customized annual environmental and social report form accepted by the Borrower.

Technical Cooperation and Grant Financing

The following technical co-operation (TC) assignments are included as part of this project:

Pre-signing

  • TC 1: Technical and Financial Due Diligence and Pre-signing Procurement Support to Municipal Development Fund ("MDF) of Georgia. The cost of this assignment financed by the Eastern Europe Energy Efficiency and Environment Partnership ("E5P") portion of the EBRD Shareholder Special Fund (SSF) was €150,000.

Post-signing

  • TC 2: Support to the Municipal Development Fund ("MDF) of Georgia and to the Municipalities of Georgia in Stakeholder Participation Programme ("SPP") and Environmental and Social Action Plan ("ESAP") implementation. The cost of this assignment financed by Early Transition Countries ("ETC") Fund was €300,000.

Company Contact Information

George Shengelia, Director
mdf@mdf.org.ge
00995 32 243 70 01
00995 32 243 70 77
www.mdf.org.ge
Municipal Development Fund of Georgia #150, D. Aghmashenebeli Ave., Tbilisi, 0112, Georgia

Implementation summary

The project supplied 66 municipalities of Georgia with 146 modern rear loaded compaction solid waste trucks and 8763 solid waste containers. All vehicles were distributed among municipalities by May 2017 and all containers by May 2018.

In addition, the project provided TC assistance to the Municipal Development Fund for pre-signing procurement process and technical & financial due diligence, as well as post signing assistance in Stakeholder Participation Programme (SPP) and Environmental and Social Action Plan (ESAP) implementation that included capacity building of all 66 Municipalities through trainings on introducing and establishing safe driving systems for the solid waste vehicles at municipal level.

Investment facilitated a significant increase in the waste collection coverage in Georgia. Together, with improved planning and waste management procedures, this project is expected to reduce informal dumping and support the sector-wide shift towards EU-compliant land-filling with significant environmental benefits

PSD last updated

08 Feb 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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