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.
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
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).
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
Total Project Cost
€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.
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:
- 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.
- 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
00995 32 243 70 01
00995 32 243 70 77
Municipal Development Fund of Georgia #150, D. Aghmashenebeli Ave., Tbilisi, 0112, Georgia
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
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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Environmental and Social Policy (ESP)
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More information on the EBRD’s practices in this regard is set out in the ESP.
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Access to Information Policy (AIP)
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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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