Istanbul Metro Project II

Location:

Turkey

Project number:

49825

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

IESE

Target board date:

27 Mar 2019

Status:

Concept Reviewed

PSD disclosed:

10 Jan 2019

Translated version of this PSD: Turkish

Project Description

A syndicated A/B loan of up to EUR 97.5 million to Istanbul Metropolitan Municipality ("IMM" or the "City") to co-finance the construction of 13 kilometres of the new Umraniye-Atasehir-Goztepe Metro line, including 11 stations. The supervision of construction that will support the engineering works of the main project components worth EUR 7.0 million is expected to be financed by the city of Istanbul.

Project Objectives

The project is essential for further expansion of public transport infrastructure in Istanbul and will connect Umraniye, Atasehir and Kadikoy districts of the Asian side of Istanbul. It will also link up the underground Marmaray commuter rail line and the Kadikoy-Kartal and Uskudar-Sancaktepe metro lines. The new line will provide safer and more reliable transport services for 400,000 passengers daily. The project is also expected to significantly reduce high traffic congestion and noise pollution. It will also help achieve a shift to a more environmentally friendly transport in Turkey's largest city.

Transition Impact

Good.

The project's transition impact is expected to be derived from promoting youth and gender inclusion as well as Green Economy Transition (GET). These areas will be explored during the due diligence studies and an action list will be agreed with the city prior to execution of the loan agreement.

  • Youth inclusion: The project will explore opening up of work-based learning opportunities for young people at the level of contractors during the construction phase. It is expected that the city will establish a youth employment programme with the support of the EBRD and in collaboration with the city's learning and vocational training centre (ISMEK). The scale and scope of the proposed programme (number of students to be trained, partnerships with local schools, certification and demonstration) will be confirmed following the completion of due diligence studies. In addition, subject to due diligence confirmation, it is expected that the city (through ISMEK) will contribute to the EBRD's on-going policy engagements in Turkey, by participating in the public private steering group established under the programme, to support the development of improved training and skills standards.
     
  • Gender inclusion:The project is expected to promote women's participation in a male-dominated sector and occupation. The company is expected to adopt significant improvements in its Human Resources and other policies in line with a gender action plan. It will also endeavour to join a recognised national equal opportunities accreditation scheme (i.e. KAGIDER FEM). The project will also explore ways to support women's access to services, through a potential Technical Cooperation (TC) which will provide gender-responsive transport services and will help the institutional strengthening of the municipality from the gender equality perspective.
     
  • Green Economy Transition: The project will promote sustainable transport by providing an alternative solution to the use of more polluting buses, minibuses, taxis and private vehicles. Given its integration into a much larger network, the new line is expected to result in a shift from high to low-carbon modes of transportation. It will also contribute to improved air quality through the reduction of nitrogen oxides and particulate matters in addition to climate change mitigation benefits.

The full impact of the project will be confirmed following the due diligence and prior to the execution of the loan agreement.

Client Information

MUNICIPALITY OF ISTANBUL

Istanbul is the largest city in Turkey with a population of around 15 million inhabitants. The city is a public legal entity established and governed under municipal laws of Turkey. IMM provides municipal services in Istanbul. It will finance and implement the project. Istanbul Metro Company, which is fully owned by IMM, will operate the proposed metro line.

EBRD Finance Summary

EUR 77,500,000.00

A/B loan of up to EUR 97.5 million to the city, and will aim to syndicate EUR 20 million of the loan under the Bank's A/B loan structure.

Total Project Cost

EUR 410,650,000.00

EUR 410.6 million

Environmental and Social Summary

Categorised IESE. The project will be categorised once more information becomes available on the line alignment, below and aboveground project components, and land acquisition. The scope of Environmental and Social Due Diligence (ESDD) will be decided once the project is categorised.

ESDD will include review of the Environmental and Social (E&S) performance for the first project signed with the city.

The extension of the metro system with construction of 13 kilometres metro line and 11 new stations will help improve the quality of the public transport services and contribute to reduction of air emissions and the traffic in Istanbul. Potential impacts will depend on how deep underground the metro line will run. Key potential issues are likely to be related to land acquisition; fire safety; geohazards (e.g., earthquakes); accessibility for people with reduced mobility, as well as impacts associated with construction activities, including construction traffic safety and temporary disruption of traffic and accessibility; where construction is underground, stability of the nearby buildings; disposal of excavated material; potential cultural heritage findings; and labour and occupational health and safety (OHS) risks.

Technical Cooperation

Pre-signing: Technical, Financial, Environmental and Social Due Diligence will be carried out for the project (EUR 150,000) via the Infrastructure Project Preparation Facility (IPPF). A review of the existing procurement process for the project (EUR 50,000) will also be carried and is to be financed by EBRD Shareholder Special Fund (SSF).

Post-signing: The EBRD is exploring the following post signing TC assignments: lender's supervision (up to EUR 150,000) from SSF, as well as gender-sensitive service provision (up to EUR 300,000) expected to be financed by the multi-donor funded Gender Advisory Services Framework.

This assignment is envisaged to include (a) development of gender-responsive transport services and institutional strengthening of the municipality from the gender equality perspective and (b) promotion of equal opportunities and practices in the company's workforce.

Company Contact Information

Nuri Sezgin
nuri.sezgin@ibb.gov.tr
+902124494000
www.ibb.istanbul
Osmaniye Mahallesi Çobançeme Kouyolu Bulvar No:5 34568 Bakrköy/ISTANBUL

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP 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. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

Project Complaint Mechanism (PCM)

The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer (pcm@ebrd.com) is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.