Izmir Metro Project

Project number:

46435

Approval date:

29 Oct 2014

Status:

Repaying

PSD disclosed:

01 Aug 2014

Translated version of this PSD: Turkish

Project Description

The EBRD is considering a €38.5 million loan to Izmir Metropolitan Municipality (‘Izmir’ or the ‘City’).  The proceeds will be used for the acquisition of 85 light rail train vehicles at a total cost of €157 million (the ‘Project’).

The procurement of the new light rail train vehicles are part of the extension of the City’s urban rail network to meet the increasing demand and will help provide frequent and efficient services to the citizens that is a fast, reliable, comfortable, and environment-friendly alternative solution to the use of private vehicles.

Transition Impact

The project is expected to foster new ways of financing, procuring and operating urban transport infrastructure in line with international best practices. In order to promote an alternative to municipal lending in support of urban transport, the various applications of commercialised approaches and greater private sector participation will be targeted.

The project is also expected to bring economic benefits by reducing street traffic congestion and air pollution by encouraging environmentally friendly urban rail transportation.

The Client

Izmir Municipality, the third largest metropolitan area in Turkey with a growing population of nearly 4 million. The procured light rail train vehicles will be operated by the municipal public transport company, Izmir Metro. The Project will be co-financed by the AFD, IFC and a commercial bank under the Multilateral Investment Guarantee Agency (MIGA) coverage.

EBRD Finance

The Bank will finance up to €38.5 million to Izmir Metropolitan Municipality as part of a €117 million lending package co-financed by other IFIs and a commercial bank.

Project Cost

€157 million.

Environmental Impact

The proposed project has been categorised B in accordance with the 2008 EBRD Environmental and Social (E&S) Policy, as the potential impacts are expected to be site specific and readily identifiable and addressed through mitigation measures.The environmental and social due diligence (ESDD) carried out by independent consultants included a review of the Izmir Metro's existing management systems, a review of existing facilities and operations, labour practices, accessibility and mobility for all user groups, and safety issues associated with the new LRT carriages including proposed specifications to meet EU requirements.
 
The project is expected to improve the efficiency and quality of transport services in the city and contribute to relieving the highly congested road traffic and in turn contribute to reduction of air emissions and noise in the city. The tender specifications for the LRT vehicles include detailed requirements for public health and safety. The existing stations are equipped with features to help disabled people and people travelling with young children. These features include maps at 50 locations with Braille alphabet showing the metro line and stations located at entrances and exits of the stations, signage for directions, elevators with audible signals, paths for visually impaired people to follow the right way, hearing induction loop systems (i.e. hearing aid users can use a telecoil switch to hear announcements and music directly through their hearing aid receiver), battery chargers for wheelchairs at 4 stations, two baby care rooms in two stations.
 
Few areas of improvement have been identified related to health and safety management, contractor management, permits, waste management, chemical storage, wastewater management and environmental noise which were addressed in the Environmental and Social Action Plan (ESAP). An ESAP has been agreed with the Company for mitigation of identified E&S issues and impacts.
 
The Bank will monitor the Company's environmental and social performance for the lifetime of the project through annual environmental and social reporting and via periodic site visits. The Izmir Metro will be required to immediately notify the Bank of any incidents or accidents likely to have an effect on the environment or worker and public safety.

Technical Cooperation

Technical, financial, and environmental and social due diligence is being carried out for the Project (€115,000 in total). This technical co-operation is funded from the EBRD’s internal resources.

Additionally, procurement support to support the city for the application of EBRD procurement policy and rules will be carried out (€74,000), to be funded by the Government of the Slovak Republic.

In the post signing stage three technical co-operation assignments are foreseen:  

(1) Development of key performance indicators for Izmir Metro to drive operational efficiency as well as the identification of strategies to further outsource certain activities of the operator (€200,000), to be financed by an international donor or the Bank’s Shareholder Special Fund (“SSF”);

(2) Policy dialogue support to identify best practice approaches to commercialize urban transport in Turkey, including seminars with urban transport operators, municipal and ministry representatives in Izmir and the neighboring cities. This will also include the analysis for the development of a municipal bond product to be issued in the Region (€350,000), to be financed by an international donor or the SSF;

(3) Procurement and implementation support to include the organization of a transparent procurement process for the light rail train fleet as well as assistance with technical acceptance of vehicles, spare parts, documentation and training (€295,000), to be financed by an international donor or the SSF.

 

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

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