KR Water Framework:Jalal-Abad Water II Sub-Project

Location:

Kyrgyz Republic

Project number:

47896

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Approval date:

12 Feb 2019

Status:

Signed

PSD disclosed:

08 Apr 2019

Translated version of this PSD: KyrgyzRussian

Project Description

The provision of a sovereign loan of up €4 million to finance the second stage of the Jalal-Abad water and wastewater rehabilitation project in the Kyrgyz Republic. The proceeds of the sovereign loan will be on-lent to the City of Jalal-Abad (the "City") for the benefit of the municipal water and wastewater company "Vodokanal" (the "Company") and be used to finance further critical water and wastewater investments in the City including the rehabilitation of water and wastewater networks, metering, the construction of a new waste water treatment plat (WWTP) and the procurement of laboratory equipment.

The financing plan also includes an investment grant of € 4.0 million from the EBRD Shareholder Special Fund ("SSF") to facilitate the implementation of the project. The project will also benefit from a € 125,000 grant from the EBRD Water Fund to finance modernisation of the water laboratory in Jalal-Abad.

The Project will also support the City in developing and adopting a targeted social support programme for low income customers. Project-funded Stakeholder Participation Programme ("SPP") will further enhance awareness among the population and strengthen formal communication channels between the City, the Company and the population on water and  wastewater-related issues.

Project Objectives

1. Rehabilitation of the water supply and wastewater infrastructure in the City of Jalal-Abad; and

2. Improvement of the Client's financial and operational management.

Transition Impact

The project's transition impact includes:

  • Improved standards of transparency and governance via a renewed Public Service Contract;
     
  • Support the City in developing and adopting a social support programme for low income customers;
     
  • Development of a tariff methodology and associated tariff amendments to achieve cost recovery; and increased collection rates;
     
  • Building the company's capacity through the preparation of the business plan, the adoption of the Internal Audit Management Procedure, the application of IFRS, the implementation of a Management Information System, improvements in customer relations management, the reduction of cross subsidies and increase in water meter coverage to enhance management information.
     
  • Introduction of a formal consultation process with water supply and wastewater service users in the form of a community-based stakeholder participation programme.

The implementation of the proposed Project will result in an increased number of people benefitting from access to tap water and wastewater management services, the reduction of water losses and energy efficiency and will decrease the risk of waterborne diseases.

Client Information

KYRGYZ REPUBLIC SOVEREIGN

The municipal water company "Vodokanal" in Jalal-Abad. The Company is wholly owned by the City of Jalal-Abad and is the only supplier of water and wastewater services in the City.

EBRD Finance Summary

EUR 4,000,000.00

A sovereign loan of up to € 4.0 million to the Kyrgyz Republic for the benefit of the Client, a grant of up to € 4.0 million from the EBRD SSF, and a grant of € 125,000 from the EBRD Water Fund.

Total Project Cost

EUR 8,125,000.00

Environmental and Social Summary

The Project is categorised B under the 2014 Environmental and Social Policy. The Project, which is an extension to Phase I Project (OpId 40753), will further improve water and wastewater services in the City and provide substantial environmental and health benefits through investment in wastewater improvements, water metering, and rehabilitation of water supply and sewage networks. The Environmental and Social Due Diligence ("ESDD") has confirmed that any potential adverse future environmental and/or social impacts arising from the implementation of Phase II are site-specific and can be readily identified and addressed through adequate mitigation measures.

The ESDD showed that the Client's Environmental Health and Safety Standard management systems, performance progress and compliance status of the Client have improved under Phase I. These included obtaining an Environmental Passport and Wastewater Permit in 2011, and developing emergency procedures in case of water supply contamination, fire safety and H&S instructions and procedures for the different work areas and trainings. The Environmental and Social Action Plan under Phase I could not be implemented in full due to delays with implementation of the project and further improvements are planned for and/or are under implementation and will be reinforced during Phase II. Implementation of the Priority Investment Plan will further improve water and wastewater supply services, and complete replacement of the existing wastewater treatment plant will enable compliance with the EU Directives and provide adequate treatment. Some adverse impacts are likely to occur during the construction period, but these will be limited in duration and extent and can easily be mitigated by means of adequate measures and with proper supervision.

The Company will provide the Bank with annual environmental and social reports, including updates on the implementation of the Environmental and Social Action Plan. The Bank will conduct monitoring visits, as required, and commission a completion audit.

Technical Cooperation

The following technical cooperation (the "TC") assignments are envisaged as part of this project:

Pre Loan Signing

  • Technical due diligence to support scoping and structuring of the project, financial analysis and an environmental and social assessment (€ 272,850 financed by the EBRD's Infrastructure Project Preparation Facility).

Post Loan Signing

  • Project Implementation Support. International consultant to support the Project Implementation Unit with detailed engineering design and approval, procurement, preparation and evaluation of tenders, contract award and administration, financial control, project management and reporting. The assignment's cost is estimated at up to € 750,000, to be financed in part by EU's Investment Facility for Central Asia (€ 600,000) and by an international donor or the SSF (€150,000);
     
  • Corporate Development Support Programme. The assignment's cost is estimated at up to €400,000, to be financed by an international donor or the SSF.

Company Contact Information

Mr. Sadyr Toroevich Aitpaev
aitbaev_61@mail.ru
+996 770 077 742
+996 372 253 011
Strelkovaya 1A, Djalal-Abad, Kyrgyz Republic, 711063

 

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

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Email: projectenquiries@ebrd.com

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