Moldovan Railways Restructuring Project



Project number:


Business sector:


Notice type:


Environmental category:


Approval date:

02 Dec 2020



PSD disclosed:

17 Oct 2012

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

The EBRD is providing a sovereign loan of EUR 76.5 million to the Government of Moldova, on-lent to Calea Ferata din Moldova (CFM, the national railway operator) to finance (i) the acquisition of new multi-purpose locomotives to offer a higher level of service quality, safety and energy efficiency benefits  and (ii) the rehabilitation of priority rail infrastructure investments and related supervision services. Out of the total EUR 76.5 million EUR 52.5 million was signed on 14 November 2014 and EUR 24 million is pending approval and signature.


Project Objectives

The objectives of the proposed Project are to upgrade CFM's rolling stock, rehabilitate priority rail infrastructure and support the railway restructuring reform process that will be achieved through:


(a) acquisition of new locomotives to offer a higher level of service quality, safety  and energy efficiency benefits;


(b) priority investments in rail infrastructure and related design and supervision services;


(c) providing support to institutional reform to improve transparency and accountability, as well as financial sustainability;


(d) providing support for the initial planning and implementation stages of a phased retrenchment programme; and


(e) providing sustainability support by improving environmental and health and safety aspects, and applying energy efficient technologies and standards and encouraging lower emission modes to reduce energy consumption.

Transition Impact

ETI score: 80

Transition impact would stem from support by the EBRD of the Government of Moldova and CFM's efforts to reform the railway sector, through:

  • formalising CFM's restructuring plan to improve the financial performance and sustainability of the railway;
  • the separation of the freight, passenger, and infrastructure businesses, and improving cost recovery; and
  • reduction of energy consumption/costs following a dedicated energy efficiency audit of CFM.  CFM is one of the largest energy consumers in Moldova so energy efficiency measures will have a considerable demonstration effect among the main energy users in the country.

Client Information


The loan will be made to the Government of Moldova with CFM as the end beneficiary.

EBRD Finance Summary

EUR 76,500,000.00

Sovereign loan, tranched

Total Project Cost

EUR 172,749,856.00

The project also benefits from an investment grant provided by the Neighbourhood Investment Facility of the European Commission for the acquisition of locomotives in the amount of EUR 5 million.


The project is co-financed with the European Investment Bank.


Project additionality derives from financing structure and policy / regulatory changes linked to TI objectives. EBRD provides access to financing that is not available in the market from commercial sources on reasonable terms and conditions, with a longer tenor the n available to the client and large amounts. Through the Project the Bank will promote the railway sector reform by supporting the Government to restructure the CFM through its corporatisation and separation of the freight, passenger, and infrastructure businesses, introduction of Public Service Obligation to improve the financial performance and sustainability as well as corporate governance of the railway. Following the energy audit provided by the Bank CFM is implementing an Energy Efficiency Action Plan, which includes new procedures for energy monitoring and modern Energy Management Information System.

Environmental and Social Summary

Categorised B. Environmental and social due diligence comprised a corporate environmental, health and safety (EHS) audit of CFM and an audit of CFM's Human Resources (HR) capacity, systems and current retrenchment planning. As part of the restructuring programme, the Bank provided technical cooperation support for the development of a corporate EHS system based on ISO 14001 and OHSAS 18001 standards.   The introduction of new locomotives is expected to result in improved fuel efficiency, reduced pollution and better safety compared with the existing fleet. The infrastructure rehabilitation will  involve the replacement of track and ballast within the existing corridor. The associated environmental and social impacts can be addressed through appropriate contractor management and stakeholder engagement. An Environmental and Social Action Plan has been agreed with CFM for each investment component in line with EBRD requirements. It requires CFM, amongst other things to carry out the refurbishment of the Diesel Multiple Units in line with EU EHS standards, develop and implement an Environmental Management System and develop a stakeholder grievance mechanism.

Technical Cooperation and Grant Financing

The EBRD supports the preparation of railway reform strategies by mobilising technical cooperation funding for consulting services, as follows:

  • Restructuring Support - EUR 650,000 (EBRD Shareholder Special Fund);
  • Assistance in preparation and implementation of tender - EUR 250,000 (Central European Initiative);
  • Capacity Building on Energy Efficiency Management - EUR 220,000 (the Czech Official Development Assistance Fund);
  • Environmental, Health and Safety Management Support and Capacity Building - EUR 73,000 (Central European Initiative);
  • Retrenchment Planning - EUR 65,000 (EBRD Shareholder Special Fund).

An implementation of an energy management information system is co-funded through the EBRD Shareholder Special Fund.

Company Contact Information

Serghei Tomsa
(+373) 22-832-040
(+373) 22-834-204
48, Vlaicu Pircalab str., Chisinau, Republic of Moldova, MD-2012

PSD last updated

13 Nov 2020

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

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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 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 to get guidance and more information on IPAM and how to submit a request.


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