Translated version of this PSD: Turkish
The EBRD signed EUR 42 million long-term loan to Turkiye Sise ve Cam Fabrikalari A.S. (Sisecam), the leading glass producer in Turkey to finance glass recycling and energy efficiency investments in Turkey. EUR 2 million of the loan will be extended under the EBRD's Near-Zero Waste programme, which finances waste minimisation projects in Turkey with support from the Clean Technology Fund.
The project will enable the improvement of the glass recycling infrastructure in Turkey. Furthermore, it will support resource efficiency improvements across Sisecam's group of companies.
The project represents a good opportunity for the Bank to achieve a strong transition impact in Turkey, particularly through (i) market expansion via improving the glass recycling market infrastructure and indirectly financing the cullet suppliers, and (i) setting standards for energy efficiency and better environmental performance in the manufacturing sector in Turkey.
TURKIYE SISE VE CAM FABRIKALARI A.S
Sisecam, which is incorporated in Turkey and operates in 13 countries, is one of the largest glass producers in the world. The company is active in all key areas of glassmaking (flat glass, glassware and glass packaging) as well as production of glass chemicals such as soda ash and chromium products. Turkiye Is Bankasi A.S. ("Isbank") owns 74 per cent controlling stake in Sisecam, while the remaining 26 per cent is free floating on the Borsa Istanbul.
EBRD Finance Summary
An additional EUR 2 million will be provided by the Clean Technology Fund, a funding window of the Climate Investment Funds.
Total Project Cost
Environmental and Social Summary
Category B (ESP 2014). An Environmental and Social Due Diligence (ESDD) was undertaken for the project financed by the Bank as well as a review of corporate management. The Bank has existing financing with the company in the container and float glass sector, and to date the company has fully
implemented best practices and complied with the agreed requirements.
The ESDD has confirmed that the current project is structured to comply with the Bank's performance requirements (PRs) and the company has the institutional capacity to implement the Bank's PRs and is in compliance with the existing requirements. The ESDD process has also confirmed that the plants are well managed with a good Environmental, Health and Safety (EHS) management system certified to ISO 14001 and OHSAS 18001 standards. The sites are compliant with national legislation. The group has issued Global Reporting Initiative G4 annual report for 2014 and is planning to publish 2015 report in September 2016. The 2014 Corporate Social Responsibility Report contains much of the basic information included with the original corporate stakeholder engagement plan.
Overall, the Company is making good progress in terms of implementing the existing ESAP and a project specific ESAP has been developed and agreed with the Company.
The ESDD proved that the Sisecam Management and R&D teams dedicate considerable time to energy efficiency improvements at all facilities. These improvements are considered to go beyond EU BREF recommendations. New facilities built within the EU would be designed to comply with the IED (e.g. the new facility in Bulgaria); however, general compliance with IED ELVs in the existing facilities in Turkey needs to be improved. The Company has agreed to assess IED and BAT requirements and develop a road map for future implementation. The Bank will monitor this and work with the Company to develop a programme to ensure long term compliance with the existing ESAP and EU requirements.
The Bank undertook a labour review as part of the due diligence as there have been a number of labour disputes. Overall, the ESDD confirmed that labour relations and labour standards within Sisecam Group are in compliant with the national laws and PR 2 requirements. Further improvements have been included in an updated ESAP to standardise the HSE, social/labour practices in supply chains and the Collective Bargaining Agreement negotiations with the Workers' organisation in line with the legislations.
The Bank will monitor the implementation of the Project and ESAP including in labour related issues.
Technical cooperation (TC) funds to support this operation, under Near Zero Waste Programme, have been provided by the EU Instrument for Pre-accession Assistance (IPA) 2013 Energy Allocation for Turkey. Using these funds, the Bank engaged consultants for providing assistance in the implementation and project management phases of the glass recycling investment.
Additionally, up to EUR 2 million in non-TC funds will be provided from the Clean Technology Fund under Near Zero Waste Programme, to address first-mover externalities and other transaction costs associated with the innovative recycling and supply-chain financing approach for the glass recycling investment.
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