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Turkey: Izmir Metro Expansion Phase 4: Fahrettin Altay – Narlidere Line Project

SUMMARY

STATUS
Approved
ECONOMY
Turkey
SECTOR
Transport
E&S CATEGORY
Category B

FINANCING

PROJECT TYPE
Nonsovereign
APPROVED FUNDING
USD56 million
FINANCING TYPE
Cofinanced

TIMELINE

CONCEPT REVIEW
February 25, 2020
FINANCING APPROVAL
July 16, 2020

OBJECTIVE

To increase capacity, connectivity, and efficiency of Izmir Metro.

DESCRIPTION

The Project involves the construction of a new 7.2-kilometer, 7-station metro line extension to meet the increasing demand for high-capacity public transport in the city of Izmir. The Project is the fourth expansion of Izmir’s single-line metro system and will connect the western areas located between Fahrettin Altay and Narlidere Kaymakamlik with the city center. The Project will provide a cleaner and more efficient alternative to road vehicles, in line with the city’s urban rail network expansion plan and Transport Master Plan (TMP) 2030.

The Project includes underground and civil engineering works (stations, tunnels), electro-mechanical works (signaling, telecommunications, energy supply, elevators and escalators, environmental control systems) and auxiliary facilities. The Project excludes the purchase of rolling stock, as the necessary metro cars were already procured in previous phases.

The European Bank for Reconstruction and Development (EBRD) and the Black Sea Trade and Development Bank (BSTDB) have committed and disbursed loans of EUR 80 million (June 2018) and EUR 50 million (Jan. 2020), respectively for the Project. In May 2020, Société Générale also provided an additional loan of EUR 25 million under EBRD’s A/B-loan. AIIB proposes to extend a non-sovereign-backed loan of up to EUR 50 million to support the completion of the Project.

The award of the Project construction contract by the Izmir Metropolitan Municipality as employer was subject to an open international tender process. The process was carried out in accordance with the EBRD Procurement Policies and Rules (https://www.ebrd.com/work-with-us/procurement/policies-and-rules.html) and the contract was awarded on June 4, 2018, to Gülermak Ağır Sanayi İnşaat ve Taahhüt A.Ş. (Gülermak). Turning over of premises to the contractor was carried out on June 25, 2018 and the Project’s physical progress is reported 57 percent as of April 2020.

Once built, the Project will be operated by Izmir Metro, a municipal entity, under an indefinite lease agreement with the Izmir Metropolitan Municipality (IMM).

ENVIRONMENTAL AND SOCIAL INFORMATION

Environmental and Social Policy and Categorization. This Project has been prepared and implemented to date in accordance with EBRD’s Environmental and Social Policy (EBRD’s ESP) and EBRD’s Performance Requirements (PRs), both dated May 2014. In order to ensure a harmonized approach to the environmental and social (ES) aspects of this Project, and as permitted under AIIB’s Environmental and Social Policy (AIIB’s ESP), EBRD’s ESP and relevant PRs will apply to the project in lieu of AIIB’s ESP. AIIB is satisfied that: (a) EBRD’s ESP and PRs are consistent with AIIB’s Articles of Agreement and are materially consistent with AIIB’s ESP, including its relevant Environmental and Social Standards and (b) the monitoring procedures that EBRD and AIIB have in place are appropriate for the Project. EBRD has assigned Category “B” to this Project due to limited and site-specific environmental and social (ES) risks of this Project that can be avoided or mitigated by adhering to relevant performance requirements, procedures, guidelines or design criteria.

An Environment and Social Due Diligence (ESDD) Report with an Environmental and Social Action Plan (ESAP) was prepared in March 2018 prior to the construction. The ESAP has been updated annually and submitted to EBRD.

AIIB has conducted an Environmental and Social Review (ESR). The corrective actions have been incorporated into the updated ESAP.

Environmental aspect. This Project is expected to expand the public transport network in Izmir, facilitate the transport modal shift and decrease travel time, which will generate socio-economic benefits and reduce noise, air pollution and congestion caused by vehicles. This Project will generate adverse impacts mostly during the construction phase. The ESR confirms that various management plans have been prepared and are being implemented by the Contractor to address the adverse environmental impacts and occupational health and safety risks. The Client has been satisfactorily supervising the management of ES risks and impacts of this Project.

The ESDD Report notes that the client’s energy management system includes periodic monitoring, review and reporting of its energy and fuel consumption, as well as greenhouse gas (GHG) emissions.

Social aspect. The ESDD Report and the ESR report both indicated that no land acquisition and/or resettlement would occur related to the Project as the lands needed for the construction of the metro line and stations belong to the City. The ESR confirmed that the station designs, and construction methods were selected to minimize physical and economic displacement. The ESR indicated there were nine (9) project design changes but did not entail additional land acquisition.

Gender and disability. The ESR confirmed that there have been no reported incidents related to sexual harassment and violence in the project. The ESR also indicated that Project has incorporated design features for its metro stations geared toward improving access of persons with limited mobility, including Braille-map for visually impaired passengers, ramps with slopes, and guiding plates for elderly and pregnant women in accordance with the international standards.

Stakeholder Engagement, Consultation and Information Disclosure. A Stakeholder Engagement Plan (SEP) has been developed and consultation activities have been carried out with stakeholders. The Non-technical Summary (NTS) of ES documents and the SEP in English and Turkish languages have been disclosed on the EBRD website.[1] The documents in English can be found on Izmir Metro’s website[2]. Izmir Metro has also disclosed the NTS[3] and SEP[4] in Turkish language.

Project-level Grievance Redress Mechanism (GRM). The client has a formal GRM for the general public and employees. The ESR indicated that all the grievances received to date have been resolved, and no pending grievance is reported in the system. The Contractor has also prepared a Grievance Management Plan for the project.

PROJECT TEAM LEADER

Asian Infrastructure Investment Bank

Francisco Fortuny

Private Sector Operations Specialist

fj.fortuny@aiib.org

 

Edwin Yuen

Senior Private Sector Operations Specialist

edwin.yuen@aiib.org

 

BORROWER

İzmir Büyükşehir Belediyesi

Mustafa Kapcı

Rail System Department Manager

mustafakapci@izmir.bel.tr

 

Övünç Özgen

Finance Manager

ovuncozgen@izmir.bel.tr

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