| Country: |
Romania |
| Project number: |
42970 |
| Business sector: |
Municipal and environmental infrastructure |
| Public/Private: |
Public |
| Environmental category: |
B |
| Board date: |
27 Mar 2012 |
| Status: |
Pending concept review |
| PSD disclosed: |
17 Jan 2012 |
Project Description
The EBRD is considering providing a loan of up to €23 million to the city of Arad to finance the modernisation of the city’s public transport system.
The project involves two components. The first component consists of a loan of €12 million for:
(i) acquisition of up to seven energy efficient modern trams;
(ii) modernisation of the main depot infrastructure;
(iii) introduction of an e-ticketing system for the public transport in the City of Arad (the “Project”).
The second component of €11 million will be used to re-finance the Bank’s existing loan, on the basis of the loan agreement dated 16 May 2009.
The proposed project is part of a wider objective of the municipality to restructure the public transport system by reducing the traffic congestion and air pollution in the city centre while reducing energy consumption of the public transport. The restructuring of the Bank’s existing loan is meant to allow a better cash management for the City faced with a large investment programme across sectors, as well as reflect market conditions.
Transition Impact
The proposed project will improve the performance of the public transport system through:
- Restructuring of the public transport company. The rolling-stock assets will be transferred from the City to the Public Transport Company in Arad via a ‘concession’ agreement.
- Private sector involvement. A new e-ticketing system, to be carried out on an out-sourced basis, will be designed and prepared for tender using the Bank’s TC Funds.
- Commercialisation of the regional bus services. The City will receive TC Funds to provide the necessary analysis of the regional bus route network and prepare a tender strategy to introduce private sector in the regional operations.
- Improvement of business practices and procurement. Acquisition of new tram rolling-stock, as opposed to the Company’s long-standing practice of wholesale refurbishment/rebuild of out-dated trams, through its heavy maintenance unit, will contribute to substantially increased private sector contracting for assets, better fleet management, better safety, improved quality of services, and improved operational performance.
The Client
Arad Municipality, located in the western part of Romania.
EBRD Finance
A loan to Arad Municipality of up to €23 million.
Project Cost
€23.5 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 for the project includes an independent third party environmental and social audit to assess the client’s management capacity and systems to manage environment, health, safety and labour issues in its operations and an analysis of the potential (future) E&S impacts and benefits. It will also assess the client’s ability to carry out the Project in compliance with the Bank’s Performance Requirements.
An Environmental and Social Action Plan (ESAP) will be prepared for the project, and a Stakeholder Engagement Plan will be developed that will include a grievance mechanism and information on environmental and social performance and a summary of the agreed Action Plan will be released to stakeholders.
This PSD will be updated when the results of due diligence are known.
Technical Cooperation
Technical Cooperation assistance is provided as follows:
- Technical and economic due diligence to include review of the technical specifications and economic analysis of proposed investments (€20,000, to be financed form the EBRD’s own resources);
- Environmental and Social due diligence to include an environmental analysis of the Project (€16,000, financed from the EBRD’s own resources);
- Support for e-ticketing system (€250,000, to be financed by an international donor).
- Design of out-sourcing of regional bus operations (€150,000, to be financed by an international donor).
Procurement or tendering opportunities
Visit EBRD Procurement
Enquiries: Tel: +44 20 7338 6794; Fax: +44 20 7338 7472, Email: procurement@ebrd.com
General enquiries
EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
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.
Text of the PIP
Project Complaint Mechanism (PCM)
The EBRD has established the Project Complaint Mechanism (PCM) to provide an opportunity for an independent review of complaints from one or more individuals or from organisations concerning projects financed by the Bank which are alleged to have caused, or likely to cause, harm. The Rules of Procedure governing the PCM can be found at www.ebrd.com/downloads/integrity/pcmrules.pdf, the Russian version can be accessed at http://www.ebrd.com/downloads/integrity/pcmrulesr.pdf
Any complaint under the PCM must be filed no later than 12 months after the last distribution of EBRD funds. You may contact the PCM officer (at pcm@ebrd.com) or the relevant EBRD Resident Office for assistance if you are uncertain as to the period within which a complaint must be filed.
Project Summary Documents are created before consideration by the EBRD Board of Directors. Details of a project may change following disclosure of a Project Summary Document. Project Summary Documents cannot be considered to represent official EBRD policy.
