Category B project supported: Rehabilitation and reconstruction of 6 bridges, Ukraine
Published 10 July 2024
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1. Project description
UK Export Finance has agreed to provide support to the Ministry of Finance in respect of the supply of goods and services by Doğuş and Onur Group to Ukravtodor for the rehabilitation and reconstruction of bridges in the Kyiv Oblast (the Project).
A key aim of the Project is to rehabilitate and reconstruct bridges damaged during the ongoing Russian invasion; while restoring road-based mobility, making the bridges safe for local users and reopening vital supply routes near the capital, Kyiv.
The Project includes:
- Structural assessment of 6 damaged bridges;
- Detailed design;
- Demolition or removal of damaged elements;
- Installation of new bridge deck; and
- Installation of road layers and furniture.
2. Project sector
The Project is in the civil construction sector.
3. Project sponsors
The Project is being developed by Ukravtodor, the State Roads Agency.
4. UK exporters
Doğuş and Onur Group
5. Export Credit Agent Bank
Citibank
6. Amount of UK Export Finance Support
The principal value of the support is approximately £26.3 million, in two tranches split between Doğuş and Onur Group.
7. OECD common approaches
UK Export Finance categorised the Project as Category B (i.e. having environmental, social and human rights (ESHR) impacts that are few in number, site-specific, few (if any) of which are irreversible, and for which mitigation measures are more readily available) in accordance with the definition in the 2012 (Revised 2016) OECD Common Approaches for Officially Supported Export Credits and Environmental and Social Due Diligence (the “OECD Common Approaches”).
8. Environmental, Social and Human Rights standards
Project related ESHR documentation was reviewed for their alignment against the 2012 International Finance Corporation (IFC) Performance Standards (PS) on Environmental and Social Sustainability and the World Bank Group Environmental, Health and Safety (EHS) Guidelines.
The applicable IFC PS were:
- PS1: Assessment and Management of Environmental and Social Risks and Impacts;
- PS2: Labour and Working Conditions;
- PS3: Resource Efficiency and Pollution Prevention;
- PS4: Community Health, Safety and Security;
The applicable World Bank Group EHS Guidelines were:
- General EHS Guidelines (2007); and
- EHS Guidelines for Toll Roads (2007).
9. Nature of ESHR impacts
The review of potential ESHR risks and impacts took into account the following impacts, receptors and issues during the construction and operational phases of the Project:
- Emergency planning and response;
- Explosive remnants of war;
- Traffic management and road safety;
- Health and safety;
- Waste and hazardous material management;
- Emissions to the atmosphere (including land, air and water);
- Worker conditions of contract; and
- Grievance mechanisms.
10. Assessment of ESHR impacts
A review was undertaken in line with the requirements of the OECD Common Approaches to identify potential ESHR risks and impacts of the Project and how these would be effectively managed.
The review included:
- Photos and aerial imagery of the 6 bridges owing to security-related travel restrictions;
- Desk-based review of project-related documentation: Environmental and Social Risk Assessment, and Environmental and Social Management Plans; and
- Follow-up meetings and interviews with relevant Project representatives.
The results of this review formed the basis for the evaluation of the Project’s alignment with relevant international standards, and recommendations for future compliance and monitoring.
Taking account of the review, the Project was deemed to have potential to cause a number of adverse environmental and social impacts both during construction and operation. However, a proposed suite of controls as part of the Project’s environmental and social management systems should facilitate the management of these impacts.
11. Climate change considerations
UKEF considered the potential direct and indirect green house gas (GHG) emissions of the Project and effects of climate change factors on the Project as part of its ESHR review.
The Project is not considered to be a carbon intensive undertaking (such as fossil fuels or petrochemical) and its GHG emissions are expected to be below 25,000tCO2e per annum. Annual reporting of emissions and a dedicated assessment of transition risks were not considered to be warranted.
The review revealed that the Project design has considered potential physical impacts of climate change such as changes to rainfall and weather patterns.
12. Decision
Various actions have been agreed between the Project developer, operator, and parties involved in the financing, which are necessary to ensure the Project’s on-going alignment with international standards. Following agreement of these commitments, it was concluded that the Project should meet the relevant international standards over the Project cycle. UKEF has therefore decided to provide its support in respect of the supply of goods and services by UK exporters to the Project.
A condition of support is that the Project will be subject to monitoring and reporting in order to provide satisfaction that the Project is aligned with the relevant international standards throughout the duration of support.
UK Export Finance
10 July 2024