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EuropeAid Water Investment Support Facility

EuropeAid Water Investment Support Facility. WISF-01: Environmental / Social Preparation Study for ADB Djizzak & Surhandarya Water Supply & Sanitation Project WISF-03: Environmental / Social Preparation Study for World Bank Ferghana Valley Water Resources Management Project Press Conference

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EuropeAid Water Investment Support Facility

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  1. EuropeAid Water Investment Support Facility WISF-01: Environmental / Social Preparation Study for ADB Djizzak & Surhandarya Water Supply & Sanitation Project WISF-03: Environmental / Social Preparation Study for World Bank Ferghana Valley Water Resources Management Project Press Conference Tashkent 20 July 2007 WISF Team Leader: George McDonnell george.mcdonnell@arcadis-euroconsult.com

  2. Encouraging Environmental Investment • International Financial Institutions like ADB and the World Bank have a long history of financing water related projects: • IFIs use toughest project evaluation methods available • IFIs can therefore provide good examples of large scale effective water projects • Project preparation is the key to IFI investment decisions

  3. Project A Project B Project C Project D Project E Project F …….. Project Z The IFI Decision Process 1 Demand for projects List of potential projects For example projects that help implement a Country Assistance Strategy (CAS) IFIofficial IFIs (ADB, World Bank) • Initial analysis of all suggestions: • Analyse need • Analyse potential impact • Analyse capacities • Initial financial projection

  4. The IFI Decision Process 2 Which potential projects deserve support ? Decision-making body approves or rejects loan IFIofficial Project Preparation Studies IFI Project Decision Document (e.g. PAD) IFIBoard Problem:who pays?

  5. IFI Project Preparation Study • An IFI loan requires a very detailed project preparation study covering financial, technical, environmental, social and other aspects • Therefore professional preparation studies are needed to explore the issues affecting the potential impact of a project • These studies are expensive, but essential

  6. The Problem • Project preparation studies cost a lot • IFIs can’t always finance them • They cannot normally be financed through loans A Solution • EuropeAid can fund some of these studies Project Preparation Studies… Who pays?

  7. Why EuropeAid Project Preparation Studies? • EuropeAid resources are too small to finance large environmental investments in the CIS, but EuropeAid can support project preparation studies • EuropeAid has done this before – lots of experience with EBRD and European Investment Bank

  8. Water Investment Support Facility Summary • WISF is helping IFIs such as ADB and World Bank prepare seven EU Water Initiative related water projects in Uzbekistan and the Caucasus • WISF is helping prepare IFI water projects with a total budget of approx. EUR 340m

  9. WISF Project Management In June 2005 EuropeAid signed the WISF contract with Euroconsult Mott MacDonald (NL) in cooperation with: • BCEOM (FR) • Mazars and Guerard (FR)

  10. WISF Background • WISF was developed by EuropeAid in collaboration with IFIs • WISF is the most recent EuropeAid project preparation facility (others: Joint Environment Programme, Black Sea Investment Facility etc)

  11. WISF Background contd. • Banks want to develop Water Supply and Sanitation and Integrated Water Resource Management • However, the banks need project preparation support • WISF = one source of project preparation support • WISF is carrying out eight project preparation studies for seven IFI projects in Uzbekistan and the Caucasus

  12. WISF Facts & Figures • The eight studies are for Asian Development Bank, EBRD and World Bank projects • Armenia (1) (EBRD) (completed) • Azerbaijan (2) (World Bank) (one completed) • Georgia (3) (EBRD) (completed) • Uzbekistan (2) (ADB & World Bank) (ongoing) • WISF Budget: EUR 2.7m • WISF Duration: July 2005 – December 2007

  13. Demand for projects ADB / World Bank Manager EuropeAid Project Manager Project A WISF Team Leader Project B Project C Project D Project E Project F …….. Project Z The WISF process Project pipeline Steering Committee • Will the project help the EU Water Initiative? • Is the project in the country strategy? • Is it realistic? • Can WISF afford it?

  14. WISF in Uzbekistan WISF is carrying out two project preparation studies in Uzbekistan • WISF-01: Environmental and Social Study for Djizzak & Surhandarya Water Supply & Sanitation Sector Project (ADB) (ongoing) • WISF-03: Environmental and Social Assessment for Ferghana Valley Water Resources Management Project (Phase I) (World Bank) (ongoing)

  15. ADB Project • Project: Djizzak & Surhandarya Water Supply & Sanitation • Project Results: • Improved water supply and sanitation in Djizzak and Surhandarya rayon centres and nearby rural settlements • Total Project Cost: USD 31m

  16. ADB Project Preparation Process • Three project preparation components: • Overall Project Preparation – David King • Project Feasibility Study – IKS Consulting (UZ) • Environmental and Social Components of the project will be carried out under the WISF-01 study

  17. WISF-01 Data • WISF-01 runs from March to July 2007 • WISF-01 components: • Task 1: Environmental Assessment • Task 2: Poverty and Social Assessment • Task 3: Social Safeguards • WISF-01 Study Manager: Wandert Benthem

  18. WISF-01 RESULTS (1) • Environmental Impacts of ADB Project • Little or no environmental impacts • Increased demand from ground water resources • Increased waste water volumes

  19. WISF-01 RESULTS (2) • Social Impacts of ADB Project • Project will not result in resettlement • Minor social impacts in two sub-projects • No social impacts in the remaining 10 sub-projects • Improved health • Expected increase of economic activities and standard of living

  20. World Bank Project • Project: Ferghana Valley Water Resources Management Project Phase 1 • Project Results: improved water productivity and water resources management in three Ferghana Oblast tumans (Rishtan, Baghdad and Altyrayk) • Total Project Cost: approximately USD 50m

  21. World Bank Project Preparation Process • Two project preparation components: • Technical feasibility study - Mott MacDonald & Temelsu (Study Manager – Bob Davey) • Environmental and Social Assessment – this will be carried out under the WISF-03 study

  22. WISF-03 • WISF-03 runs from May to November 2007 • WISF-03 components: • Task 1: Environmental Assessment • Task 2: Social Assessment • WISF-03 Study Manager: Wandert Benthem

  23. WISF-03 – PRELIMINARY RESULTS • Project intervention options currently being formulated • Environmental survey has started • Social survey has started

  24. Conclusions • WISF is a EuropeAid tool to help banks prepare water projects in the Caucasus and Uzbekistan • WISF is a “good gamble” by EuropeAid whereby a relatively small facility is helping to mobilise two water projects in Uzbekistan (ADB and World Bank) with a combined total budget of USD 81m • WISF will run until December 2007

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