Financed ProjectsEmbawood Azerbaijan

Identification Code:

OP/14/0006

Total Operation Cost:

20.000.000

Maturity:

60 months

Operation Status:

Description and Purpose of the Operation:

Corporate Loan for Company Development Program, Provision of a USD 20 millon corporate loan to Embawood LLC, for the development of Embawood Group companies.

Countries of Operation:

Azerbaijan (100,00 %)

Financial Product:

Loans

Sector:

Consumer Discretionary

Domain:

Private

Borrower/Client:

Embawood LLC Azerbaijan

Co-Financiers/Participants:

Guarantors/Sponsors:

EmbaFinans NBCO (Azerbaijan) and VibroStone LLC (Azerbaijan)

Developmental and Regional Cooperation Impact:

The operation is expected to have moderate but positive economic benefits for the Azerbaijani economy due to new employment creation, tax revenue gains, some multiplier effects and upstream and downstream linkages. The regional cooperation impact of the operation is moderate but positive, with the Embawood Group having sales in other BSEC countries.

Environmental Classification and Impact (summary):

The operation has been screened as Category B due to the fact that the environmental and social issues associated with furniture manufacturing including expansion of existing production facilities and installation of new production lines of rubber/polyurethane mattresses are limited, site specific, can be readily prevented and mitigated, and are not likely to generate significant risks and negative impacts. The construction of the green field plant for manufacturing of concrete pavement products has been screened as Category B+ due to the fact that construction of industrial facilities can generate medium to high environmental and social risks. During the plant's operation stage however the cateforization is expected to be changed to Category B as the manufacturing process of concrete pavement products is relatively simple and does not include complex mechanical, chemical or physical operations and the associated risks and impacts are limited, site specific and can be readily prevented and mitigated by applying appropriate measures. The Bank's environmental and social assessment process included the follwing key issues: (i) existing environmental and social management system; (ii) site selection; (iii) labour and working conditions; and (iv) pollution prevention and mitigation. The assessment concluded that the environmental and social risks and impacts associated with these issues are limited and not likely to be significant. The existing issues will be addressed through implementation of an ESAP.

Operation Leader:

General Industries, Transport, Tourism 2

E-mail:

gitt2@bstdb.org