Gap Turkmen 2

complete

Capital increase to ensure the long-term future of the first vertically integrated denim fabric and ready-made goods production complex in Turkmenistan. Production of ready-made goods commenced in February 1998. An original investment from the EBRD of US$ 31 million (EUR 30.08 million) was signed in December 1995 which has been disbursed and is repaying. The company has been producing denim since 1997 and the production of ready-made goods commenced in February 1998. Project objectives: The capital increase is intended to provide long-term working capital needs to ensure the ongoing economic viability of the integrated textile plant. This operation has high transition impact predominately through the demonstration effects of being the EBRD's first private sector operation in the country as well as the first joint-stock company in Turkmenistan. The ways of doing business in this joint venture are setting a benchmark for other foreign investments, and developing significant skills in the process. A/O Gap Turkmen and its systems are a model for other investments in Turkmenistan. The company is also the first local organisation, and the first in the Commonwealth of Independent States to receive ISO 9002 Quality Management Certification, an internationally recognised symbol of quality. The operation has created over 1,600 new local jobs. The company is one of the few exporters of high value added goods in the country. A/O Gap Turkmen, a joint-stock company incorporated under the laws of the Republic of Turkmenistan. The EBRD is contributing US$ 3.0 million (EUR 2.88 million) to the US$ 15.0 million (EUR 14.4 million) pro-rata capital increase. The original cost was estimated at US$ 89.339 million, including the existing plant valued at US$ 39.694 million. With the capital increase, total project costs are US$ 104.339 million. A/O Gap Turkmen facilities have been constructed to meet both local and international environmental standards. An environmental audit carried out in March 1999 confirmed that the company fully complies with environmental, health and safety standards in Turkmenistan as well as with the relevant EU directives. The company is considered by the regulatory authorities to be the most modern, well-equipped and environmentally friendly operating company in Turkmenistan. None