GEORGIA: TRANS-CAUCASIAN RAIL LINK PROJECT

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Priority investment and railway restructuring measures to assist the commercialisation of Georgian railways by improving the main international transit route from Baku to the Georgian ports. The project aims to assist the commercialisation of Georgian railways by improving the main international transit route from Baku to the Georgian ports. It will also support the development of a more commercially oriented organisational structure and the ultimate conversion of Georgian railways into a joint-stock company or similar type independent legal entity. The project is expected to lead to the enactment of a new Railway Law. This will result in the separation of policy and operating responsibilities in the railway sector, with SR being established, initially as a government-owned commercial company. Georgian railways (Sakartvelo's Rkinigza – SR). Loan of US$ 20 million (ECU 17.8 million). Co-financing of US$ 7 million from the European Union's Tacis Programme. US$ 32 million (ECU 28.5 million). The project has been categorised as B/0, requiring an Environmental Analysis. The investment project was preceded by a pre-investment study, which has identified potential environmental issues that may be associated with the investments and need to be assessed during project preparation. These issues include construction-related impact, such as pollution of soil and water resources, changes in local hydrology, noise and dust disturbance and disposal of spoil and other waste materials. The project will be accompanied by an EU Tacis-TRACECA technical assistance project. The terms of reference for this provides for an environmental analysis of the proposed investments and for assistance to SR in developing an Environmental Management Plan. During the operation and maintenance phase adequate provision will be made for disposal of hazardous and non-hazardous solid wastes, water run-offs and possible increased noise along the railway corridors. As a condition of the Bank's involvement in the financing of the investments, SR will need to develop in-house capacity for environmental management and develop an Environmental Management Plan. Project implementation assistance (US$ 0.6 million) and a restructuring study (US$ 0.6 million).