Toyota Russia

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The proposed project consists of the construction and operation of a passenger car assembly plant near St. Petersburg. Annual production will target 20,000 “Camry” sedan passenger cars. The transition impact potential derives from the demonstration effects associated with transfer of modern technologies and know-how as well as managerial, organisational, marketing, financial, environmental protection and other skills into the Russian automotive sector. The proposed project will also provide a modern and environmentally clean and lean auto production of vehicles and related components from suppliers in Russia. This will increase the competitiveness and quality of domestically manufactured Russian motor vehicles and set new standards for domestically manufactured vehicles and help the Russian automotive industry to comply with environmental legislation. Toyota Russia, a greenfield assembly plant and a limited liability company incorporated in Russia. Up to $28 million equity investment for up to 20% common voting shares in the company. Market exposure could reach up to $190 million (€160 million). The construction and operation of a new, 50000 per annum car assembly plant is typically associated with limited direct environmental, health and safety issues, which can be readily identified and assessed as well as efficiently mitigated with modern technology and project design. The project site is not in the immediate vicinity of environmentally sensitive or residential areas and the investment is being designed in compliance with local environmental regulation and EU standards. Therefore, the EBRD has classified the project B/0, requiring an Environmental Analysis of the proposed development. Key Environmental issues and mitigation The modern operation will not involve any significant manufacturing, and car assembly operations are mainly associated with some machine tooling, welding and painting. The main emissions are associated with space heating and paint shop operations. Modern gas fired heating units will be used and the painting operations will include appropriate abatement equipment, meeting the current requirements of the EU VOC Directive. Air and noise emissions from the proposed plant will be in compliance with Russian and EU environmental standards. Pursuant to standard Russian requirements for similar plants, a 500 m sanitary protection zone is being set up around the facility. This sanitation zone will not include any residential areas, and therefore no resettlement will be associated with the project Limited volume of wastewater will be generated and the plant will include a preliminary wastewater treatment facility. Waste management will be undertaken in accordance with Toyota Motor Corporation environmental policy as well as local laws. Toyota Motor Corporation has committed to meet applicable laws and EU standards and the company will implement their corporate environmental policy and management system. The new facility will be constructed on what is currently unused land within an industrial setting and close to an existing combined heat and power plant. The environmental due diligence has identified limited historic soil contamination. Nevertheless, whilst identified as an issue, the levels are not unique and manageable. This issue will be monitored by Toyota Motor Corporation and the EBRD. In summary, the environmental due diligence confirms that the project is not associated with significant environmental issues and is structured in line with EBRD environmental policies. Summary of Environmental Action Plan Toyota Motor Corporation will adhere to Russian environmental, health and safety regulations and design the project in line with applicable EU environmental standards. An Environmental Action Plan is being developed jointly with the Bank. Disclosure of information and consultation In accordance with Russian law, the project is subject to formal public disclosure and public consultation prior to obtaining a construction permit. The Company has held discussions with local authorities and public consultations are planned. The Company is committed to working in a close relationship with the local community and will implement their global environmental policy. In the context of EBRD’s potential participation in the project, the Company has released locally this summary of the relevant environmental issues associated with the project and the mitigation measures. Monitoring and reporting The Company will monitor the environmental impact of its operations in accordance with the law and regulations of Russia. The Bank will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of its investment in the project by reviewing annual environmental reports covering ongoing performance of project-specific environmental, health and safety, and the status of implementation of environmental mitigation and improvement measures. The Bank’s representatives will also conduct periodic site supervision visits when deemed appropriate. None.