Integrated Safeguards Data Sheet (Initial) Section I - Basic Information Date Prepared/Updated: 06/16/2003 A. Basic Project Data (from PDS) I.A.1. Project Statistics Country: EGYPT, ARAB REPUBLIC OF Project ID: P082914 Project: EG-AIRPORT DEVELOPMENT Task Team Leader: Michel A. Loir Authorized to Appraise Date: November 10, 2003 IBRD Amount ($m): 173.00 Bank Approval: March 16, 2004 IDA Amount ($m): Managing Unit: MNSIF Lending Instrument: Specific Investment Loan (SIL) Status: Lending Sector: Aviation (100%) Theme: Corporate governance (P); Infrastructure services for private sector development (P); Regulation and competition policy (P) I.A.2. Project Objectives (From PDS): The key development objectives of the Airport Development Project (ADP) are to foster more rapid economic growth, capitalize on Cairo International Airport s (CA) potential as a regional hub for passengers and freight, and augment Egypt s foreign exchange earning capacity. These objectives, which are well-aligned with other on-going Bank operations, including the proposed Economic Reform Project and the Agricultural Export Development Project, would be achieved by: eliminating existing capacity constraints at CA, which would permit increased traffic flows, contribute to better airport services, lower transaction costs, and more competitive operations, and promote tourism and encourage agricultural exports, both of which are intensive airport users; and addressing airport sector governance issues, including separation of policy, regulatory and operational functions, and promotion of policies to strengthen the investment climate, attract private investment, and encourage competition by limiting the influence of EgyptAir on airport management decisions; also, testing of a simple, albeit significant, formula for a private operator to manage CA, and which could serve as a strong demonstration effect to be applied to broader private sector involvement for planned improvements at other international airports, including at Aswan, Hurghada, Luxor, Abu Simbel and Sharm El Sheikh. I.A.3. Project Description (From PDS): While the scope of the proposed ADP has not yet been finalized, construction of TB3 and a new cargo village, or CV2, (the existing cargo village is used by EgyptAir; other areas are occupied by foreign airlines that will move to CV2 when built) would be core components. Other investments contemplated by the GoE, but which won't form part of the ADP, include a shopping mall and hotels at CA, and the inclusion of other airport developments at Sharm El Sheikh, Hurghada, Luxor, Aswan or Abu Simbel. The development of these airports under separate concession arrangements would appear to be a better proposition. Project components, as defined hereafter, correspond to a preliminary project concept that would limit physical investments to CA. Policy formulation to support private sector participation in airport infrastructure and services, and related institutional building initiatives would start with the establishment of an independent regulatory organization. The proposed ADP would consist of:
2 (a) civil works (construction of TB3 and CV2); (b) equipment (for TB3, as well as transfer and storage equipment for CV2); and (c) technical assistance (to prepare an integrated national airport master plan, develop an appropriate regulatory framework and establish an independent regulatory authority, assess strategic options for private management of and investments in airports, streamline airport cross-subsidization, assist in tendering of new airport concessions, and supervise works). The overall cost of the TB3 Project (civil works and equipment) is estimated to be between US$300 million and US$400 million. When completed, TB3 would have a total capacity of 11.0 million passengers (5.0 million domestic and 6.0 million international passengers), compared to the current 9.5 million, and would later be integrated with Terminal 2, which is presently used primarily by foreign airlines. Terminal 1, which has EgyptAir as its main user, would continue to receive domestic and regional flights. The TB3 would consist of: one new terminal building; one concourse; two fingers; three skyways - two connecting the concourse with each finger, and one connecting Terminal 2 with TB3; and electromechanical equipment. To better accommodate an aggressive construction schedule, two packages of works are planned for TB3. The first would be an enabling package, which would proceed in advance of the main contract and involve a local contractor to prepare the site by putting up fences, moving utility networks providing temporary access roads and parking facilities, and preparing a laydown area for equipment and supplies. The enabling package is estimated to have a duration of between eight and nine months, is projected to cost between US$20 million and US$30 million, would be tendered locally, and financed by the National Investment Bank of Egypt. The second package or main contract for works and equipment and would be completed in 30 to 32 months. The main contract would be co-financed by the GoE and the Bank. It is estimated that the composition of project expenses will be 70 percent in foreign currency and 30 percent in local currency. Bank financing would only apply to civil works, the preferred option being to let the TB3 operator share risks by financing some of the equipment, which is estimated to be 25 percent of total costs. While existing runway capacity has been deemed sufficient to handle additional traffic generated as a result of TB3, design work for a third runway at CA is currently being undertaken by Aeroports de Paris. The runway will be four kilometers in length, 65 meters wide, and will accommodate the future generation of aircraft that will carry between 600 and 800 passengers. The estimated cost to build the new runway, which would not be part of the proposed project, is US$50 million. CV2 would provide a 14,000 m 2 covered storage facility during Phase 1, and an additional 8,000 m 2 is planned during Phase 2, or by 2010. When completed, it would accommodate up to 135,000 tons per year. A study, currently being updated, estimates the cost of Phase 1 to be some US$25 million, of which 35 percent would be for cooling equipment and refrigeration storage. If CV2 is a necessary complement to TB3, its construction would best be delegated to private investors, such as to individual or a consortium of airlines and freight forwarders, to the TB3 operator, or to a combination of both. It is not
3 planned to use Bank financing to develop the CV2 component. The selection of a private firm to operate TB3, or CA as a whole, and to (possibly) finance part of the investment will be key to project success. The selection should be made upstream, and indeed the Government's objective is to hire an investment bank by mid-2003 and to finalize the scope of the investment and prepare appropriate tender documents with a view to awarding a contract in early 2004. Slippages are possible, and project conditionalities would be designed to minimize risks of failure to select a private firm. Making launch of the tendering process a Condition of Appraisal and contract signing a Condition of Effectiveness might be envisaged. PROJECT COMPONENTS Civil Works (US$ TBD) Equipment (US$ TBD) Technical Assistance and Studies (US$ TBD) I.A.4. Project Location: (Geographic location, information about the key environmental and social characteristics of the area and population likely to be affected, and proximity to any protected areas, or sites or critical natural habitats, or any other culturally or socially sensitive areas.) The proposed project is located in Cairo, Egypt, a city of around twelve million inhabitants. Cairo International Airport is Egypt's main international gateway and receives more than half of all passenger traffic. The project is not expected to have any adverse environmental or social impacts. The land on which the project will be developed is fenced, in the public domain, and other than airport activities, is otherwise unoccupied. B. Check Environmental Classification: A (Full Assessment) Comments: The project will require a full environmental assessment (EA). The Client has finalized the TORs for the EA, and launched the process of selecting a qualified consulting firm to undertake the work. C. Safeguard Policies Triggered (from PDS) (click on for a detailed desciption or click on the policy number for a brief description) Policy Triggered Environmental Assessment (OP 4.01, BP 4.01, GP 4.01) Yes No TBD Natural Habitats (OP 4.04, BP 4.04, GP 4.04) Yes No TBD Forestry (OP 4.36, GP 4.36) Yes No TBD Pest Management (OP 4.09) Yes No TBD Cultural Property (OPN 11.03) Yes No TBD Indigenous Peoples (OD 4.20) Yes No TBD Involuntary Resettlement (OP/BP 4.12) Yes No TBD Safety of Dams (OP 4.37, BP 4.37) Yes No TBD Projects in International Waters (OP 7.50, BP 7.50, GP 7.50) Yes No TBD Projects in Disputed Areas (OP 7.60, BP 7.60, GP 7.60)* Yes No TBD Section II - Key Safeguard Issues and Their Management D. Summary of Key Safeguard Issues. Please fill in all relevant questions. If information is not available,
4 describe steps to be taken to obtain necessary data. II.D.1a. Describe any safeguard issues and impacts associated with the proposed project. Identify and describe any potential large scale, significant and/or irreversible impacts. An environmental impact assessment (EIA) will be conducted in accordance with OP/BP 4.01, and will address the project's potential impacts, including to noise, air and water quality, cultural and biological resources, management of solid and hazardous waste, vehicular access to the airport, and social impacts. In addition, a land acquisition assessment will form part of the EIA to help determine whether OP/BP 4.12 will be triggered. While the proposed ADP would not include financing to build additional runway capacity, a third runway will be constructed at some point in the future, and an assessment of its potential impacts will form a part of the final EIA. II.D.1b. Describe any potential cumulative impacts due to application of more than one safeguard policy or due to multiple project component. The project is not anticipated to have any cumulative impacts, nor to trigger more than one safeguard. Since the land in question is owned by the Government, resettlement and land acquisition is not expected. However, as described above, aland acquisition will be undertaken as part of the EIA. II.D.1c Describe any potential long term impacts due to anticipated future activities in the project area. Noise would likely have the biggest long-term inpact. Other potential impacts, such as waste management and treatment of any hazardous materials, could more easily be mitigated. The development of a third terminal would create jobs, and provide a boost to prvate sector development. II.D.2. In light of 1, describe the proposed treatment of alternatives (if required) TBD II.D.3. Describe arrangement for the borrower to address safeguard issues Social and environmental specialists are members of the team preparing the ADP. They will supervise the preparation studies that will carried out by local consultants. They will also participate in the pre-appraisal mission, advise on formulation of Bank documents and the kind of measures to be taken to ensure compliance with Bank safeguard policies, and provide assistance during project negotiations. As part of the EIA, an environmental management plan will be developed. In case issues of resettlement become necessary, appropriate measures, including a Resetlement Action Plan and resettlement policy framework, would be undertaken. II.D.4. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. The EIA will also include social assessments, which will be conducted to identify key stakeholders, determine the extent of any potential impacts, and verify land ownership. E. Safeguards Classification (select in SAP). Category is determined by the highest impact in any policy. Or on basis of cumulative impacts from multiple safeguards. Whenever an individual safeguard policy is triggered the provisions of that policy apply. [X] S1. Significant, cumulative and/or irreversible impacts; or significant technical and institutional risks in management of one or more safeguard areas [ ] S2. One or more safeguard policies are triggered, but effects are limited in their impact and are technically and institutionally manageable
5 [ ] S3. No safeguard issues [ ] SF. Financial intermediary projects, social development funds, community driven development or similar projects which require a safeguard framework or programmatic approach to address safeguard issues. F. Disclosure Requirements Environmental Assessment/Analysis/Management Plan: Expected Actual 9/30/2003 9/30/2003 10/15/2003 Date of distributing the Exec. Summary of the EA to the Executive Directors (For category A projects) 10/31/2003 Resettlement Action Plan/Framework: Expected Actual Indigenous Peoples Development Plan/Framework: Expected Actual Pest Management Plan: Expected Actual Dam Safety Management Plan: Expected Actual If in-country disclosure of any of the above documents is not expected, please explain why. Signed and submitted by Name Date Task Team Leader: Michel A. Loir June 10, 2003 Project Safeguards Specialists 1: Sherif Kamel F. Arif/Person/World Bank June 16, 2003 Project Safeguards Specialists 2: John Keith Rennie-MNS/Person/World Bank June 13, 2003 Project Safeguards Specialists 3: Approved by: Name Date Regional Safeguards Coordinator: Sherif Kamel F. Arif June 16, 2003 Sector Manager/Director Emmanuel Forestier June 16, 2003