KYRGYZ REPUBLIC

(E2897)

KYRGYZ REPUBLIC

FINANCIAL SECTOR DEVELOPMENT PROJECT

ENVIRONMENTAL MANAGEMENT FRAMEWORK

Bishkek, November 2011

List of Abbreviations

APAP Agricultural Productivity Assistance Project

CFCChlorofluorocarbons

CLMUCredit Line Management Unit

EAEnvironmental Assessment

EEEnvironmental Expertise

EIAEnvironmental Impact Assessment

EMFEnvironmental Management Framework

EMPEnvironmental Management Plan

FSDPFinancial Sector Development Project

GOKGovernment of the Kyrgyz Republic

GMOGenetically Modified Organism

IDAInternational Development Association

IPMIntegrated Pest Management

ISDSIntegrated Safeguards Data Sheet

MoFMinistry of Finance

PCBPolychlorinated biphenyls

PFIParticipating Financial Institution

SAEPFState Agency on Environmental Protection and Forestry

SMESmall and Medium Size Enterprise

TATechnical Assistance

TORTerms of Reference

List of Abbreviations

Contents

Part I – Background and Applicable Policies

1. Introduction

2. Purpose

3. World Bank Safeguard Policies

4. Project Description

5. Environmental Category and Impacts

6. Guidance for Training

Part II – Procedures for Sub-Projects under the Credit Line

1. Probable Sub-Project Activities

2. Vulnerability and Risk

3. Environmental Screening Categories

4. Environmental Screening Process

5. Environmental Assessment

6. Steps in the Environmental Review Process

Part III – Kyrgyz Context

1. The system of environmental state management in the Kyrgyz Republic.

Part IV – Management of CFCs, PCBs and Asbestos

Annexes

Annex AEnvironmental Screening Checklist

Annex BEnvironmental Impacts, Causes, Consequences and Mitigation Measures for Agribusinesses

Annex CEnvironmental Impacts, Causes, Consequences and Mitigation Measures for Agriculture

Annex DContent of an Environmental Assessment

Annex EContent of an Environmental Management Plan (including Monitoring Plan)

Annex FField Site Visit Checklist

Annex GFinal Environmental Assessment Checklist

Annex HChecklist for the reconstruction and construction

Annex ILegislation of the Kyrgyz Republic of the environmental protection

Annex JReference Documents for World Bank Operational Policies (OP) and Procedures (BP) Relevant to Environmental Assessment and World Bank Safeguard Policies

Annex KStakeholder Consultation

Part I – Background and Applicable Policies

1. Introduction

The Government of the Kyrgyz Republic is preparing an Financial Sector Development Project (FSDP) for funding by the International Development Agency (IDA or World Bank). The Project will focus on enhancing financial sector stability through a strengthened legal, supervisory, and regulatory framework for the financial sector; and (b) increasing access to financial services by underserved segments of the market.

.

These Guidelines relate to sub-projects to be financed under a credit line to be provided Aiyl Bank, linked to technical assistance to support deposit mobilization and privatization. These Guidelines have been adapted from the Environmental Management Plan prepared for the Kyrgyz Republic Agricultural Productivity Assistance Project (APAP), since the APAP project and FSDP will support similar sub-projects, and since Aiyl Bank serves as a participating financial institution for on-lending under both projects

2. Purpose

The purpose of these Guidelines is to provide Aiyl Bank and other Project implementing partners] with a set of guidelines and procedures that will assist in determining the potential environmental impacts of relevant activities to be financed under the FSDP, to identify mitigation measures to be built into the activities to minimize negative impacts and maximize positive ones, and to determine monitoring requirements to ensure that agreed mitigation measures are carried out and are effective in minimizing environmental impacts. The main Project implementing partners are the Aiyl Bank and the Credit Line Management Unit (CLMU) under the Ministry of Finance..

3. World Bank Safeguard Policies

The principal documents that guide and describe the World Bank’s environmental assessment (EA) policies are its Operational Policy (OP) and Bank Procedure (BP) 4.01 on EA. EA is one of ten Safeguard Policies that projects must comply with to remain eligible for Bank financing. These key policies are intended to ensure that potentially adverse environmental and social consequences of Bank financed projects are identified, minimized and mitigated. The policies are listed with web links in Annex J. The Project triggers OP 4.01 (EA), and is a World Bank environmental category FI (Financial Intermediary) project, presenting potential moderate environmental risks that cannot be identified prior to implementation, but that can be adequately mitigated and monitored during implementation.

4. Project Description

The relevant sub-component (2) (iii) of the proposed project is expected to provide financing for a credit line to Aiyl Bank, which lends for the rural sector. The credit line would support increased productivity in the agricultural sector, by improving access to finance for investments in farm inputs, agricultural machinery, agribusinesses, and marketing infrastructure. The project has two components as described below.

(1)Enhance financial sector stability by: (i) strengthening the supervisory and regulatory framework (improving onsite and offsite supervision, improving bank regulations, adopting risk-based and macroprudential supervision, enhancing stress tests, building capacity); and (ii) strengthening the IT infrastructure (supporting an improved off-site database, early warning system, stress tests, dynamic modeling, macro-prudential supervision model, etc.).

(2)Increase access to financial services by: (i) supporting institutional reform of the Kyrgyz Post Office (KPO), including the expansion of its existing payment and remittance services, and the addition of deposit services; (ii) supporting legal, regulatory, and institutional reform to modernize the system for moveable collateral registration and execution; (iii) providing a credit line to Aiyl Bank, linked to technical assistance to support deposit mobilization and privatization; and (iv) support to the credit union sector.

Under sub-component (2) (iii), providing a credit line to Aiyl Bank (US$ 4 million):

The Credit Line will enable Aiyl Bank to continue lending to the rural sector during the transfer to deposit mobilization and privatization. The Credit Line will increase farmers’ access to financing in order to promote increased productivity in the rural sector. The Credit Line will consist of two products:

i. Working capital loans, providing access to much needed short-term financing for spring and winter planting (agricultural inputs, such as seeds, fertilizers and fuel) and harvesting activities for small farmers and farmer cooperatives.

ii. Investment loans and leases, to enable farmers and farmer cooperatives to purchase farm machinery, invest in warehouses and other productive assets in the heavily under-invested farming sector. Long-term investment loans and leases will be provided under the sub-component.

Aiyl Bank’s mission is to increase the efficiency and profitability of the rural sector in the Kyrgyz Republic and improve living conditions of the village population by providing financial services. The bank’s objectives are to: (i) provide high quality financial services to agricultural and rural sectors in an efficient and cost-effective manner; (ii) support the development and raise efficiency of production and incomes of the private agricultural and rural sectors of the country; (iii) meet the client target groups’ demand for credit resources; (iv) provide high quality management of the credit portfolio ensuring appropriate pricing, minimization of lending risks, diversification of the portfolio, and sustainability of the lending operations through timely repayment of the loans by the borrowers. Aiyl Bank devotes 70 percent of its lending to agriculture (including agribusiness) and 30 percent to non-agricultural businesses. The credit line under FSDP will be used to finance projects that fall within the agricultural portion of Aiyl Bank’s lending policy, subject to the negative list cited in Section XX of this EMF. The average working capital loan size is expected to be around US$5,000, while the average investment loans is expected to be in the range of US$25,000 equivalent, with a maximum of US$50,000 per loan under this Credit Line. The Credit Line beneficiaries will receive sub-loans/leases in accordance with agreed eligibility criteria. The financial and commercial viability of the sub-projects and beneficiaries under this facility will be assessed by Aiyl Bank. It is estimated that around [500] farmers will have access to sub-loans under this program.

Implementation Arrangements

The Credit Line Management Unit (CLMU) under the Ministry of Finance will implement Sub-component (2) (iii) (the Credit Line and undertake the Safeguards functions for the project. Aiyl Bank will serve as the financial intermediary and implement the Credit Line. CLMU will recruit a local environmental specialist to support implementation of the project in keeping with this EMF.

5. Environmental Category

The project is assigned World Bank environmental category FI, as the exact sub-projects to be funded under the credit line are not identified prior to implementation. However, only sub-projects that present moderate environmental risks that can be readily mitigated during implementation would be eligible for funding. The planned new Credit Line for farmers and agribusinesses is intended to support productivity increase in agriculture. These activities may generate some positive and adverse environmental and social impacts. The identified positive impacts of the project include: (a) increased food security and household income for the smallholder farmers, due to higher agricultural productivity; (b) improved nutritional status of the farmers due to increased agricultural production; (c) improved soil fertility due to fodder crop sowing (enrichment by nitrogen), use of phosphorus-potassium fertilizers; d) increased savings mobilization and increased productivity on farms; and (e) increased opportunity for engagement in other income generating activities or small scale businesses by smallholder farmers due to increased food security for the households. The potential negative environmental impacts that may result from implementation of the project include: (a) increased pollution of ground and surface waters due to soil erosion and use of fertilizers and pesticides; (b) threats to human health and wildlife due to improper handling of treated seeds, fertilizers and pesticides; (c) increased siltation of water bodies due to soil erosion; (d) introduction of genetic monoculture through seed purchased with credit line financing; and (e) construction waste. These potential negative impacts will be mitigated through the environmental screening and sub-project environmental management plans (EMPs) under this EMF. The project will not finance acquisition of land, genetically modified organisms (GMOs), pesticides, or World Bank Category A sub-projects under the Credit Line.

6. Training

The CLMU environmental specialist will not only provide environmental guidance, support and review for sub-projects under the Credit Line, but will also serve as a resource for the design and delivery of the environmental training services for Aiyl Bank loan officers. . The training for Aiyl Bank loan officers will ensure their ability to apply the environmental screening procedures required under this EMF. Annexes A-H provide materials that form the basis for the training for Aiyl Bank loan officers under the project. Training may be combined with training provided under the APAP project.

Part II – Procedures for Sub-Projects under the Credit Line

1. Probable Sub-project Activities

It is not possible to anticipate all of the activities for which project financing may be requested. Sub-projects are expected to primarily include the renovation, rehabilitation and expansion of existing agro-processing businesses as well as agricultural production inputs and improvements, transportation, warehousing and marketing. Credits will be available for both sub-projects and working capital.

Relevant activities not supported by the World Bank include (sub-project type in brackets): tobacco growing/or processing (agriculture); development, production or purchase of genetically modified organisms (GMOs) (agriculture); any activity related to illegal pesticides (agriculture); use of chlorofluorocarbons (CFCs) (agro-processing requiring refrigeration); use of natural products listed under CITES Appendix 1 (tanning industry).

2. Vulnerability and Risks

The impacts of sub-projects to be financed under the FSDP credit line to Aiyl Bank are expected to be easily mitigated through good practices and project design. While cumulative impacts are not likely to be an issue, attention will have to be given to agro-processing activities within the same watershed and within the same region due to their characteristic common impacts resulting from solid waste, effluent discharges and air emissions. This will be monitored by the CLMU environment specialist.

3. Environmental Screening Categories

The proposed sub-projects are classified into one of three categories based on the type, location, sensitivity and scale of the subproject and the magnitude of potential environmental impacts. The three categories are: Category A - High Potential; Category B - Intermediate Potential, and; Category C - Low Potential. A list of potential sub-projects classified by category (for A and B) and is provided in the table below. Category A sub-projects are not eligible for World Bank financing.

Category A

Category B

· dams and reservoirs

· forestry production projects

· industrial plants (large scale) and industrial estates

· irrigation, drainage and flood control (large scale)

· aquaculture

· land clearance and leveling

· reclamation and new land development

· resettlement

· river basin development

· manufacture, transportation and use of pesticides or other hazardous and/or toxic materials

· new construction or major upgrades of highways or rural roads

· agro-industries (small scale)

· electrical transmission

· irrigation and drainage (small scale)

· renewable energy

· rural electrification

· tourism facilities

· rural water supply and sanitation

· watershed projects (management or rehabilitation)

· protected areas and biodiversity conservation

· rehabilitation of highways or rural roads

· rehabilitation or modification of existing industrial facilities (small scale)

· energy efficiency and energy conservation

4. Environmental Screening Process

Screening. The first stage of the environmental review process is the screening of sub-project proposals and concepts for potential impacts and the determination of the level of environmental assessment that will be required. Annex B Part 1 provides an environmental screening checklist to be completed by sub-project proponents with assistance from Aiyl Bank. This will be reviewed by the FSDP CLMU environmental specialist, and a preliminary assignment of the environmental risk category will be made.

Based on the Environmental Screening Checklist, the recommendations of the Aiyl Bank loan officer and, if necessary, a field site visit, the CLMUin consultation with the SAEPF State Environmental Inspector will determine the sub-project category and extent of environmental assessment that will be required.

Consultation. In the case of Category B sub-projects, during the environmental assessment process the proponent provides a forum or hearing for consultation and comment by project-affected groups and local non-governmental organizations, and takes their views into account before finalizing project design and submission of the project to Aiyl Bank and subsequently, the FSDP CLMU for final approval. The sub-project proponent provides any relevant materials (process descriptions, maps, building plans, etc.) to participants in a timely manner and in a form and language that are understandable to the group being consulted. The CLMU environmental specialist or the Aiyl Bank loan officer describes and records consultations held on the project screening form (Annex B Part 3).

Public Disclosure. For Category B sub-projects for which an environmental assessment is prepared, the draft assessment report is made available at a public place accessible to project-affected groups. This would usually be the raion or oblast level office of SAEPF. Aiyl Bank and the CLMU would also retain a copy of the report for its records and possible review by World Bank supervision missions.

5. Environmental Assessment

An environmental assessment is conducted to identify, predict and evaluate potential impacts and to plan for mitigation measures that may be incorporated in sub-project design to minimize negative impacts. The purpose is to anticipate potential consequences and to improve the environmental aspects of sub-projects by minimizing, mitigating or compensating for negative effects.

Annex A provides a set of matrices for agricultural activities and agro-processing businesses (and other non-agricultural activities) which indicate impacts to be expected, causes, consequences and mitigation required.

For sub-projects that require an environmental impact assessment (Category B) the scope and contents of an environmental assessment are described in Annex B.

The project proponent is responsible for preparing the environmental assessment. The costs of the environmental assessment may be included in the credit amount.

6. Steps in the Environmental Review Process

This section outlines the sequence of steps to be carried out for environmental review of sub-projects and the responsibilities of the various actors and authorities. These steps are shown in the schematic, Figure 1.

Step 1: The proponent prepares an initial sub-project concept for discussion with Aiyl Bank. If the project receives preliminary endorsement by Aiyl Bank, the proponent completes Part 1 of the Environmental Screening Checklist (Annex A). At this time the proponent initiates discussions with the respective local environmental authorities (SAEPF) to determine requirements for environmental review. The proponent is also responsible for obtaining appropriate permits and approvals that may be required by other local authorities.

Step 2: Aiyl Bank, after consulting with PIU, assigns a preliminary environmental category. Aiyl Bank in consultation with the PIU completes Part 2 of the Environmental Screening Checklist (Annex A).

Step 3. Aiyl Bank carries out a field site visit and completes the Field Site Visit Checklist (Annex F). The Environmental Screening and Field Site Visit Checklists are submitted to SAEPF (raion level) which issues a preliminary environmental statement listing potential environmental concerns and mitigation measures and whether an environmental assessment is required. Aiyl Bank further reviews the checklists and assigns a final category to the sub-project. For Category B sub-projects, the Aiyl Bank (with assistance from the PIU) provides framework terms of reference for preparation of an environmental assessment. For some Category B projects, an environmental management plan may be required. The proponent, in consultation with Aiyl Bank (and possibly in consultation with the CLMU and SAEPF) arranges for preparation of the EA and management plan. Annex D provides the content of an environmental assessment, and Annex E provides the management plan content.

Step 4: For Category B sub-projects, the proponent organizes a public consultation session with community representatives and affected groups. Formal minutes record the participants, issues raised and steps taken or recommended to address them. The scope of the EA is discussed.

Step 5: The SAEPF (oblast level) reviews ( carries out ecological expertise (EE) on) the environmental assessment and management plan. The PIU reviews the assessment report, the environmental management plan and the documentation of necessary permits and clearances and completes the Final Environmental Assessment Checklist (Annex G). These documents are then included in the package that goes forward to Aiyl Bank and the PIU for a decision on approval of project financing. The SAEPF (oblast level) issues a final environmental statement (EE). If supported by SAEPF, SAEPF then issues an Environmental Passport which includes discharge permits for solid and liquid wastes and aerosol emissions.

Step 6: The proponent incorporates the recommendations provided in the environmental assessment, as well as those received during the review and clearance process by SAEPF and other local authorities, into the sub-project design and implementation plan.

Step 7: Aiyl Bank and the local (raion) SAEPF representative monitor implementation of agreed design and mitigation measures.

Step 8: When implementation is complete, SAEPF and other agencies, as appropriate, monitor emissions and discharge during operations.

Step 9: The status of compliance with agreed environmental mitigation measures is reported by Aiyl Bank officers (in collaboration with SAEPF for monitoring results) in their regular (quarterly) reporting on project implementation. In the case of non-compliance, the Aiyl Bank officers (with SAEPF and PIU assistance) investigate the nature and reason(s) for noncompliance, and a decision is taken about what is needed to bring a sub-project into compliance, or whether financing should be suspended.

Step 10: The PIU makes available information on Aiyl Bank monitoring of environmental management plans and mitigation measures in its routine reporting on sub-project implementation to the World Bank and during periodic Bank supervision missions.

Part III

1. Government control system of environment in the Kyrgyz Republic

Relations in the field of the environment protection and rational use of natural resources are regulated by the Constitution of the Kyrgyz Republic, the Law of the Kyrgyz Republic “ On the environment protection” (as of May 13,1999) other laws, and legal normative acts of the Kyrgyz Republic accepted according to them.

According to Constitution of the KR, the Law of the KR “On the environment protection”:

Each citizen has the right on favorable for life and health environment and indemnification caused to health or property by adverse impact on environment as a result of economic or other activity implementation.

1) Principles of the environment protection.

The main principles of the environment protection are:

1) The principle of priority: to ensure the respect for human rights, favorable for life, work and rest the environment providing life and health of the people;

2) The equilibrium principle: preservation of ecological systems stability, avoiding the environment and people’s health irreversible consequences;

3) The complexity principle: the harmonious scientifically proved combination of ecological, economic and social interests of the society, integrated approach of the resource-saving issues and the environment protection;

4) The restraint principle: rationing, obligatory ecological assessment, validity and restriction of economic activities and other influences on environment;

5) the principle of liability: strict compliance with the legislation on environmental protection, the inevitability of punishment for its infringements, damage compensation caused to the environment by enterprises, institutions, organizations, households and citizens;

6) The openness principle: publicity in the decision of nature protection problems at the economic and other activity having ecological consequences, a close connection with public organizations and the population, encouragement and stimulation of the measures directed on protection and rational use of natural resources, a combination of national, regional and international interests in the field of environment protection.

The followings should be protected from pollution, deterioration, exhaustion, destruction, extermination and other negative impacts:

- the land and its subsoil;

- soil cover;

- water;

- forests;

- flora, fauna and their genetic fund;

- ambient air;

- other natural objects, systems and ecological systems;

- as well as climate and ozone layer.

The natural complexes and nature objects having particular ecological, environmental, scientific, historical, cultural, aesthetic, recreation value, rare or endangered species of plants, animals and their habitats shall be subject to special protection. In this regards, specially protected natural areas: state reserve, biosphere reserves, state natural reserves, national parks, natural monuments, resorts and recreational areas, botanic gardens, dendrological and zoological parks are created in the KR.

In order to protect rare or endangered plant and animal species the Red Book is established in the Kyrgyz Republic. The government of the Kyrgyz Republic determined the list of rare or endangered plant and animal species which are subjected to list in the Red Book, and the order of their protection.

2) Environmental protection measures

In the Kyrgyz Republic the following measures are implemented in order to protect the environment:

1) state records and socio-economic evaluation of natural resources;

2) environmental quality control (maximum permissible concentrations of harmful substances in air, water, soil, subsoil and other natural objects);

3) complex regulation of economic and ecological relationships;

4) establishment the environmental requirements to economic or other activities related to the impact on nature;

5) establishment the charges standards for natural resources use, dumping, pollutants emissions, physical and other harmful effects of waste disposal in the environment;

6) state support by nature waste-free and low-waste technologies implementation;

7) ecological entrepreneurship introduction;

8) environmental impact assessment at economic and other activities implementation in order to prevent possible adverse effects of these activities on the environment;

9) special protection of nature reserves, wildlife preserve, national parks, rare species of animals, plants and other facilities;

10) nature protection funds establishment;

11) the guilty compensates the damages caused to environment, and conducts environment restoration activities;

12) establishment of environmental violations and responsibility measures for these acts;

13) making the guilty answerable for environment damage;

14) preservation and reproduction of forests;

15) natural waters restoration;

16) prevention the atmosphere pollution;

17) use wind and solar energy, as well as other non-conventional energy sources;

18) integration of environmental aspects during the construction of hydroelectric stations (the human pressure on fragile mountain ecosystems, and rising water tables, provoking landslides and earthquakes, etc.).

Other environment protection measures can be established by the legislation of the Kyrgyz Republic, decisions of local state administrations and local self-government.

3) Nature management

Nature management in the Kyrgyz Republic is carried out in the form of general and special nature management.

The general nature management does not require any special permission, is carried out by citizens owing to the natural rights arising and existing as result of its birth and existence (atmospheric air using, water for drinking, medical-improving needs etc.).

The special nature management of used objects divided into land, subsoil, forests, water management, use of flora and fauna, use of atmospheric air.

The special nature management is carried out within the established limits.

Limitation is subdivided into:

· Maximum permissible standards of natural resources withdrawal from the environment;

· Maximum permissible levels of emissions, harmful substances discharge into the environment, waste disposal.

The special nature management is carried out on a fee basis.

Natural resources payments are royalty on a natural resource, payment for environmental pollution and other negative impacts on nature.

The royalty on a natural resource is fixed within established limits, for the above-limit use and entered into the state budget, is used for protective activities and environmental sanitation. The Law of the KR “On payment rates for natural objects of fauna and flora use in the Kyrgyz Republic” dated August 11, 2008.

Norms and procedure of payments collecting for the natural resources use in the Kyrgyz Republic, approved by Resolution of the Government of the Kyrgyz Republic dated July 7, 1995, # 269.

Payments for environmental pollution such as emissions, discharges of pollutants, disposal of waste and other types of pollution and negative impacts on nature.

Law of the Kyrgyz Republic “On payment rate for environmental pollution (emissions, discharges of pollutants, waste disposal) dated March 10, 2002.

Government Resolution “On approval of Instructions and guidance on the rate definition for environmental pollution in the Kyrgyz Republic” dated November 10, 2004 of the KR, # 823.

Rates and payments for environmental management standards developed by the Government of the Kyrgyz Republic and approved by the Parliament (Jogorku Kenesh) of the Kyrgyz Republic.

Emissions, discharges of hazardous substances - exit to the external environment (in air, water bodies, land) pollution from any source.

Fees for natural resources does not relieve the polluter to comply with measures to protect the environment, damages compensation caused by them due to violations of environmental laws, the prosecution of the offense.

4) Environmental requirements to economic and other activities

1) The design, location, construction, reconstruction, technical upgrading and commissioning of facilities and activities that have a direct or indirect impact on the environment should be set and activities for nature protection, rational use, reproduction, natural resources, improve the environment in compliance with environmental standards should be implemented and impact assessments of proposed activities on the environment (EIA) should be conducted.

Identification of location, design, construction, household objects operation is made in accordance with active legislation and based on the positive confirmation of state ecological expertise. An approved project is not allowed to be changed at the expense of environmental safety.

Objects that haven’t been provided with cleaning facilities and equipment, decontamination and disposal of hazardous waste, emissions and discharges to the limit level, monitoring requirements of environmental pollution are prohibited to going into operation.

Environmental impact assessment is carried out in order to prevent possible adverse effects on the environment by proposed economic and other activities.

Environmental impact assessment is carried out on commitment to the adoption of its economic decisions, reasonableness, independence, objectivity, legitimacy and transparency of its findings.

It is prohibited to fund and implement projects related to environmental management, without the positive conclusion of state ecological expertise.

Relations connected with the environmental assessment, regulated by law of the Kyrgyz Republic “On ecological expertise”.

2) During economy and other entities activities implementation, they are obliged to comply with the approved technology regimes, to have and ensure reliable and effective operation of treatment facilities, installations and control devices, decontamination and waste disposal, to introduce environmentally sound technologies and industries, to carry put protection and rational use of land, minerals, water, air, forests, flora and fauna, the reproduction of natural resources.

3) Entities engaged in commodity production in the field of animal husbandry and agricultural products processing should have the necessary sanitary protection zones and treatment facilities.

4) Measures on the water balance preservation, efficient use of water, land conservation, forest depletion, rising sea levels, flooding, and prevention of other adverse effects on the environment should be observed during operation of reclamation projects and implementation of reclamation work.

5) Operation of hydroelectric power stations should be carried out in strict conformity with requirements of fish stocks protection, and avoiding of negative environment changes.

6) It is prohibited to use toxic chemicals, which are not exposed to decay, and negatively influence on human health and environmental. Activity of economic or other subjects related to the use of radioactive materials and toxic chemicals carried in the presence of licenses (permits). Permits (licenses) for handling of radioactive materials and toxic chemicals are issued by specially authorized state bodies.

7) Protection of the environment from uncontrolled and harmful biological influence.

Import, including the transit of biological objects and their metabolic products is prohibited without a quarantine certificate. Introduction and acclimatization of unknown biological objects for the Republic are allowed only in scientific research, medical and veterinary purposes after an ecological examination passage. New plant varieties, animal breeds, microorganism strains of local and foreign breeding allowed to industrial production only after passing the examination, development of measures of ecological security and state tests. The use and cultivation of biological objects, not peculiar to the nature of the region, as well as obtained by artificial means, without multiplication and penetration of the artificial genetic material in natural communities is prohibited.

During the production, reproduction, storage, transportation, trade, disposal, destruction of organisms of animal and vegetable origin the measures of environmental safety, avoiding the possibility of negative consequences for the gene pool, as well as human health should be necessarily complied.

8) Protection of the environment from the harmful physical influences.

It is prohibited to exceed standards of maximum allowable levels of production and other background noise, vibration, electromagnetic fields and other harmful physical effects influencing on human health and environment.

Legal and physical persons are obliged to take necessary measures for prevention and elimination of the manufacturing standards excess, and other background noise, vibration, harmful effects of electromagnetic fields and other harmful physical impacts on the environment.

Measures ensuring compliance with limit values developed at the planning and building cities and other settlements, designing the construction, reconstruction of enterprises, shops, production lines, establishment and development of new equipment, renovation, design and use of land, water and air transport, entertainment institutions.

9) Protection of the environment from industrial, household and other wastes.

Discharge of industrial and other wastes in the prescribed manner permitted only in specially designated areas. It is prohibited to dump wastes and sewage into water reservoirs of general use, underground aquifers.

Legal and physical persons are obliged to take effective measures for disposal, recycling, disposal, storage or disposal of industrial and domestic waste, comply with applicable environmental, sanitary and anti-epidemic norms and regulations. Storage and waste disposal are made in the places determined by the decision of local governments in coordination with the state environmental authorities and public health services of the Kyrgyz Republic.

Storage and waste disposal are made in order provided by legislation.

10) Protection of the atmosphere’s climate and ozone layer

Protection of the environment from the environmentally dangerous climate change, ozone layer of the atmosphere provided by:

· Organization of observation, recording and monitoring of climate change, ozone layer under the influence of economic and other activities and other processes;

· Organization of collecting and recording data on the consumption of ozone-depleting substances;

· Establishment of and compliance with standards of maximum permissible emissions of pollutants affected on climate and ozone layer;

· Regulation in the production and in domestic the chemicals depleting the ozone layer;

· Use of responsibility measures for violation of these requirements, including the suspension or prohibition of harmful activities, by decision of public authorities of Environment of the Kyrgyz Republic.

In accordance with international agreements of the Kyrgyz Republic, ministries, departments, enterprises, institutions, organizations must reduce and subsequently completely terminate consumption and use of chemicals harmfully influencing on ozone layer.

List of chemicals and waste products harmfully influencing on ozone layer of the atmosphere approved by republican state environmental authorities of the Kyrgyz Republic. All public authorities, administration, enterprises, institutions, and organizations provided by this list.

The ozone layer is the layer of the atmosphere at an altitude of 7-8 km at the poles, 17-18 miles - at the equator of the planet's surface with a high concentration of ozone molecules that absorbs ultraviolet radiation from space harmfully influencing on living organisms.

5) Monitoring of the environment

The system of state monitoring of the environment is created in order to ensure the observation, recording, assessment, prediction, control and management of the condition and changes in the environment and its resources in the territory of the Kyrgyz Republic.

The structure, content and procedure of the State environment monitoring are established by the Government of the Kyrgyz Republic.

Monitoring of the environment condition, including transboundary pollution, natural resources use, carried out by specially authorized bodies over the country through the observation system of the cities, industrial centers, natural objects and the individual territories, as well as enterprises, organizations and institutions, activities which cause or may lead to environmental degradation.

Specially authorized bodies, as well as enterprises, organizations and institutions are obliged to charge the materials of their observations to the relevant state bodies engaged in environmental monitoring and health.

6) Control of the environment

Control of environment and natural resource management has the following objectives: observation of the condition and environmental change under the influence of economic and other activities, verification of compliance measures for nature protection, rational use of natural resources, environmental health, compliance with environmental laws and environmental quality standards.

Control system for environmental protection includes state, department and public control.

Economic and other entities affecting on the environment at their respective territories and objects exercise control over the environment.

The ministries and administrative departments of the Kyrgyz Republic implement departmental control of the environment state at their convention facilities to verify compliance with measures for nature protection, rational use, reproduction, natural resources, environmental health and compliance with environmental legislation.

State and higher organization monitoring of environment state and natural resource use implemented by the Republican state and territorial environmental authorities of the Kyrgyz Republic. The order of state control exercising over the environmental state.

The order of public control in the field of environment protection and natural resources is regulated by legislation on public associations, statutes and regulations which do not contradict to the present law.

7) Prevention of the environmental emergencies

The measures preventing accidents and eliminating their consequences are designed and implemented at the design, exploitation, conservation and the elimination of economic and other facilities.

In case of accident, disaster, legal and natural persons are obliged immediately proceed to eliminate them and immediately notify the relevant government bodies, specialized services and people.

8) The competence of public authorities at the environment protection

The organization of interdepartmental cooperation, management and regulation in the field of environmental protection are subject to the jurisdiction of the Government of the Kyrgyz Republic.

The Republican state environmental authorities of the Kyrgyz Republic supervises the activities of ministries, administrative departments, enterprises, institutions and organizations in the field of environmental protection.

The competence of the republican state environmental authorities of the Kyrgyz Republic is carrying out the unified state policy and integrated management of environment and natural resources, coordination among ministries, departments, implementation of the state ecological expertise and public control in the field of environmental protection. Decisions of state environmental authorities of the KR are obligatory for all legal and physical persons and may be appealed in court.

Local state administrations and local authorities in the field of environmental protection within the jurisdiction territory involved in the development of environmental programs and implement measures to protect the environment, and act in accordance with the legislation regulating local government bodies and local authorities.

9) Rights and obligations of natural resource users.

The natural resource user has the right to use natural resources for the provided purposes, use the properties of other natural resources without prejudice to the environment, to claim damages caused by both legitimate and illegal actions, to demand restoration of violated rights.

The user should rationally use natural resources for the provided purposes, does not violate the rights and lawful interests of other natural-resource users, and comply with approved requirements and limitations on use, preservation, and rehabilitation of the environment.

10) Liabilities for ecological offenses.

For committing environmental crimes provided disciplinary, administrative, criminal, civil liability in accordance with the laws of the Kyrgyz Republic.

Attraction to disciplinary, administrative or criminal liability does not absolve the perpetrators of the reparation harm to the environment.

Compensation for damage done voluntarily or by court order in accordance with approved in due course fees and methods of damages calculation, but in their absence – at actual cost to the restoration of the environment taking into account incurred losses, including loss of profits.

For example, the decree "On the liability for damage caused by damage to the land" of the Government of the Kyrgyz Republic as of September 7, 2004 # 668.

11) Principles of international cooperation in the field of environmental protection

In order to ensure universal environmental security for present and future generations the Kyrgyz Republic carries out the international environmental cooperation and guided by the following principles:

- Everyone has the right to life under favorable environmental conditions;

- State has the right to use the environment and natural resources for development to ensure the needs of its citizens;

- Environmental well-being of one state can not be achieved at the expense of other states or without regard for their interests;

- The activity of the state shall not damage the environment;

- Compliance with the fundamental principle of mutual benefit;

- Establishment of the intercontrol to the state and change of environment and its resources based on internationally recognized criteria and parameters;

- Mutual assistance between States in environmental emergencies;

- Peaceful settlement of disputes in the field of environmental protection;

- Combination of international organizations activities with the national interests of the Kyrgyz Republic.

If the International treaty, (the Kyrgyz Republic participant of it) establishes other rules than those contained in the legislation of the Kyrgyz Republic on Environmental Protection, the rules of the International treaty are used.

The main normative acts of the Kyrgyz Republic in the field of environmental protection are given in Appendix I.

Part IV – Management of CFCs, PCBs and Asbestos

Chlorofluorocarbons (CFCs)

FSDP does not support any projects involving equipment containing CFCs. Aiyl Bank must ensure that all new purchases of refrigeration equipment is ozone friendly, getting in this regard special written proofs from the subproject beneficiaries.

CFCs are used as the working substances as cooling agent, also in firefighting at hazardous installations (power stations, ships, etc.), perfume and medicine for aerosols creation.

Potential PCBs issues

The oil used in electricity transformers can contain and/or be contaminated with the PCBs (substances interdicted to be used per Stockholm Convention). Aiyl Bank officers in this regard, for all new such activity they have to request a proof there will be no PCB containing/contaminated oils used. In the case of sub-projects involving the replacement of old transformers, these should be handed over to the raion level State Inspection for Energy and Gas (SIEG) as the specialized agency responsible for de-commissioning old transformers. The borrower signs an agreement the SIEG and may include payment for their services in the credit budget.

Polychlorinated Biphenyls (PCBs) are a class of synthetic organic chemicals. Since the 1930s, PCBs were used globally for a variety of industrial uses (mainly as dielectric fluids in capacitors and transformers) because of their chemical stability. In the 1970s it became generally recognized that their chemical stability also represented a serious threat to human health and the environment if they were released. PCBs are considered to be immune-toxic and affect reproduction with specific adverse effects associated with chronic exposure, including damage to the immune system, liver, skin, reproductive system, gastrointestinal tract and thyroid gland. While local impacts close to the source of release of these chemicals into the environment are of concern, the primary impacts are widely distributed and effectively global in nature, given the chemical’s characteristics of bioaccumulating higher in the food chain and being subject to long range, multi media transport mechanisms. Based on these characteristics they are generally classified as persistent organic pollutants (POPs). Through the late 1970s and 1980’s the production and use of PCBs was generally discontinued, with regulatory bans being applied in many countries. However, there were and remain substantial global inventories of the chemical remaining in operating electrical equipment, stockpiles of retired equipment and PCB contaminated waste, and on localized sites where concentrated releases have occurred.

Asbestos.

Asbestos is the collective name of fine-fibered minerals from the silicates class. Asbestos is painted in white, green, yellow or gray. It has high fire resistance, and therefore used in compositions where the combination of flexibility and heat resistance is need (construction, automotive industry, rocket production). Asbestos included in numerous types of products in various areas such as textiles, paper, filters, tarpaulins, protective clothing (fire), paper, asbestos building materials (roofing sheets, pipes).

Asbestos is not commonly used in new construction materials. However, renovations of older buildings frequently involve removal of asbestos-containing materials (e.g., roof sheets, pipe insulation). In these cases, great care must be taken in handling the old materials:

· The risk presented by asbestos is from inhalation of asbestos fibers in dust, which causes lung disease, including cancer. Asbestos bound in materials (e.g., unbroken roofing sheets) is stable and not a risk.

· If asbestos is located on the project site, it should be marked clearly as hazardous material.

· When possible the asbestos will be appropriately contained and sealed to minimize exposure.

· The asbestos prior to removal (if removal is necessary) will be treated with a wetting agent to minimize asbestos dust.

· Asbestos will be handled and disposed by skilled & experienced professionals using proper protective gear (mask, gloves, coveralls).

· Milk is not a prophylactic. In some countries, drinking milk is considered helpful to mitigate the effects of toxic materials. While nutritious, milk has no influence on toxic materials that are inhaled.

· Asbestos containing materials (roofing sheets) should not be broken or cut. This releases dust.

· If asbestos material is to be stored temporarily, the wastes should be securely enclosed inside closed containers and marked as hazardous material. Security measures needs to be taken against unauthorized removal from the site.

· The removed asbestos should not be reused (except for intact roofing sheets, with approval of San-Epi Department).

· Asbestos-containing materials must be disposed in at approved hazardous waste disposal site.

Annex A

Environmental Screening Checklist

(to be completed by Sub-borrower)

1. Project Name:

2. Brief Description of Sub-project to include: nature of the project, project cost, physical size, site area, location, property ownership, existence of on-going operations, plans for expansion or new construction.

3. Will the project have impacts on the environmental parameters listed below during the construction or operational phases? Indicate, with a check, during which phase impacts will occur and whether mitigation measures are required.

Environmental Component

Construction

Phase

Operational

Phase

Mitigation Measures

Terrestrial environment

Soil Erosion: does the project involve crop agriculture? If so, which crops? Is agricultural field is located on the slopes and/or on the plain areas? Will the project involve plowing/plant cultivation on the slopes?

Habitats and Biodiversity Loss: Will the project involve use or modification of natural habitats (pasturing on and plowing up the steppe areas, cutting or removal of trees or other natural vegetation, etc.)

Soil pollution: Will the project applies pesticides? If yes which types and their amount?

Land, habitats & ecosystems degradation: Is the area which is to be used currently a natural (not converted) habitat (forest, wetland, natural grassland, etc.)?

Land degradation: Will the project involve land excavation?

Generation of solid wastes – what type of wastes will be generated (various types of construction wastes, wastes from agro-processing activities, livestock manure) and their approximate amount

Generation of toxic wastes – what types of toxic waste will be generated (obsolete and unusable pesticides and mineral fertilizers; chemicals used in agro-processing activities; asbestos) and their approximate amount.

Biodiversity and Habitats Loss: Will the project located in vicinity of protected areas or other sensitive areas supporting important habitats of natural fauna and flora? Is it planned enlargement of area under agricultural crop production based on transformation of natural habitats?

Underground water pollution - if the project involves production of stall fed livestock does it has a manure platform?

Construction

Air quality

Will the project provide pollutant emissions? Which types of pollutants (SOx, NOx, solid particles, dioxins, furans, etc.)

Aquatic environment

Water Quantity: will the project involve water use? Which volumes and from which water source (centralized water supply system and/or from water reservoir)?

Water Quality/Pollution: Will the project contribute to surface water pollution – what will be the approximate volumes of waste water discharge? Does the project involve discharges of waste waters in water reservoirs and/or in centralized sanitation network/septic tank?

Loss of Biodiversity: Will the project involve introduction of alien species (in case of aquaculture projects)?

Loss of Biodiversity: Will the project located in vicinity of protected area or wetlands?

Degradation of natural aquatic ecosystems – if the project involves discharges in water courses and reservoirs of solid wastes; pesticides; cutting of protective shelterbelts.

Weeds, pests, diseases: will the project contribute to spreading of weeds, pests and animal and plant diseases?

Sedimentation of water bodies – will the project contribute to sedimentation of water bodies due to soil erosion?

Socio-economic environment

Social impacts – does the project involve the following: (a) occupational safety issues; (b) health hazards; (c) land acquisition; (d) loss of the access to sources of income; and (e) disturbance of residents living near the project area.

Does the project per national legislation require public consultation to consider local people’s environmental concerns and inputs?

Will the project assure non-deterioration of human health, occupational safety and non-disturbance of residents living near project area? If no, is it possible by applying proposed mitigation measures to reduce the project environmental and social impacts to admissible levels?

4. For the environmental components indicated above, and using the information provided in the table below describe the mitigation measures that will be included during the construction (C) or operational (O) phase of the project or both (B). Typical mitigation measures could be found in the point 5 and in Annex C and D below.

Environmental Component

Phase

(C, O or B)

Mitigation Measures

5. Examples of Mitigation Measures (for more detailed description of listed below and other potential mitigation measures refer to Annexes C and D).

Environmental Component

Mitigation Measures

Soil Erosion: does the project involve crop agriculture? If so, which crops? Is agricultural field is located on the slopes and/or on the plain areas? Does the project involve ploughing/plant cultivation on the slopes?

1) Plowing across the slope

2) Contour tillage

3) Avoid creation of new terraces since it is linked with loss of topsoil, etc.

4) Appropriate crop rotation: fallow land – wheat – maize – sunflower – Lucerne – Lucerne (2 years long) – legumes (pea, haricot, etc.) / wheat maize, etc.

5) On lands which are subject to erosion preferable cultivation of plants with require dense sawing (e.g. wheat, rye, etc.) and avoid cultivation of tilled crops (e.g., maize, sunflower),

6) Orchards: creation of grass strips between the rows, deep cultivation between the rows,

7) Where possible, to use the branch of field crops with the branch of cattle-breeding and gardening, etc.

Habitats and Biodiversity Loss: Will the project involve use or modification of natural habitats (pasturing on and ploughing up the steppe areas, cutting or removal of trees or other natural vegetation, etc.)

1) Avoiding use of remained natural or semi-natural steppe areas for pasturing and crop production

2) Avoid, where possible, cutting of trees and other natural vegetation, etc.

3) Minimize loss of natural vegetation/ Protection of vegetation during construction activities

Soil pollution: Will the project applies pesticides? If yes which types and their amount?

1) Use of less harmful (non-persistent) pesticides

2) Not to apply more pesticides than needed

3) To ensure appropriate pesticides handling to avoid polluted surface runoff, etc.

Land, habitats & ecosystems degradation: Is the area which is to be used currently a natural (not converted) habitat (forest, wetland, natural grassland, etc.)? Does the project involve production of livestock? If so, what type and how many? Will the animals be stall-fed, pastured or free-ranging?

1) Not to exceed pastures’ capacity (on degraded lands this is 0,3-0,5 conv. cap/ ha; on good lands – 1,5 conv. cap/ per ha) and avoid overgrazing

2) Where possible, use of stabling

3) Where possible, do develop sown pastures

4) Where possible, fencing the grazing areas to use them subsequently, giving to others possibility to restore, etc.

5) Not to graze in natural areas in early spring and late autumn, etc.)

6) Use natural meadows and grasslands rather for mowing than grazing, etc.

Land degradation: Will the project involve land excavation?

1) Removal of topsoil to adjacent agricultural lands

Generation of solid wastes – what type of wastes will be generated (various types of construction wastes, wastes from agro-processing activities, livestock manure) and their approximate amount

1) Separation of wastes, their usage and recycling

2) Disposal on authorized landfills

3) Full utilization of manure as organic fertilizers

Generation of toxic wastes – what types of toxic waste will be generated (obsolete and unusable pesticides and mineral fertilizers; chemicals used in agro processing activities; asbestos) and their approximate amount.

1) Clearly marking toxic wastes on the project site as hazardous material and securely enclose them inside closed containments, as well as label them with details of composition, properties and handling information;

2) Disposal on special toxic wastes disposal sites.

3) Usage of specially licensed carriers for transportation and disposal of toxic wastes

4) Ensure containers with hazardous substances are placed in an leak-proof container to prevent spillage and leaching;

5) Ensure the asbestos is not reused

Biodiversity and Habitats Loss: Will the project located in vicinity of protected areas or other sensitive areas supporting important habitats of natural fauna and flora? Is it planned enlargement of area under agricultural crop production based on transformation of natural habitats?

1) Consideration of alternative locations, where possible

2) Careful timing of works and work seasonally, as appropriate: no construction during breeding season

3) Where possible, to fence the area under construction to lessen even occasional disturbance on habitats and biodiversity

4) Inform personnel about importance of adjacent environmentally important area, if any

5) Where possible, to plant (or maintain) green corridors to ensure movement of terrestrial fauna

Underground water pollution – does the project involve usage of fuel and lubricants? if the project involves production of stall fed livestock does it has a manure platform?

1) Fuel and lubricants: use of specially arranged sites (with concrete floor) for fuel and lubricants handling and storage to avoid their leakages into the soil and runoff into water bodies

2) Pesticides: see above

3) Use of special platforms and tanks with a waterproof bottom for accumulation of manure and preparing of organic fertilizers, etc.

Construction

1) Careful selection of location for and planning of the project

2) To minimize construction site’s size and design work to minimize land affected,

3) Where possible, to execute construction works during dry season to avoid excessive contaminated runoff

4) Properly arranged waste disposals

5) Cleaning of construction site, replacing lost trees, boundary structures, re-vegetation of work area

Air quality

Will the project provide pollutant emissions? Which types of pollutants (SOx, NOx, solid particles, dioxins, furans, etc)

1) Use of approved methods and techniques to prevent and control emissions (e.g. absorption)

2) Where possible, enclosure of dust producing equipment, and use of local exhaust ventilation

3) Arrange barriers for wind protection (if raw material is stored in open piles

4) Where possible, use of fuels with a low sulfur content, such as natural gas or liquefied petroleum gas and use of low-sulfur raw material

5) Where possible, installation of dedicated filtration systems, etc

6) Selection of materials or processes with no or low demand for VOC-containing products

7) Where possible, to install and modify equipment to reduce solvent use in manufacturing process

8) To execute strict primary and secondary control of air emissions, etc.

Water Quantity: will the project involve water use? Which volumes and from which water source (centralized water supply system and/or from water reservoir)?

1) To ensure natural flow of water/ minimum disruption of natural streams flows

2) To install water meters to control and minimize water use

3) Avoid or minimize surface water abstraction in case of downstream the wetland is situated, etc.

Water Quality/Pollution: Will the project contribute to surface water pollution – what will be the approximate volumes of waste water discharge? Does the project involve discharges of waste waters in water reservoirs and/or in centralized sanitation network/septic tank?

1) a. For small rural enterprises: to install local wastewater treatment facilities (e.g., septic tanks)

b. For big enterprises: not to exceed established limits of pollutants in effluents

2) To minimize water and mud collection

3) Renovation of existing sewerage system/ connection to municipal sewerage system

4) Properly arranged waste disposals

5) Where possible, to plant at least bush vegetation down slope to reduce pollutants runoff into surface water bodies

Loss of Biodiversity: Will the project involve introduction of alien species (in case of aquaculture projects)?

1) Where possible, to avoid introduction of alien species

2) In case of use of already introduced alien species to ensure their non-coming into natural ecosystems, e.g., during water discharge from ponds, etc.

Loss of Biodiversity: Will the project located in vicinity of protected area or wetlands?

1) Not to exceed established limits of pollutants in effluents and emissions

2) To avoid or minimize construction and operational activities during breeding and migration periods, etc.

Degradation of water ecosystems

1) Avoid application of pesticides in the strip with width of 300 m along the natural surface water bodies,

2) Avoid cutting of trees and other natural vegetation along the water bodies

3) Avoid coming of alien species into natural water bodies,

4) Properly arranged waste disposals sites, etc.

Weeds, pests, diseases: will the project contribute to spreading of weeds, pests and animal and plant diseases?

1) Avoid cultivation of plant mono-culture on agricultural lands

2) Appropriate pest management

3) Giving the priority to the agro-technical and biological measures for the control of weeds, pests, and diseases,

4) In cattle farms, to adhere carefully established rules to prevent or minimize animal diseases, etc.

Sedimentation of water bodies – will the project contribute to sedimentation of water bodies due to soil erosion?

1) To avoid excessive soil erosion: see above

2) Minimize soil processing

3) Provide retention/ sedimentation ponds, as necessary

4) To control reed harvesting ( to avoid over-harvesting)

Socio-economic environment

Social impacts – does the project involve the following: (a) occupational safety issues; (b) health hazards; (c) land acquisition; (d) loss of the access to sources of income; and (e) disturbance of residents living near the project area.

Appropriate project design: location, methods of construction, use of safe technologies during operation period, work timing, careful decommissioning, etc.

Does the project per national legislation require public consultation to consider local people environmental concerns and inputs?

If yes, anticipated public concerns, e.g., project location, waste disposal sites, harmful emissions into environment, and aesthetic arrangement of constructed sites? etc.

Will the project assure non-deterioration of human health, occupational safety and non-disturbance of residents living near project area? If no, is it possible by applying proposed mitigation measures to reduce the project environmental and social impacts to admissible levels?

1) To ensure collective and individual protective measures (work clothes, masks, shoes), when needed.

2) To adhere established occupational safety requirements as well as simple rules, e.g.:

a) water spaying twice a day during construction to avoid dust

b) ventilation of internal areas during and post construction

c) timing of work

3) To conduct regular instructing of employees on health and occupational safety requirements

4) To restrict vehicle speeds and trough-traffic in residential areas, especially trucks, using signing and appropriate design

5) Restrict trough-traffic in residential areas

6) Work timing to minimize disturbance/ restrict construction to certain hours,

7) Restrict movement of hazardous materials in residential areas/ regulation of transportation of materials; apply any load restriction required during and post construction periods,

8) Incorporate safety and environment protection requirements in the project contract documents, etc.

Part 2

(Completed by Aiyl Bank approved by CLMU, based on data revealed during ecological monitoring and evaluation process)

1. Category of ecological risk (A, B or C) _____

2. Necessity for EE (yes or no) _____

3. Which ecological aspects are arisen in the subproject?

_________________________________________________________________________

_________________________________________________________________________

4. In case of need to carry EE out, on what aspects are necessary to pay special attention? _____________________________________________________________________________

_____________________________________________________________________________

5. What terms and expenses are necessary for carrying EE out? _____________________________________________________________________________

Explanation

The given part is filled according to the maintenance of the filled part 1.

The category A in overwhelming majority of projects is not applied, except for processing of raw stock and wool, and also separate rather large manufactures (see manual)

EE is required to apply to all projects of the category A and to separate projects of the category B, connected with natural ecosystem alienation (destruction) or environmental pollution outside of manufacture.

Ecological and social aspects are allocated according to allocated in part 1.

Part 3

Completed by CLMU with assistance of Aiyl Bank and/or MES on the basis of analysis of the offered mitigating methods (in case of need).

6. Whether was EE necessary? (Yes or no) ___ if yes whether is it finished? ___

Whether the requirements of the World Bank on public consultations and national requirements have been observed and completely reported? (Yes or no) ___

7. Whether the Plan of Ecological Management is prepared? (Yes or no) ___

8. Are mitigating methods included in the carried project adequate and suitable? (Yes or not) ___

9. Whether the project will correspond to existing standards concerning emissions and a waste? (Yes or not) _____ if no, whether exemption of responsibility has been obtained? _____

10. Whether is a necessity in respect of Ecological monitoring? (Yes or no) ___ If yes, whether it is ready? (Yes or no) _____ Has Aiyl Bank approved? ______

2. What subsequent actions are required from the Borrower orAiyl Bank? ______________________________________________________________

______________________________________________________________________

11. Whether the potential ecological impacts of a sub-credit discussed with stakeholders? (Yes or no) Whether there is a report? (Yes or no)

DateParticipants

____________________________________________________________

____________________________________________________________

____________________________________________________________

From Aiyl BankDate:

Signature:

From PIU partDate:

Signature:

Annex B

Impacts, Causes, Consequences, Mitigation and Monitoring

Agribusiness (agro-processing and other)

Table B1

For Planning and Construction of all New Enterprises, Rehabilitation of Existing Enterprises and De-commissioning of all Enterprises

Potential Impacts

Causes

Consequences

Mitigation Required

Remarks

Planning Phase:

Loss of biodiversity

Poor location analysis not taking into account important biophysical values.

Loss of flora and fauna.

Location in areas that are not high priority for biodiversity protection.

Loss of cultural features

Poor location analysis not providing consideration to cultural values.

Loss of important cultural sites and structures.

Location in areas of little or no cultural significance.

Public participation is a requirement for all EIAs and if properly conducted during EIA will ensure input required to select appropriate alternative sites.

Socially unacceptable

Poor location analysis not taking into consideration local communities’ lifestyle, movement patterns and values.

Nuisance factor to local communities; loss of peace and quiet; loss of access to other areas or sites (e.g. school children may have to walk greater distances due to loss of direct route to school.

Location in areas where noise, odour or aesthetics will not be a problem; location to be selected which doesn’t interfere with important access (e.g. to schools).

Public participation is a requirement for all EIAs and if properly conducted during EIA will ensure input required to select appropriate alternative sites (and modus operandi) for enterprise.

Construction Phase:

Soil erosion

Vegetation and topsoil is removed for initial construction and access, exposing bare soil that is vulnerable to erosion, particularly in rainy periods.

Further soil erosion off-site and downstream; increased sediment loads in receiving streams resulting in aquatic habitat changes.

Ensure awareness by workers; adopt appropriate soil protection techniques; ensure exposed soil surfaces are kept to a minimum and for short periods of time; conserve topsoil, recover and replant when construction is completed.

If possible construction should occur in dry periods or seasons, particularly in situations where soil erosion could be a problem.

Soil contamination

Spilled and dumped fuels, and other chemicals.

Ineffective on-site sewage treatment during construction phase.

Loss of soil productivity. Contaminated groundwater.

Environmental awareness; training in handling and storage of fuels, lubricants and chemicals; provision of proper on-site storage facilities.

Water pollution

Spilled and dumped fuels and other chemicals.

Contaminated groundwater and surface water resulting in contaminated drinking water and in the case of surface water, damaged aquatic ecosystem.

Same as above.

Provision of waste containing toilets which waste can be transferred to a municipal treatment facility.

Noise and dust

Vehicles and construction machinery; dirt access roads.

Nuisance factor to neighboring communities.

Operations during normal working hours only; access roads to be watered during dry periods.

Solid waste

Littering of unused construction materials and workers personal garbage.

Unsightly and remnant construction materials could pose a safety hazard.

Effective disposal of materials and garbage in designated waste disposal sites.

Loss of access

Construction site may have formerly been used as an access for local population (and vehicles) for various sections of the community.

Nuisance and possibly economic hardship.

During planning phase ensure that local people are aware of restrictions during construction and alternative arrangements for access are provided.

Public participation during planning phase should identify this and similar conflicts.

Injuries

Inadequate safety procedures for workers; inadequate signage and construction activities exposed where public can interface with such.

Injury / death resulting in lost work days (for construction workers and general public; lost income.

Ensure construction workers are given safety instruction; ensure safety officers on site; ensure effective signage for the public and ensure that all exposed construction areas are barricaded from public access.

Decommissioning Phase: (it is unlikely that any of the enterprises will undergo decommissioning in a 25-50 month period from initial start up or refurbishment but if such should occur then the listed impacts should be considered).

Same as above for construction plus:

See above

See above

See above

Waste

Concrete, blocks, steel, glass will result from demolition; old equipment will be dismantled.

Public safety hazard.

Waste of resources.

Removal and recycling or effective disposal of all toxic materials; complete demolition after recycling useful materials; removal to a designated and environmentally safe disposal site and burial of clean and inert materials.

Aesthetics

Unsightly site (as are many industrial sites from former Soviet times).

Following removal of all materials (see above), site to be formed (topsoiled where relevant and feasible) and landscaped, where appropriate, to suit surrounding areas.

Soil erosion

As for construction phase above.

Safety

As for construction phase above.

Table B2

Abattoir

Overall Potential Impact: HIGH (due to threat to human health threat)

Potential Impacts

Cause

Consequences

Mitigation Required

Remarks

Contaminated meat

Poor sanitary conditions including lack of protective clothing and ineffective maintenance; processing of sick and diseased animals.

Consumers become ill; lost work days; lost productivity and income; abattoir’s reputation leads to lost business.

Provision of protective clothing; effective use of disinfectants; effective sanitary inspections leading to required standards being met; effective regulatory animal and meat inspection.

Government inspections can be erratic and perhaps not always effectively conducted. Residents of Bishkek are very cautious with meat purchases because of faulty meat inspections and record of people becoming ill and dying. This however is mainly related to small farm slaughter and not the commercial abattoirs.

Contaminated groundwater and surface water

Improper disposal of animal manure and offal as well as bones and other non-useable animal parts including blood.

Contaminated drinking (E. coli) water resulting in illness (possibly death), lost productivity and income.

Ground waste bone, meat and offal into flour for animal feed (see remarks); blood can be used for blood sausage; other water and blood waste must be collected and treated before proper disposal into municipal waste treatment systems; manure should be recycled or allowed to mature in an impervious containment – mature manure can be applied as fertilizer for crop production or on pastures.

Current ban on using such flour as animal feed in other countries due to threat of spongiform encephalitis (BCE-mad cow disease) which can result in deadly Jacob Kreifeldt disease in humans for those consuming meat of infected animals.

Odour

Manure; refrigerants (NH3); animals and carcasses.

Nuisance to nearby residents.

Avoid escaping NH3; maintain good sanitary conditions; dispose of manure in a timely fashion.

Ozone depletion

Refrigeration and freezing units utilizing Freon or ammonia.

Increase in UV rays resulting in skin cancer if proper protection is not taken; can also affect plant health.

Convert refrigerants from ozone depleting substances (NH3 and chlorofluorocarbons) to a hydrofluorocarbon.

KR is signatory to the Vienna Convention and the Montreal Protocol re: ozone-depleting substances.

Groundwater depletion

Large volumes of water used in washing.

Lowering of water table and depletion of water resources required by others.

Water apportioning; efficient use of water including recycling.

Of particular concern when planning a new abattoir that water resources are sufficient to meet needs of present and future users.

Injuries

Knives and saws used in the processing; large and heavy animal carcasses can fall and cause injury.

Lost productivity, work days and income.

Safety instructions; safety clothing where appropriate (e.g. hard hats).

Residual Impact Assuming Full Mitigation: LOW

Environmental Risk: MODERATE

Table B3

Meat Packing (This activity is often combined with the abattoir)

Overall Potential Impact: HIGH (due to threat to human health threat)

Potential Impacts

Causes

Consequences

Mitigation Required

Remarks

Contaminated meat

Poor sanitary conditions including lack of protective clothing and ineffective maintenance; processing of contaminated meat from abattoir.

Consumers become ill; lost work days; lost productivity and income;

Meat packing enterprise loses reputation resulting in lost sales, lost revenue and loss of job.

Provision of protective clothing; effective use of disinfectants; effective sanitary inspections leading to required standards being met; effective regulatory animal and meat inspection; assurance that carcasses and meat joints delivered are free of contamination and have been refrigerated adequately.

Government inspections can be erratic and perhaps not always effectively conducted.

Contaminated groundwater and surface water

Improper disposal of bones and fat.

Illness

Ground waste bone and fat into flour for animal feed (see remarks).

Current ban on using such flour as animal feed in other countries and other places due to threat of spongiform encephalitis (BCE-mad cow disease) which can result in deadly Jacob Kreifeldt disease in humans for those consuming meat of infected animals.

Disease

Improper disposal of wastes into municipal disposal sites providing ideal habitat for vermin.

Lost workdays and income.

Appropriate disposal of waste.

Illness

Canning uses lead solder for can seams.

Lead (Pb), a carcinogen, is cumulative in humans.

Use tin (Sn) for soldering or adopt other appropriate sealing methods.

Solid waste

Canning material scrap.

Wasted resource.

Recycle back to processor.

Residual Impact Assuming Full Mitigation: NONE

Risk: MODERATE

Table B4

Vegetable Processing and Canning

Overall Potential Impact: LOW

Potential Impacts

Causes

Consequences

Mitigation Required

Remarks

Damage to aquatic ecosystems.

Residue from vegetable and fruits allowed to be dumped into surface waters.

High organic content leading to oxygen depletion and habitat destruction.

Compost vegetative waste.

Illness

Canning uses lead solder for can seams.

Lead (Pb), a carcinogen, is cumulative in humans.

Use tin (Sn) for soldering or adopt other appropriate sealing methods.

Solid waste

Canning material scrap.

Wasted resource.

Recycle metal back to metal processor.

Injuries

Open machinery.

Lost productivity, work days and income.

Safety instructions; safety clothing where appropriate (e.g. hard hats); protective guards on all machinery.

Residual Impact Assuming Full Mitigation: NONE

Risk: LOW

Table B5

Tanning

Overall Potential Impact: HIGH (primarily due to toxic chemicals in effluent discharge)

Potential Impacts

Causes

Consequences

Mitigation Required

Remarks

Modification of aquatic habitats

A variety of chemicals is used in the tanning industry including Cr, NH4, Ti, Na2SiF6, Na2S, CaO, Na3OH4, Na2SO4, (CH2)6N4, AlNH4(SO)2. These chemicals can be found in waste effluent or they can reach the effluent discharge as a result of spillage. As well there is waste including leather and hair from the hides that can find its way into the aquatic habitat.

Receiving water bodies become highly polluted and toxic, rendering them unfit for other uses and destroying existing fauna and flora; loss of biodiversity.

Organic wastes can deplete oxygen levels surface waters, resulting in damaged habitat and aquatic communities.

Containment and treatment facilities to ensure that effluent discharges are within the regulated limits.

Chemicals should be stored and handled in such a manner as to prevent spillage.

One tannery in Bishkek does not use the Cr process because it does not have the facility for treating the chemical after it has been used. Christian[footnoteRef:1] suggests separating effluents into four wastewater streams: low polluted, high polluted, chromium bearing and sulphide bearing wastewaters. Solid wastes[footnoteRef:2]might be separated into three fractions: spent salt, non-chromium containing solids, and chromium solid wastes. Aerobic biological treatment (composting) is suggested as proper technology for the non-chromium containing solid waste since this can represent up to 80% of all of the solid waste generated at a tannery[footnoteRef:3]. [1: ] [2: ] [3: Christian, K. 2001.]

High energy consumption

Aging high production tanneries use large amount of energy, particularly in winter.

Depending on source of energy, could contribute to greenhouse effect (if fossil fuel derived) or if hydro derived, could result in pushing high demand on limited supply that would result in additional energy sources to be found.

For new tanneries building design and construction should be compact and energy efficient.

The large Bishkek tannery has to close during the coldest months due to high cost of heating.

Injuries

Tanneries use heavy machinery, which, if not fitted with protective shields, can cause injury.

Lost productivity, work days and income.

Safety instructions; safety clothing where appropriate (e.g. hard hats); protective guards on all machinery.

Illness

A number of chemicals have to be handled in the tanning process. Some of these can be dangerous to the health of workers if not properly stored and handled.

Lost productivity, work days and income. Long term illness.

Effective training in the handling of chemicals; protective clothing (e.g. respirators, gloves of inert material); proper storage for highly volatile compounds.

Solid waste and contamination of groundwater and surface water.

Hair and small quantities of skin and leather waste during the tanning process.

Small quantities of leather do not present a problem. Hair of hides often contains parasites and disease. Unknown as to whether or not these could find their way into groundwater and surface water and pose a threat to health.

Minimize amount of waste; treat hides before removal of hair (or treat hair after removal).

See remarks for modification of aquatic habitats, above.

High water consumption

Large tannery uses large amounts of water.

Drawdown of water table which could affect other users.

Ensure proper water apportionment with other competing users; efficient water use and recycling.

One tannery in Bishkek uses approximately 10,000m3 of water monthly.

Residual Impact Assuming Full Mitigation: LOW - MODERATE

Risk: MODERATE - HIGH

Table B6

Dairy Processing

Overall Potential Impact: HIGH (primarily due to human health threat)

Potential Impacts

Causes

Consequences

Mitigation Required

Remarks

Surface water contamination

Effluent discharge containing whey (waste from cheese making); discharge of acid from milk processing as a result of cleaning of equipment.

Waterways become opaque and display high protein levels resulting in damaged or destroyed aquatic ecosystem.

Effective collection and treatment of whey before discharge; make available all whey to farmers for feedstock.

Ozone depletion

Refrigeration and freezing units utilizing Freon or ammonia.

Increase in UV rays resulting in skin cancer if proper protection is not taken; can also affect plant health.

Convert refrigerants from ozone depleting substances (NH3 and chlorofluorocarbons) to a hydrofluorocarbon.

Food contamination

Pasteurization process not effective; workers in contact with milk and milk products.

Consumers become ill (could be very serious as milk could come from cows with brucilosis or tuberculosis); workers could infect milk products during handling.

Origin of milk should be known; pasteurization process must be effective; workers must be protected with effective clothing and workers should not come in direct contact with milk products; veterinary diligence to ensure healthy animals.

Injuries

Open machinery.

Lost productivity, work days and income.

Safety instructions; safety clothing where appropriate (e.g. hard hats); protective guards on all machinery.

Residual Impact Assuming Full Mitigation: NONE

Risk: MODERATE

Table B7

Frozen Food Production

Overall Potential Impact: MODERATE (primarily due to human health threat)

Potential Impacts

Causes

Consequences

Mitigation Required

Remarks

Ozone depletion

Refrigeration and freezing units utilizing Freon / or ammonia.

Increase in UV rays resulting in skin cancer if proper protection is not taken; can also affect plant health.

Convert refrigerants from ozone depleting substances (NH3 and chlorofluorocarbons) to a hydro fluorocarbon.

Food contamination

Poor sanitary conditions including lack of protective clothing and ineffective maintenance; contaminated raw materials.

Consumers become ill; lost work days; lost productivity and income; enterprise’s reputation leads to lost business.

Provision of protective clothing; proper washing up with disinfectants; effective sanitary inspections leading to required standards being met; effective inspection of raw materials.

Government inspections c