IFC requires that this document is made available through the World Bank InfoShop and to the locally affected community no less than 30 days prior to project consideration by the IFC Board of Directors. The Summary of Project Information (SPI) also provides details of where the ERS has been made available to the locally affected community. The SPI must be sent to World Bank InfoShop no less than 30 days prior to project consideration by the IFC Board of Directors.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental /social information submitted by the project sponsor, a visit to TBK’s brake products factory in Dongguang and a visit to an existing CSABC brake linings factory in Changchun. The following potential environment, health and safety and social impacts of the projects were analyzed. - asbestos content of products; - land acquisition process for the new factory; - emissions to air; - emissions to water; - solid waste; - occupational health and safety

The sponsor has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements - the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow - Asbestos content of products TBK has confirmed that the project’s brake lining products will have zero asbestos content. In comparison, brake friction materials for commercial vehicles generally manufactured and used today in China, which will be replaced by products from the Project have an asbestos content of around 40%. - Land acquisition process for the new factory The land upon which the factory will be built is a small element of the development of the Changchun High-Tech Industries Development Area (CHIDA). CHIDA, which has been under development for several years is built on land which was formerly used for production of corn. The development area includes more than 1600 industrial and commercial enterprises residential apartments buildings have been constructed to house the zone’s workers. The project’s land is a rectangular walled flat and level plot, bounded on two sides by roads; with newly constructed industrial buildings on the other two sides, and across the roads. Permission was granted by the Jilin Provincial government in January 2002 to convert the Project’s land from agricultural use. Other land at the edge of the development area appears barren and weed-covered and showed no evidence of recent agricultural activity or human habitation. - Emissions to air All the project’s process heating will be electrically-based, with electricity supplied from the grid system. The project will use steam, supplied by the industrial area for space heating. The only air emissions from the Project will be of air extracted from the process for dust-control purposes, and extracted air will be filtered by bag filters meeting local and IFC requirements before discharge. - Emissions to water The project will use a dry process and will produce no process effluents. Sanitary waste water arising from the factory and worker dormitory, and from the factory kitchen will be discharged to the municipal sewer system and treated. - Solid Waste Dust collected from the first process steps will be recovered into the process. Dust arising from machining of pressed and cured friction materials will be disposed of to landfill by an authorized contractor. - Occupational health and safety The project design will include provision to control and capture dust arising from mixture, pressing and machining operations. Additionally, workers at these parts of the process will wear masks. There will be a systematic process hazard analysis, and additional risk mitigation procedures will be designed accordingly. Regular meetings to discuss safe working practices will be held, and training will be provided. CSABPC reported that it keeps records but has suffered no lost-time injuries in its operations.

This ERS contains the full environmental and social documentation prepared for the project.

Accordingly, IFC concludes that the proposed project will meet the applicable World Bank/IFC environment and social policies and the environmental, health and safety guidelines upon successful implementation of the agreed mitigation measures.

IFC will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing the annual monitoring reports (AMRs) prepared for the project covering: ongoing performance of project-specific environmental, health and safety activities as reflected in the results of periodic and quantitative sampling and measuring programs. Periodic site supervision visits will also be conducted.