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 also 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, worker health and safety (EHS), and social/community 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, environmental, health and safety, social and community information submitted by the project sponsor as well as site visits to the Inegol and Bozuyuk plants The following potential environment, health and safety (EHS) and social/community impacts of the projects were analyzed. - The compliance of TDD’s Bozuyuk plant with Turkish and IFC EHS requirements; - The commitment of TDD to quality and efficiency and to EHS performance including international certifications; - Labor, community and social issues.

The sponsor, Turk Demir Dokum (TDD) has presented plans to address these impacts to ensure that the proposed project will comply with the environmental, health and safety and social/community requirements of Turkey as well as the IFC environment and social policies and the environmental, health and safety guidelines. Information about how these potential impacts will be addressed is summarized in the paragraphs that follow. - Compliance with Turkish and IFC Environment, Health and Safety (EHS) Requirements Raw water is provided to the Bozuyuk plant from wells and from the municipal system. In addition some of the treated process wastewater is recycled back to the plant. The production plant has a very extensive and well operated wastewater treatment plant which includes pH adjustment, chemical addition, flocculation, and solids separation, with the treated wastewater then discharged to the municipal sewer system. The wastewater treatment plant is very efficient and is subject to extensive monitoring by TDD and by the government authorities. Hazardous wastes (e.g. paint sludges) are sent to the licensed Izaydas Plant near Izmit in licensed trucks for proper treatment and disposal. Solid waste from the wastewater treatment plant is sent to a filter press for additional treatment prior to proper disposal. The majority of the plant’s solid waste (e.g. cardboard, glass, wood and plastic) is sent to recyclers with the remaining solid waste being disposed of in the municipality’s sanitary landfill. Air emissions including from natural gas fired boilers, drying ovens and paint booths are monitored annually by independent consultants with the results sent to TDD and to the regulatory agency. TDD places a very high emphasis on worker health and safety (OHS) and there are detailed procedures in place. Workers were observed to be wearing their personal protective equipment where necessary in the plant. There is a medical clinic onsite and all workers are subject to annual medical examinations (particularly eye and ear tests). There are a number of first aid teams in place during each of the three daily shifts and these teams have been trained. Accidents are generally minor in nature and can be adequately dealt with by the first aid teams or the onsite doctor. The more seriously injured would be transported by TDD’s ambulance to the Bozuyuk hospital which is nearby for treatment. - Commitment to Quality and to Efficiency TDD, as is the case with other Koc Holding companies, have developed and implemented world class quality systems. The Bozuyuk plant is ISO 9001 (Quality) certified using both the Turkish Standards Institute (TSE) and the British Standards Institute (BSI) as their certifiers. In addition many of TDD’s products are internationally certified for quality and safety for instance GASTEC, DVE, CE, IMQ certifications. TDD also has a large and experienced research and development capability which is focused on improving the existing product range and bringing new technology such as the use of fuel cells to the market. With regard to EHS performance, TDD is on track to achieve both ISO 14001 (Environmental Management) and OHSAS 18001 (Occupational Health and Safety) certifications for the Bozuyuk plant by the end of CY2006. Overall TDD and Koc generally have a very strong commitment to quality and to excellent EHS performance throughout their organizations. - Labor, community and social issues TDD’s Bozuyuk plant employs about 1,000 workers who are represented by one union. Salaries, benefits and working conditions are covered in a 2 year collective agreement negotiated between the company and the union. Benefits include free transportation to and from the plant, 1 meal during each shift, medical coverage and pensions. Training is regularly provided to workers by TDD to improve skills. Salaries are very competitive and TDD has no problem hiring and retaining a very skilled workforce. TDD is very active in the local community and supports education and sports activities as well as donating equipment to a number of groups. TDD also contributes to the Vehbi Koc Foundation which supports a wide variety of social and community activities across Turkey.

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

Accordingly, IFC concludes that the proposed project will meet the applicable Turkish and IFC environmental and social policies and the environmental, health and safety guidelines.

IFC will evaluate the project's compliance with the applicable Turkish and IFC environmental, health and safety 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 and social/community activities. Periodic site supervision visits will also be conducted.