27557 - Digicel Panama

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Environmental & Social Review Summary

Project Number

27557

Company Name

Digicel (Panama), S.A.

Date ESRS Disclosed

Aug 28, 2008

Country

Panama

Region

Latin America and the Caribbean

Last Updated Date

Nov 30, 2016

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Nov 24, 2008
Signed : Nov 28, 2008
Invested : Dec 19, 2008

Sector

Mobile Telephony

Industry

Telecommunications and Technology

Department

Gbl Infrastructure & Natural Resources

Project Description

The project consists of the construction and operation of a greenfield mobile cellular telephone network in Panama, sponsored by Digicel Central America Holdings Limited. The project will be implemented by Digicel Panama S.A. (the company or Digicel Panama), a Panama-based company that is 75% owned by the Digicel Group, a leading telecommunications enterprise, and 25% owned by the Bettsak Family, a successful local business group.

Overview of IFC's Scope of Review

The review of this project consisted of appraising technical, environmental and social information submitted by Digicel Panama, and a visit by IFC investment staff to the project site, to meet with Digicel Panama management and to have a first-hand look at operational activities.

E & S Project Categorization and Applicable Standard

IFC’s environmental and social due diligence indicates that the principal Performance Standards (PSs) to be applied to this investment are:

- PS1: Social and Environmental Assessment and Management Systems
- PS2: Labor and Working Conditions,
- PS3: Pollution Prevention and Abatement

A condition of IFC’s investment will be that Digicel Panama’s operations shall consider all relevant social and environmental risks and impacts, including issues covered in all IFC PSs.

This project involves the development of a cellular network, with construction and maintenance of cellular tower sites, and construction and leasing of retail outlets. The key issues associated with the project are for environmental, health, safety, and social management; labor and working conditions (including employee and contractor occupational health and safety); and pollution prevention and abatement. The nature of the company’s operations is such that no major adverse environmental or social impacts are expected to result from the project, and that it will be possible to avoid or mitigate any limited adverse impacts that might result. As a result, it has been classified as a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects.

Environmental and Social Mitigation Measures

The proposed project will upon implementation of the specific agreed measures described below comply with applicable standards including host country laws and regulations, IFC Performance Standards, and IFC environmental, health and safety guidelines. Information provided by Digicel Panama is summarized as follows:

- PS1: Environmental, Health, Safety and Social Management:

To manage environmental and social risks and impacts, comply with applicable standards, and as a condition of IFC’s investment, Digicel will continue to implement its group-wide Environmental and Social Management System (ESMS), with tailoring as needed for its operations in Panama and to IFC’s satisfaction. The group-wide ESMS includes policies and procedures to manage all relevant functions covered in IFC’s PS1 through PS8.

Digicel Panama will outsource construction of new tower sites and security services to reputable companies with high quality management standards. The company will ensure prior disclosure of the development of new tower sites to local communities, as site conditions warrant. Digicel Panama will include environmental, health and safety terms in all contracts for its outsourced construction and security services, and will monitor compliance with those terms and require improvement in the event that non-compliance is identified.

The company will not undertake any construction in sensitive areas – including sites planned for indigenous areas in its service territory (Kuna Yala, Darien, and Bocas del Toro) – and will ensure that nobody will be physically or economically displaced by any of its construction activity. Rather than purchase sites, the company will negotiate to lease them from landowners. A process is in place for site engineers to document locations of sites and surrounding areas. The company will maximize the useful life of materials and recycle as many materials as possible.

- PS2: Labor and Working Conditions:

Digicel Panama has been working to comply with all applicable local labor laws and regulations. The Company will submit to IFC its written human resources policy and procedures, which will include a mechanism for handling employee grievances, to IFC’s satisfaction. Digicel Panama will ensure that all of its employees are provided with appropriate personal protective equipment and health and safety training for the type of work in which they are engaged. For all of its offices, operational sites, switching centers, and retail outlets, appropriate measures for life and fire safety will be included.

Digicel Panama shall make commercially reasonable efforts to ensure that no contractors’ employee who performs work related to core functions of Digicel Panama for a substantial duration is below the legal employment age. Digicel Panama shall also make commercially reasonable efforts to ensure that contractors’ employees who perform work related to core functions of Digicel Panama for a substantial duration shall be provided a safe and healthy work environment, including appropriate training, protective clothing and equipment.

- PS3: Pollution Prevention and Abatement:

The company will oversee waste management by contractors performing construction to ensure compliance with PS3 and IFC’s Telecommunications Guidelines.

Stakeholder Engagement

Digicel Panama recognizes the importance of community engagement. For acquisition of tower sites, Digicel Panama shall consult with relevant municipalities or local village councils, obtain required authorizations, and comply with local environmental codes and IFC Performance Standards. Digicel Panama will disclose relevant facts to community members regarding proposed new sites, and has provisions in place for handling and resolving complaints or grievances received from community members regarding any tower site.

**Information on IFC's Policy and Performance Standards on Environmental and Social Sustainability can be found at www.ifc.org/sustainability

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Environmental and Social Review Summary (ESRS) is prepared by IFC to disclose its findings and recommendations related to environmental and social considerations regarding potential investments. Its purpose is to enhance the transparency of IFC's activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this ESRS is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein.
It is distributed in advance of IFC Board of Directors' consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following ESRS is disclosed in accordance with IFC's Access to Information Policy (AIP).

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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Environmental & Social Review Summary

Project Description

Overview of IFC's Scope of Review

E & S Project Categorization and Applicable Standard

Identified Applicable Performance Standards

Environmental and Social Categorization and Rationale

Environmental and Social Mitigation Measures

Environmental and Social Mitigation Measures

Stakeholder Engagement

Stakeholder Engagement

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