29008 - Societe Eiffage de la Nouvelle Autoroute Concedee

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Summary of Proposed Investment

Project Number

29008

Company Name

SOCIETE EIFFAGE DE LA CONCESSION DE L'AUTOROUTE DE L'AVENIR S.A.

Date SPI Disclosed

Jun 10, 2010

Country

Senegal

Industry

Infrastructure

Projected Board Date

Aug 10, 2010

Status

Completed

Sector

Highway Operations (Includes Toll Roads)

Department

Gbl Infrastructure & Natural Resources

Environmental Category

A - Significant

Previous Events

Approved : Sep 30, 2010
Signed : Nov 14, 2010
Invested : Jul 13, 2011

Project Description

The proposed Dakar-Diamniadio Toll Highway Project consists in: (i) the construction of a 20 km section of urban highway (from Pikine to Diamniadio); and (ii) the operation and maintenance of the highway (24 kms, including a 4 kms stretch, build and transferred by the GoS) on a 30-year DBFO (Design Build Finance Operate) concession. SENAC (the “Company” or the “Concessionaire”), a Senegalese Special Purpose Company controlled by Eiffage, (the “Sponsor”) has been granted a 30 year concession for this PPP pursuant to an international and competitive bidding process organized by APIX, the government investment promotion agency (the concession agreement was signed on July 2, 2009).

This greenfield project, connecting Dakar to Diamniadio, was designed to alleviate the severe congestion affecting travel in and out of Dakar, Senegal’s main economic center, and will also serve as an anchor for a vast urban upgrading program undertaken by the Government of Senegal (“GoS”) with support of the World Bank (IDA), the French Development Agency (AFD) and the African Development Bank (AfDB), which aims to improve the living standards of the suburban populations around Dakar.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	31.72
Equity

Development Impact

The proposed Project is the first toll-road designed on a PPP basis from its inception in Sub-Saharan African, and has significant development impact:

Improving access to Dakar, Senegal’s economic engine: today, with the acute congestion affecting the RN1, the only road in/out of Dakar, it can take over two hours to travel about 20 km. This congestion is a significant cost to the movement of goods and people out of Dakar. The Project will eliminate this cost, resulting in improved competitiveness of the Senegalese economy through better access to markets;

Reducing the cost of infrastructure development to the GoS: the Project will allow the GoS to build a modern toll-road, up to international standards and operated by a world-class operator, while saving about EUR90 million in upfront capital expenditure costs. This immediate cost saving would allow the GoS to direct the resources of its general budget to other priority expenditures – in particular, in the social sectors;

Improving the living standards of about 3,000 households: the Project is an essential component of a larger urban upgrading project, undertaken by the GoS with support from the World Bank (IDA), the African Development Bank and the French Development Agency, to upgrade one of the neighborhoods crossed by the Project toll-road (Pikine). As part of the Project, the GoS will implement a comprehensive upgrade and restructuring of Pikine, leading to a major improvement in the livelihood standard of about 3,000 households (for additional details, cf. available documents relative to IDA project number 4341-SN, approved by the Board of the World Bank on May 2009);

Raising private sector participation in infrastructure in Africa to new levels: the Project a first of its kind in Sub-Saharan Africa: this will be the first greenfield toll-road PPP in Sub Saharan African (excluding South Africa), conceived as such from the onset (there are a number of toll roads in Africa, but they are all expansions of existing roads or having the addition of a toll post construction). The demonstration impact of the Project will therefore be very high, demonstrating that well structured PPPs in the transport sector are feasible in Africa, and paving the way for the replication of such structures.

IFC’s financial additionality will stem from:

The provision of a subordinated, long tenor, loan to enhance the credit strength of the financial structure and encourage the participation of senior lenders;
The design of a robust financial structure, resilient enough to withstand the various risks of the Project;
Coordination of a pool of lenders including Development Finance Institutions and local commercial banks in order to swiftly reach financial close; and
Working with the Sponsor and the GoS to fine-tune the Project’s contractual and risk allocation structures.

IFC’s non financial additionality is expected to stem from:

Helping ensure adequate environmental and social safeguards are being implemented;
Coordinating closely with the International Development Association (“IDA”), the African Development Bank (“AfDB”)and the French Development Agency (“AFD”) to ensure that the public and private components of the Project are fully in synch for maximum development impact; and
(iii) Sharing with the Sponsor, its experience in toll-road financing in emerging markets.

This is category A Project. The anticipated key environmental and social risks for this toll road project include sitting and right-of way for the new alignment including alternatives analysis; physical and/or economic resulting from land acquisition under GoS responsibility (an estimated 30,000 people will be affected of which 3,000 households to be resettled); public consultation and disclosure; community health and safety with the increase of traffic and reduced access; control of ambient air quality and noise during the construction and rehabilitation works; erosion and sediment control as well as watershed protection; hazardous materials management during construction; disposal of construction debris and waste, labor and working conditions as well as occupational health and safety training; and emergency preparedness and response.

For further Environmental and Social Information please refer to the Environmental and Social Review Summary (ESRS).

Contacts

For Inquiries About the Project, Contact

Didier Payerne
Directeur Opérationnel
SENAC
Avenue Félix Eboué x Route Des Brasseries – BP 737 – Dakar (Sénégal)
Tel : +221 – 33-839-7339 / +221-33-839-7330
Fax : +221-33-832-7152
Email : ste-eif.nouvelleautoroute.concedee@eiffage.com
Website : http://www.senegal.eiffage.sn

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Local Access of Project Documentation

Reports concerning the highway can be viewed on the toll road’s GoS dedicated website (ww.autoroutedakardiamniadio.com) and on Eiffage Senegal’s website (www.senegal.eiffage.sn), as will also be made available at SENAC and Apix’s offices in Dakar.

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC’s Policy on Disclosure of Information that went into effect April 30, 2006.

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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