Summary of Proposed Investment
Project Number
7706
Company Name
Palestine Industrial Estates Development and Management Company
Date SPI Disclosed
Apr 29, 1997
Country
West Bank and Gaza
Industry
Tourism, Retail and Property
Status
Completed
Sector
Construction and Real Estate
Department
Regional Industry MAS MCT
Environmental Category
B - Limited
Previous Events
Approved : Jun 18, 1997
Signed : Oct 25, 1997
Invested : May 20, 1998
Project Description
Summary Of Project Information (SPI)
| Project Name | West Bank and Gaza - The Gaza Industrial Estate (GIE) |
| Region | Central Asia, Middle East and North Africa |
| Sector |
Projected Board DateMay 30, 1997
Company NamePalestine Industrial Estate Development and Management Company (under establishment)
Technical Partner and/or Major Shareholders
The Gaza Industrial Estate is being developed by the Palestine Development and Investment Ltd.(PADICO), which will own 49.0% of the shares of the project company. The off-site infrastructure will be financed by the donor community led by the World Bank and USAID. PADICO has also requested IFC’s assistance in identifying a technical partner with experience in operating and managing a similar industrial estate.
Project Cost Including proposed IFC investment
The total project cost is estimated at about US$60.7 million, consisting of US$20.0 million for off-site infrastructure and US$40.7 million for on-site infrastructure and the construction of factory buildings(the Project). IFC’s investment will be a loan of about US$ 8.0 million and up to US$ 1.0 million in equity.
Location of project and Description of site
The GIE is located on the border between Gaza and Israel, 3 km South of the center of Gaza City and 1 km from the main highway to Egypt. The site is well connected with the main commercial transfer points - 5 km from the proposed Gaza Port; 25 km from Gaza Airport (expected to be operational in mid-1997); 25 km from the port of Ashkalon; and 65 km from Lod International Airport in Israel. The total size of the GIE is about 48 hectares. The land was provided by the Palestinian National Authority (PNA) under a 49 year lease agreement with PADICO.
Description of Company and Purpose of Project
The GIE will be developed by PADICO. PADICO was incorporated in 1993 with the main objective to develop and encourage investment in various sectors throughout the West Bank and Gaza. As of year end, 1995, PADICO’s total shareholder’s equity was about US$58.3 million. To date, PADICO has established five subsidiaries in tourism, real estate and industrial development, telecommunications, and securities markets. The total estimated cost of projects in PADICO’s current investment program is over US$500 million. PADICO has begun the process of establishing a new subsidiary company (Palestine Industrial Estate Development and Management Company) to operate and manage the project which consists of the construction, operation, and management of an industrial estate catering to small- medium-scale enterprises. The project will address the critical shortage of infrastructure (water, sewage, power, etc.) for industries in Gaza and will draw on Gaza’s relatively low wage and productive labor force, its preferential trade arrangements with the US and EU, and the low lease for the land. At full development, the project is expected to employ about 20,000 Palestinian workers. IFC’s developmental role consists of: a) supporting a project that alleviates serious unemployment in Gaza and builds up Gaza’s trade and business potential; b) giving confidence to the private sector businesses, especially those from overseas, to locate at the site; c) helping to complete the project’s financial plan by providing funding on terms and maturities not otherwise available; d) playing a catalytic role in attracting financing from foreign sources; e) assisting PADICO to find a partner with experience in operating and managing an industrial estate; and f) creating a model for the development of future industrial estates in the West Bank and Gaza. IFC’s financing of the on-site development will be complemented by the World Bank and USAID financing for the off-site infrastructure development.
Environmental Category and Issues
This is a category “B” project according to IFC’s environmental review procedure. Environmental issues associated with this project include liquid effluence, ground water resources, air emissions, and solid waste. Health and safety issues include fire safety and emergency response. The project will be designed to meet all local regulations as well as World Bank guidelines, and is likely to result in significant environmental benefits for Gaza as a whole by providing a well-serviced industrial estate under centralized management. An EIA for the project was completed under the supervision of USAID. Various infrastructure upgrades (relating to water supply and waste disposal), to which the project is linked, are being completed with a combination of EIB, EU, USAID, and World Bank support.
The is Available from the Public Information Center.
| Date SPI sent to PIC | April 29, 1997 |
For Additional Information contact: Corporate Relations Unit -
telephone: (202) 473-7711
facsimile: (202) 974-4384
Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).
Sponsor / Cost / Location
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