|
|
 |
 |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. |
Summary of Project Information (SPI) |
| |
| Project number | 9736 |
| Project name | SEF TAMO Marble Factory |
| Country | Tajikistan |
| Sector | Oil, Gas and Mining |
| Department | Global Manufacturing & Services |
| Company name | TAMO Joint Stock Company |
| Environmental category | B |
| Date SPI disclosed | May 11, 2000 |
| Projected board date | June 18, 2000 |
| Status | Completed |
| Previous Events | Signed: October 9, 2000
Approved: June 27, 2000 |
|
| Project sponsor and major shareholders of project company |
The project will be owned and operated by the Joint Stock Company Tamo, established and registered under the laws of Tajikistan in January 1992. The shareholding of the company is proposed as follows:
Mr. Ruslan Bagdasariyan 55%
Mr. Fatullo Babaev 45%
Mr. Ruslan Bagdasariyan is a mechanical engineer by profession. He earned a Masters degree in 1973 from the Dushanbe University. He worked in the transport sector for seven years after graduation as Head of the town-planning department in the Dushanbe government from 1980 to 1989. Since 1989 he has been involved with the mining and processing of marble and established TAMO in 1992 as the first private company in the country with foreign shareholders. Mr. Bagdasariyan is the driving force behind this venture and is a well respected and well known professional in Tajikistan.
Mr. Fatullo Babaev is an accountant by education and obtained his degree from the Dushanbe University in 1978 after which he has worked in the capacity of an accountant in various state enterprises. Since 1996 he is engaged in small business projects, mostly as a passive investor. He started working with TAMO in 1998, when he provided financial assistance to the company to execute certain orders. He is now interested in taking an equity stake given the profitable nature of the business. |
|
| Total project cost and proposed IFC investment |
| The total project cost has been estimated at US$1.045 million and the project is proposed to be implemented in two stages. The proposed IFC investment amounts to a loan of US$100,000 for Stage 1 and US$290,000 for Stage 2, for a total proposed investment of US$390,000. |
|
| Location of project and description of site |
The project has two sites: (i) the Marble Processing Plant; and (ii) the Granite Quarry. The Marble Processing Plant is currently located on rented premises in the city of Chakalovsk, about five kilometers from Khudjand in the Leninabad Region of Northern Tajikistan. This plant will be re-located to new premises purchased by the sponsor last year and located at a distance of 500 meters from the existing plant. The total covered area of the new premises is 3000 sq. meters of which the plant will occupy 1000 sq. meters. It is proposed by the sponsor to use the remaining 2000 sq. meters for a granite tiles manufacturing plant planned for an eventual Stage 3. Water and power are available at the new site and there is ample room for inventory and finished products storage. Water settling tanks have already been constructed and arrangements for installation of stone handling and processing equipment have been made. The sponsor has proceeded with the refurbishing of the new premises using his own resources. The site is located approximately at a distance of 150 meters from a railhead which will facilitate import and export.
The Granite Quarry known as the “Mogoltau Deposit” is located at a distance of 17 kilometers from the marble processing plant and 2 kilometers from the city of Khudjand on the right bank of the Syr-Darya river. The sponsor has the concession rights to this quarry. A 900 meters un-metalled road leads to the deposit from the nearest asphalt road. The deposit is estimated at 1.6 million cubic meters, which is adequate and appears solid with minimum cracks and is highly suitable for large scale in-expensive quarrying. The granite itself is variegated, coarse-grained and pink colored. |
|
| Description of company and purpose of project |
The existing manufacturing facility for the production of marble architectural forms (MAF’s) is owned and operated by “TAMO” a Joint Stock Company established in 1992 in Dushanbe. The company commenced operations with a small marble processing line of Soviet origin and some quarrying equipment. Owing to the civil war and social unrest in Dushnabe, TAMO relocated to Northern Tajikistan (Chakalovsk) in 1996. Since then, Mr. Bagdasariyan has been was able to re-establish the business in Chakalovsk, albeit on a much smaller scale. Demand for the company’s products continued to grow and, although the company was able to create a strong presence in the local market, it was not able to increase production to meet demand because of the lack of resources.
TAMO also purchased the rights to a granite quarry located at a distance of 17 kilometers from the marble processing factory and about 2 kilometers from the city of Khudjand and is now looking to diversify into granite extraction and processing. Presently, there is a significant demand for granite tiles in the region arising due to a shift in architectural and aesthetic standards from Soviet to Western style of construction, refurbishment of old and construction of new buildings.
The project involves (i) the expansion of an existing manufacturing unit for marble architectural forms (MAF’s) i.e., fountains, vases, furniture and other decorative items; and (ii) development of a granite quarry in the city of Chakalovsk in Tajikistan, near Khudjand.
The project is proposed to be implemented in two stages, as follows: Stage 1 - involves the relocation of the exisiting MAF facility to new premises in order to facilitate better and more efficient plant layout and increased output; and Stage 2 - involves development of the granite quarry and sale of granite blocks, which are in high demand in Tajikistan and neighboring countries.
Tajikistan is the smallest and the poorest of the Central Asian republics. The country since independence in 1992, has attracted very little Foreign Direct Investment (FDI) due to a civil conflict and its remote location. The modernization and expansion project is based on value addition to local raw materials i.e., marble and granite which are locally available in abundance and are of high quality. Part of the production is to be exported, hence generating the much-needed foreign currency for the company and the country. The project will improve the quality of goods being manufactured and will also introduce modern management, information and marketing practices. The standard of manufacturing activities in the country will be raised to new levels and the project will provide direct employment to some 30 people. In addition to it’s own plant, the company will have a spill-over effect by creating opportunities for smaller stone processing units to manufacture parts for the larger items to be produced by TAMO. This would provide additional employment and income-generating opportunities to other manufacturers. The success of the project should encourage other investors, who are currently reluctant to do business in the country, to invest in Tajikistan as the perceived risk diminishes.
The World Bank Group Country Assistance Strategy for Tajikistan highlights IFC’s key focus on promoting investments in small and medium sized businesses (which are particularly disadvantaged in the present economic environment) to foster broad-based industrial development and to help reduce poverty. More specifically, the project compliments IFC’s strategy to encourage and support commercially viable projects in Tajikistan’s emerging private sector by focusing on the following priority areas: (i) helping develop new and efficient private sector companies; (ii) assisting employment generation; (iii) promoting development of the minerals mining and processing sector; and (iv) promoting export based industry.
In line with this strategy, the proposed project has two very important objectives. First, the project will complement the broader World Bank Group’s strategy to develop a competitive private sector, in particular the SME sector. Secondly, the project will help partial alleviation of lack of term finance in Tajikistan to private sector SME’s. Currently, there is a critical need for long-term hard currency funding in the country.
Tajikistan has attracted very little FDI during the civil conflict and because of its particular location. IFC’s involvement will assist a viable project which was unable to expand in spite of demand in an important sector, and help to encourage more FDI into the country by demonstrating that projects can be successfully established and managed in the private manufacturing and mining sectors. IFC also assisted the company to install a MIS system through a Technical Assistance provided under the Dutch Trust Funds. |
|
| Environmental and social issues - Category B |
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/or social impacts may result which, can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.
To view the environmental documents for this project, click here
|
|
| Location of environmental documents in locally affected community |
Mr. Ruslan Bagdasariyan
General Director, TAMO
15 Fuchjika Street
Chakalovsk
Leninabad Oblast
Tajikistan |
|
| To contact the project company, please write to: |
Mr. Ruslan Bagdasariyan
General Director, TAMO
15 Fuchjika Street
Chakalovsk
Leninabad Oblast
Tajikistan |
|
|
|