ARAB REPUBLIC OF EGYPT




        CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT




Environmental and Social Management Framework (ESMF)




                                November 2018




ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT    1
Table of Contents

CHAPTER ONE: INTRODUCTION                                                                  5
1.1 BACKGROUND AND CONTEXT                                                                 5
1.2 PROJECT RATIONALE                                                                      8
1.3 PROJECT DESCRIPTION                                                                    9
1.3.2 PARTICIPATING FINANCIAL INSTITUTIONS (FPIS)                                         14
1.3.4 POTENTIAL SECTORS FOR SMES AND MSMES                                                15
1.4 OBJECTIVES OF ESMF                                                                    16

CHAPTER TWO: LEGAL AND INSTITUTIONAL FRAMEWORK                                            17
2.1 WORLD BANK OPERATIONAL POLICIES                                                       17
2.2 SCREENING CATEGORIES AND ENVIRONMENTAL ASSESSMENT PROCEDURES                          18
2.3 NATIONAL LEGISLATIONS AND REGULATIONS                                                 19
2.3.1 ENVIRONMENTAL LAWS AND REGULATIONS                                                  19
2.3.2 EGYPTIAN LABOR LAW                                                                  24
2.3.3 LEGAL AND REGULATORY SYSTEM AFFECTING THE ECONOMIC EMPOWERMENT OF WOMEN             25
2.3.4 LEGAL AND REGULATORY SYSTEM AFFECTING THE RIGHTS OF PEOPLE WITH DISABILITIES        28

CHAPTER THREE: BASELINE DESCRIPTION                                                       30
3.1   BASELINE OVERVIEW                                                                   30
3.2   ENVIRONMENTAL BASELINE                                                              31
3.3   SOCIAL/SOCIO-ECONOMIC BASELINE                                                      38

CHAPTER FOUR: ENVIRONEMNTAL AND SOCIAL MANAGEMENT FRAMEWORK                               55
4.1 ENVIRONMENTAL AND SOCIAL IMPACT IDENTIFICATION AND ASSESMENT                          55
4.2 ESMP FRAMEWORK IMPLEMENTATION ARRANGEMENTS                                            58
4.2.1 INTRODUCTION                                                                        58
4.2.2 OVERALL PROJECT INSTITUTIONAL AND IMPLEMENTATION ARRANGEMENTS                       58
4.2.3 RESULTS MONITORING AND EVALUATION ARRANGEMENTS                                      60
4.3 SUB-PROJECT ENVIRONMENTAL AND SOCIAL SCREENING AND APPROVAL FRAMEWORK                 60
SCREENING FOR POTENTIAL ENVIRONMENTAL AND SOCIAL SAFEGUARD IMPACTS AND DETERMINATION OF
SUITABLE SAFEGUARDS INSTRUMENTS FOR EACH SUB-PROJECT                                      64
4.4 FRAMEWORK ESMP                                                                        67
4.5 CAPACITY BUILDING AND TRAINING NEEDS                                                  79
4.6 ESMF COST ESTIMATE                                                                    79

ANNEX 1: CONSULTATION                                                                     82
APPENDIX 1: SAMPLE INVITATION FOR ROUNDTABLE DISCUSSIONS                                  87
APPENDIX 2: LIST OF ATTENDEES AT THE MSMEDA MICRO-ENTERPRISE CLIENTS ROUNDTABLE           88
APPENDIX 3: LIST OF ATTENDEES TO PUBLIC CONSULTATION WORKSHOP                             89
APPENDIX 4: PUBLIC CONSULTATION WORKSHOP PHOTOS                                           92
APPENDIX 5: KEY TAKEAWAYS FROM THE UK SPEIG TF BEHAVIORAL DIAGNOSTIC QUALITATIVE DATA
COLLECTION ACTIVITIES                                                                     94

ANNEX 2. LIST OF EXCLUDED ACTIVITIES                                                      98



      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                          2
ANNEX 3: ENVIRONMENTAL & SOCIAL SCREENING CRITERIA/CHECKLISTS       101

ANNEX 4: ENVIRONEMNTAL IMPACT ASSESSMENT METHODOLOGY                105

ANNEX 5: ENVIRONMENTAL AND SOCIAL MANAGEMENT PLAN (ESMP) OUTLINE    107




 I.     Abbreviations and Acronyms


BDS      Business Development Services
CBE      Central Bank of Egypt
CGC      Credit Guarantee Company
CPF      Country Partnership Framework
EBRD     European Bank for Reconstruction and Development
EEP      Egypt Entrepreneurship Program
ESG      Environmental, Social and Governance
ESMF     Environmental and Social Management Framework
ESMF     Environmental and Social Management Framework
ESMP     Environmental and Social Management Plan
ESMS     Environmental and Social Management System
FAO       Food and Agriculture Organization
FAP       Fintech Acceleration Program
FI        Financial Intermediaries
FRA      Financial Regulatory Authority
GAFI      General Authority for Investment and Free Zones
GDP       Gross Domestic Product
GEM       Global Entrepreneurship Monitor Report
GoE       Government of Egypt
GRM       Grievance Redress Mechanism
IBRD      International Bank for Reconstruction and Development
IC        Investment Committees
ICA       Investment Climate Assessment
IDD       Integrity Due Diligence
IFC       International Finance Corporation
IFR       Interim Financial Report
ILO       International Labor Organization
IMF       International Monetary Fund
IPF       Investment Project Financing
M&E       Monitoring and evaluation

      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT     3
MENA       Middle East and North Africa
MIIC       Ministry of Investment and International Cooperation
MSME       Micro Small and Medium Enterprises
NBFIs      Non-Bank Financial Institutions
NCW        National Council for Women
PDO        Project Development Objective
PE         Private Equity
PFI        Participating Financial Institution
PIU        Project Implementing Unit
SMEs       Small and Medium Enterprises
VC         Venture Capital



 II.     List of Tables


Table 2-1 Ambient air Quality Emission Limits (µg/m3)
Table 2-2 Comparison of National and WBG Noise limits
Table 3-1 Overview of Temperature and Precipitation in Egypt
Table 3-2 Egypt’s 1000 Poorest Villages in Poverty within Governorates
Table 3-3 Distribution of Unemployment according to Gender and Age Group
Table 3-4 Literacy Rates in Egypt by age and gender
Table 3-5 Gender differences in distribution of self-employment/employers between formal and
informal sector
Table 4-1 Potential Negative Impacts of the project’s financed activities
Table 4-2 Common Environmental impacts associated with MSEs
Table 4-3 Sub-project Safeguarding, Approval, and Disclosure Methodology
Table 4-4 Framework ESMP during Operation
Table 4-5 Framework ESMP during Construction



III.     List of Figures

Figure 1-1    Flow of Funds
Figure 3-1    National Poverty Line
Figure 3-2    Pauperism – Geographical Regions Year 2013
Figure 3-3    Average Annual Household Expenditure in L.E
Figure 3-4    Key Aspects of Multi-Dimensional Poverty, 2011
Figure 3-5    Average Annual Incomes for the family District Distribution Year 2013
Figure 3-6    Average Per Capita of the Family Annual Expenditure in L.E
Figure 3-7    The Prevalence of poverty by Governorate, 2011
Figure 3-8    Unemployment in Egypt 2012-2016
Figure 3-9    Business Ownership by Gender, by Urban/Rural Areas
Figure 3-10   Women Business Owners by Sector of Economic Activity
Figure 3-11   Geographic Distribution of Women Business Owners by Governorate
Figure 4-1    Outline of the ES Screening and Approval Methodology




       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                             4
CHAPTER ONE: INTRODUCTION



1.1 Background and Context

Egypt’s economic reform program is showing early signs of success, as economic growth rebounds, inflation
falls, and fiscal consolidation efforts remain on track to bring public debt back to sustainable levels. The
development of a private sector-led economy faces several constraints and requires further efforts to alleviate
these key binding constraints. The Government of Egypt (GoE) has also implemented structural reforms that
include a new industrial licensing law and an investment law, as well as updating the companies law and
introducing legislation to cover bankruptcy all which have laid the ground work for a private sector response
to the new macroeconomic conditions. Access to finance and land, as well as the lack of a level-playing field
remain key impediments to private sector activity. Thus, the implementation and proper enforcement of the
newly adopted legislative reforms are imperative to enhance the business environment and ensure fair
competition and equal-opportunity for all market players. Due to the high inflation over the course of FY17
and FY18, social conditions have remained difficult. The government’s efforts to scale up social protection
measures including through higher allocations on food smart cards and targeted cash transfer programs have
been key in partly mitigating the short-term negative effects. Yet, these need to be complemented with efforts
to improve targeting and widen coverage, also in addition to enhancing public service delivery. To ensure
that the economic reforms have a positive impact on citizens, Egypt needs the private sector-to create new
jobs, particularly in the formal labor market, as well as jobs for women and youth.

There are several constraints to private sector growth: finance and land access, competitiveness and an equal
playing field. Access to finance was cited as a top business constraint by 13 percent of firms in 2016, up
from 10 percent of firms in 2013. Finance, particularly for Micro, Small and Medium Enterprises (MSMEs)
and start-ups, is predominantly debt financing with channels through the banking and non-banking sectors;
but financing for entrepreneurs requires various mechanisms to open up such as capital markets, venture
capital, and private equity. More than 90 percent of land is owned by the government, and land registration
processes have not been modernized.

The GoE has launched a set of legislative and institutional reforms that foster an improved environment for

the business sector, especially for smaller enterprises, focusing on the demand-side constraints. 1


1 World Bank. 2017. “Women Entrepreneurship in Egypt: High growth potential start -up report�.


       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          5
Recognizing that new job creation is likely to come from new firms and the growth of smaller enterprises,
the government has taken measures such as: i) creating a formal registry for movable assets to be used as
collateral, to overcome constraints especially for smaller enterprises, and women and youth entrepreneurs
who do not own/cannot own land or have access to traditional collateral; ii) amending the companies’ law
to allow single person companies to be formally incorporated and to strengthen protection for minority
shareholders, iii) issuing a new Investment Law to encourage new inward investments; iv) introducing a new
Bankruptcy Law which de-criminalizes bankruptcy, simplifies the procedures and minimizes the need for
companies or individuals to resort to the courts; and (iv) the establishment of a one-stop shop and on-line
services to start a business; and offering dedicated services for women entrepreneurs. At the same time, there
is a renewed impetus behind the reform of the education sector with a focus on acquiring skills for the jobs
of the future. Yet even with reforms in both the demand- and the supply-side of the labor market, informality
is widespread across income groups. Even fifty percent of the middle class are employed in the informal
sector. To foster a stronger private sector response to the improved business environment the government
has established its own venture capital fund to support entrepreneurs, as well as launched various initiatives
to build entrepreneurial skills – particularly given the needs for women and youth. The government
established Egypt Ventures2 to develop the Egyptian entrepreneurial ecosystem, increase deal-flow from
startups to scaleups, as well as support the development of new and existing accelerators and venture capital
firms. The government also launched the Fekretak Sherketak (your idea, your company) initiative which
provides financial and technical support to entrepreneurs all over Egypt.3

In Egypt, over a third of entrepreneurs remain driven by opportunity, which means that they have started a
business due to the absence of other work alternatives; higher than the global average of 23.2 percent.4 In
terms of age distribution, there is a noticeable increase in the percentage of youth that decide to open their
own business, especially those in the age range 18-24 years. This growth in youth entrepreneurship could be

attributed to the higher rate of necessity entrepreneurs driven by the unemployment rate. 56 In terms of
gender one in four entrepreneurs is a woman, and one in six established business owners is a woman. The
trend has been a decline, 25 percent of early stage entrepreneurs were women in 2015 compared to 32 percent



2 Egypt Ventures is an investment firm seeded by the Ministry of Investment and International Cooperation with a
mandate of supporting and investing in startups from a diverse range of sectors across Egypt.
3 “Fekretak Sherketak� Initiative is an innovative initiative to encourage startups and promote the entrepreneurial
ecosystem in Egypt; it promotes the launch of the Egypt Entrepreneurship Program (EEP) in partnership with
Hermes Financial Group and the United Nations Development Program. EEP is a comprehensive platform designed
to catalyze the entire entrepreneurial ecosystem in Egypt.
4 Global Entrepreneurship Monitor Report 2016-2017
5 Ibid
6 Ibid


         ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                              6
in 2010.7 Furthermore, women-led businesses have a lower probability of continuation compared to men-
led businesses, although women entrepreneurs tend to make higher returns than their male counterparts.8

While the problem of limited access to finance for entrepreneurs is widespread, it is more acute for female
and youth-led enterprises, who also face more challenges in accessing business development services. The
World Bank FINDEX 2017 survey finds that only 27 percent of females aged 15 years and above had an
account at a financial institution, compared to 57 percent of males. In addition, only 14 percent of Egyptians
aged 15 to 24 years had an account at a financial institution in 2017, compared to 23 percent in Tunisia, 25
percent in Jordan, and an average of 34 percent in the MENA region. The main constraints women and
youth face are: restrictive collateral requirements and inadequate loan sizes and terms.9 In addition, women
and youth tend to lack awareness and understanding of available financing mechanisms. In the case of start-
ups, entrepreneurs identify lack of investors and shortage of funding at all the stages of the start-up financing
lifecycle as one of the main constraints.10 In the case of women and youth entrepreneurs, this is aggravated
by two factors: i) women and youth have lower access to networks of investors compared to men; and ii)
investors perceive women and youth led enterprises as riskier than other investments. Investors have
expressed a preference to work with men rather than women,11 and young entrepreneurs are perceived as
high risk due to lack of business experience.

According to the Women Entrepreneurship Development Assessment, although there are various NGOs
providing mainstream business development services, the geographical reach, depth of services and quality
of interventions are reported to be low. These factors, together with lack of convenient scheduling options
and affordability of services cause women’s take-up of mainstream business development programs to be
very low in Egypt. Women entrepreneurs in ILO focus groups confirm that they are not aware of such
services and only 8.5 percent have ever attended a training program for women, and only 5 percent have
received business counselling or mentoring targeting women entrepreneurs. According to the ILO’s Women
Entrepreneurs Survey results, 56 per cent of respondents obtain most of their information on business related
matters from family, friends and neighbors. Similarly, young entrepreneurs also have difficulty getting




7 GEM Egypt National Report 2015/16
8 WOMENA founder Elissa Freiha interview, 2016.
9 Based on a survey conducted by the Middle East and North Africa Business Women Network (MENA BWN), approximately 60 per cent of
Egyptian women business owners rated high interest rates as the major constraint in obtaining a loan; 40 per cent identified collateral
requirements as an issue; 42 per cent reported that approved loan amounts were not adequate; and 38 per cent reported that repayment terms were
too short.
10 World Bank. 2017. “Women Entrepreneurship in Egypt: High growth potential start -up report�.
11 As suggested by interviews conducted to angel investors in Cairo as part of the Women Entrepreneurship in Egypt: High growth potential
start-up report�.

       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                                                           7
information on business development, marketing, sales, management and operations, all vital for their
businesses to survive and grow.12

1.2 Project Rationale


The project is part of a broader comprehensive program of support to Egypt to foster inclusive growth led
by the private sector to create jobs, given the context of a relatively high population growth rate and a
persistent problem of unemployment. IBRD-led activities include the US$1billion Development Policy
Financing (DPF)for Enabling Private Sector and Territorial Development project which continues to
support the policy and institutional reforms for the private sector to develop. The DPF financing is
complemented by technical assistance to the General Authority for Free Zones and Investment and the
Industrial Development Authority to help them to implement the reforms to reduce the time and costs of
starting a business and getting an industrial license (through the Equal Access and Simplified Environment
for Investment Project). The project benefits from the technical support already provided to the Financial
Regulation Authority (FRA) to strengthen the legal and regulatory framework for microfinance. Also, this
project builds upon the Promoting Innovation for Inclusive Financial Access which was implemented by
MSMEDA (and formerly the Social Fund for Development) and supported the creation of a line of to
finance MSEs through eligible financial institutions and the promotion of innovative financing mechanisms
through Venture Capital support.

The project contributes to an inclusive growth strategy, by unlocking finance and business development
constraints to entrepreneurs enabling them to start-up, grow and go on to create new economic opportunities
and jobs. With specific targets for those typically excluded, the project will also focus on inclusion of women
and youth. The proposed operation is fully aligned with the IFC regional priorities, which include small and
medium-sized enterprises, gender and youth employability, with the objective of supporting the region’s
private sector, helping to create jobs and drive sustainable growth. Through improving financial inclusion of
women in Egypt, the proposed project intervention is fully aligned with the WB Gender Strategy especially
with respect to pillar 2: “removing barriers for more and better jobs� and pillar 3: “removing barriers for
women’s ownership and control over assets�. The proposed project is supplemented with technical assistance
to a range of stakeholders in the financial sector.




12 Brookings 2016. “Educated but unemployed. The challenge faced Egypt’s youth�


       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          8
1.3 Project Description




     1.3.1 Project Objective and Components

The project development objective is catalyzing entrepreneurship for enhancing economic opportunities
and job creation. The project is composed of the following components:



Component 1: Financial Support to Income Generating MSMEs ($146 million)

This component will provide debt financing for entrepreneurs through financial intermediaries, with a focus
on end-beneficiaries that can generate jobs; and specific targets for the share of financing for women- and
youth-led MSMEs and first-time borrowers. Financial intermediaries will include micro-finance institutions,
factoring and leasing companies, and banks.                             However, with a focus on the non-banking financial
intermediaries (NBFIs), the project seeks to complement existing banking sector initiatives and maximize
the additionality of the resources. Microfinance institutions, factoring and leasing companies are important
sources of funding for MSMEs. In the same way, factoring and leasing serve as an alternative to bank loan
financing for acquisition of productive assets, providing medium and long-term financing for segments
which typically are under-served by the banking sector or may not qualify for bank financing due to
excessive collateral requirements. Once financial intermediaries receive the project funds, they will channel
the funds to entrepreneurs through commercial lines. This will be done putting in place specific eligibility
criteria to ensure that the desired beneficiaries are reached. 13

By using a range of intermediaries to channel the project funds, the operation expects to maximize the impact
and outreach to high growth, job-creating firms and the target population. The project complements existing
Central Bank of Egypt (CBE) initiatives that aim to provide MSME financing through the banking sector;
with a special focus on the non-banking financial sector to create a critical mass of successful lending
transactions, to make a demonstration effect. When a demonstration effect is achieved more private investors
will be interested in participating in this space. Microfinance institutions, factoring, and leasing companies
require dedicated financing to incentivize greater participation in the MSME market, especially if it comes
accompanied by targeted financial and non-financial support to serve specific segments of the population,
such as women and youth. Financing will be in the form of a line of credit, through NBFI intermediaries, in




13 The eligibility criteria will be outlined in detailed in the Operations manual of the project.


        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                                    9
particular microfinance institutions (MFIs), microfinance companies (MFCs), Factoring Companies (FC)
and leasing companies (LCs) to support access to entrepreneurs.

This component will place special emphasis on elements of additionality through a strategy focused on
providing financing to enterprises with job creating potential but will not target specific sectors. Since
globally high growth potential firms can arise in any sector the component will not target specific sectors.
However, capacity for identifying firms with job-creating potential will be developed and the strategy may
be refined going forward. The strategy includes financing for: a) financial institutions: a) financial
intermediaries that have not previously accessed commercial funding; b) institutions such as Tier C NGO
MFIs that have a higher operational risk profile than the median market average and tend to be closer to
female and youth beneficiaries; and c) first time borrowers such as microfinance, factoring and leasing
companies. Progress made on these elements by the project will be monitored through the results framework.
Participating financial institutions (PFIs) will be selected based on their ability to finance targeted
entrepreneurs with job creating potential.

Funding will be provided at commercial rates and in accordance with World Bank Operational Procedure
10, to ensure there are no market distortions and that investment decisions are made according to financial
sustainability.   In accordance with World Bank Operational Procedure 10, the cost of financing to
participating financial institutions (PFIs) and final borrowers will be one hundred percent commercial. An
interest rate will be constructed and outlined in the operations manual that incorporates exchange rate risk,
the cost of mobilizing resources, administrative costs, and financial/credit risk. Costs to the final borrowers
will incorporate macro financial sector-related and liquidity mismatch risks, in line with credit policies of
PFIs. Each PFI will follow its own applicable credit risk appraisal and approval management procedures.


Component 2: Risk capital for innovative Startups and high growth SMEs ($50 million)

The entrepreneurship and early stage investment ecosystem in Egypt is nascent; and as such, it faces a
significant gap in startup financing, as well as, weaknesses in its ability to support entrepreneurs to create
and develop viable high-growth potential businesses. There are only a handful of commercially sustainable
entrepreneurship support entities, such as incubators, accelerators, equity funds, etc. In this context, this
component provides equity financing for investments both in early stage equity funds and directly in
innovative start-ups and SMEs; as well as resources to support entrepreneurship support entities, both
existing and new ones.

The objective of this activity is to catalyze the creation and growth of new or existing private risk capital
intermediaries (RCIs) such as incubators, angel funds, accelerators, Venture Capital and SME investment


      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          10
funds to support innovative startups and enterprises capable of high growth and job creation. Resources
under this sub-component will support equity and quasi equity investments (mezzanine, debt and convertible
notes) in RCIs. 14

Subject to market demand, the component will include the option for equity investments in financial
intermediaries. This would help microfinance companies with long-term funding needs and thus support
professionalization of the sector. Once NBFIs receive the project funds, they will channel the funds to
entrepreneurs through commercial lines. This will be done putting in place specific eligibility criteria15 to
ensure that the desired beneficiaries are reached.



Component 3: Business and Capacity Development ($4.0 million)
This component will cover non-financial support to ensure that there is (a) capacity built within the
implementing agency, particularly to manage component 2 as well as to undertake rigorous monitoring and
management for results; and (b) working with others to ensure adequate business development services,
mentoring and coaching are accessed by program beneficiaries; (c) provide specific support to generate deal
flow for the second component and (d) to provide a digital matching platform that would connect
entrepreneurs with potential investors. In addition to lack of finance, entrepreneurs in general, and more
specifically women- and youth-led MSMEs face several non-financial challenges, including a lack of skills,
limited access to markets, and limited access to tailored business development support such as information
services, training, networking, and mentorship. The design of these activities is based on two assessments,
currently ongoing that seek to identify gaps in hard and soft skills of entrepreneurs. The assessments put
emphasis on identifying common constraints as well as identifying specific needs of women and youth
entrepreneurs to ensure tailored solutions 16 . Feedback on the business development activities will be
obtained from beneficiaries on a regular basis and will be used to iteratively improve the activities over the
project period.


This component will be used to develop a robust monitoring framework, including to monitor risks and
constraints to achieving the PDO-level indicators, particularly, on job creation and support the implementing




16 Most of the Angel, Accelerator, VC and SME fund management teams applying will be considered as SMEs, accordingly; technical assistance
to the teams will be complementing the supply of risk capital and early stage financing to ensure that these fund managers have the adequate
competencies and skill-set to operate investment vehicles and support the entrepreneurial ecosystem.
16 The eligibility criteria will be outlined in detailed in the Operations manual of the project.
16 Two assessments are currently ongoing: one is a hard skills gap assessment and the second one a behavioral gap assessment. Both studies
separate women and youth through analysis of specific secondary data, interviews and focus groups.

       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                                                           11
agency to also work with other partners to build a strong pipeline of MSMEs that can access financing under
the project. The component will build awareness of the program among start-ups, and stimulate business
development services in partnership with other development partners. This activity will bring out good
business ideas through competitions and rigorous acceleration programs and help mitigate the elevated risk
of failure, typically experienced by startups due to lack of experience in management, marketing and
navigating through legal requirements. To this end, the component will also work on improving the quality
of mentors and mentorship services in general. This component will include activities to attract potential
entrepreneurs, such as training, business plan competitions.


Funds under this activity will also cover any additional project-related management costs over the project
life, especially as it relates to developing a monitoring and evaluation framework, but also to ensure that the
project remains in compliance with all Bank requirements. These costs include management and consultancy
fees and operations and administrative costs for the management and monitoring of the project activities, to
ensure smooth quality implementation. This can include: training and capacity building activities for staff;
marketing; conducting ecosystem assessments and analysis; monitoring and evaluation (M&E); safeguards
monitoring and review; legal; accounting, auditing, and financial management.


In addition, an impact evaluation will be undertaken to assess the impact of financing under component 1
and 2 on outcomes, especially job creation. This impact evaluation will be funded outside of the project
through complementary trust funded activity.




      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          12
Figure 1-1: Flow of Funds




     The World Bank’s financial management rules apply on the flow of funds. Throughout the preparation and
     implementation of previous WBG operations with the implementing entity, the Bank worked closely with
     the MSMEDA team to improve the MSMEDA’s internal control procedures including updating the FM
     Manual and the Internal Audit risk-based approach.




           ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                  13
    1.3.2 Participating Financial Institutions (FPIs)


Component 1 will provide debt financing for entrepreneurs through financial intermediaries, with a focus
on firms as end-beneficiaries that can generate jobs; and specific targets for the share of financing for
women- and youth-led MSMEs and first-time borrowers. This component aims to address access to debt
and equity financing gaps amongst MSMEs in Egypt, noting that a majority of MSMEs feel more
financially constrained since the revolution (the share of MSME loans to total loans decreased from 5% to
3% between 2010 and 2013) and only 5% of small firms have access to formal financial credit. The
microfinance market is currently reaching only 25% of its potential market. Debt Financing will flow from
the project implementing agency to participating financial institutions (PFIs) who will on-lend the money
on commercial terms to end borrowers, MSMEs. Participating Financial Institutions (PFIs) will include
microfinance institutions (MFIs), factoring and leasing companies, and banks. Factoring and leasing
companies serve as an alternative to bank loan financing for the acquisition of productive assets. They
provide medium and long-term financing for businesses which are typically under-served by the banking
sector or may not even qualify for bank financing due to the bank’s collateral requirements. Microfinance,
both in Egypt and in markets globally, is an important driver of female economic empowerment. Access to
financial services improves a woman’s ability to climb out of poverty, reduces her dependence on the
informal sector, and improves their ability to engage in measurable and productive economic activities.

Component 2. The objective of this activity is to increase the supply of seed, early stage and venture capital
going to innovative startups and young SMEs with high potential for growth and job creation. Funding
under this component will be provided as equity, and quasi equity (Venture debt, mezzanine) to startups
and SMEs through capital made in risk capital intermediaries (RCI) such as Angel funds, Accelerators, VC
funds and investment companies that meet the criteria (this includes capacity, track record, and investment
strategy).

    1.3.3 Project Beneficiaries of Financing Activities


The list below includes the project beneficiaries of financing activities:


â—?    Firms: income generating MSMEs (component 1) and innovative startups and SMEs (component 2)
â—?    Individuals: Entrepreneurs (sole proprietors or sole proprietors; Home Based Businesses)
â—?    Economic opportunities: Improved economic opportunities include opportunities to expand a
     business, to develop new product lines, upgrade business processes, and enter new markets. The theory



      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          14
     of change is that these economic opportunities arise to firms when bottlenecks to accessing technical
     or managerial skills; finance; and soft skills are removed.
â—?    Youth: male or female individuals between 18 and 35 years old.
â—?    MSME: The project will use the definition provided by the Central Bank of Egypt for micro small and
     medium-sized enterprises which is based on the volume of revenues or turnover: micro enterprises less
     than EGP 1 million, small is between EGP10 million and EGP20 million; and medium between EGP20
     million and EGP100 million. Number of employees: Micro<10; Small<200; Med<200; Paid Capital:
     Micro<50 000 LE; 50 000< Small<5M LE; 5<Med<10M LE. However, other definitions will be taken
     into consideration such as that for the FRA definition and that for Law 141 of 2014.
â—?    Income generating MSMEs: It refers to self-sustaining micro-enterprises that operate in traditional
     sectors and are mostly subsistence businesses.
â—?    Innovative startups and SMEs: Innovative in this context is applied to mean new or improved
     products; new or improved processes and/or business models; goods and/or services that are new to
     Egypt or to other markets. An eligible startup for this component means an officially registered
     enterprise that has been in operation for 5 years or less.
The project displays an innovative approach applying flexible and diverse financial instruments to meet the
demands and needs of targeted beneficiaries across all socio-economic groups (self-sustaining enterprises in
lower-income areas, women and youth in traditional businesses, and entrepreneurs applying innovative ideas
to startups). This approach seeks to ensure maximum impact and a focus on additionality, by encouraging
the market to extend financing to new customers (i.e. first-time borrowers) and new product segments (i.e.
private equity funds and leasing for SMEs). Also, the project has a strong focus on leveraging private-sector
finance, in line with the WBG cascade approach, as the project mobilizes commercial finance in the form of
co-investments for component 2.

    1.3.4 Potential Sectors for SMEs and MSMEs


Funding under component 1 will be sector agnostic. PFIs will be selected on their capacity to finance
targeted beneficiaries in Egypt and financial health/regulatory compliance, in line with the operational
criteria. To create markets, operational emphasis will be placed on providing financing to institutions with
a higher risk profile than the median market averages (particularly category B and C NGO MFIs). The use
of commercial institutions is prioritized in the project’s implementation arrangements and credit allocation
will be done on the basis of credit and operational risk with no reference to subsidy.

On component 2, an indicative investment strategy is set in place and outlaid in the PAD as well as
parameters for the investments in funds. MSMEDA will maintain a minority share, and will not be involved


      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                        15
in an RCI investment committee or play a role in the selection of investments. Investments should be sector
agnostic and no more than 40% of the overall portfolio should be concentrated in funds serving one sector.
Modification may be made as needed to meet market demand so long as the project development objective
is met. Changes to the investment strategy will require non-objection of the World Bank.

From previous experience, distribution of projects/beneficiaries by sector included the following:
commercial, services, animal production, industrial.

On amounts and tenors of financing provided: the average loan size for micro loans is LE 12,000; and for
SME finance LE 250,000. The repayment/tenor for micro loans is 5 years (MFIs), and 18 months on average
(end beneficiaries). For SME finance, repayment is over 6 years (PFI), and from 3-5 years (end
beneficiaries).

1.4 Objectives of ESMF


This project is classified as category FI (Financial Intermediary) according to OP 4.01 on Environmental
Assessment. This project will support the following interventions: a) start-ups and high-growth potential
SMEs e.g. renewable energy, pharmaceuticals, agro-business, b) interventions in the services, trade or
technology spheres, c) leasing activities, in which the project will focus mostly on financing vehicles,
machinery, medical equipment and equipment for production lines. The environmental impacts of these
interventions are expected to be limited, site-specific and reversible.

To ensure that the project’s interventions are compliant with the relevant requirements of the national
policies and legislations as well as the World Bank relevant operational policies and procedures; and to
ensure that any potential negative environmental or social impact would be properly mitigated, an
Environmental and Social Management Framework (ESMF) has been prepared (this document). The ESMF
will include an assessment of the institutional capacity of the MSMEDA and using the existing
Environmental and Social Management System (ESMS), the ESMF will detail the procedures for screening,
assessing, managing, and monitoring the environmental and social risks and impacts of subprojects. The
ESMF will provide an overall framework for the operation and will include a screening process to exclude
any subprojects that might cause significant environmental impacts i.e. Category A.




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CHAPTER TWO: LEGAL AND INSTITUTIONAL FRAMEWORK

This section highlights the key national requirements likely to be relevant to the project. Applicability of
the various World Bank and national requirements to specific sub-project activities should be assessed upon
detailing designs of sub-projects and their activities. Furthermore, the Egyptian Government has signed and
ratified a number of international conventions related to environmental protection and human rights. These
conventions are, therefore, considered an integral part of the environmental legislative framework of Egypt.


2.1 World Bank Operational Policies

The World Bank (WB) has identified 10 environmental and social safeguard policies that should be taken
into consideration in its financed projects. The objective of these policies is to prevent and mitigate undue
harm to people and their environment during the development process. The ESMF was prepared guided by
the following WB Operational Policies:


    -     This project is classified as category Financial Intermediary (FI) according to OP 4.01 on
          Environmental Assessment:
                  For a project involving a financial intermediary (FI), the Bank requires that each FI screen
                  proposed subprojects and ensure that sub-borrowers carry out appropriate EA for each
                  subproject. Before approving a subproject, the FI verifies (through its own staff, outside
                  experts, or existing environmental institutions) that the subproject meets the environmental
                  requirements of appropriate national and local authorities and is consistent with this OP
                  and other applicable environmental policies of the Bank.
    -     In appraising a proposed FI operation, the Bank reviews the adequacy of country environmental
          requirements relevant to the project and the proposed EA arrangements for subprojects, including
          the mechanisms and responsibilities for environmental screening and review of EA results. When
          necessary, the Bank ensures that the project includes components to strengthen such EA
          arrangements.
    -     Sub-projects will be screened, categorized, and managed in accordance with OP 4.01.
    -     The project will only support only category “B� or “C� sub-projects as per the World Bank OP
          4.01 classifications. Sub-projects classified as category “A� as per OP 4.01 will not be eligible for
          funding by this component.
    -     Sub-projects which trigger World Bank OPs other than 4.01- specifically 4.12 (Involuntary
          Resettlement), OP 7.50 (Projects on International Waterways), OP 4.04 (Natural Habitats), or OP
          4.09 (Pest Management) will not be eligible for funding by the project.

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2.2 Screening categories and Environmental Assessment procedures

Environmental Screening is a mandatory procedure under OP/BP 4.01 Environmental Assessment. The
Bank undertakes an environmental screening of each proposed project for which it will provide funding in
order to determine the appropriate extent and type of the Environmental Assessment to be conducted. The
Bank classifies a proposed project into one of three categories, depending on the type, location, sensitivity
and scale of the project and the nature and magnitude and scale of the project and the nature and magnitude
of its potential environmental impacts.17


Category A projects are likely to have significant adverse environmental impacts that are sensitive, diverse,
or unprecedented. For a Category A project, the beneficiary is responsible for preparing a report, normally
a full ESIA. No Category A sub-projects will be financed under the project.


Category B projects have potential adverse environmental impacts on human populations or
environmentally important areas - including wetlands, forests, grasslands, and other natural habitats - which
are less adverse than those of Category A projects. Like Category A, Category B environmental assessment
examines the project's potential negative and positive environmental impacts and recommends any
measures needed to prevent, minimize, mitigate, or compensate for adverse impacts and improve
environmental performance.


Category C projects mainly include activities, which are expected to have minor or no impacts on the
environment and therefore, do not need to be passed through the formal procedures of an ESIA.


Category FI: A proposed project is classified as Category FI if it involves investment of IFC funds through
a financial intermediary, in subprojects that may result in adverse environmental impacts. In addition, in
some capital markets projects, IFC funds are not targeted to specific subprojects (e.g. equity in a financial
institution such as a commercial bank), but the financial institution has operations which may have adverse
environmental impacts (e.g. project finance). In such cases, IFC may also classify the project as Category
FI.




17   See: Environmental Assessment Update Sourcebook, Environmental Department, April 1993. The World Bank

        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          18
Public consultation and Disclosure. For Category C sub-projects, there will be no need for a special public
hearing, but the borrower should provide information to all interested parties about the project activities by
publishing posters, leaflets and brochures and posting on the website relevant information. For Category B
sub-projects, the borrower shall consult project-affected groups and other interested groups about the
project's environmental and social aspects as early as possible and takes their views into account. The
borrower shall provide prior to the consultation event/sessions relevant material in a timely manner, and in
local language. All sub-projects environmental assessment reports shall be made available to public.

EHS Guidelines, the WB Group Environmental, Health, and Safety Guidelines referred to as the
EHS Guidelines are technical reference documents with general and industry-specific examples of Good
International Industry Practice (GIIP). They contain the performance levels and measures that are normally
acceptable to the WB Group. When preparing the EA reports and implementing the ESMPs , the borrower
shall apply the relevant levels or measures of the EHS Guidelines.




2.3 National Legislations and Regulations

National legislation and guidelines sufficiently address the potential environmental and social issues
associated with the project. An analysis of relevant national legal framework and identification of possible
gaps with WB Operational Policies is discussed below.



    2.3.1 Environmental Laws and regulations
        Environmental Assessment
Environmental assessment for projects is included in the environmental legislation in Republic of Egypt:
Law 4/1994 modified by Law 9/2009 and by Law 105/2015. The Ministry of State enforces the law for
Environmental Affairs (MSEA) and the Egyptian Environmental Affairs Agency (EEAA), its executive
agency. A number of decrees to the Law have been issued over the past 20 years including the latest decrees
in 2016, concerning the placement of specific review fees based on the environmental category of the
project. According to Law 4/1994 the Environmental Impact Assessment (EIA) is a licensing requirement
for development projects that are likely to cause ES impacts.


The projects are categorized into four main categories (each supplemented by a pre-defined list of
projects/activities). These are listed below in the order of impact significance:


      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          19
    -     Class C; which includes high-impact projects (equivalent to WB Category A) requiring full-fledged
          EIA.
    -     Scoped B projects; requiring Form B EIA, intended for projects with impacts higher than typical
          Form B projects whilst lower than Class C projects
    -     Form B projects; requiring Form B EIA (less-detailed than Class C EIA).
    -     Form A projects; requiring Form A EIA (fewer requirements as compared with Form B projects).
    -     Special condition projects; do not require the EIA but will be licensed given that the project
          developer will comply with certain standard requirements.
    -     Projects that are not subject to environmental licensing system.
The 2009 Egyptian EIA Guidelines include EIA requirements, including social assessment and
consultation, and is highly compatible with environmental assessment requirements of the WB.


A few gaps have been identified, mainly in the procedural and compliance side:
    -     A large number of governmental projects do not prepare EIAs (unless required by an International
          Finance Institution).
    -     ESMPs are not usually implemented and if implemented, they are not sufficiently monitored and
          followed up, in particular during the construction phase.
    -     In the majority of the projects, contractors are not aware of their basic environmental and social
          roles and responsibilities (occupational health & safety, community safety, impacts due to
          temporary labor influx, etc.) and tender documents do not usually contain such clauses (i.e.
          ESMPs).
    -     Although the Law clearly indicates that social impacts should be assessed as part of the EIA
          process, the social impact assessment and social management plan are not thoroughly reviewed
          during the environmental approval process by EEAA.
    -     There is no requirement for stakeholder consultation, public participation and disclosure for
          Categories A & B projects according to national classification. Stakeholder engagement and public
          consultation are a requirement for category C projects (national classification) only.

    Hazardous substances and wastes
Law 4/1994 includes procedures for handling hazardous substances and wastes, which are to a great extent
conforming to international standards and best practices. The identified gaps are mainly attributed with the
implementation, and include:
    -     Law 4/1994 does not include requirements for an impervious secondary containment.




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    -     The only licensed facility is located in Nasreya, Borg El Arab, Alexandria Governorate. This makes
          it more difficult for the industries to comply with the legislation.

    Air quality
Ambient air quality and emission standards of Law 4/1994 generally meet the interim targets of the WHO
ambient air guidelines, with few exceptions that have little significance in the program’s context. The main
gaps identified with relevance to the current program are:
    -     Engines, burners and furnaces are rarely checked for efficiency.
    -     Ambient air quality monitoring stations are limited in number. Monitoring data is not disclosed to
          the public and is not used in the EIA and licensing procedures
    -     Selected air emission limits are different from WBG limits. A brief comparison is presented in the
          table below

Table 2-1: Ambient air quality emission limits (µg/m3)

                            NO         NO2        NOx         SO2                CO       PM10      T.S.P

  National (24 hrs)         150         150        150        150                10       150       230

                                                                         (mg/m3, 8 hrs)

        WB (24 hrs)           -          -         200        125                N/A      150       230

                                                  (1 hr)


    Water Quality

Law 40/1982 regulates the quality of freshwater resources. It includes standards for ambient water quality
as well as limits for discharging wastewaters in different water bodies. Industrial facilities and workshops
discharging to sewers are required to comply with Law 93/1962 and its modified executive regulations
(Decree 44/2000). The identified gaps are presented below:


    -     Unserved/weakly served areas with sanitation services are not provided with adequate septage
          management system.
    -     WWTPs do not have a plan for de-sludging and safe disposal/management of sludge.
    -     Water balance in tree forests is weakly managed.
    -     Environmental registers for operating WWTPs are not regularly checked and water quality in the
          receiving drains is not methodologically inspected.
    -     Selected national water quality and discharge limits are different from WBG limits.


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 However, these are not presented here in details, as they are not expected to be a major impact of the project-
 financed activities .

       Noise
 Law 4/1994 includes standards for ambient and occupational noise with correspondent exposure periods.
 The main gaps identified are:
       -       The ambient noise standards generally conform to international standards, but do not place a limit
               on the potential increase in ambient noise caused by new activities (usually an increase less than 3
               dB is considered acceptable).
       -       Ambient noise monitoring is not consistently conducted, and monitoring data is not available to the
               public.
       -       There is no tracking of compliance with occupational noise exposure during the majority of
               construction activities.
       -       Selected Noise limits are different from WBG limits. A brief comparison is presented in the table
               below.



 Table 2-2: Comparison of National and WBG Noise limits

                             Egyptian Law 4 Requirements                            WB Requirements18
                                                   Permissible noise
                                                                                               One hour LAeq
                                                   intensity decibel                           (dBA)

                                                     DAY                                         Day
                                                               NIGHT        Receptor                       Night
                TYPE OF AREA                        7 a.m.
                                                               10 p.m.                          07:00–    22:00 -
                                                    to 10                                        22:00
                                                              to 7 a.m.                                    07:00
                                                     p.m.

Sensitive Areas (Schools- hospitals- rural                                  Residential;
       Noise




areas)                                                50         40         Institutional;        55        45
                                                                            educational

                                                                            Industrial;
Residential with limited traffic                      55         45                               70        70
                                                                            commercial

Urban residential areas with commercial
                                                      60         50
activities


 18   World Bank Group EHS Guidelines

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Residential adjacent to roads less than 12m
                                                    65         55
wide

Residential adjacent to roads 12m wide or
                                                    70         60
more, or light industrial areas.

1.1.1.1.1     Industrial     areas     (heavy
                                                    70         70
              industries)

 The maximum occupational noise allowed by Law 4/1994 for establishments that have been licensed before
 2011 is 90 dBA for eight hours. The thresholds, although relatively high, would provide good protection to
 workers if complied with. However, the main gaps are in compliance with such requirements.

     Solid Waste Management
 General cleanliness and solid waste management, are regulated by Law 38/1967. Solid waste collection and
 disposal services are usually performed by the Local Authority on a governmental level, and they lack
 sufficient financial resources to deliver the desired quality service. The main gaps identified are:
     -      The service covers cities only, in most of the areas.
     -      Insufficient manpower and equipment.
     -      The service providers are not and sometimes cannot be accountable to ineffective services or
            random disposals.
     -      Besides the use of engineered landfills, disposal is still being done in open dumpsites with low
            environmental and health standards, sometimes close to urban settlements.

     Occupational Health and Safety
 The Labor Law 12/2003 is the main legislation for health and safety issues. The main gaps identified are
 (mainly during implementation):
     -      Lack of awareness to adhere to safe working measures among employers and workers.
     -      Contractors do not implement proper and complete occupational health and safety measures in
            order to reduce construction costs.
     -      There is limited capacity to monitor health and safety issues in some industrial sites
     -      Construction activities are usually not inspected for health and safety issues.

     Natural habitats
 Law 102/1984 regulates natural protected areas (including more than 140 islands in the Nile). Usually
 development of the protected areas is well monitored by EEAA. However, it has been noticed that for a




         ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                     23
number of islands, no effective law enforcement is in place, and many of them already host urban
development activities.

    Cultural Heritage
Law 117/1983 has been issued to protect antiquities and culturally valuable sites. The Law addresses
structural protection of antiquities by placing certain procedures for chance finds. These procedures
adequately safeguard against potential negative impacts during the construction activities associated with
the program’s sub-projects. Registered sites are closely inspected by the Antiquity Authority.


    2.3.2 Egyptian Labor Law

   â–ª     The Unified Labor Law 12/2003 establishes comprehensive guidelines on labor relations, including
         hiring, working hours, and termination of employees, training, health, and safety. Under the law
         employees have qualified right to strike. Moreover, the law also provides rules and guidelines
         governing mediation, arbitration, and collective bargaining between employees and
         employers. The law includes non-discrimination clauses and complies with the International Labor
         Organization (ILO) conventions regulating the employment and training of women and eligible
         children (Egypt ratified ILO Convention 182 on combating the Worst Forms of Child Labor in
         April 2002). Under the law, a national committee to formulate general labor policies and the
         National Council of Wages, whose mandate is to discuss wage-related issues and national
         minimum-wage policy is established.


   ▪     Under the Unified Labor Law, workers may join trade unions. A trade union or workers’
         committee may be formed if 50 employees in an entity express a wish to organize. The Minister of
         Manpower and Migration (MOMM) issued a decree in 2011 recognizing complete freedom of
         association. In March 2016, a directive was issued not to recognize documentation from any trade
         union without a stamp from the Egyptian Trade Union Federation (ETUF), the only official
         representative of trade unions recognized by the state.


   ▪     The 2014 Constitution stipulates in article 76 that “establishing unions and federations is a right
         that is guaranteed by the law.� Only courts may dissolve unions. The constitution states that “one
         syndicate is allowed per profession.� The Egyptian constitutional legislation differentiates between
         white-collar syndicates (for professional workers e.g. doctors, lawyers, journalists) and blue-collar
         workers (e.g. transportation, food, mining workers).



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   â–ª     Collective negotiation is allowed between trade union organizations and private sector employers
         or their organizations. Agreements reached through negotiations are recorded in collective
         agreements regulated by the Unified Labor law and usually registered at MOMM.


   â–ª     MOMM sets worker health and safety standards. The Unified Labor Law prohibits employers from
         maintaining hazardous working conditions, and workers have the right to remove themselves from
         hazardous conditions without risking the loss of employment.
   â–ª     Egyptian labor laws allow employers to close or downsize for economic reasons. The
         unemployment insurance law (Emergency Subsidy Fund Law 156//2002) sets a fund to compensate
         employees whose wages are suspended due to the partial or complete closure of their firm or due
         to its downsizing.


   â–ª     In the case of a dispute about work conditions, terms, or employment provisions arises a dispute
         resolution mechanism exists. Both the employer and the worker have the right to ask the competent
         administrative authorities to start informal negotiations to settle the dispute.


   â–ª     In the case of difficult economic conditions, Labor Law 12//2003 enables termination of an
         employment contract. The Law allows an employer to close his establishment totally or partially or
         to reduce its size of activity for economic reasons, following approval from a committee designated
         by the Prime Minister. In addition, the employer must pay former employees a sum equal to one
         month of the employee’s total salary for each of his first five years of service and one and a half
         months of salary for each year of service over and above the first five years. Workers that have
         been dismissed have the right to appeal. This is not applicable to workers in the public sector.



    2.3.3 Legal and regulatory system affecting the economic empowerment of women

A regulatory and legal environment significantly affects women’s ability to gain access to economic rights.
Moreover, it guarantees that specific laws and regulations are clearly enforced, and thereby plays a role in
preventing women to be subject to customary practices that contradict their legal rights. Women are
economically empowered if they have the freedom to choose to work, or to decide to start their own
businesses, combined with access to employment and entrepreneurial opportunities and control over their
own resources and profits. On this basis, Labour laws and regulations, property rights and business
registration and licensing of the legal and regulatory system and laws and regulations on violence against
women are discussed below (Egypt, ILO, 2016):


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      a) Labor laws and regulations

The Egyptian Constitution

Article 9 emphasizes equal opportunities for all citizens, without discrimination.


Article 11 stresses the equality between women and men in terms of economic rights, the protection
of women against any forms of violence, women empowerment by ensuring the balance between family
duties and work requirements and providing protection to motherhood and women-headed households.


Labor Law No. 12/2003
Article 88 prevents any discrimination against women and emphasizes the equal application of the labor
law for both women and men.
Article 35 prohibits gender wage discrimination to ensure that women and men receive equal pay for
similar work.
Articles No. 91, 92, 93, 94 and 95 of the labor law relate to women’s maternity leave whereas pregnant
women who have worked in an organization for 10 months have the right to take maternity leave for 90
days, receiving full financial compensation during their leave. Maternity leave is available twice during a
term of employment with the same employer. The employer cannot fire a woman during her maternity
leave. Moreover, women have the right to take unpaid child care leave for a period not exceeding two years
and can do this twice during their service. Up until 24 months of the child’s birth date, women have the
right to a 30-minute breastfeeding break twice a day, with an option of joining the two periods.


Article 90 prohibits women from working in specific jobs, which have been defined by the minister of
Manpower Decree No 155/2003. It lists jobs considered immoral, such as working in bars, gambling clubs,
furnished apartments, boarding houses that are not subject to supervision by the Ministry of Tourism. Other
restrictions prevent women from working in jobs potentially harmful to their health, such as working
underground in mines and quarries, working in furnaces of melting mineral materials, making explosives,
glass melting, leather tanning and fertilizers manufacturing. Moreover, the labor law restricts women from
working overnight from 7:00 pm to 7:00 am, with the exception of certain businesses such as hotels,
restaurants, theatres, hospitals, cinemas, airports, tourist and airline offices and senior occupations (OECD,
2015, pp. 47-48).


Conventions

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According to Article 93 of the Egyptian Constitution in terms of hierarchy, treaties are below the
constitution and are equivalent to the laws issued/enacted by the parliament. Below is a list of Conventions
Egypt has ratified:


Convention on the Elimination of All Forms of Discrimination Against Women
The convention promotes gender equality by ensuring women’s equal access to and equal opportunities in
political and public life, including the right to vote and to stand for election as well as education, health,
and employment. Egypt also recognizes the UN Declaration on the Elimination of Violence Against
Women of 1993 and accordingly the Egyptian Criminal Code criminalizes some of the forms of violence
cited in article 2 of the 1993 Declaration, such as sexual assault, rape, FGM, sexual harassment, and the
trafficking of women.


Promotion of Equal Remuneration Convention, 1951 (No. 100)
The Convention promotes and ensures equal remuneration for men and women workers.


Discrimination (Employment and Occupation) Convention, 1958 (No. 111)
The convention promotes equality of opportunity and treatment between women and men in employment
and occupation and focuses on the elimination of discrimination based on race, color, sex, religion, political
opinion, national extraction and social origin, which has the effect of nullifying or impairing equality of
opportunity or treatment in employment or occupation.


    b) Property Rights
Women are legally entitled to administer and deal with property. Women are entitled to be the sole owner
of their properties and have the rights to control them. Upon turning 21, a woman has the full right to deal
with her properties on an equal basis as men without any sort of gender discrimination.


      c) Business registration and licensing regulations and procedures
Regulations in Egypt enable women entrepreneurs to obtain business licenses for all types of businesses.
No permission of their husband is required.
       d) Laws and regulations protecting against Violence Against Women


The two main legislations protecting and supporting women are the Egyptian Constitution of 2014 and the
Criminal Code of 1937 and its amendments. Articles 11, 52, 60, 67, 71, 80 and 89 of the 2014 Constitution
ensure the protection of women against violence, torture, mutilation and organ trade, incitement of violence



      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                          27
against women or specific women-based groups, “infringement of individual honor�, sexual exploitation
and assault, and human trafficking, respectively.


The Egyptian legal system is also bound by international law principles, including those pertaining to
women’s rights. As outlined above Egypt has ratified the Convention on the Elimination of All Forms of
Discrimination Against Women (CEDAW) on September 18, 1981. Egypt also recognizes the UN
Declaration on the Elimination of Violence Against Women of 1993. Accordingly, the Egyptian Criminal
Code criminalizes some of the forms of violence cited in article 2 of the 1993 Declaration, such as sexual
assault, rape, FGM, sexual harassment, and the trafficking of women. Crimes against women in Egypt are
classified either as misdemeanors or felonies. Misdemeanors, such as catcalling or sexual harassment, are
regarded as less significant and are usually punished by fines and short-term jail time; the trails are also
shortened. Felonies, like Female Genital Mutilation (FGM), rape, kidnapping of women, or sexual assault,
are punished by longer jail time, and a permanent record is placed for those convicted.
For a case to be classified as sexual assault19 it is sufficient for the offender to touch the victim with their
hands, reproductive organs or device against the victim’s will, and that it can be proven that the act was
intentional and not accidental. 20


The first of its kind, the Violence Against Women (VAW) unit 2015-2020 aims to help women who report
violent crimes by offering them social and psychological support. Although a revolutionary establishment,
the unit has not yet started functioning as regularly as it is supposed to. The strategy also aims to stop
negative behavior against women at its roots by educating people and raising public awareness.



      2.3.4 Legal and regulatory system affecting the rights of people with disabilities

Article 81 of Egypt’s 2014 Constitution states that the State shall guarantee the health, economic, social,
cultural, entertainment, sporting and educational rights of persons with disabilities and strives to provide
them with job opportunities, allocate a percentage of job opportunities to them, and adapt public facilities
and their surrounding environment to their special needs. The State shall also ensure their exercise of all
political rights and integration with other citizens in compliance with the principles of equality, justice and
equal opportunities. Seven other articles in the 2014 constitution also directly and indirectly address persons




19   See Criminal Chamber of the Court of Cassation in Ruling No. 289 of April 24 in 1950
20   See Criminal Chamber of the Court of Cassation Ruling No. 4794 of February 14 in 1985

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with disabilities, protecting their rights to equal health care, employment, education, political participation,
and social inclusion.

Law No 10 of 2018 provides a wide range of legal rights and protections for disabled people. These include
rights to non-discrimination in employment, health, political activity, rehabilitation and training, and legal
protection. The law also includes provisions for the rights of persons with disabilities in education at all
levels. The law also requires that educational institutions adopt policies to support disabled people, and that
they provide equal opportunities in education. It prohibits institutions from rejecting applications from
students on grounds of disability.




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CHAPTER THREE: BASELINE DESCRIPTION


This section provides a high-level overview of key baseline components given the wide range of urban and
rural areas eligible for sub-project implementation.

3.1 Baseline Overview

Egypt is a transcontinental country, which spans the southwest corner of Asia and the northeast corner of
Africa. This is made possible through a land bridge formed by the Sinai Peninsula. Most of Egypt is located
in North Africa and is bordered by both land and sea. Egypt is one of the most populous countries in Africa
and the Middle East. With a 2018 estimated population of 99.38 million, Egypt ranks 15th in the world,
compared to the last official census figure of 72.7 million in 2006.
Population density (people per sq. km) in Egypt was reported at 98 sq. Km in 2017, according to the World
Bank collection of development indicators, compiled from officially recognized sources.
Around 8 million acres of agricultural land-use and the majority of rural and urban clusters are located in
the Nile Valley and Delta.




As of the beginning of 2018 according to the latest demographic and social statistics by United Nations
Statistics Division Egypt had the following population age distribution:




    32.7                            62.8                                                                   4.5



    1.1.1.1.2   - percentage of population under 15

    1.1.1.1.3   - percentage of population between 15 and 64 years old


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    1.1.1.1.4   - percentage of population 65+


3.2 Environmental Baseline

Climate
The main vulnerabilities to climate change in Egypt are related to: rise of the Mediterranean Sea level
leading to inundation of coastal areas in an around the Nile Delta, change of precipitation patterns leading
to heavy rains causing urban flooding (along coastal areas) and flash floods (in Upper Egypt and Sinai),
rise in average temperature and more frequent heat waves and dust storms.
Table 3-1 below provides an overview of temperature and precipitation in Egypt (Weather Base 2017).
Table 3-1: Overview of temperature and precipitation in Egypt

                  ANN         MAR     MAY
                      JAN FEB     APR     JUN JUL AUG SEP OCT NOV DEC
                  UAL

Average
Temperature       21.7 13.5 14.7 17.3 21.3 24.8 27.5 28.4 28.3 26.6 23.8 19.3 15.2
(C)

Average High
Temperature  27.8 19.4 20.8 23.6 27.8 31.5 33.9 34.4 34.3 32.5 29.8 25.4 21.1
(C)

Average   Low
Temperature   16.1 8.4          9.2    11.6 15       18.5 21.3 22.6 22.9 21.2 18.6 14.3 10.2
(C)

Average
Precipitation     49.5 11.2 6.8        4.8    2.2    1.5   0.3    0.2    0.3    0.3    2.9    6.1    10.3
(mm)

The graphs below show the max and min temperatures, and average precipitation for both Delta
(represented by Cairo) and Upper Egypt (represented by Kosseir)
Delta:




      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                        31
Upper Egypt:




     ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT   32
Topography
Topography in potential project areas is expected to be flat as the mountainous areas of Egypt exhibit
extremely low population densities.
Geomorphology and Geology vary greatly across Egypt but are generally irrelevant to the project.
Soil and Water
    • Nile Valley and Nile Delta
Rural project areas are expected to be predominantly agricultural. While urban areas typically exhibit
minimal uncovered soil.
Surface water is quite likely to be encountered in the Nile Valley and Nile Delta in the form of the Nile and
its branch system.
Groundwater in the Nile Valley and Delta is generally at relatively shallow depths and is connected to the
Nile and its branch system.
    •     Eastern & Western Deserts and the Sinai
Rural and urban project areas may be expected to exhibit uncovered soil. Surface water is rarely
encountered outside the Nile Valley and Nile Delta. Groundwater is generally deep in areas outside the Nile
Valley and Nile Delta.
The unique location of Ismailia offered it a rich environment with fertility soil and good climate, all this
helped corps to grow with quality, the most famous plantings in the governorate is vegetables. Soil also

        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                       33
varies in Ismailia, some is clay soil (total area 60,000 acres east of Suez Canal). Sand soil (total area 340,000
acres) at East of Suez Canal, which is decided to be planted and watered by water drops method or spray
according to each area. Ismailia is very specialized be the presence of Ismailia water Canal as a source for
water.
Most of the Suez soil is classified as red desert characterized by salinity of the soil. Soil with such
characteristics is not suitable for the cultivation of traditional crops known in the Nile Valley and Delta,
especially in the absence of fresh water, and rain fed agriculture cannot be sustained due to the lack of
continuity of the rainy season, as in the northern coast. The only source of fresh water in Suez Governorate
is the Suez Canal, 45 km long. The canal starts at Ismailia with fresh water from north Cairo and passes
through the provinces of Al-Qaliubia and Al-Sharqeya and Ismailia, where it branches to two fresh water
wells, the fresh water canal in Port Said and the water canal in Suez.
In South Sinai 342,000 feddans can be classified as “fair� land (roughly equivalent to SCS class II), and
365,000 feddans as “poor� land (roughly equivalent to SCS class IV). The majority of South Sinai, however,
is classified as “unsuitable� for agricultural reclamation. There are several significant areas of “fair�
agricultural land in South Sinai. In the Wadi El Bruk area, a broad area of “fair� land occurs, extending
from El Mineidra-El Soghaiyare northward to Bir El Thamada. In South Sinai, the largest area of “fair�
agricultural land lies in the El Qaa Plain. This area runs north-south, encompassing most of the central
stretch of the El Qaa Plain. Its broadest point is around El Tur, where it widens to about 10 to 15 kilometers,
where 2,000 feddans are planned to be reclaimed during the period 2005-2017, on underground water using
modern irrigation systems for vegetable and fruit crops cultivation (GARPAD). Another area of “fair�
agricultural land can be found at Abu Rudeis. The area occupies the alluvial fans developed by Wadi Baba
and Wadi Sidri. Long narrow strips of “fair� agricultural land are also located in most of the major wadis
of the region.
Flora and Fauna
Flora & Fauna to be encountered in project areas and during project activities is generally expected to be
limited to agricultural crops and livestock & domesticated animals, respectively.
Across Egypt, total area of agricultural land is about 8.4 million feddan (3.5% of total area of Egypt). About
92% of the agricultural land is located in Nile valley and the Delta. Typical crops in Upper (Southern)
Egypt include cotton, wheat, and sugar cane; while rice, citrus, maize, and cotton are more typically located
in Lower (Northern Egypt). Alfalfa and various fodders are also commonly planted with these crops as
livestock feed. Typical livestock includes: cattle, camels, buffalos, sheep, horses, goats, donkeys, and
poultry.
Marine and coastal resources in the Gulf of Suez and the Red Sea are among the top four distinguished
environments in Egypt. Each has its own habitat for plant and animal life; there are a lot of places that

      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                             34
classified as marine and protected areas. In the plant life there are 44 strains of viruses, 238 species of
bacteria, 1260 species of fungus, 1148 species of Algae, 369 species of non-flowering flowering plants, in
addition to 2072 breed of plants in flowering, in animal life, there are 10,000 strains of insects, 1,422 breeds
of vertebrates, 755 strain of fish, 105 breed of reptiles and amphibians, 470 breed of birds, in addition to
126 species of mammals.
North Sinai is considered one of the important plant areas in Egypt because it contains plants of nutritional
value suitable for grazing as plants of medicinal and aromatic interest. The diversity of topography of the
earth, soil nature and the extension of the valleys between the high mountains made a great importance to
the plants in north Sinai.
Forming a land bridge between Africa and Asia, Sinai is host to a unique assemblage of species from
African, European and Asian biogeographic provinces. At the same time, the gulfs of Suez and Aqaba
present dispersal barriers between South Sinai and the Egyptian mainland and Arabia, whilst convoluted
topography and vertical climatic zonation create dispersal barriers within South Sinai, particularly within
the southern mountain region. These joint factors have resulted in a large number of relict and endemic
species in Sinai, especially in the southern mountain zone. Biodiversity assessments for the region vary,
and there is a need for further inventories and studies, particularly for flora and insects in the southern
mountain region.
Due to Egypt’s dry climate, few indigenous wild animals are present across Egypt. For instance, gazelles
which are found in the deserts, as well as desert fox, hyena, jackal, boar, jerboa, and ichneumon which
inhabit the areas of delta and the mountains along the Red Sea. In addition, reptiles of Egypt are lizards
and several kinds of poisonous snakes including the horned viper and the asp. As well as, the hippopotamus
and crocodile which were common in the lower Nile and Nile delta in antiquity, which are now restricted
to the upper Nile. Regarding Egypt’s avifauna, Egypt is considered one of the significant transit locations
of migrating birds; approximately 350 species of migrating birds come to Egypt across the Red Sea to find
a resort in its islands. Thus, around 485 species of birds, including the sunbird, golden oriole, egret, hoopoe,
plover, pelican, flamingo, heron, stork, quail, and snipe are present in Egypt. Furthermore, birds of prey are
also found in Egypt such as eagles, falcons, hawks, vultures, owls and kites. Several species of insects are
present in Egypt, such as; beetles, mosquitoes, flies, and fleas being especially numerous, nevertheless;
scorpions are found in desert areas.
Although South Sinai Governorate has relatively low faunal biodiversity the region supports several
nationally or internationally endangered species. 42 reptile species (43% of Egyptian reptile fauna) are
known from the area, 54 common resident breeding bird species (10% of Egyptian avifauna), and 39
mammal species in South Sinai (25% of Egyptian mammal fauna), with no amphibian species yet recorded.



      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                            35
Insects have not been well studied in the region, with the exception of the Lepidoptera. 44 species of
butterfly are known from the peninsula, 34 being confirmed residents.
Energy and Sanitation Utilities
The National Electricity Network has generally covered all residential areas in Egypt. However, many
locations in Egypt experience power outages during summer months due to peak loads on the national and
local grids. Agricultural lands, canals, and roads where project activities may take place will generally not
have access to grid electricity sources. Diesel generators are typically the alternative source of power in
such locations.
Only a small proportion of households in rural areas in Egypt are connected to central sewage treatment
collection networks. Rural areas generally rely on decentralized sanitation systems. Conversely, the
majority of urban areas are connected to the sewage collection and treatment network. The sewerage
infrastructure of some areas and cities in Egypt is described below:
Qena: Apart from Qena city there is no sewerage infrastructure in any settlement in the Governorate of
Qena. The network of gravity sewerage systems in Qena City covers about 200 km with approximately
1600 manholes, covering approximately 80% of the city’s area, with approximately 10,000 connections.
The types of sanitation systems available include traditional gravity sewers, untraditional or pumped sewers
or on-site sanitation systems. Traditional sewers account for 5% of sanitation coverage in the Governorate,
untraditional sewers approximately 15% and on-site sanitation systems account respectively for
approximately 45%. Accordingly, about 35% of the population is not provided with any sanitation services.
The only operational wastewater treatment plant is in the city of Qena. The rural areas of Qena
accommodate over 65 % of the total population, yet there are no formal wastewater services in these areas,
which lead to adverse effects on health, particularly for women and children.
North Sinai: According to 2006 statistics of sanitation facilities, there is a sewage network in El Arish and
Bir El Abed only. Other centers are connected to a drainage manhole with an open bottom. The percentage
of homes connected to sanitation network in the governorate is about 36% and the percentage of homes
without any sanitation services are about 64%, equivalent to 222,423 people, while the countryside does
not receive any sanitation services.
South Sinai: a range of sanitation facilities currently exists in both rural and urban areas; however, many
of the rural settlements remain un-served. The type and availability of sanitation facilities are in direct
correlation to the level of satisfaction people have with the services. In urban areas, the sanitation issue was
often linked to a lack of secure tenure and therefore an inability to gain access to the city sanitation network
through official channels. The absence of sanitation facilities was quite common in rural settlements.
Alexandria: According to the 2005 Human Development Report, 99.9% of households are connected to
the sanitation network, but 6.7 thousand people remain without sanitation. The amount of sewage generated

      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                            36
is 1.2 million m3/day. According to the Ministry of Housing, Utilities and Urban Development, the total
capacity of sanitation is 1398 thousand cubic meters / day, which translates 372 liters/day per capita. The
sewerage system covers the planned areas of Alexandria and most of the informal settlements.
Matrouh: Sewerage systems exist only in Marsa Matrouh while other provinces rely on septic tanks, which
are periodically emptied by the local municipal. These practices do not present any environmental risks at
the present time due to the low population density. The capacity of the sanitation plant is 25000 m3/day,
which serves the city of Matrouh, and is yet to be expanded to a larger production capacity. An integrated
sewage project is also under way in Siwa, but even with the larger expansions, those projects will only
serve the urban areas, as the production capacity of 68000 m3/day would not be able to accommodate the
needs of entire governorate (76600 m3/day). The percentage of households connected to the sanitation
service is 25.4% and the per capita generation of sewage is 6.77 liters/day.
Luxor: Electricity reaches about 97 % of the household in their homes in the supreme council of Luxor
compared to 95% for the Upper Egypt and 98.7 % for the republic of Egypt. According to Information
Center of the Supreme Council of Luxor, Total sewage capacity in Luxor reaches 42 thousand cubic meters
/ day. Per capita sewage is 71 liters / day / person. This area is limited to the urban areas of Luxor by 70%
while the countryside is still connected permanently to any sewage network.
Aswan: The quantity of wastewater discharged from homes in Aswan Governorate is estimated at
approximately 130,000 m3 / day. About one-third of this amount is processed while two-thirds are
discharged others as untreated wastewater. At present, there are eight sewage treatment plants in the
province: 2 conventional treatment plants (Kema 1 & 2) in Aswan city and 6 oxidation ponds (Balana, Nasr
Nubia, Hager, Atawani, and the mountain, and al-Busayliya). Most homes in Aswan do not have a sewerage
system or treatment system and discharge unprocessed wastewater in banks.
Waste Management
Waste collection, transport, treatment and disposal systems are generally underperforming across the
country. Municipal waste management is typically the responsibility of local authorities. Door-to-door
collection is rare and curbside collection is the dominant mode with average coverage of about 40%. Waste
accumulations, open burning, and scavenging are common. Waste disposal sites are generally overloaded,
and many are unmanaged.
Hazardous waste is relatively better managed with the Nasreya Waste Treatment & Disposal Facility being
the only licensed Hazardous waste disposal site in Egypt and is located in Borg El Arab, North of
Alexandria Governorate.




      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                         37
3.3 Social/Socio-economic Baseline

Overview
Egypt has witnessed significant political and economic changes since 2011. Through this transition, which
includes periods of political unrest, the main income sources of the economy have been negatively
impacted, particularly in the tourism sector, as well as revenues from the Suez Canal, oil and remittances
from Egyptians working abroad, affected by the global economy.
Although Egypt has made visible efforts to achieve the Millennium Development Goals (MDGs), it not
reached the anticipated targets for poverty reduction, environment protection and gender equity. Egypt
ranks 131 on the Gender Inequality Index out of 155 countries.
To address major issues, in line with the 2030 Agenda, the Egyptian Government has launched a working
plan called Egypt’s Vision 2030, otherwise known as Sustainable Development Strategy (SDS), which
covers the economic, social and environmental dimensions of development. SDS promotes economic
flourishing based on justice, social integrity and participation. It is under the SDS that all development
plans in Egypt are incorporated while at the same time being strongly guided by the SDGs.
Economy
In 2014, the GoE started implementing a transformational reforms program, with the aims of stimulating
the economy, enhancing the country’s business environment and creating growth. The first stage of reforms
package focused on rebalancing the macroeconomic aspects; such as the VAT Law, reducing energy
subsides, and the floatation of the Egyptian Pound. The second stage of reforms targeted improving
governance and investment climate, which includes the Civil Service Reform Law (passed in October
2016), as well as undergoing reforms to remove investment barriers and attract local and foreign
investments.
These reforms have led to a gradual improvement of the economy with the annual rates of GDP growth
reaching 4.3 percent in 2015/2016, up from an average of only 2 percent during the period 2010/11-2013/14,
and grew at 5.2% in the first half of 2018, compared to 3.7% a year earlier, mainly driven by investment,
exports and consumption. As a result of the floatation of the local currency, the exchange rate has initially
displayed instability, but has subsequently started to strengthen, notably with the strong foreign investor
demand for local debt instruments.
To alleviate the adverse effects of the economic reforms on the poor and vulnerable, the government has
scaled up key social protection short-term mitigating measures, including through higher allocations of food
smart cards and targeted cash transfer programs and shifting from generalized energy and food subsidies to
more poverty targeted programs.




      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                         38
However, despite the Government’s current efforts, social conditions remain difficult due to the episode of
high inflation and the erosion of real incomes. Regional disparities are an enduring characteristic, where
Upper Rural Egypt continues to lag behind other regions, with poverty rates reaching as high as 60% in
some governorates. Although, the unemployment rate has declined to 11.3% in 2018, reaching its lowest
level since 2010, still, unemployment remains high especially among youth and women (World Bank 2018).
The ability of the private sector to create jobs, particularly for the youth and women, is critical to reap the
benefits of the reforms and mitigate the impact on the non-poor but vulnerable and the middle class.
Accordingly, the government has introduced a series of key legislative reforms to enhance the business
environment.
Poverty
Poverty in Egypt, as measured in monetary terms through the National Poverty Line, has been increasing
over the past 15 years, reaching 27.8 percent of the population in 2016. Notably, throughout this period, the
prevalence of poverty has been higher amongst children. Furthermore, with an increase in national fertility
rates from 3.1 children per woman in 2005 to 3.5 in 2014, children represent the growing majority among
Egypt’s poor. Poverty is a key challenge facing Egypt, and poverty eradication has become a central theme
for the Government of Egypt’s (GoE) ongoing social and economic reform initiatives.
Poverty in Egypt affects not only many children, but also populations living in rural areas. 21 When
compared to urban areas in Egypt, the poverty rate in rural areas was 37 percent higher as of July 2016. The
poverty rate is highest in Upper Egypt and specifically rural Upper Egypt (51.5 %), followed by urban
Upper Egypt (29.4 %) and it is the least prevalent in Urban Governorates (9.6 %); the same applies to the
poverty gap and the squared poverty gap22.
Women constitute half of the population of Egypt and face different challenges from men for their economic
development. According to a recent World Bank poverty assessment, women have lower poverty rates than
national rate, yet girls (under 18 years old) show higher poverty ra


tes than the national rate, at 31.9 percent which is slightly lower than that for boys (34.3 percent).
Households where only women work show lower poverty rates than those where either one or more men
work. This could be partly explained by demographics: their households are relatively smaller and their
dependency rates lower. From the economic side, however, it is notable that another part of the explanation


21 Geographically, Egypt is divided into seven regions: Metropolitan including Cairo, Alexandria, Port Said and
Suez governorates which are fully Lower Urban and Lower Rural which include urban and rural areas of Damietta,
Dakahlia, Sharkia, Qualiobia, Kafr el Sheikh, Garbeyya, Menoufia, Beheira, Ismailia governorates, Upper Urban
and Upper Rural which include urban and rural areas of Giza, Bani Suef, Fayoum, Menia, Assiut, Sohag, Qena,
Aswan and luxor governorates, and Border Urban and Border Rural which include urban and rural areas of Red Sea.
22 The poverty gap index amounted to 35.3% compared to 5.9% at the level of total rural Egypt.


      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                           39
is not due to better labor market outcomes for women. Households with one or more female breadwinners
tend to have lower salaries, lower incomes from agricultural activities, and lower incomes from
nonagricultural businesses than households with one or more male breadwinners. The higher consumption
levels and total income are mainly explained by the large differences in monetary transfers.
Households with female breadwinners earn an average of four times this type of income than
households with male breadwinners.


Figure 3-1 Income Poverty in Egypt




Source: CAPMAS and World Food Programme (WFP) (2013), The Status of Poverty and Food Insecurity
in Egypt: Analysis and Policy Recommendations, Preliminary Summary Report, May 2013
Poverty in Upper Egypt is mainly structural/chronic poverty that is driven by lack of adequate public
infrastructure, private capital accumulation, and low investment in human capital and the absence of pro-
poor program-based fiscal policy, which collectively lead to deterioration in living standards in Upper
Egypt, compared to other regions. (CAPMAS, Population Department)
Table 2 below showcases that of the 1000 poorest villages in Egypt, 941 are located in Upper Egypt and
the remaining 59 villages are scattered across the North in addition to the population densities in these
governorates. In addition to the group of poverty indicators in Egypt’s poverty map and which illustrate
that 94% of the poorest villages in rural Egypt are in the South, it is important to shed light on the most
serious indicators of deprivation.
Table 3-2: Egypt’s 1000 Poorest Villages in Poverty within Governorates (Egypt’s Poverty Map Report
2007)




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                                                 Total                        Population
            No.     of Total number of Number of
Upper Egypt                                      Population    in Number of Density /
            Poorest    Families in the Poor
Governorate                                      the      Poorest Poor People km2
            Villages Poorest Villages Families
                                                 Villages

Giza             18          28,377             10,357        133,601           48,811        5,951

Beni Suef        13          15,542             5,584         86,807            31,162        1,933

Al Minia         310         654,148            272,083       3,049,039         1,270,324     1,987
Assiout          234         527,027            298,569       2,530,302         1,436,795     2,337

Souhag           250         593,151            274,017       2,733,101         1,268,608     2,473

Qena             112         305,470            119,167       1,497,021         587,743       2,276

Aswan            4           1,803              656           6,518             2,391         1,316
Total            941         2,125,518          980,433       10,036,389 4      4,645,834

CAPMAS analysis espoused an analysis of income and expenditure that was based on a representative
sample of 141 villages out of 1000 households with the poorest villages. From the results that were obtained
from the analysis, spending less than LE 197 per month in the year 2015 or approximately 2364 LE per
year led to the classification of a person as poor in Egypt. The data findings also indicated that an average
of 131 LE per month or 1572 LE per year also made a person to spend less than what was necessary or the
minimum threshold to shun away the extreme poverty. In that regard, the amount fell short of the LE 148
per month/ LE 1776 per year that should be the lowest required. In the sample villages, the findings also
deviated from the overall shallow nature of poverty. That is because the poverty is deep and thus not exhibits
a situation where the poor cluster around the poverty line. Furthermore, unlike the overall shallow nature
of poverty in Egypt (where most of the poor cluster around the poverty line), poverty in these particular
villages is deep (Figure 2-1,2-2,2-3).




       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                         41
Figure 3-2: National Poverty Line




Figure 3-3: Pauperism – Geographical Regions Year 2013




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Figure 3-4: Average Annual Household Expenditure in L.E




Multi-dimensional Poverty
The multi-dimensional poverty is often concerned with both intensity and the nature of the poverty. It is
keen to espouse the multiple deprivations in measures like the education, health and the standard of living
and as such show the extent of these factors at an individual level. The common approach taken by the
multi-dimension poverty is to use the micro data that are taken from household surveys, which would later
on be aggregated at a macro level to attain the national measure of poverty. The national measure often
encompasses the standard UNDP definition that is focused on establishing indicators of factors such as
health, education and the living standards. For instance, these might include the nutrition, child morality,
and measures assets in a household, access to hard flooring, water, electricity, a toilet and cooking fuel)23.
In Figure 2-4, the concept has been put into use in making comparisons in main geographical reasons and
Cairo, Alexandria, Suez and Port Said have performed better in these entire areas apart from health services.




23 Alkire, S. and Santos, M.E., Multidimensional Poverty Index, (Oxford Poverty & Human Development Initiative, Oxford, July
2010)




        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                                     43
Figure 3-5: Key Aspects of Multi-Dimensional Poverty, 2011 (Source: CAPMAS and World Food Program
(WFP), May 2013)




Income and Expenditure in Upper Egypt
The increasing prevalence of income poverty in recent times is compounded by the prevalence of poor
living conditions and inadequate access to education and health services resulting in extreme
multidimensional poverty amongst 11.9 % of the population in 2011.
Figure 3-6: Average Annual Incomes for the family District Distribution Year 2013




Figure 3-7: Average Per Capita of the Family Annual Expenditure in L.E


     ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                44
Figure 3-8: The Prevalence of poverty by Governorate, 2011




According to CAPMAS (Figure 3-7), Upper Egypt shows the highest prevalence rate (18 %) compared to
all other regions, much higher than Lower Egypt and Urban Governorates (8.7 % and 6.8 % respectively).
Moreover, the prevalence of poor living standards is generally higher in rural areas; deprivation of
sanitation is as high as 87% in rural Upper Egypt and 47 % in rural Lower Egypt. Governorates that
demonstrate the highest income poverty rates are also those with the highest rates of extreme multi-
dimensional poverty; mostly Menia, Assuit, Sohag, Bani Suef, Fayoum and Qena in Upper Egypt (Figure
3-7).
Education


        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                45
The correlation between the level of education and the poverty status is positive; as the level of poverty
decreases as one decreases his/her education in this case. Increasing education determines individual access
to income through employment. The results that are given by CAPMAS indicate that the illiteracy level
increased in the year 2013 to 25.9 from around 24.9 percent in 2012. In term of numbers, the more Egyptians
were unable to read or write with the numbers increasing from 16.1 million in the year 2012 to 17.2 million
in the year 2013. From the findings, Upper Egypt was mostly affected as it recorded the highest rates of
illiteracy especially among the youth. The illiteracy level among the youth is at 29.8% compared to 64.9
percent among the elderly. In terms of Cities, the highest rates were recorded in Fayoum at 37 percent
followed by Minya and Sohag.
The social class members at 47% are the most affected in the rural parts of Upper Egypt. The reality is that
families drop out school because of their inability to pay for their school fees. In case of the middle class,
they prefer the technical high schools. Technical high schools are mostly widespread among the middle
classes (48%); the lowest class prefers getting a job instead of going to a technical school, and the higher
class chooses to continue in the university path (56%). The general high school education is the least
between all the levels of education.
According to the 2017 census, 30.8 percent of Egyptian females over ten years of age (10.6 million females)
are illiterate compared to 18.5% of men. This percentage is higher in urban areas (38.8 percent) and even
higher in Upper Egypt (45 percent in Minia and 44 percent in Beni Suef). Illiteracy is also high among the
younger cohort, especially in rural areas, where one in every five females aged between 15 and 29 is
illiterate.

Unemployment
Although Egypt´s unemployment rate Egypt's dropped to 10.60 % in March 2018, from the previously
reported number of 11.30 % in December 2017, unemployment is one of the key economic challenges
facing Egypt, particularly women and youth (CEIC, 2018). Youth unemployment has reached an
unprecedented level of 26% (World Bank, 2017). Moreover, there is not only an enormous employment
gap, where labor supply exceeds the demand, but also despite attaining higher levels of education, there is
a skills mismatch between job seekers and job offers (Abdel-Ghafar, 2016).
In 2015, according to “Women’s Entrepreneurship Development Assessment� (Egypt, ILO, 2016), the data
on labor force participation, illustrated in figure 3-8 below; employment and unemployment in Egypt
indicate significant gender gaps. In fact, women in Egypt have more difficulties in finding new jobs and
securing their current jobs, as female unemployment reached 25% in 2015, while the male unemployment
amounted to 8.3%. Moreover, 37% of female employees are un-paid, compared to only 5% for male
employees.


       ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                         46
Figure 3-9: Unemployment in Egypt 2012-2016




Unemployment rates for female and males categorized by age groups are illustrated in Table 3-3 below,
which showcases that unemployment rates are mainly concentrated in the age group 30-59, as 29% of
female unemployment exists in the age group 30-39. In addition, 25% of female unemployment exists in
the age group 40-49, and 18% for age group 50-59, as oppose to the male are 26%, 22% and 18% in the
same age groups respectively.
Table 3-3: Distribution of unemployment according to gender and age group




Preference in hiring male employees versus female in private sector employers, results in women’s share
being only 17% versus 83% for men. A similar situation exists in the public sector where women hold 31%
of the jobs and men 69% of the jobs. The latter resulted in women lacking the opportunity to gain
knowledge, skills, experience and networks, which are all critical and essential pillars to those who later
choose the self-employment option.
Health
For health care, access is even worse: more than 70% of households in metropolitan Egypt live within 20
minutes of a hospital, compared to less than 40% in rural Lower Egypt and less than 30% in rural Upper
Egypt. Access to both forms of infrastructure has also deteriorated dramatically over the last 15 years.
Reequipping peripheral Egypt with adequate infrastructure would be a huge priority even in the absence of
broader problems in the labor market.

     ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                        47
According to the latest 2015 Egypt Health Issues Survey (EHIS), half of women aged between 15 and 59
are obese, and an additional 26 percent are overweight. Another indicator reflecting women’s poor
nutritional status is the prevalence of anemia. Overall, 25 percent of women are classified as anemic, with
the majority being mildly anemic, and only 2 percent classified as moderately anemic. The anemia rate is
higher among women living in rural Upper Egypt (31 percent) and among women with six or more children.
The life expectancy at birth among Egyptian females has improved during the last decade, and it was
estimated at 73.6 years of age in 2015, which is 4.4 years higher than the life expectancy of males.
While the life expectancy of Egyptian women is slightly lower than the world average (73.8 years), it is 3.2
years higher than the average of countries categorized as having medium human development (MHD),
which is 70.4 years. Breast Cancer is the most common type of cancers among women in Egypt and is
estimated to be the cause of 22 percent all cancer-related female deaths. Although female genital
mutilation and cutting is prohibited according to the Child Law 126/2008, the practice continues to prevail,
and adherence to the custom remains widespread. Recent data from 2014 showed that 87 percent of all
women between 15 and 49 years of age have been circumcised. However, adherence to the practice is
declining among younger women.

Women’s Status in Egypt
The majority of legislations regarding social and economic rights emphasizes the principles and values of
social justice, as well as women’s right to equality with men, to a fair access to resources and services and
to participation in public affairs. Over the past year there have been positive trends aiming at improving the
situation of Egyptian Women, in conjunction with relative improvement in opportunities for women’s
education, employment, participation in public affairs, and appointment to senior posts.
Still, women continue to endure multiple forms of social, cultural, economic and political exclusion. Egypt
ranks low in gender equity compared to other countries worldwide. The 2015 Global Gender Gap Index,
which measures disparities between men and women across countries, ranks Egypt at 136 out of 145
countries worldwide. Women have significantly lower participation in the labor force than men (26% vs
79%) and lower literacy (see Table 3-4). The Organization for Economic Cooperation and Development’s
Social Institutions and Gender Index 2014, which measures legislation, practices, and attitudes that restrict
women’s rights and opportunities, classifies Egypt to be among the countries ‘very high’ in gender
discrimination together with others in Africa and the Middle East. And as revealed by the 2014
Demographic and Health Survey, 92% of the ever-married women ages 15-49 interviewed have been
circumcised.
Table 3-4: Literacy Rates in Egypt by age and gender

                                                   Total          Male           Female

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Literacy rate (%)

15-24 years                                              93.92           94.96            92.84           (2017)

15 years and older                                         80.8          86.48            74.99           (2017)

65 years and older                                       71.73           79.54            64.13           (2017)


 (Source: UNESCO Institute for Statistics, 2017)
 Sexual harassment is a widespread and serious problem in Egypt, as the country ranks second in the world
 after Afghanistan in terms of this issue according to the United Nations Population Fund. There appear to
 be no official statistics for crimes of sexual violence against women because the victims of such violence
 refrain from reporting it out of fear of retaliation or shame. However, a 2013 United Nations report, Study
 on Ways and Methods to Eliminate Sexual Harassment in Egypt, offers insights on the spread of sexual
 harassment, both physical and verbal, in Egypt. According to the study 99.3% of female respondents
 reported that they had been subjected to some form of sexual harassment.24 According to the same study
 82.6 percent of the total female respondents did not feel safe or secure in the street. The percentage increased
 to 86.5 percent with regard to safety and security in public transportation. Overwhelmingly, the study
 revealed that enactment and enforcement of a law addressing sexual harassment is perceived as the first
 step in addressing the problem.
 Likewise, Egyptian women continue to be subject to female genital mutilation (FGM) at extremely high
 rates. According to a joint demographic health survey conducted in October 2015 by the United States
 Agency for International Development (USAID), the United Nations International Children’s Emergency
 Fund (UNICEF), a domestic nongovernmental organization (NGO), and the Egyptian Ministry of Health,
 approximately nine in ten women aged fifteen to forty-nine are victims of the crime of FGM in Egypt.25
 Regarding gender-based violence, the most recent data available for domestic violence incidences are 2014
 figures in which more than one-third (36%) of ever-married women between age (15-49) have experienced
 physical violence since the age of 15, also a 2013 Government study revealed that over 99.3% of Egyptian
 women and girls surveyed reported experiencing some form of sexual harassment in their lifetime. The
 most commonly reported perpetrators are current husband (64%), but parents are also frequently listed
 (father/ step-father, 26%, mother/ step mother, 31%).


 24 Bouthiana El Deeb, United Nations Entity for Gender Equality and the Empowerment of Women (U.N. Women),
 Study on Ways and Methods to Eliminate Sexual Harassment in Egypt 6 (May 23, 2013), available
 athttp://www.dgvn.de/fileadmin/user_upload/DOKUMENTE/English_Documents/Sexual-Harassment-Study-
 Egypt-Final-EN.pdf,
 25 Ministry of Health and Population et al., Egypt: Health Issues Survey 2015 at 103 (Oct. 2015), available
 athttp://dhsprogram.com/pubs/pdf/FR313/FR313.pdf

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Women Labor Force Participation and Entrepreneurship in Egypt
According to the assessment’s women entrepreneurs survey (WES26), the majority of women entrepreneurs
in Egypt are motivated by the necessity to have income rather than the opportunity to start their own
business.
In the past few years, Egypt’s percentage of women entrepreneurs has been the lowest in the Middle East
North Africa (MENA) region and Sub-Saharan Africa countries: 2% of women in early- stage
entrepreneurial activities in Egypt in 2012, contrarily to 4% in the MENA region and 27% in Sub-Saharan
Africa. Furthermore, the distribution of entrepreneurially active adults in Egypt shows that women are less
entrepreneurially active compared to men across the different phases of the entrepreneurship process.
Based on the Global Entrepreneurship Monitor (GEM) Egypt Report 2012, 2.4% of adult females were
involved in either trying to start a business or managing their own business that is less than 42 months old
(early-stage entrepreneurial activity), compared to 13.1% of adult males. Females accounted for only 14%
of the early-stage entrepreneurs and 12% of owners and managers of established businesses that are more
than 42 months old. Relative to other regions in 2012, Egypt had the highest gender gap in entrepreneurial
activity compared to other MENA countries (Hattab H., 2012, pp 17-18).
Women business owners (including the self-employed) reached 613,100 in 2014, accounting for about 9%
of the total number of self-employed/business owners in Egypt – male business owners numbered six
million, with women owners concentrated in rural areas (82%), with 18% located in urban areas. This was
in large contrast to the distribution of male business owners – 62 per cent in rural areas and 38% in urban
areas.




26 The WES is a standardized face-to-face survey conducted with 200 women entrepreneurs as part of the WED
Assessment methodology developed by ILO, in 2016.
 http://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_ent/---
ifp_seed/documents/publication/wcms_551168.pdf

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Figure 3-10: Business ownership by gender, by urban/rural areas




Women-owned Micro and Small Enterprises (MSEs) are smaller than male-owned MSEs, with an average
of 1.85 workers compared to 2.12 workers in 2011, noting that 98.4% of the women-owned MSEs had
fewer than five workers, compared to 94.2% of male-owned MSEs. However, it is important to mention
the slight improvement in the size of women-owned MSEs over the period from 2003 to 2011 as the
percentage of women entrepreneurs with only one worker decreased from 58.4% in 2003 to 47.7% in 2011,
while the percentage of women entrepreneurs with 3 or 4 workers doubled from 9.1% to 19.0% in the same
period. The mean size of the women-owned MSEs increased slightly, while the mean number of workers
in male-owned MSEs declined over the same period (Egypt, ILO, 2016).




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Table 3-5: Gender differences in distribution of self-employment/employers between formal and
informal sector




According to the Women Entrepreneurship Development Assessment by ILO (2016), 33% of working
males are self-employed, compared to 12.2% of working females. Only 6.8% of self-employed women
engage workers compared to 25% of self-employed men who engage workers. Egyptian women
entrepreneurs have a stronger presence in the informal sector, and do not engage employees. Many of these
women are home-based and operate micro scale enterprise activities, especially those in the agriculture
sector. Women in the agriculture sector often face more severe constraints than men in accessing productive
resources, markets and services, thus reducing their productivity and contributions to their achievement of
broader economic and social development goals.




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Figure 3-11: Women business owners by sector of economic activity




In addition, the distribution of women entrepreneurs by governorate shows that the Behira governorate has
the highest number (39 per cent) of women business owners, followed by Dakhlia (nine per cent), Menia
(nine per cent), Menofia (six per cent), and Sharqiya (five per cent) (Figure below).
Figure: 3-12 Geographic distribution of women business owners by governorate
From a social perspective, females in Egypt are more disadvantaged than men due to social norms that




commit women to family and home responsibilities. Cultural beliefs in some areas of the country diminish
women’s economic roles. Although female and male-owned enterprises operate in the same business
environment, but the challenges they face differ. Women face more challenges than men in starting,



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managing and growing businesses as they can be more likely constrained by a lack of the necessary human
and financial capital.
Disability in Egypt
Although the rights of persons with disabilities are guaranteed in the constitution, and Law No 10 of 2018
on persons with disability has been recently enacted, there is shame, stigma and prejudice around disability
in Egypt, preventing the full inclusion of people with disabilities. Health and rehabilitation services for
children and adults with disabilities are lacking, of poor quality, and do not meet all their needs. Children
with disabilities struggle to access education, leading to high illiteracy rates (61% for males and 70% for
females), and creating barriers to participation in higher education. Other barriers to education include
inaccessible environments, inaccessible course material, lack of assistive technologies, and attitudinal
barriers.
The employment rate of people with disabilities is reported to be half that of the non-disabled population
and they may face worse treatment at work. Barriers to employment include negative attitudes around
disability; lack of relevant skills as a result of exclusion from education and/or professional training; and
inaccessible working environments and transportation to work. While public buses are free to people with
disabilities they are not wheelchair accessible.
Companies have partnered with civil society organizations to employ people with disabilities and have seen
that the return on the investment of time and resources is an effective, productive, and committed workforce.
(Institute of Development Studies, 2018)




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CHAPTER FOUR: ENVIRONEMNTAL AND SOCIAL MANAGEMENT
FRAMEWORK

4.1 Environmental and Social Impact Identification and Assesment

The program sub-projects are likely to lead to positive ES impacts. Despite the positive impacts that are
likely to result from the implementation of the project-financed activities, some minor negative
environmental impacts may occur. Due to the nature of the project-financed activities, potential negative
environmental and OHS impacts are expected to occur during both the construction and/or operations
phases. These are outlined in Table 4-1 and Table 4-2 below. The latter includes the list of potential impacts
classified according to the nature of the activity of the MSME and/or startup.

With regards to social impacts, project-financed activities are not expected to involve any works that would
require land acquisition. No indigenous people are likely to be present in, or have collective attachment to,
areas where the project activities are located. A resettlement policy or an indigenous people’s frameworks
are therefore not required. However, some negative social impacts and risks could present themselves under
the project-financed activities such as:


     -     Discrimination based on gender and/or physical abilities
     -     Risks pertaining to gender based violence (GBV), both direct and indirect, including sexual
           harassment, domestic and partner violence, emerging forms of violations, such as stalking and
           bullying.
     -     Child Labor
     -     Beneficiary Dissatisfaction


Table: 4-1 Potential Negative Impacts of the project’s financed activities

                                                          Potential Impacts
          Sub-Project
                            Environmental                   Occupational H&S            Community H&S

 â–ª       Agro-Business      -   Demolition Waste Management
 â–ª       Renewable Energy -     Hazardous waste and chemicals management
 â–ª       Pharmaceuticals
 â–ª       Technology/     IT                                  -
                                                            Noise & Dust
         based                                               -
                                                            Volatile Organic Compounds
                                                             -
                                                            Asbestos handling
                                                             -
                                                            Physical hazard from demolition waste
                                                             -
                                                            Physical hazard from equipment or
                                                            vehicles
                                                          - Fire hazards
                                                                                  - Worker influx
                            - Equipment           on-site - Slippage and falling - Traffic        &
                               fueling                    - Working at heights      accessibility
                                                          - Manual      handling - Waste burning
                            Archaeological/antiquities      and lifting           - Waste
                            Chance finds                  - Electrocution           dumping
                            - Clearing/Cleaning/Weeding Waste Management

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                                              Potential Impacts
Sub-Project
                   Environmental                Occupational H&S          Community H&S

                                                 -   Physical hazard from equipment or
                                                     vehicles
                                                 -   Air emissions from waste burning
                                                                           - Worker influx
                                                 -   Slippage and falling - Traffic         &
                                                 -   Manual      handling     accessibility
                                                     and lifting           - Waste
                                                 -   Exposure           to    dumping
                                                     biological hazards




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Table 4-2 below illustrates examples of typical environmental and OHS impacts associated with MSMEs

Table 4-2 Key environmental impacts commonly associated with MSMEs



    Component activities                                       Potential Impacts


 Food Processing                     Less water availability

                                     Health impacts associated with risk of food poisoning

                                     Improper solid waste disposal

 Textiles, leather, footwear         Noise impacts

                                     Air quality and odour impacts

                                     Indoor air quality impacts (i.e. VOC emissions )

                                     Improper solid waste and wastewater disposal

 Paper articles, printing, and       Chemical and lead contamination associated with handling and waste
 photography                         disposal
 Manufacture of jewelry and
 glass                               Chemical contamination associated with handling and waste disposal

                                     OHS risks for operators and surrounding community

 Manufacture and repair of           Noise impacts
 household appliances and
 agricultural     implements,        Contamination from metal particles and substances, such as oils,
 except batteries                    solvents, and coolants

                                     Improper solid waste disposal

 Livestock     farming         and   Odor impacts and biological contamination by insects and rodents
 slaughter
                                     Improper solid waste and wastewater disposal

                                     Soil pollution
 Tanning and dying leather
                                     Exposure to hazardous substances such as chrome, mercury, and sulfides

                                     Improper solid waste and wastewater disposal

                                     Odor impacts




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 Manufacture of carpets and           Exposure to hazardous substances such as acids and heavy metals
 rugs, textile dying, and
 printing                             Fire hazards

                                      Soil pollution

 Sawmills, manufacture of             Noise impacts
 furniture and other wood
 products                             Indoor air quality impacts such as exposure to high noise & Particulate
                                      matter (PM) levels

                                      Exposure to hazardous substances such as solvents, sealants, lacquers,
                                      among others

                                      Improper solid waste disposal

 Automobile and motorcycle            Exposure to hazardous substances such as oil, fuel, and lubricants
 repair
                                      Noise impacts from operating vehicles, hammering, and polishing

                                      Traffic congestion due to obstruction of public space by improperly
                                      parked vehicles

                                      Improper solid waste and wastewater disposal

                                      Fire hazards

                                      Soil pollution

 Engineering and electric             Indoor air quality impacts
 industries (ACs, electronics
 etc.)                                Improper solid waste and wastewater disposal

                                      Noise impacts



4.2 ESMP Framework Implementation Arrangements


    4.2.1 Introduction

A well-defined institutional and implementation mechanism for identifying, appraising, managing and
monitoring safeguards at all levels is a key necessity. This section lays out the roles, responsibilities of
various parties and the due diligence process that will need to take place from the preparation of an
investment through implementation completion.

    4.2.2 Overall project institutional and implementation arrangements




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The Ministry of Investment and International Cooperation (MIIC) will sign the Loan Agreement and receive
the World Bank loan on behalf of the government of Egypt.
Decision-making and involvement in review and selection of equity investments will be the sole
responsibility of the Investment Committee (having representatives from the private sector, MSMEDA,
MIIC, MCIT), to be designated to it by the MSMEDA Board. A set of boundaries to the decision-making
process to address accountability issues will be laid out in the Operations Manual.
MSMEDA will be the implementing entity for this operation, and will act as the borrower, representing the
Government of Egypt. MSMEDA will also have overall supervision of the project and the responsibility of
ensuring that the daily activities of the project, as well as the monitoring and reporting of required indicators,
are duly conducted in accordance with the project criteria, which will be detailed in the project operations
manual.
MSMEDA will be responsible for housing the PIU and reporting back to MIIC and the World Bank. All
expenses for the operation of the PIU will be funded under Component 3. The PIU will be responsible for
the following: (i) Overall project management; (ii) Coordination; (iii) M&E of outcomes and results; (iv)
Procurement and implementation support; (v) Financial management; (vi) Ensuring gender focus in
implementation.
The Environment Unit of the MSMEDA will be responsible for implementing the ESMF. As part of
the former SFD, the Environment Unit has years of experience in implementing and monitoring World Bank-
funded projects including FIs; a robust environmental safeguards management system with well-established
procedures is in place and will be used for subproject’s screening, categorization, monitoring and reporting.
MSMEDA safeguards institutional arrangements include a central Environment Unit with qualified
environmental and social specialists and trained Environmental Focal Points (EFPs) in 33 SFD branches at
governorate/local level. The Project will benefit from the existing modern and efficient MIS which has been
put in place for on-line reporting on the compliance with environmental safeguards measures at
governorate/local level. As the MIS was mainly used for monitoring infrastructure type of subprojects, this
system should be upgraded to include reporting on the compliance of MSMEs that will be supported under
this Project. The capacity of the Environment Unit and the EFPs should be further enhanced under the Project
in terms of monitoring and reporting on MSMEs.
Services anticipated under Component 3, as well as debt and equity financing supported via Component 1
and 2, MSME-DA’s POM will outline a communications and outreach strategy for reaching the most
vulnerable groups, as well as for fostering transparency and accessibility of the funding application process
for participating financial intermediaries.
The project components and particularly BDS interventions will build on the ongoing needs assessments for
evaluating gaps in hard and soft entrepreneurial skills, contributing to a citizen-oriented design. The
assessments put emphasis on identifying common constraints as well as identifying specific needs of women
and youth entrepreneurs to ensure tailored solutions in project design. Feedback on the business development
activities will be obtained from beneficiaries on a regular basis and will be used to iteratively improve the
activities over the project period.




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 4.2.3 Results Monitoring and Evaluation Arrangements
The PIU established within MSMEDA will have the primary responsibility for the overall monitoring and
evaluation of project results, in accordance with the Project Results Framework and the POM. The PIU will
be responsible for developing a strong M&E framework and system to monitor project progress and results,
including E&S performance. Relevant activities will include: (a) development of an M&E methodology and
implementation plan; (b) compilation of baseline data, as determined by the Project Results Framework and
the M&E methodology developed; (c) introduction of a beneficiary feedback mechanism to collect feedback
from project beneficiaries on a regular basis. The PIU will also be responsible for preparing semi-annual and
annual project monitoring reports to be submitted to the World Bank Group. The project monitoring reports
will contain, at a minimum, summary data on overall performance against project targets, implementation
challenges experienced, and feedback received from project beneficiaries.
PFIs will also be required to monitor results related to project beneficiaries and submit M&E reports to the
PIU. PFIs will be required to include, in their funding applications, the mechanisms that will be used to
monitor results related to the project funds and E&S performance; and to submit M&E reports to the PIU on
a semi-annual basis. The PIU will be responsible for consolidating the M&E reports received from PFIs as
part of its reporting to the World Bank Group.
The project will provide capacity building support to the PIU to develop and implement the M&E
framework. The World Bank Group will provide resources to build the capacity of staff within the PIU to
undertake the activities related to the monitoring and evaluation of project results. This will include support
for setting up an M&E system, as well as relevant staff training on M&E.



4.3 Sub-project Environmental and Social Screening and Approval Framework

Under this ESMF, MSMEDA is committed to operationalizing and promoting an appropriate
Environmental and Social Management System (ESMS) for itself − as well as for the PFIs in order to
effectively assess and manage the E&S risk exposure associated with the project’s financed activities.
In order to appropriately identify the E&S risks associated with PFIs, MSMEDA will review the existing
business activities of the PFIs to identify risk and impacts associated with their existing portfolio and the
capacity of PFIs to manage E&S risks and impacts. In doing so, MSMEDA will take into consideration (a)
the types of products and services which will be provided by the PFI; (b) size and tenor of financing; (c)
the nature of the PFIs portfolio, including sectors and locations; (d) organizational capacity and
commitment of the PFIs to identify, assess and manage environmental and social risks and impacts of its
MSMEDA-supported portfolio.
As a condition of eligibility to receive financing, the PFIs will put in place and maintain an Environmental
and Social Management System (ESMS) to identify, assess, manage, and monitor E&S risks and impacts
associated with business activities they finance. Moreover, the PFI will have to comply with the Exclusion
List (Annex 2), which will be incorporated into the Financing Agreement as an Annex as a mandatory
requirement. Where the PFI can demonstrate that it already has an ESMS at the time of MSMEDA´s due
diligence, it will provide adequate documentary evidence to that effect.
The ESMS of PFIs will include the following key elements:

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    (i)       Exclusion List of excluded activities (Annex 2).

    (ii)      E&S policy (stating applicable E&S requirements and expressing overall commitment in
              managing E&S risks in their operations)

    (iii)     E&S screening procedures for identification, assessment, mitigation, and monitoring of E&S
              risks27,
    (iv)      Consistent reporting process and formats;
    (v)       Adequate organizational capacity for implementation, including training of credit staff on the
              applicable requirements and E&S screening process of final borrowers against them;
    (vi)      Monitoring and review of E&S risks of individual transactions and the portfolio, and
    (vii)     Grievance Handling Mechanism.

The ESMS will be endorsed by the PFI’s senior management and have adequate resources dedicated to its
implementation. MSMEDA will require all PFIs to promptly notify, of any social, labor, health and safety,
security or environmental incident, accident or circumstances which may have any material impact on the
compliance of the Applicable Environmental and Social Requirements.
MSMEDA will periodically review adequacy and implementation effectiveness of the PFIs’ ESMS,
including the processes and the results of the E&S due diligence conducted by the PFIs on its sub-
borrowers/sub-projects. In addition, MSMEDA will periodically review a sample of PFIs’ sub-
borrowers/sub-projects.
The PFI will put in place and maintain an Environmental and Social Screening Criteria developed
according to the criteria included in Annex 3. The objective will be to determine the suitable safeguard
instruments to use concurrent with the level of significance for the expected impacts
A framework methodology is proposed in this section for the screening, categorization, review, approval,
safeguarding, and monitoring of the project’s financed activities. These tools will be developed and
improved on an on-going basis.
The Bank will then review the screening results and accordingly the safeguards relevant instruments shall
be prepared, consulted with stakeholders and disclosed. Following clearance of the safeguards instruments
by the Bank and/or government, the ESMPs shall be implemented, supervised and monitored. Figure 4-1
outlines the proposed methodology.




27 Such procedures will include environmental and social categorization, record keeping, and disclosure.

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Figure 4-1: Outline of the ES Screening and Approval Methodology


   1- Screening for potential ES impacts and Categorization according to National and
                                  World Bank guidelines


                   2- Review of safeguards screening by World Bank



    3- Preparation of safeguards instruments, consultation, and disclosure - if needed


 4- Review and clearance of the safeguard instruments within the government or/and by
                                    the World Bank


  5- Implementation of agreed actions; accompanied by supervision and monitoring &
                                      evaluation




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Table 4-3: Sub-project Safeguarding , Approval, and Disclosure Methodology




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      Step                  Scope           Responsibility                          Criteria                                        Outcomes
                     -   Screen proposed    ES team of the   -    The program is categorized as Category FI            -   Subproject-specific
   Screening for         sub-project                         -    Screening criteria in Annex 3 will be adopted            screening checklist
                                            MSMEDA’s
   Potential             according to                            - Category A project-financed activities will         -   Sub-project
                                            environmental
   Environmental         safeguards                                  be excluded                                           categorization
   and Social                               unit
                         checklist (Annex                        - Activities which will involve land                  -   ES Assessments and
   Safeguard             3)                                          acquisition, involuntary resettlement or affect       Management &
   Impacts and       -   Determine                                   indigenous peoples will be excluded.                  Monitoring instruments
   Determination         applicable                              - Activities that might involve elevated labor
   of suitable           national and                                influx and related gender-based violence
   Safeguards            World Bank                                  risks will be excluded.
   instruments for       requirements                            - Activities with moderate negative impacts
   Each Sub-         -   Determine                                   (according to screening criteria in Annex 3 )
   project               instruments                                 will be required to prepare a site specific
                         needed to meet                              ESMP (i.e. additional mitigation measures)
                         requirements                                according to the framework ESMP and the
                                                                     layout described in Annex 5.
                                                                 - Sub-projects with minimal impacts
                                                                     (according to screening criteria in Annex 3)
                                                                     will be only required to fulfill the
                                                                     requirements of the framework ESMP.


1- Review of             -   Prepare                      A. Safeguards Screening Summary (SSS)                        A. Safeguards Screening
   Safeguards                subproject-    A. ES team of      i. Categorization Rationale                                Summary (SSS)
   Screening by              specific          the            ii. Safeguard instruments
   the ESO                   Safeguards        MSMEDA’       iii. Submitted as part of sub-project
   &World Bank               Screening         s                  identification package
                             Summary           environme                                                               B. Approval/Revision of
                                               ntal unit  B. Selective review of SSS                                      SSS
                         -   Assess         B. WB for
                             Safeguards        category B
                             Screening         subproject




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2- Preparation of   -   Draft Category     ES team of the   -   Draft ES instruments according to national and     -   Draft ES instruments
   Safeguards           B ES               MSMEDA’s             WB requirements                                    -   Consultation on draft ES
   Instruments,         instruments        environmental    -   Liaise with WB in case clarifications or changes       instruments
   Consultation     -   Consult on draft   unit                 arise                                              -   Final ES instruments
   and Disclosure       ES instruments                      -   Include project stakeholders, project-affected
                    -   Incorporate                             groups, local NGOs in consultations
                        feedback in                         -   Initiate consultations as early as possible
                        Final ES                            -   Provide relevant material in Arabic,
                        instruments                             comprehensible, accessible formats
                                                            -   Ensure enough time is provided to examine
                                                                documents ahead of consultation events
                                                            -   Document stakeholder feedback and ensure
                                                                disclosure & meaningful consultation
                                                            -   Show how stakeholder feedback was addressed
                                                                in final ES instrument
3- Review and       -   Review and         ES team of the   -   Category C sub-projects are not reviewed by        -   Cleared ES instrument
   Clearance of         clearance of ES    MSMEDA’s             WB                                                     according to national
   Safeguard            instruments        environmental    -   Project proponent ensures compliance of                requirements
   Instruments          according to       unit                 Category C projects with national legal
                        national           & WB                 requirements
                        requirements
                                                                                                                   -   Cleared ES instrument
                    -   Review and                                                                                     according to WB
                        clearance of ES                                                                                requirements
                        instruments
                        according to WB
                        requirements
4- Implementation   A. ES safeguards       A. ES team of    A. Project proponent contractually obliged to          A. ES instrument
   of Agreed        implementation         the MSMEDA’s     implements ES safeguards                               implementation
   Actions and

      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                                                                 65
Supervision,     B. Safeguard         environmental     B. WB team may conduct regular visits to supervise
Monitoring and   implementation       unit              implementation of safeguards instruments and
Evaluation       supervision                            compliance with the Bank policy requirements.        B. ES instrument
                                                                                                             implementation review
                 C. Monitoring &                        C. Independent consultants carry out monitoring
                 Evaluation                             programs, if needed
                                      B. WB
                                                                                                             C. ES instrument
                                                                                                             implementation monitoring,
                                                                                                             evaluation, and improvements
                                      C. Independent
                                      consultants




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4.4 Framework ESMP


In the event any of the subprojects financed through the program should require the engagement of
contractors, bidders must be requested to include a complete ESMP within their bidding documents. The
ESMP would be treated as a legally binding document, which is to be enforced in compliance with the
social and environmental safeguards operational policies of the World Bank.


Table 4-4 below presents the framework Environmental and Social Management Plan, under which
specific ESMPs shall be developed. This covers the project financed activities , sub-projects listed
below:

        â–ª    Agro-Business
        â–ª    Renewable Energy
        â–ª    Pharmaceuticals
        â–ª    Technology/ IT based

In general, the provisions related to worker training, occupational health & safety including Personal
Protective Equipment (PPE) provision and utilization, sound waste management,
archaeological/antiquities chance finds, and coordination with relevant authorities should be included as
contract clauses.
A Grievance Redress Mechanism (GRM) to be developed, which should also be elaborated and
incorporated in the ESMP instruments. Table 4-4 and table 4-5 summarize the mitigation and monitoring
measures for key impacts anticipated from the funded MSMEs and start-ups.
Given the nature of the project activities, the most effective mitigation measure for the identified risks
will be ensuring that project beneficiaries are actively involved throughout all stages of the project. Social
accountability and citizen engagement activities will be taken into consideration to strengthen project
results through different mechanisms: (a) a grievance redress mechanism (GRM) that allows citizens to
inquire about the project, provide feedback to MSMEDA about project implementation, and allow
potential beneficiaries to seek resolution on inclusion and/or exclusion errors, social and environmental
risk exposure and concerns, delays or errors in payment, and other project-related concerns; (b) public
information at different levels of implementation on the program objectives, eligibility criteria, the
application process, and available grievance redress mechanisms; (c) beneficiary satisfaction surveys,
which will be included in the process evaluation planned midway through implementation; and (d)
independent targeting performance evaluation to ensure compliance and effectiveness of targeting the
intended beneficiaries.


Gender based Violence-related complaints received directly through the GRM should be categorized
accordingly, and a survivor-centric approach followed to ensure that any adversely affected are treated
with utmost confidentiality during verification/investigation and linked with support resources as needed.



With regards to the Grievance system the two following tools need to be achieved: (i) raising public
awareness and carrying out mandatory public displays; and (ii) establishment of a viable GRM.

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Raising public awareness: Information about the grievance handling system described below will be
distributed at an early stage of the project to all project affected people through regular information
channels used by the project, including initiating meetings at the start of the project where feasible, public
meetings during project implementation, brochures/pamphlets in Arabic Language, posting on notice
boards and online when necessary.
Grievance Redress Mechanism: Transparency and accountability will be core elements of the Project.
Comprehensive GRM will be set up for all subprojects to account for all potential complaints arising
from the project’s potential impacts.
The goal of the GRM will be to increase transparency and accountability and to reduce the risk of the
project inadvertently affecting citizens. The GRM will also serve as an important feedback and learning
mechanism that can help improve project impact. The objective will be to provide channels for project
stakeholders to provide feedback on project activities via a mechanism that allows for the identification
and resolution of issues affecting the project, promptly and effectively in a culturally appropriate manner
and at no cost. This includes safeguards-related complaints pertaining to this ESMF and the WB’s
safeguards policies as a whole.
As a minimum, the PIU should ensure the following channels are well functioning within the current
GRM, through which citizens and beneficiaries can make complaints regarding project-funded
activities:

    a) A dedicated email address
    b) A dedicated phone line
    c) A dedicated address to send written letters
    d) Feedback boxes located at project sites
    e) Verbal or written complaints to community leaders, or project staff directly or through project
          meetings. If project stakeholders provide verbal feedback/complaint, project staff will lodge
          the complaint on their behalf, and it will be processed through the same channels with
          consideration for requests for confidentiality to the best degree possible..
    f) Periodic project meetings, each of which shall include women, with consideration to the
          requirement of providing safe spaces for women.


The GRM should comprise of a set of operating procedures to ensure successful implementation. The
PIU should ensure the current GRM uses the following set of measures as a minimum at all times:
    •     Receive and register complaints.
    •     Grievance’s document verification.
    •     Conduct field inspections in order to verify and confirm the authenticity and eligibility of the
          reported grievance. The field inspection could include interviews with different parties
          involved, with considerations of confidentiality and sensitivity to other cultural contexts and
          norms.
    •     Referring cases to other GRMs, if necessary and/or to the courts.
    •     Referring cases to a third party.

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    •     Track, and evaluate the process and results.


The WB’s Grievance Redress Service (GRS) provides an additional, accessible way for individuals and
communities to complain directly to the WB if they believe that a World Bank-financed project had or
is likely to have adverse effects on them or their community.         The GRS enhances the WB’s
responsiveness and accountability by ensuring that grievances are promptly reviewed and responded to
and working together identifies problems and solutions.

The GRS accepts complaints in English or the official language of the country of the person submitting
the complaint. Submissions to the GRS may be sent by:

        Email: grievances@worldbank.org
        Fax: +1-202-614-7313
        Letter: The World Bank
                  Grievance Redress Service (GRS)
                  MSN MC 10-1018
                  1818 H St NW
                  Washington, DC 20433, USA


Operation Phase for the project-financed activities

The below Table illustrates potential impacts and their mitigation and monitoring measures during the
operation phase of the project-financed activities. The ESMP described below represents the framework
under which site-specific ESMPs will be developed where applicable according to the sub-project
Environmental and Social Screening and Approval Framework. The framework ESMP could also
represent the minimum measures to be implemented for sub-projects, which do not need site-specific
ESMP as a result of the screening process and where simplified measures are sufficient to mitigate the
expected risks and impacts.




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Table 4-4: Framework ESMP during Operation

         Potential Impact                              Mitigation Measure                                              Monitoring

     All impacts                  -   Develop a robust and multi-channels project level Grievance         -   Review of the number of complaints
                                      Redress Mechanism (GRM)                                                 received.
                                  -   Ensure dissemination of the GRM to local communities prior to       -   Review of the number of complaints
                                      starting project activities.                                            solved, the mechanisms used and the
                                  -   Maintain solid documentation for the received complaints                time it took to solve them.
                                      during the operation of the project and track the level of
                                      responsiveness (provision of feedback).
     Beneficiary                  -   Create a qualitative assessment of the aspirations of women and     -   Collecting, monitoring,
     Dissatisfaction and              men of various age groups, especially the disabled and the most         disaggregating, and evaluation data.
     Discrimination                   vulnerable, through focus group discussions, to solicit feedback    -   Review number of complaints and
                                      on the challenges being faced by them, their views on solutions         negative data compared to positive
                                      and coping mechanisms, as well as feedback on the training              feedback and time it took to resolve
                                      programs and how they can be improved during all project                them
                                      stages
                                  -   Taking into consideration accessibility of project components
                                      for the disabled
     Gender Issues and all        -   Representation of women in all exercises of sub-project             -   Collecting gender-disaggregated
     forms of Gender based            designing, planning, implementation, and monitoring.                    monitoring and evaluation data to
     Violence, including          -   Inclusion of women in decision-making bodies (e. g Project              track the extent to which women have
     sexual harassment and            Steering Committee (PSC) and the Project Management Unit                been able to participate and benefit
     partner and domestic             (PMU).                                                                  from project activities.
     violence                     -   Deploy and conduct training around Codes of Conduct for all         -
                                      project staff and contractors especially those involved in
                                      employability activities such as training and direct interactions
                                      with families.
                                  -   Increase local NGOs/CSOs engagement and coordinate where
                                      possible with national systems to map available GBV
                                      prevention and response resources.
                                  -   Inclusion of women in decision-making bodies (e. g Project
                                      Steering Committee (PSC) and the Project Management Unit
                                      (PMU).

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    Potential Impact                               Mitigation Measure                                              Monitoring

                              -   Conducting gender-sensitive and participatory consultations
                                  while finalizing and designing the various sub-project activities
                                  such as the selection of niche products, training activities, and
                                  capacity building initiatives. These have to include safe spaces/
                                  women-only focus groups to encourage women’s meaningful
                                  participation in consultations.
                              -   Create female only spaces for women to receive trainings and
                                  services
                              -   Gender mainstreaming actions should be developed as part of a
                                  Gender Development Plan (GDP)
Child Labor                   -   Strictly enforce the national law, and include contractual          -   Review all labor contracts
                                  obligations for all project’s partners and beneficiaries            -   Field inspections
                                  prohibiting all forms of child labor                                -   Review complaints or grievances
                                                                                                          raised with regard to child labor
Solid & Hazardous Waste       -   Sufficient drainage, sanitation, & waste disposal facilities        -   Field inspections
and Wastewater Disposal           should be provided at work places with protocols for handling       -   Review complaints or grievances
                                  toxic and hazardous waste                                               raised with regard to solid waste and
                              -   Promote safe recycling systems and                                      wastewater and time it took to resolve
                                  microenterprises that specialize in recycling.                          them
                              -   Include Waste Management as part of beneficiary training.
                              -   Enforce strict hygiene practices.
                              -   Encourage use of raw materials free from chemical residues

OHS impacts, including:       -   Development of an OHS management plan, guidelines and               -   Field inspections
  - Noise & Dust                  operational procedures tailored to each sector, drawing on WB       -   Review complaints or grievances
  - Volatile Organic              EHS Guidelines and national laws.                                       raised with regard to OHS aspects and
      Compounds               -   Train beneficiaries on the following:                                   time it took to resolve them
  - chemicals        and                o Use of safety equipment, such as masks, gloves, and         -   Number of training sessions
      hazardous                             ear plugs                                                     conducted
      substances                        o Hygiene Standards
  - Asbestos                            o Promotion of safe recycling systems
      handling                          o Proper ventilation

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    Potential Impact                                Mitigation Measure                                          Monitoring

    -   Physical hazard                  o   Suitable hazardous substance management, including
        from demolition                      safe handling and storage
        waste                            o   Workshop cleanliness
    - Physical hazard                    o   Toxicity and hazardous substance storage.
        from equipment                   o   How to establish contingency plans for work
        or vehicles                          accidents
    - Fire hazards                       o   Fire hazards, contingency plans and availability and
    - Slippage and                           function of fire extinguishers
        falling
    - Working at
        heights
    - Manual handling
        and lifting
    - Electrocution
Effluents and Dust             -   Use of equipment with permissible air emission quality.          -    Review of the number of complaints
Generation                     -   Installment of air extractors and filters                             received and time it took to resolve
                               -   Train beneficiaries on EHS guidelines.                                them.
                                                                                                    -    Follow up inspections
                                                                                                    -    Number of training sessions
                                                                                                         conducted
Noise Impacts                 -    Work in closed installations and follow strict working hours     -   Review of the number of complaints
                                   schedule in order to reduce impact on neighbors                      received and time it took to resolve
                              -    Train beneficiaries on EHS guidelines.                               them.
                                                                                                    -   Train beneficiaries on EHS
                                                                                                        guidelines.




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Table 4-5: Framework ESMP during Construction




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                  Potential Impact                Mitigation Measures                                                       Monitoring Measures

                  All impacts                     -   Develop a robust and multi-channels project level Grievance              -   Review of the number of
                                                      Redress Mechanism (GRM)                                                      complaints received
                                                  -   Ensure dissemination of the GRM to local communities and                 -   Review of the number of
                                                      potential PAPs prior to starting construction activities.                    complaints solved and the
                                                  -   Maintain solid documentation for the received complaints during              time it took to solve them.
                                                      the construction phase of any sub project components and track the
                                                      level of responsiveness (provision of feedback).
                                                      - Assign & train worker(s) to manage waste collection, transport,        -   Daily review of waste
                  Solid waste management                  and management.                                                          containers or accumulations
                  (demolition, excavation etc.)       - Arrange with local authority or authorized waste handler to            -   Weekly review of chain of
                                                          transport and dispose of waste in designated facility                    custody or proof of
                                                      - Ensure waste transport vehicles are adequately equipped and                contracting authorized waste
                                                          that waste material is covered during transport                          handler
                                                      - Provide suitable Personal Protective Equipment (PPE) for               -   Weekly review of proof of
                                                          workers assigned to manage demolition waste                              disposal at designated
                                                      - Arrange for suitable waste containers and skips to be present              facility
                                                          for temporary waste storage                                          -   Daily review of signs of ash
                                                      - Avoid dropping the demolition waste from heights.                          or waste accumulations
                                                      - Avoid leaving sharp or protruding objects in the waste pile            -   Daily review of log of
                                                      - Recover recyclable materials from the demolition waste                     relevant incidents &
                                                      - Perform random checks on areas surrounding work site and                   complaints
                                                          route to waste disposal facility to ensure waste was not dumped
                                                      - Strictly prohibit waste burning.
                  Hazardous waste and materials       - Clearly identify and label hazardous waste or hazardous                -   Daily review of waste
                  management                              materials and ensure Material Safety Data Sheets (MSDS) are              containers or accumulations
                                                          available in Arabic                                                  -   Daily review of hazardous
                                                      - Identify and provide contacts of closest authorities and                   chemical storage areas and
                                                          emergency services to contact in case of incidents involving             containers
                                                          hazardous waste and materials                                        -   Weekly review of chain of
                                                      - Assign & train worker(s) to identify & manage hazardous waste              custody or proof of
                                                          and materials                                                            contracting authorized waste
                                                      - Provide suitable Personal Protective Equipment (PPE) for                   handler
                                                          workers assigned to manage hazardous waste and materials             -   Weekly review of proof of
                                                      - Provide relevant first-aid kits                                            disposal at designated
                                                      - Anticipate mass and volume of possible hazardous waste                     facility
                                                      - Arrange for a secure area on-site for hazardous material
                                                          receiving and storage

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                                                        -   Arrange for suitable waste containers and skips to be present
                                                            for temporary waste storage
                                                        -   Predetermine temporary storage zone for waste pile or
                                                            container
                                                        -   Arrange with local authority or authorized hazardous waste
                                                            handler to transport and dispose of waste in designated facility
                                                        -   Provide suitable Personal Protective Equipment (PPE) for           -   Daily review of works
                                                            workers assigned to jobs in sustained high noise levels                schedule
                                                        -   Coordinate with surrounding community to avoid noisy tasks         -   Daily review of Noise
                               Noise impacts                during sensitive times of facility operation                           complaints
                                                        -   Seek to schedule noisy works in institutional vacation periods     -   Review of PPE availability
                                                        -   Inform surrounding community of periods of unavoidable noisy           & usage during noisy works
                                                            works
                                                        -   Provide suitable Personal Protective Equipment (PPE) for           -   Daily review of works
                                                            workers assigned to jobs in sustained high dust levels                 schedule
                                                        -   Economically spray water (preferably used/grey water) to wet       -   Daily review of Dust
                                                            waste and dust piles to minimize emissions                             complaints
                               Dust Emissions           -   Coordinate with surrounding community to ventilate dusty           -   Weekly review of Dust
                                                            works in confined spaces in the facility                               wetting procedures
                                                        -   Seek to schedule dusty works in institutional vacation periods     -   Review of PPE availability
                                                        -   Inform surrounding community of periods of unavoidable dusty           & usage during dusty works
                                                            works
                                                        -   Inform workers to stay vigilant in areas of demolition waste       -   Worker and facility user
                               Physical hazards from        generation and storage                                                 monitoring
                               demolition waste         -   Same measures as for demolition waste management                   -   Log of relevant injuries &
                                                                                                                                   complaints
                                                        -   Ensure drivers and machine operators undergo random medical        -   Monthly review of Driver &
                                                            and drug/alcohol detection checks                                      operator testing reports
                                                        -   Train workers on equipment operation safety                        -   Monthly review of Driver &
            Occupational H&S




                                                        -   Ensure equipment, machinery, and vehicles used is in good              operator training certificates
                               Physical hazards from
                                                            working condition                                                  -   Review of exclusion zones
                               equipment and vehicles
                                                        -   Create exclusion zones to limit access to equipment and vehicle    -   Log of relevant injuries &
                                                            maneuver lines                                                         complaints
                                                        -   Avoid vehicle speeds higher than 20km/hr in project sites
                                                            (where applicable)

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                                                             -   Same measures as for demolition waste management
                                                             -   Train workers on identifying and avoiding fire hazards             -   Weekly review of fire
                                                             -   Provide fire extinguisher instruments and sand buckets in good         extinguishing instruments
                                                                 working condition                                                  -   Weekly review of
                                                             -   Create strictly No-Smoking zones in fire risk areas such as fuel       flammable material
                                                                 storage areas, excavations, near decomposing organic matter in         containers & storage
                                                                 waste piles and around water bodies                                -   Log of relevant injuries &
                                                             -   Avoid storing flammable materials in direct sunlight or near           incidents
                               Fire Hazard                       heat sources
                                                             -   Ensure suitable grounding and circuit breakers are available for
                                                                 electrical works
                                                             -   Strictly avoid excavations in areas with residential natural gas
                                                                 connections or works near natural gas piping
                                                             -   Identify and provide contacts of closest authorities and
                                                                 emergency services to contact in case of incidents involving
                                                                 Fires
                                                             -   Provision of suitable footwear to avoid slippage                   -   Ongoing review of PPE
                                                             -   Avoiding tasks on unstable slopes or soils without proper fall         availability & usage
                               Slippage and Falling &            prevention precautions                                             -   On-going review of relevant
                               Working at heights            -   Installation of guardrails at the edge of any fall hazard area         fall prevention measures and
                                                             -   Proper use of ladders and scaffolds by trained employees               awareness
                                                             -   Use of fall prevention devices
                                                             -   Incorporating rest and stretch breaks into work processes and      -   Ongoing observation of
                                                                 conducting job rotation                                                workers
                               Manual handling and lifting   -   Taking into consideration additional special conditions such as    -   Weekly review of break
                                                                 left-handed persons and persons with existing medical                  periods and rotations
                                                                 conditions
                                                             -   Checking all electrical cords, cables, and hand power tools for    -   Ongoing equipment and
                                                                 frayed or exposed cords                                                connection checks and
            Occupational H&S




                                                             -   Following manufacturer recommendations for maximum                     reporting
                                                                 permitted operating voltage of the portable hand tool
                               Electrocution
                                                             -   Protecting power cords and extension cords against damage
                                                                 from traffic by shielding or suspending above traffic areas
                                                             -   Conducting detailed identification and marking of all buried
                                                                 electrical wiring prior to any excavation work

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                                                      -   Inform local communities in case of anticipation of prolonged        -   Daily review of log of
                  Traffic and accessibility               closure of roads or access routes and clearly point at alternative       relevant incidents &
                                                          routes.                                                                  complaints
                                                      -   Minimize on-site fuel container storage and fueling activities       -   Weekly review of signs of
                                                          by planning fueling before site deployment                               spillage or contamination
                                                      -   Designate a specific location on-site for fueling, maintenance,      -   Weekly review of integrity
                  Equipment on-site fueling               and lubrication activities                                               of impervious layer
                                                      -   Provide impervious material such as geotextile or polymer
                                                          sheets in locations on-site designated for fueling, maintenance,
                                                          or lubrication
                                                      -   Coordinate with local authorities and natural gas and electricity    -   Daily review of log of
                                                          authorities before excavation                                            relevant incidents &
                  Utility damage
                                                      -   Conduct detailed identification and marking of all underground           complaints
                                                          utility lines prior to any excavation work
                                                      -   Include clear and explicit measures in the contractors’ contract     -   Regular review of the
                                                          to 1) prohibit labor under18 years old in the main contract, 2)          contractors’ contract.
                  Risk of child labor
                                                          stipulate that this contract should go to the entire sub contract    -   Regular site inspection of
                                                          as binding condition.                                                    workers
                                                      -   Encourage the common practice of using local workers as this         -   Daily review of log of
                                                          will reduce the transaction cost and will eliminate the risk of          relevant incidents &
                                                          labor influx.                                                            complaints
                                                      -   Inform local communities in case of anticipation of high worker      -   Ongoing field supervision
                                                          influx into project area.
                                                      -   ($) Provision of cultural sensitization training for workers
                                                          regarding engagement with local community
                                                      -   Code of conduct to be developed and all workers to adhere to.
                  Labour Influx                       -   Provision of information regarding Worker Code of Conduct in
                                                          local language and follow up on compliance.
                                                      -   Share with community and implement the approved GRM at all
                                                          times during the construction phase and track the level of
                                                          responsiveness (provision of feedback).
                                                      -   Ensure that workers have monthly vacation to go visit their
                                                          families.
                                                      -   Ensure that the location of the workers’ residence does not
                                                          provoke any inconveniences to the local community.

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                                                               -   Enforce the national law                                            -   Daily review of log of
                                                               -   Ensure appropriate payment to both contractors and sub-                 relevant incidents &
                         Increased risk of illicit behavior
                                                                   contractors workers                                                     complaints
                         and crime
                                                               -   Introduction of sanctions (e.g. dismissal) for workers involved
                                                                   in abuse or any inappropriate activities

In the event any of project-financed activities should require the engagement of contractors, bidders must be requested to include a complete ESMP within
their bidding documents. Bidding documents should also include Code of Conducts and other measures for how contractors will mitigate Gender Based Violence
Risks. The ESMP would be treated as a legally binding document, which is to be enforced in compliance with the social and environmental safeguards
operational policies of the WB. The table below includes the minimum mitigation and monitoring measures to be included in such ESMPs. Additional measures
could be added according to individual site conditions.




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4.5 Capacity Building and Training Needs


Upon ESMF and ESMP approval by the WB and adoption by MSMEDA, that the following
stakeholders should undergo training on ESMF application:

    -    Environmental/Safeguards Focal Points
    -    Relevant staff of the concerned governorates and ministries.
    -    PFIs
    -    Other project stakeholders - intrested/potential partners
ESMF Training will be customized to the roles of the various stakeholders to include:
   - Sub-project screening, categorization, ES instrument preparation, and disclosure, including
      ‘negative list.’
   - Overview of the ESMF structure, including positive list of potential subprojects
   - Mitigation measures implementation
   - Monitoring measures implementation
   - Templates, archiving, and reporting
   - Project data analysis and project improvements
In addition, worker training needed to minimize incident risk and ensure compliance with
ESMF/ESMP provisions. Relevant training topics to be delivered by the contractor for worker
training include:
     - Customized Occupational Health and Safety
     - First aid & Emergency response
     - Training on sub-project ESMP preparation and implementation



4.6 ESMF Cost Estimate

The costs associated with implementing the ESMF will be covered under the standard
operating/administrative costs of the private company as the companies are obliged to follow the
EEAA regulations.

Training costs will be primarily related to the use of the ES consultant to prepare and execute these
workshops as needed. These costs are included in Section 4.5, ESMF Cost Estimate. Costs related
to hosting workshops are expected to be borne by WYEP, all costs related to attending workshops
are expected to be borne by workshop participants.

It is expected that WYEP will retain access to ES consultancy services to advise the WYEP on a
“as needed� basis. ES consultancy services implies that the WYEP may retain services of several
different ESs as they are available when their services are needed. The cost of hiring a part-time
Environmental Consultant (included in ‘Environmental Monitoring’) is included in the ESMF
budget (Table 4-4).




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                   Table 4-4: ESMF Implementation Cost Estimate Details

                 Activity                          Quantity          Unit Rate   Estimated
                                                                      (USD)        Cost
                                                                                  (USD)
ESMF Training (Project Partners )                 120 Trainees         150        18,000
ESMF Training (Sub-project proponents )          1500 Trainees          15        22,500
Customized Occupational Health and Safety        1500 Trainees          15        22,500
training (Sub-project proponents)
First aid & Emergency response (Sub-project      1500 Trainees          15        22,500
proponents)
Environmental Monitoring                      100 Expert days/year     170        102,000
                                    Total                                         187,000




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         ANNEXES



         Annex 1: Consultation
         Annex 2: Excluded Activities
         Annex 3: Environmental & Social Screening Criteria/Checklists
         Annex 4: Impact Assessment Methodology
         Annex 5: Environmental and Social Management Plan (ESMP) Outline




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                                      Annex 1: Consultation


Purpose of Stakeholder Consultation:

    •     Inform: Promote stakeholder understanding of the project as well as any issues, problems,
          alternatives, opportunities and solutions through balanced and objective information
          sharing;
    •     Consult: To obtain feedback and acknowledge concerns and aspirations of stakeholders on
          design, analysis, alternatives, and decisions with regard to project activities;
    •     Engage: Work directly with stakeholders to ensure that their concerns and aspirations are
          understood and considered and to assure them that their concerns/aspirations would be
          directly reflected in the project design and/or alternatives; and that feedback will be
          provided on how their input influenced the final decision;
    •     Empower: Make stakeholders partners in each aspect of the decision, including
          development of the project design, alternatives and identification of preferred solutions so
          as to ensure ownership of subprojects at the grassroots level.

Objectives of Stakeholder Consultation:

    •     To share the proposed project components, coverage and activities in a participatory
          manner;
    •     Engage stakeholders in the development of project design;
    •     Develop recommendations/mitigation measures on how best to address the anticipated
          environmental and social implications;
    •     Develop a provisional list of institutional responsibilities; and
    •     Identify capacity needs.

Stakeholder Participation and Key Takeaways

The consultation process involved several activities including: meetings with potential financial
intermediaries, focus group discussions and in-depth interviews with potential beneficiaries and a
public consultation workshop.

Throughout the entire project development process, starting from the preparation and scoping, the
team conducted meetings with banks and other non-bank financial institutions obtaining their views
and perspectives which contributed to the development of the project design.

Roundtable discussions were held in April 21-23, 2018 with ecosystem players, youth and women
entrepreneurs and business owners as well as with MSMEDA micro-enterprise clients (a sample
invitation in Appendix 1), an additional roundtable discussion with ecosystem players
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including venture capitals, angel investors, accelerators and startups was held on July 10,
2018.


Key takeaways from youth/startup roundtables:
   • Participants: Two sessions: one with female startup entrepreneurs and one with male
       startup entrepreneurs. 9-12 participants each.
   • Who they are: Most were young, generally under the age of 35. Almost all entrepreneurs
       had successful jobs in the past or have the capacity/skills to pursue one. Most were driven
       by passion for what they do, and others started their business to meet an unmet demand in
       the market. Several pointed out that quitting their job and becoming a full-time
       entrepreneur was a difficult decision; some still continue to work in addition to running
       their business.
   • Type of business: There was significant difference between male and female entrepreneurs
       in terms of both industry and financing (based on our sample of participants). Male
       entrepreneurs are mostly in tech or F&B sector, while women tend to own businesses that
       primarily target/cater to women.
   • Literacy: High levels of literacy and tech-savviness
   • Formal vs. informality: All male-owned businesses were formal, but several women-
       owned ones were not. In general, there is strong preference to formalize businesses.
   • Financing: Most female startup entrepreneurs were self-funded. Almost none indicated
       that they need formal financing, such as banks or venture capital funds (even though several
       were registered businesses). Male entrepreneurs tend to go for equity financing, but hold
       negative opinions about venture capital funds in Egypt saying that “there is no added
       value� and that they are “only interested to make money�
   • Barriers: Several structural and non-structural barriers were identified by the
       entrepreneurs:
            o Financial management (both accounting and taxes) is a challenge for both men and
                women as most had not dealt with this in their previous jobs. They tend to work
                with accountants to help them with this, but would like to learn more.
            o Lack of skilled labor- several had difficulty findings good employees. Some also
                found it challenging to find trustworthy suppliers for their products.
            o Regulatory process- almost all found it challenging to figure out paperwork and
                business requirements. Common frustrations include dealing with the bureaucracy,
                entry/exit to the business, taxation, export license, etc. Interestingly, very few
                knew or used the Ministry of Investment “Investment Service Center�. A potential
                entry point for interventions here could be simplification of processes or checklists
                that entrepreneurs can use to plan things better, along with referrals to one-stop
                shops.
   • Social barriers: Female entrepreneurs did not think there were any social barriers for
       women business-owners like them. None reported facing any gender-related
       discrimination.


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    •     Networks: Almost all participants, especially males, felt that there is need for good
          mentors or peer networks. Some male entrepreneurs have created ad-hoc networks, but
          they all admit that they would benefit for a network of peers and/or mentors.

Key takeaways from MSMEDA micro-enterprise clients roundtable:
   • Participants: One session with 10-12 participants, mostly women. (list of attended in
       Appendix 2)
   • Who they are: Most of the participants appeared to be need-driven entrepreneurs (i.e.
       working to fulfill financial needs to family rather than following a passion or addressing a
       gap in the market).
   • Type of business: Most of the economic/livelihood activities were small and community-
       based, in some cases building on the comparative advantage of the locality (village, rural
       setting).
   • Literacy: Several of the micro entrepreneurs were illiterate and had little knowledge of
       technology. however, a few of the educated entrepreneurs mentioned using Facebook and
       WhatsApp for their businesses.
   • Formality vs. informality: Majority of these business are generally unregistered by
       choice. Lack of knowledge about formalization and fear of the regulatory system makes
       many of these women opting to remain informal. Informality means less taxes and less
       regulation in general. However, it does come with some challenges. Informality restricts
       their capacity to grow their businesses (because they cannot rent a shop without a business
       license) and secure financing (certain financing vehicles are only available for registered
       business.
   • Barriers: Access to financial resources was identified as the biggest constraint (this may
       have been somewhat biased given SFD and WB presence in the room), but several said
       that they were not keep on accessing larger amounts. There is little knowledge of available
       resources (financing, one-stop shops, etc.). Many female participants also identified access
       to information as a major barrier.
   • Aspirations: Most entrepreneurs aspire to expand their business (e.g. open shops, open
       more shops, start exporting), but very few have specific plans or are taking active steps to
       reach that goal. Setting and following through on goals may be an issue here. Some female
       entrepreneurs also face some resistance from their friends and families and face emotional
       difficulties in fulfilling their aspirations. E.g. one of the beneficiaries broke down into tears
       during the side discussions while talking about her husband’s lack of support. Her family
       viewed her business as a “hobby�. Social norms also restrict ambition. One woman
       reported that she did not want to go through leadership/skills trainings because she did not
       want to stand out or get looked upon as being too ambitious. Women who do talk about
       expanding their business tend to have more supportive spouses or family/community
       members.
   • Role models: Almost none of the participants talked about having any mentors or role
       models. This is a potential entry point given the lack of support from families and spouses
       that can lead to demotivation. One of the women mentioned that she sometimes reads about
       or interacts online with other successful women to keep herself motivation. However, this
       may not be the case with everyone given the low levels of tech-savviness.
        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                  84
    •     Initiative/effort: Self-initiative varied among the participants. E.g. one participant
          mentioned that she watches videos and invests her profits into enrolling into training
          programs to teach herself better skills, while another deliberately avoids this so as to not
          become superior to her peers.
    •     Financial behavior: Most women do not save (most say they do not have enough income).
          Some have small loans, but there may be some bias against borrowing (especially large
          amounts).


A stakeholder workshop was held on the 11th of November 2018, in Cairo (at the Social Fund of
Development) where a presentation on the project background and components and its expected
positive and negative impacts and their mitigation measures were presented to key stakeholders.
The stakeholders were then invited to detail their concerns, perceptions, reactions and experiences
in relation to the proposed sub-components of the project and the impacts presented.

A total of 28 stakeholders representing attended the consultation. A list of Attendees is attached to
this annex as Appendix 1 and pictures of the consultation under Appendix 2.


A summary of issues and responses raised during the stakeholder consultation is presented
in the Table below:


Table A-1: Questions and Answers


                        Questions                                                Answers

        1. How will the project reach out to the                -   As part of the project there will be an
           informal sector or people hesitant to                    awareness campaign to reach out to the
           approach intermediaries such as banks.                   informal sector and with the aim of reaching
           This sector represents the majority of                   the highest number of people in different
           businesses in Egypt and therefore should                 governorates. This will for instance be done
           be focused on the most.                                  through various media outlets.


        2. With regards to the three project                    -   Project beneficiaries who receive financial
           components, will people who do not                       support under the project will be given
           receive finance support also be eligible for             priority. However, others, who have not
                                                                    received financial support will also be
           training and capacity building as specified
                                                                    eligible for business and capacity
           under component three? Or is it a pre                    development.
           requisite to receive financial support.




        ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                                85
     3. How is the cost of ESMF implementation                -   The cost for implementing the ESMF should
        incorporated into the project?                            be added (i.e. excluded) from the loan
                                                                  amount in order to facilitate for the
                                                                  beneficiaries implementation of such
                                                                  measures.



     4. How will GBV be prevented in the                      -   The ESMF lays out several mitigation
        project?                                                  measures for GBV, including conducting
                                                                  gender-sensitive and participatory
                                                                  consultations, training activities, and
                                                                  capacity building initiatives. The project
                                                                  will also create safe spaces and women-only
                                                                  focus groups to encourage women’s
                                                                  participation in consultations. Any
                                                                  complaints on GBV will be handled through
                                                                  the GRM. All measures preventing GBV
                                                                  will be monitored through monitoring and
                                                                  evaluation data.

     5. What are examples of Category A, B and                -   Projects have to undergo a screening process
        C projects?                                               to identify the Category. The screening
                                                                  process for this project as presented prepares
                                                                  a list of questions, which will identify the
                                                                  category based on the applicability of the
                                                                  question. Category A projects will not be
                                                                  eligible under any case. Other projects with
                                                                  certain impacts, such as land acquisition
                                                                  will also not be eligible.
     6. Will there be more information on the                 -   Yes, all necessary information will be
        terms used in the Project Description,                    available to stakeholders, including
        such as small and medium enterprises,                     important definitions.
        informal sector or intermediaries?



In addition to the consultation activities conducted as part of the project, a Behavioral Diagnostic
study on psychological, behavioral, and social barriers for women and youth entrepreneurs in
Egypt funded by the UK SPEIG TF has conducted additional data collection through focus group
discussions and in-depth interviews with women and youth entrepreneurs in October 2018. The
study is expected to be complete by December 2018 and its findings are expected to feed into the
Project’s Component 3 pertaining to Business and Capacity Development. Further details of their
key takeaways from the focus group discussions and in-depth interviews held are in Appendix 5.




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Appendix 1: Sample Invitation for Roundtable Discussions




    ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT   87
Appendix 2: List of attendees at the MSMEDA micro-enterprise clients
roundtable

                  Client Name                                         Activity

 Small Enterprises

 Mr. Samer Elia Salman                           Pickles processing

 Ms. Doaa Ramadan                                Handicrafts from palms

 Mr. Gamal Ahmed                                 Bambo products

 Ms. Abeer Quorany                               Trading of Readymade Garments

 Ms. Wafaa Ahmed                                 Exporting Aromatic Herbs

 Micro Finance:

 Ms. Fayza Abdel Aleem                           Production of fiber quilts and pillows

 Ms. Hadeer Hosny Hassan                         Porcelain

 Mr. Mohamed Mahmoud                             Stationary shop

 Mr. Mohamed Sayed Bastawy                       Barber

 Ms. Jacklin Boles                               Sewing of clothes




     ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                          88
Appendix 3: List of Attendees to Public Consultation Workshop

 I.     Photos of Attendance Sheet




      ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT   89
 II.     Printed Attendance Sheet
a) English Attendance Sheet
 No       Name                             Title                        Company
 1  Maher                     -                                 -
                                                                Industrial Development
 2     Tarek Galal            Head of MSEs & Credit Zones
                                                                Bank
                              Director of Business
 3     Haytham Aly                                              BM Leasing
                              Development
 4     Hisham Sheta           Managing Director and CEO         BM Leasing
 5     Manar Nasr             Relationship Manager Treasury     QNB Al-Ahli
 6     Ahmed Radwan           Credit Officer SMEs Sector        SAIB Bank
 7     Saad Mohy Eldeen       Head SME Sector                   National Bank of Egypt
                                                                Industrial Development
 8     Safaa Hamza Ahmed      -
                                                                Bank
       Dr.Abdelzaher El-                                        ECIDA (Environment Care
 9                            Chairman of Board of Directors
       Hakim                                                    & Integrated Development)
                                                                ECIDA (Environment Care
 10    Eng. Leila Morsi       Secretary General
                                                                & Integrated Development)
       Dr. Tawfiq El-
 11                           General Manager                   Banque du Caire
       Semary
       Eng. Hatem Kamal
 12                                                             MSMEDA
       Mahmoud
 13    Marie-Therese Fam      Managing Partner                  Flat6Labs cairo
 14    Maha Bishr                                               Micro Finance
       Adel Taha              General Manager Small and         aiBANK (Arab Investment
 15
       Abdelwahab             Medium Enterprises Sector         Bank)
                              Investment & Venture Capital
       Amr Mohamed
 16                           Department - Enterprises          MSMEDA-UNDP
       Shehata
                              Development Agency
       Mohamed Mohamed
 17                           Chief Executive Officer           Agriculture Bank of Egypt
       Shawky
 18    Saeed Mounir Fam       -                                 -
       Mohamed Hatem          -
 19                                                             Financial Portfolio Manager
       Guendeya
                              -                                 Egyptian Small Enterprise
 20    Mohamed Abdelnaby
                                                                Development Foundation
 21    Guirguis Khalil        -                                 -
 22    Masoud                                                   MSMEDA
 23    Khalil Aly                                               National Bank of Egypt
                                                                SECDA (The Small
       Mohamed Tarek                                            Enterprises & Community
 24                           General Manager
       Saleh                                                    Development Association –
                                                                NGO)
 25    Hazem Salah                                              MSMEDA
 26    Rania Mohamed                                            MSMEDA
 27    Alia El-Kadi           Consultant                        World Bank
       Elham Hamdy
 28                                                             Global Investment House
       Mohamed

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‫‪b) Arabic Attendance Sheet‬‬
             ‫الشركة‬                                  ‫الوظيÙ?ة‬                            ‫االسم‬
                                                                                                      ‫‪ 1‬ماهر‬
                                            ‫مدير قطاع المشروعات الصغيرة و‬                                  ‫‪2‬‬
             ‫بنك التنمية الصناعية‬                                                               ‫طارق جالل‬
                                                                     ‫المتوسطة‬
           ‫بي ام للتاجير التمويلي‬               ‫مدير عام قطاع تطوير االعمال‬                     ‫‪ 3‬هيثم علي‬
           ‫بي ام للتاجير التمويلي‬            ‫العضو المنتدب Ùˆ الرئيس التنÙ?يذي‬                    ‫‪ 4‬هشام شتا‬
          ‫بنك قطر الوطني االهلي‬             ‫مدير عالقات العمالء ادارة الخزانه‬                  ‫‪ 5‬منار نصر‬
                                       ‫مسئول ائتمان قطاع المشروعات الصغيرة‬                               ‫‪6‬‬
                    ‫‪SAIB bank‬‬                                                               ‫احمد رضوان‬
                                                                   ‫و المتوسطة‬
             ‫البنك االهلي المصري‬        ‫رئيس المشروعات الصغيرة و المتوسطة‬                 ‫‪ 7‬سعد محي الدين‬
              ‫بنك التنمية الصناعية‬                                                      ‫‪ 8‬صÙ?اء حمزة احمد‬
      ‫جمعيه رعاية البيئة و التنميه‬                                                                        ‫‪9‬‬
                                                            ‫رئيس مجلس ادارة‬          ‫د‪ .‬عبد الظاهر الحكيم‬
                           ‫المتكاملة‬
      ‫جمعيه رعاية البيئة و التنميه‬                                                                            ‫‪10‬‬
                                                                     ‫امين عام‬              ‫م‪ .‬ليلي مرسي‬
                           ‫المتكاملة‬
                         ‫بنك القاهره‬                     ‫مدير عام بنك القاهرة‬           ‫د‪ .‬توÙ?يق السمري‬       ‫‪11‬‬
                                                                                        ‫حاتم كمال محمود‬       ‫‪12‬‬
                   ‫‪Flat6Labs‬‬                                     ‫شريك اداري‬               ‫ماري تريز Ù?ام‬       ‫‪13‬‬
               ‫‪Micro Finance‬‬                                                                    ‫مها بشير‬      ‫‪14‬‬
                                         ‫مدير عام قطاع المشروعات الصغيرة و‬                                    ‫‪15‬‬
             ‫بنك االستثمار العربي‬                                                     ‫عادل طه عبدالوهاب‬
                                                                    ‫المتوسطة‬
          ‫جهاز تنمية المشروعات‬                      ‫نائب مدير ادارة االستثمار‬    ‫‪ 16‬عمرو محمد شحاته العباسي‬
          ‫البنك الزراعي المصري‬                        ‫الرئيس التنÙ?يذي لالئتمان‬          ‫‪ 17‬محمد محمد شوقي‬
                                                                                            ‫‪ 18‬سعيد منير Ù?ام‬
                                                            ‫مدير محÙ?ظه ماليه‬             ‫‪ 19‬محمد حاتم جنديه‬
  ‫الجمعيه المصريه لمساعدة صغار‬                                                                            ‫‪20‬‬
                                                                                          ‫محمد عبد النبي‬
                       ‫الصناع‬
   ‫"منصة المشروعات الصغيرة"‬                                                                                   ‫‪21‬‬
                                                                                            ‫جرجس خليل‬
                 ‫‪MSMEDA‬‬
                                                                                              ‫‪/ 22‬مسعود‬
                   ‫البنك االهلي‬                                                              ‫‪ 23‬خليل علي‬
 ‫جمعية تنمية المشروعات الصغيرة‬                                                                        ‫‪24‬‬
                                                                     ‫مدير عام‬          ‫محمد طارق صالح‬
               ‫و تنمية المجتمع‬
   ‫"منصة المشروعات الصغيرة"‬                                                                                   ‫‪25‬‬
                                                                                                ‫حازم صالح‬
                ‫‪MSMEDA‬‬
   ‫"منصة المشروعات الصغيرة"‬                                                                                   ‫‪26‬‬
                                                                                                 ‫رانيا محمد‬
                ‫‪MSMEDA‬‬
                   ‫البنك الدولي‬                                     ‫استشارية‬                ‫‪ 27‬عالية القاضي‬
            ‫جلوبال للتاجير التمويلي‬                                                       ‫الهام حمدي محمد‬     ‫‪28‬‬




     ‫‪ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT‬‬                                               ‫‪91‬‬
Appendix 4: Public Consultation Workshop Photos




    ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT   92
ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT   93
Appendix 5: Key Takeaways from the UK SPEIG TF Behavioral Diagnostic
Qualitative Data Collection Activities

1. Pre-tests with women microentrepreneurs and male youth microentrepreneurs:
   The pre-test comprised of two FGDs and two in-depth interviews- one FGD and IDI
   in Shaeqeya with female microentrepreneurs and one FGD and IDI in Cairo with
   youth male microentrepreneurs. The FGDs had between 7-8 participants each.
   Preliminary insights from the pre-tests point to several potential barriers and entry-
   points:
            • Fear of borrowing: Women almost always prefer saving to borrowing
               because it’s less risky. They are generally not very interested to borrow.
            • Unwilling to register: Registration is directly associated with taxes, so
               most entrepreneurs do not plan to register.
            • Limited planning and aspirations: Even if they want to grow their
               business or mention an aspiration, they’re (especially women) not doing
               anything actively to achieve or work towards the goal
            • Stark difference between men and women in seeking
               advice/resourcefulness: Women tend to not consult or seek advice from
               others (those that do, talk to husbands or male family members). Of the
               few that have “role models�, the qualities they admire are mostly unrelated
               to running their business. Men tend to be more resourceful in seeking
               support/information and have more informed goals/aspirations. Most male
               youth mentioned getting advice from others- either with knowledge or
               experience- and are more aware of what they want and why. However,
               their networks are still limited to people they know.
            • Limited knowledge of other resources to build capacity or skills: Most do
               not know of any resources or training that can help them build their
               capacity (one woman mentioned using the internet). Men are slightly more
               resourceful, but within their own (limited) environments and network of
               people they already know. No one has heard of or considered joining
               business associations (note: all of these were very small business- almost
               subsistence level).
            • Mobility and gender-related barriers: Mobility can be restricted for
               women due to social barriers- women shouldn’t be out late, meet alone
               with male suppliers/customers. They worry about their reputation (with
               regards to interaction with men).
            • Exposure to successful women increases men’s willingness to support their
               female relatives to become entrepreneurs: most male participants were not
               very supportive of their female relatives having their own businesses-
               concerned about safety, coming home late, harassment. Those that support
               mentioned successful female entrepreneurs they know.
            • Other barriers for women: Lack of information/uncertainty about
               processes and services; intra-household bargaining.
            • Takeaways: To understand the processes and services better, engaging
               with NGOs and MFIs that provide financial and non-financial services to
               these beneficiaries could also provide useful insights; the implications of
     ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                          94
               business registration might need to be clarified; the fear/distrust of loans
               needs to be address- either through information or reframing; women need
               help with planning and goal setting as well as to overcome social
               barriers/stigma; to enable women to succeed and receive husband’s
               support (i.e. believe in their ability to succeed), it would be useful to
               expose male relatives to successful female entrepreneurs.

2. Interview with Hana, founder of EGPEX: Self-made, former micro entrepreneur,
   who has built up her business (exporting local handicrafts) and now also
   coordinates/manages a network of female microentrepreneurs she sources her
   materials from. She provides non-financial support and facilitate market linkages for
   these entrepreneurs. Key takeaways based on her own experience and from the
   discussion about the micro and small entrepreneurs in her network:
           • Money is not the major barrier for most- they wouldn’t know what to do
               with it without proper guidance. In many case, husbands ask/demand that
               they share the money with them, which then makes repayment difficult for
               the female entrepreneurs. Getting loans is also a hassle- commercial banks
               ask for guarantees/collateral and financial statements- none of which
               micro entrepreneurs have (husbands are hesitant to be guarantors).
               Complex procedures for loans provided by government agencies as well-
               lots of procedure, fear of arrest/property confiscation (which does happen)
               if they can’t pay. People are afraid to borrow because they “don’t want to
               go to jail�. Most women in her network do not end up borrowing.
           • Needs: Exposure to information, market linkages (rather than relying on
               pre-orders from their limited network), advice, support/mentorship,
               pushing/nudging (them to overcome societal barriers and not be shy).
           • What prevents other women from achieving this? Women entrepreneurs
               do have aspirations to grow their business, but they lack information and
               guidance to make it happen. Barriers include- giving up due to social
               pressure; need to stay at home/look after children; lack of planning;
               difficulty in projecting profits; reluctance to take risks; lack of financial
               support (husbands rarely support wives financially in their businesses);
               low trust and confidence (often due to observed failure of others); and lack
               of resources or money to pursue skills training.
           • The fears related to societal and family expectations/ pressure is not
               “perceived�- they are raised with these expectations and norms in mind.
               However, there is no real repercussion if they defy these norms. The need
               to be a “good mother� came up a lot- highlighting the importance of
               childcare-related support.
           • Hana met many of these entrepreneurs during exhibitions- a potential
               outreach option if we are trying to provide information or recruit or invite
               entrepreneurs for our capacity building and financing services.
           • Takeaways: Mentoring/role models and guidance for longer-term
               planning will be helpful; need to build market linkages or provide
               information on this; need to look into loan application processes and terms

     ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT                         95
              of NGOs to ensure key barriers are being addressed; think about how to
              frame financing product to make them appealing/reduce trust barriers.

3. Meeting with Alexandria Businessmen Association (Maghdy Meged, Executive
   Director, ABA): ABA serves business owners across Egypt- has a portfolio of
   420,000 active clients (50% women); most loans are relatively small (90% are
   <10,000 EGP. Based on his experience at ABA (and also SFD, where he worked
   before):
          • Many microentrepreneurs remain small by choice: they don’t want to
              register and grow their businesses due to fears of police interference,
              social security/tax.
          • Barriers for female entrepreneurs: financial literacy/knowledge; lack of
              trust towards formal financial institutions (people are always looking for
              shortcuts); not take loans due to religious reasons. For female
              entrepreneurs in particular: interference from husbands (may take money
              out of their business earnings/loans); they don’t want to stand out (or be
              disruptive) which limits their growth; women have less mobility
              restrictions in Upper Egypt and can often be breadwinners.
          • Micro loans are generally used to maintain business, not expand it.
          • What needs to be done: create and share success stories on the ground
              (told by people who are local/relatable); develop/provide value chains and
              business linkages; help businesses with marketing (most commonly
              mentioned need); improve network and accessibility; provide clear,
              simpler information about how microloans work




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ESMF - CATALYZING ENTREPRENEURSHIP FOR JOB CREATION PROJECT   97
                       ANNEX 2. LIST OF EXCLUDED ACTIVITIES


The List of Excluded Activities, given below, is applied to all the financings under the Catalyzing
Entrepreneurship for Job Creation Project. The implementation of this List of Excluded Activities
to end-borrower is the responsibility of the PFI. The project, shall, under no circumstances, support
the following activities:

1.    Production or trade in any product or activity deemed illegal under Egyptian laws or
      regulations or international conventions and agreements.

2.    Production or trade in pharmaceuticals, pesticides/herbicides, ozone depleting substances,
      polychlorinated biphenyls (PCBs) subject to international phase outs or bans.

3.    Trade in wildlife or wildlife products regulated under Convention on International Trade in
      Endangered Species (CITES).

4.    Production or trade in weapons and ammunitions.

5.    Gambling, casinos, and equivalent enterprises.1

6.    Production or trade in radioactive materials (this does not apply to the purchase of medical
      equipment, quality control measurement equipment, and any equipment where the
      radioactive source is considered to be trivial and/or adequately shielded.)

7.    Cross-border trade in waste and waste products, unless compliant with the Basel Convention
      and the underlying regulations.

8.    Production or trade in or use of unbounded asbestos fibers.

9.    Unsustainable fishing practices, such as drift net fishing in the marine environment using
      nets in excess of 2.5 km length, electric shocks, or explosive materials.

10.   Production or trade in wood or other forestry products other than from sustainably managed
      forests.2

11.   Production or activities involving harmful or exploitative forms of forced labor3 or any form
      of child labor as provided under Egyptian Law.

12.   Activities involving land acquisition and/or restrictions on land use resulting in involuntary
      resettlement or economic displacement.4

13.   Any activities involving significant degradation or conversion of natural5 and/or critical
      habitats 6 and/or any activities in legally protected areas.




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14.       Production, trade, storage, or transport of significant volumes of hazardous chemicals, or
          commercial scale usage of hazardous chemicals (gasoline, kerosene, other petroleum
          products, textile dyes, and so on).

15.       Production or activities that have adverse impacts, including relocation, on the lands, natural
          resources, or critical cultural heritage subject to traditional ownership or under customary
          use by Indigenous Peoples.7

16.       Activities involving adverse impacts on critical cultural heritage.8

Notes:
1. This does not apply to enterprises that are not substantially involved in these activities. ‘Not
substantially involved’ means that the activity concerned is ancillary to an enterprise’s primary
operations.
2. Sustainable forest management may be demonstrated by the application of industry-specific good
practices and available technologies. In some cases, it may be demonstrated by certification/
verification or progress towards certification /verification under a credible standards system.
3. Forced labor means all work or service, not voluntarily performed that is extracted from an
individual under threat of force or penalty.
4. Land acquisition and/or restrictions on land use may result in the physical displacement of people
(involuntary resettlement), as well as their economic displacement (as loss of assets and/or means
of livelihood, regardless of whether or not the affected people are physically displaced). Land must
be bought on willing-buyer, willing-seller basis.
5. Natural habitats are areas composed of viable assemblages of plant and/or animal species of
largely native origin, and/or where human activity has not essentially modified an area ’s primary
ecological functions and species composition. This includes HCV forests. High conservation Value
areas do not directly correspond with definitions for modified, natural, and critical habitat. The
HCV Resource Network, an internationally recognized group, provides information and support on
the evolving usage of HCV to ensure a consistent approach. https://www.hcvnetwork.org/.
6. Critical habitat is a subset of both natural and modified habitats that deserves particular attention.
Critical habitat includes areas with high biodiversity value that meet the criteria of the World
Conservation Union (IUCN) classification, including habitats of significant importance for
required for critically endangered or endangered species as defined by the IUCN Red List of
Threatened Species; habitats of significant importance for endemic or restricted-range species;
habitats supporting globally significant concentrations of migratory species and/or congregatory
species; and areas with unique assemblages of species or which are associated with key
evolutionary processes. Primary forests or forests of High Conservation Value (HCV) shall be
considered Critical Habitats.
7. The term ‘Indigenous Peoples’ is used in a generic sense to refer to a distinct social and cultural
group possessing the following characteristics in varying degrees:
      •     Self-identification as members of a distinct cultural group and recognition of this identity
            by others


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    •     Collective attachment to geographically distinct habitats or ancestral territories in the
          project area and to the natural resources in these habitats and territories
    •     Customary cultural, economic, social, or political institutions that are separate from those
          of the mainstream society or culture
    •     A distinct language or dialect, often different from the official language or languages of
          the country or region in which they reside.

8. Critical cultural heritage consists of (a) the internationally recognized heritage of communities
who use, or have used, within living memory the cultural heritage for long-standing cultural
purposes and (b) legally protected cultural heritage areas.




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               Annex 3: Environmental & Social Screening Criteria/Checklists


Objectives

      1. Ensure that sub-projects28 are NOT classified as WB OP4.01 Category A, hence not
         associated with high ES risks.
      2. Ensure that sub-projects will NOT trigger:
             a. OP/BP 4.12: The proposed sub-projects should not entail any physical
                 displacement, loss of assets or loss of income sources or means of livelihoods. Sub-
                 projects causing partial loss of income, partial damage of the land, temporary land
                 acquisition and temporary restriction to accessing assets will not be Eligible for
                 financing.
             b. OP/BP 7:50: Project on international waterways: the project will not undertake any
                 activities in the catchment areas of international waterways and shared aquifers.
             c. OP/BP 4.09: Pest Management: the project will not support the purchase or use of
                 pesticides or pesticide application equipment.
             d. OP/BP 4.04: Natural habitats: the project will not intervene in areas of natural
                 habitat nor result in loss, conversion or degradation of natural habitats or critical
                 natural habitats as defined by the policy.
             e. OP/BP 4.11: Policy addresses physical cultural resources, which are defined as
                 movable or immovable objects, sites, structures, groups of structures, and natural
                 features and landscapes that have archaeological, paleontological, historical,
                 architectural, religious, aesthetic, or other cultural significance. Physical cultural
                 resources may be located in urban or rural settings, and may be above or below
                 ground, or under water. Their cultural interest may be at the local, provincial or
                 national level, or within the international community.
             f. OP/BP 4.36: on forests
             g. OP/BP 4.37: on safety of dams

      3. Determine the WB environmental category for each sub-project (B or C) and the WB
         instruments needed (Site specific or simplified ESMP)
      4. Identify the category of the sub-project according to national classification29 (Category
         A, B or C) and type of National Instruments needed (full-fledged EIA, EIA Form B, or
         EIA Form C) .

In order to achieve the above, the screening process follows three stages:

      •     Stage 1: Identify the environmental category of the sub-project according to national
            classification. This determines the type of National Instruments needed (full-fledged EIA,
            EIA Form B, or EIA Form C) and provides an early indication of the potential ES impacts
            of the project.


28   sub-projects refer to project financed activities
29It is not expected that the sub-projects will fall under category C (highest impact category) under the
national classification
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      •     Stage 2: Screen the sub-project against Criteria/Checklist 1 –. The objective of this
            Checklist, is to exclude projects which would trigger OP 4.12, OP 4.09, OP 4.04, OP 7.50,
            OP 4.11, OP 4.36, or OP 4.37)

      •     Stage 3: Screen the sub-project against Criteria/Checklist 2 – High Impact Checklist.
            The objective of this Checklist, is to exclude projects which would have highly significant
            and sensitive ES impacts (WB OP 4.01 Category A).

      •     Stage 4: Screen the sub-project against Criteria/Checklist 2– Detailed Impact
            Assessment Checklist, in order to assess the level of significance of potential ES impacts,
            determine the WB instruments needed (Site-specific ESMP, simplified ESMP or none ).


Stage 1: Identify the Environmental Category according to the national
classification (Country System)30

 Sub-project title
 Sub-project brief description
 The most relevant
 description/title/category of the
 project as described in EEAA
 project lists
 Sub-project environmental
 category (A, B, Scoped B, or C)
 Comments


Stage 2: Exclusion Checklist (to exclude projects with would trigger OP 4.12, OP
4.09, OP 4.04, OP 7.50, OP 4.11, OP 4.36, or OP 4.37)

If any of the answers to the questions below is Yes, then the sub-project would trigger
one or more of the critical safeguards mentioned above, and should NOT be Eligible for
financing.

 Sub-project title:
 Sub-project brief description:
 Question                                                                               Answer (Yes/No)
 Will the project:
 1. Require physical displacement of land owners/lessees/occupiers/squatters?
 2. Require permanent/temporary land acquisition?
 3. Cause loss of assets, restriction to assets, loss of income sources or means of
 livelihoods?
 4. Cause partial loss of income, partial damage of the land, and temporary
 restriction to assets?
 5. Use/affect an international waterway?

30   by using the lists published on the EEAA website (www.eeaa.gov.eg)
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 6. Involve rehabilitation/conservation of a listed building/Physical Cultural
 Resource (PCR)?
 7. Be located within a recognized PCR conservation area or UNESCO World
 heritage site?
 8. Use synthetic chemical pesticides?
 9. Production or use of explosives?

Stage 3: High Impact Checklist (to exclude projects with high ES impacts)
If any of the answers to the questions below is Yes, then the sub-project would be
classified as WB Category A, and should NOT be Eligible for financing.

 Sub-project title:
 Sub-project brief description:
 Question                                                                                Answer (Yes/No)
 Will the project:
 1. Cause sensitive (direct and or cumulative) impacts?
 Examples of Sensitive impacts are those, which may be irreversible, or those which
 raise issues related to natural habitats, forests and or physical cultural resources.
 2. Cause diverse (direct and or cumulative) impacts? Diverse impacts are those
 impacting different media (air quality, water quality, noise level, risk to the
 community) at the same time.
 3. Cause unprecedented impacts?
 Unprecedented impacts are those, which have not been experienced before in the
 project’s area of influence (i.e. those which occur for the first time in the area)
 4. Have an area of influence that significantly exceeds its footprint?



Stage 4: Detailed Impact Assessment Checklist

Environmental aspects
For Eligible projects, apply the checklist below:
    •     If the answer is “No� to all questions, then no safeguards instruments need to be prepared
          in addition to national instruments identified in Stage 1.
    •     If the answer is YES to ANY of the questions, a simplified ESMP shall be prepared
          comprising of the mitigation and monitoring measures included in the framework ESMP.
    •     Additional site-specific mitigation actions to those included in the framework ESMP
          might be required for the impacts indicated by an asterisk in the table below, depending
          on the their significance. The latter should be assessed using the impact assessment
          criteria included in Annex 3 and additional mitigation measures shall be developed where
          the results of the assessment show that the impact significance is moderate/high.
Social aspects
ALL mitigation measures associated with social risks and impacts as included in the
framework ESMP shall be applied to all subprojects.




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Question                                                                           Answer      Other
                                                                                  (Yes/No)   categories
                                                                                              affected
                    Water (quality and resources)

W1*        Is the sub-project adjacent to drains and/or canals?
W2         Will the sub-project generate solid waste?
W3*        Will the sub-project generate liquid waste?
W4         Will the sub-project generate demolition waste?
W5*        Will the sub-project generate hazardous waste (grease, oil, empty
           paint containers, etc..)?
W6         Will the sub-project consume an amount of potable water higher
           than 3m3/site/day
W7*        Will the sub-project cause interruption to water flows?


                    Air (Quality and Noise level)

A1*        Will the sub-project use of chemicals, agro-chemicals, corrosives,
           and solvents?
A2         Will the sub-project use machinery?
A3         Will the sub-project involve refurbishment works (marble,
           concrete, ceramics, wood, etc)?
A4         Will the sub-project activities generate volatile Organic
           Compounds VOCs (paints, asphalt heating, preparation and
           application, etc)?
A5*        Will the sub-project involve major Demolition works?
A6         Will the sub-project involve minor demolition works?
A7*        Will the sub-project involve Asbestos management?
A8         Will the sub-project involve waste burning?
A9         Will the sub-project involve Generation of odors?
                    Soil (quality and erosion)

S1         Will the sub-project cause soil erosion?
S2         Will the sub-project cause topsoil loss?
S3         Will the sub-project involve soil compaction?
S4         Will the sub-project involve concrete foundations/impervious
           layers?
S5         Will the sub-project involve equipment on-site fueling and
           storage?
                    Social impacts and community health & safety

S.C1*      Will the sub-project involve temporary labor influx (more than 20
           workers)?
S.C2*      Will the sub-project cause traffic impacts and accessibility issues?
S.C3*      Could the sub-project cause utility damage?
S.C4*      Will the sub-project affect physical integrity of weak
           structures/houses adjacent to construction sites?
                    Occupational Health & Safety
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Question                                                               Answer      Other
                                                                      (Yes/No)   categories
                                                                                  affected

OHS1       Will the sub-project involve potential physical hazards?
OHS2       Fire hazards?
OHS3       Slippage and Falling hazards & Working at heights?
OHS4       Manual handling and lifting?
OHS5       Electrocution hazard?
OHS6       Excavation works?




                Annex 4: Environemntal Impact Assessment methodology

General Methodology
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The methodology proposed to be used for the impact assessment is a semi-quantitative
process, based on scores. The overall score for the significance of the impacts will be
evaluated taking into accounts the following factors:
   A. Affected area
   B. Temporal scale
   C. Intensity of the impact (which also includes the sensitivity of the nearest receptors)
   D. Probability

A. Affected area
Four levels are proposed to be considered

  Score                  Criterion
  1 (Site)               Affected area is less than 1 km2
  2 (Limited)            Affected area is between 1 and 10 km2
  3 (Area)               Affected area is between 10 and 100 km2
  4 (Regional)           Affected area is larger than 100 km2

B. Temporal scale
Four levels are proposed to be considered for the temporal scale

  Score                  Criterion
  1 (Short-Term)         Impact duration is less than 3 months
  2 (Medium-Term)        Impact duration is between 3 months and 1 year
  3 (Long-Term)          Impact duration is between 1 and 3 years
  4 (Permanent)          Impact duration is higher than 3 years

C. Impact intensity
Four levels are proposed to be considered for the impact intensity

  Score                 Criterion
  1 (Negligible)        Environmental changes are within the normal limits of natural
                        variations
  2 (low)               Environmental changes exceed the normal limits of natural variations.
                        However, natural environment is still self-recoverable.
  3 (Medium)            Environmental changes exceed the normal limits of natural variations
                        but result in recoverable damage to environmental components.
  4 (High)              Environmental changes result in significant irreversible disturbance to
                        particular environmental components and ecosystems.




D. Probability

Three levels are shown below

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  Probability score         Criterion
  1                         80-100% confidence that the impact will take place
  0.5                       30-80% confidence that the impact will take place
  0.25                      less than 30% confidence that the impact will take place


E. Integrated Assessment of Impact

The overall score is the multiplication result of the A,B,C and D . The overall score will
determine the category of severity (i.e. impact significance) based on the score range it
falls into. Table below shows the upper and lower limits of each impact significance
category, assuming a probability of occurrence of 1 (A. Probability score).

Impact intensity criterion adopted for the impact assessment
  Impact Parameters                                   Overall
  Spatial     Temporal         Impact     Probability Score           Score    Impact
  Scale       Scale            intensity  of                          range    Significance
                                          occurrence
  Site         Short-term      Negligible 1           1               1-8      Minor
  [1]          [1]             [1]
  Limited      medium-         Low        1           8
  [2]          term            [2]
               [2]
  Area         Long-term       Medium       1            27           9-27     Moderate
  [3]          [3]             [3]
  Regional     permanent       High         1            64           28-64    Major
  [4]          [4]             [4]




       Annex 5: Environmental and Social Management Plan (ESMP) Outline


Guidelines for a sub-project ESMP: An ESMP is needed for EA category B projects in
order to identify the potential impacts and appropriate mitigation measures to be included
in the ESMP.
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Any sub-project ESMP would have the following format:

1. Project Description

2. Description of Adverse Impacts: The anticipated impacts are identified and
summarized.

3. Description of Mitigation Measures: Each measure is described with reference to the
effects it is intended to deal with. As needed, detailed plans, designs, equipment
description, and operating procedures are described.

4. Mitigation Indicators and Description of Monitoring Program: Monitoring provides
information on the occurrence of impacts. It helps identify how well mitigation measures
are working, and where better mitigation may be needed. The monitoring program should
identify what information will be collected, how, where and how often. It should also
indicate at what level of effect there would be a need for further mitigation. How
environmental impacts are monitored is discussed below.

5. Monitoring methods: Methods for monitoring the implementation of mitigation
measures or environmental impacts should be as simple as possible, consistent with
collecting useful information, so that the sub project implementer can apply them. For
instance, they could just be regular observations of the sub project activities or sites during
construction and then when in use. Are plant/equipment being maintained and damages
repaired, does a water source look muddier/cloudier different than it should, if so, why and
where is the potential source of contamination. Most observations of inappropriate
behavior or adverse impacts should lead to common sense solutions. In some case, e.g.
transgenic crops, there may be needing to require investigation by a technically qualified
person.

6. Responsibilities: The people, groups, or organizations that will carry out the mitigation
and monitoring activities are defined, as well as to whom they report and are responsible.
There may be a need to train people to carry out these responsibilities, and to provide them
with equipment and supplies.

7. Implementation Schedule: The timing, frequency and duration of mitigation measure
and monitoring are specified in an implementation schedule and linked to the overall sub
project schedule.



8. Capacity Development and Training: If necessary, the ESMP can recommend
specific, targeted training for project staff, contractor, and community groups to ensure the
implementation of environmental safeguards recommendations.

9. Cost Estimates and Source of Funds: These are specified for the mitigation and
monitoring activities as a sub project is implemented.

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10. Integration: The ESMP must be integrated into the sub-project’s plan and design,
budget, specifications, estimated costs, bid documents, and contract/agreements clauses.
Contract documents should only be finalized when site-specific ESMP recommendations
are adequately and appropriately incorporated into the plan and design, cost estimates,
specifications, and contract clauses.




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