Armenia : High-Efficiency Horticulture and Integrated Supply Chain Project

Nonsovereign Project | 51162-001

The project will support the development of 30 hectares of climate-controlled greenhouses equipped with drip irrigation systems in Yerevan to produce tomatoes and bell peppers. The products will be exported to Russia and the United Arab Emirates, leveraging Spayka's existing supply chain and client network.

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Project Details

  • Project Officer
    Mokroussov, Sergey
    Private Sector Operations Department
    Request for information
  • Country/Economy
    Armenia
  • Sector
    • Agriculture, natural resources and rural development
Project Name High-Efficiency Horticulture and Integrated Supply Chain Project
Project Number 51162-001
Borrower / Company Spayka Limited Liability Company
Country / Economy Armenia
Location Nation-wide
Type or Modality of Assistance
3642 Loan Ordinary capital resources USD 32.00 million Committed
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Private sector development
Sector / Subsector

Agriculture, natural resources and rural development / Agricultural production
Gender Effective gender mainstreaming
Responsible ADB Department Private Sector Operations Department
Responsible ADB Division Portfolio Management Division, PSOD
Responsible ADB Officer Mokroussov, Sergey
Project Sponsor(s)
Description

The project will support the development of 30 hectares of climate-controlled greenhouses equipped with drip irrigation systems in Yerevan to produce tomatoes and bell peppers. The products will be exported to Russia and the United Arab Emirates, leveraging Spayka's existing supply chain and client network.
Objectives and Scope The project is consistent with key objectives of the Armenian Development Strategy 2025, namely (i) the development of a modern agriculture sector through 'industrialization_ (including through the application of modern technologies like greenhouses), (ii) the promotion of export of agricultural products in support of an exportoriented economy and the integration of the Armenian economy into regional cooperation formats and international economy in general, and (iii) the creation of quality and well-paid jobs as one of the main conditions to achieve poverty eradication and income redistribution.
Status of Operation/Construction Operating
Linkage to Country/Regional Strategy ADB's Armenia country partnership strategy 2014-2018 is based on three development pillars: (i) high and sustainable economic growth, (ii) broadened access to economic opportunities, and (iii) strengthened social protection. The project supports pillars (i) and (ii). The project is also fully aligned with the four priorities of the ADB's Operational Plan for Agriculture and Natural Resources 2015-2020: (i) increasing the productivity and reducing pre- and postharvest losses of food crops; (ii) improving market connectivity and value chain linkages; (iii) enhancing food safety, quality, and nutrition; and (iv) enhancing management and climate resilience of natural resources.
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The location of the proposed climate-controlled greenhouses is devoid of any dense vegetation, any structures or habitation therefore no significant site disturbance will occur. The potential environmental and social impacts of the project have been identified during due diligence and effective measures to avoid, minimize, mitigate, and compensate for the adverse impacts are being incorporated in the environmental and social management plan. Spayka's proposed greenhouses will be equipped with computer systems that will control and monitor greenhouse climate, water quality and energy consumption to create the most optimal growing conditions for the crops inside the greenhouses. The institutional capacity and commitment of Spayka to manage the project's social and environment impacts are deemed adequate.
Involuntary Resettlement The proposed greenhouse project will be built on a 47.76 ha land donated by the Yerevan Municipal Government. In the 1990s, people were issued permits to cultivate the Shengavit community land. These permits were cancelled in 2008 when a law was passed changing the status of the communities to administrative districts. In 2012, the Yerevan Municipality acquired the land to be managed by the Armenian Crop Promoting Centre (a public-private partnership which became a private company in 2014) for the development of a greenhouse facility. The government compensated the remaining users of the community land. However, the greenhouse development project did not materialize as some conditions were not met. The land was left unused from 2012 until 2017. In early 2017, Spayka applied to the government for the allocation of a land plot to develop a greenhouse complex. In July 2017, Yerevan Municipality and Spayka signed a donation contract and a property certificate was issued to Spayka. No one is currently living-on or using the land informally and there are no outstanding complaints with regards to the land.
Indigenous Peoples Yerevan is largely mono-ethnic municipality, with majority of population being Armenians (98.9%). The major ethnic minorities are Yazidis (0.3%) and Russians (0.5%) and the rest are other ethnic minorities. The greenhouse project is in the Yerevan municipality in Shengavit administrative district, inhabited mostly by Armenians with few ethnic minorities who are already mainstreamed to the society.
Stakeholder Communication, Participation, and Consultation Spayka plans to conduct consultations with relevant stakeholders on the proposed greenhouse project. During the greenhouse construction phase, communications with stakeholders will be led by the Spayka Project Coordinator. During the operations phase, the local greenhouse Director will handle engagement with communities and other stakeholders. An informal grievance redress mechanism is being practiced, but Spayka will establish a formal grievance procedure.
Timetable for assistance design, processing and implementation
Concept Clearance 08 Aug 2017
Credit Committee Meeting 15 Dec 2017
Approval 07 Feb 2018
Last PDS Update 29 Nov 2022

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Title Document Type Document Date
High Efficiency Horticulture and Integrated Supply Chain Project: Initial Environmental Examination Environmental Assessment and Measures Feb 2018
High Efficiency Horticulture and Integrated Supply Chain Project: Social Compliance Audit Report and Corrective Action Plan Environment and Social Compliance Audit Reports Dec 2017

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.

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