GUIDELINES ON ENVIRONMENTAL AND SOCIAL CONSIDERATIONS

Transcription

1 GUIDELINES ON ENVIRONMENTAL AND SOCIAL CONSIDERATIONS IN TRADE INSURANCE January 2015 Incorporated Administrative Agency Nippon Export and Investment Insurance

2 GUIDELINES ON ENVIRONMENTAL AND SOCIAL CONSIDERATIONS IN TRADE INSURANCE - January Table of Contents I. Commitment of NEXI according to the captioned guidelines 1 II. Policy 1 (page) III. Procedures for Confirmation of and Social (Pre-commitment) 1. Screening 2 2. Categorization 2 3. Reviews 4 IV. Incorporating Reviews into Decision-making 5 V. Assurance of and Social (Post-Commitment) 6 VI. Disclosure of Information Regarding Confirmation of and Social 6 VII. Ensuring Compliance with the Guidelines 7 Exhibit 1 and Social Required of Covered Projects 8 Exhibit 2 ESIA Reports for A Projects 11 Appendix 1 Information Required for Screening Process 12 Appendix 2 Categories and s in Checklist 13 Appendix 3 s Requiring Monitoring 14 << References >> 15 I. Screening Form 17 II. Checklists 21 III. Monitoring Form 168 IV. Frequently Asked Questions (FAQ) 170 NB: If there is any ambiguity in English version and/or any inconsistency with Japanese version, the Japanese version prevails.

3 Established on April 1, 2001 Partially revised on April 1, 2002 Partially revised on March 29, 2005 Partially revised on November 29, 2006 Partially revised on July 21, 2009 Partially revised on January 28, 2015 GUIDELINES ON ENVIRONMENTAL AND SOCIAL CONSIDERATIONS IN TRADE INSURANCE I. Commitment of NEXI according to the captioned guidelines These guidelines (hereinafter referred to as the "Guidelines") provide Policy and procedures employed by Nippon Export and Investment Insurance (hereinafter referred to as "NEXI") to confirm environmental and social considerations in trade insurance. According to the Guidelines, NEXI commits itself, in accordance with the policy of the Japanese Government, to contribute to sound development of Japan's external transactions such as foreign trade by confirming whether the project sponsors and relevant parties (hereinafter referred to as the "project sponsors") have implemented appropriate environmental and social considerations in the projects (hereinafter referred to as the "project" or the "projects") subject to NEXI s insurance services. II. Policy The project sponsors are responsible for environmental and social considerations for the project. NEXI confirms such considerations in light of the Guidelines. NEXI encourages the project sponsors in the projects that are subject to NEXI s insurance services, via the applicants for insurance services such as exporters and others (hereinafter referred to as the "Applicants"), to undertake appropriate environmental and social considerations in accordance with the nature of the project, based on the principles listed in Exhibit 1 of the Guidelines. NEXI also promotes awareness of the OECD Guidelines for Multinational Enterprises among appropriate parties such as project sponsors via the Applicants. NEXI confirms whether the project sponsors implement appropriate environmental and social considerations, so as to prevent or mitigate potential impacts on environment (i.e. not only on the natural environment, but also on social issues such as involuntary resettlement and respect for the human rights of indigenous peoples: hereinafter referred to as the "environment") which may be caused by the projects relating to insurance (two years or more) services from NEXI. NEXI s confirmation of environmental and social considerations is one of the most important components in its risk assessment. NEXI incorporates the outcomes of its confirmation of environmental and social considerations in its decisions on issuance of commitment (or on conclusion of an insurance contract if application for commitment is not made. The same applies hereafter.). If, as a result of its confirmation of environmental and social considerations, NEXI judges that the relevant project will cause adverse impacts on the environment, it encourages the project sponsors, through the Applicants, to undertake appropriate environmental and social considerations, and there may be cases where a commitment letter is not issued. NEXI prescribes its procedures for confirmation of environmental and social considerations such as to classify the projects into 3 categories through screening and to implement Review for each category and engages to disclose information. In so doing, NEXI endeavors to ensure transparency, predictability and accountability in its decision on issuance of commitment from the viewpoint of environmental and social considerations, taking into account the constrains of the Applicants' business confidentiality and competitive concerns. Even after making a decision on issuance of commitment, NEXI will take appropriate actions to confirm the status of monitoring by the project sponsor via the Applicants when necessary. 1

4 III. Procedures for Confirmation of and Social (Pre-commitment) 1. Screening NEXI confirms environmental and social considerations in the projects to be applied by its insurance service, in principle, at the stage of risk assessment. The Applicants should submit a copy of the Screening Form to NEXI head office at the stage of application for commitment of NEXI's trade insurance for projects. Applicants who wish to apply for the above mentioned procedures through Internet service may apply in accordance with the Usage of Web Application Service that is provided separately. NEXI classifies the project into one of the categories prescribed in (2) below based on the Screening Form submitted by the Applicants at the earliest stage of risk assessment (this process is hereinafter referred to as screening ). NEXI may request the Applicants to submit additional information when necessary. NEXI conducts screening in terms of such factors as the project sponsor, the sector, size, location, and the potentiality of adverse environmental impacts by identifying its potential environmental impacts based on the information submitted by the Applicants (see Appendix 1), and by taking into consideration whether environmental review is necessary, and if necessary, the degree of necessity of such review. NEXI may revise the categorization of the projects when necessary, e.g., in cases where environmental impacts worth considering come to light after screening once being performed on the basis of information provided by the Applicants. 2. Categorization [ A] Projects that are likely to have significant adverse impacts on the environment are classified into A. Projects with complicated or unprecedented impacts that are difficult to assess are also classified as A. The impacts of A projects may affect an area broader than the sites or facilities subject to physical construction. A, in principle, includes projects in sensitive sectors (i.e., sectors that are liable to cause adverse environmental impacts) or with sensitive characteristics (i.e., characteristics that are liable to cause adverse environmental impacts) and projects located in or near sensitive areas. An illustrative list of sensitive sectors, sensitive characteristics and sensitive areas is given below: (1) Sensitive Sectors Large-scale projects in the following sectors: a) Mining b) Oil and natural gas development c) Pipelines d) Iron and steel (projects that include large furnaces) e) Non-ferrous metals smelting and refining f) Petrochemicals (manufacture of raw materials; including complexes) g) Petroleum refining h) Oil, gas and chemical terminals i) Paper and pulp j) Cement plants (including a greenfield quarry) k) Manufacture and transport of toxic or poisonous substances regulated by international treaties, etc. l) Thermal power m) Nuclear power 2

5 n) Hydropower, dams and reservoirs o) Power transmission and distribution lines involving large-scale involuntary resettlement, large-scale logging or submarine electrical cables p) Roads, railways and bridges q) Airports r) Ports and harbors s) Sewage and wastewater treatment having sensitive characteristics or located in sensitive areas or their vicinity t) Waste management and disposal u) Agriculture involving large-scale land-clearing or irrigation v) Forestry w) Tourism (construction of hotels, etc.) (2) Sensitive Characteristics a) Large-scale involuntary resettlement or large-scale loss of means of livelihood b) Large-scale groundwater pumping c) Large-scale land reclamation, land development and land-clearing d) Large-scale logging (3) Sensitive Areas Projects in the following areas or their vicinity a) National parks, nationally-designated protected areas (coastal areas, wetlands, areas for ethnic minorities or indigenous peoples, and cultural heritage, etc. designated by national governments) b) Areas considered to require careful consideration by the country or locality <Natural > i. Forests with important ecological value (including primary forests and natural forests in tropical areas) ii. Habitats with important ecological value (including coral reefs, mangrove wetlands and tidal flats) iii. Habitats of rare species requiring protection under domestic legislation, international treaties, etc. iv. Areas in danger of large-scale salt accumulation or soil erosion v. Areas with a remarkable tendency towards desertification [ B] <Social > i. Areas with unique archeological, historical or cultural value ii. Areas inhabited by ethnic minorities, indigenous peoples or nomadic peoples with traditional ways of life (including areas which are used for cultural or spiritual purposes) and other areas with special social value Projects with potential adverse environmental impacts less adverse than those of A are classified as B. Typically, these impacts are site-specific, few if any are irreversible, and in most cases normal mitigation measures can be designed more readily. [ C] A proposed project is classified as C, if it is likely to have minimal or no adverse environmental impacts. Projects that correspond to one of the following (1) to (3) are, in principle, classified as C, with the exception of projects with sensitive characteristics and projects located in or near sensitive areas as included in A: 3

6 a) Projects of which insurable value is SDR 10 million or less; b) Sectors or projects in which no particular environmental impact would be normally expected (e.g., maintenance of existing facilities and acquisition of equity interest without additional capital investment); or c) Cases in which involvement of the Applicants is only a minor part of a project, such as the export of items of machinery or equipment that is not connected with a particular project, and where there would be little reasonable significance in NEXI s conducting an environmental review. 3. Reviews After the screening process, NEXI carries out environmental reviews for the projects subject to NEXI's insurance services, according to the following procedures for each category. a) NEXI requests from the Applicants information on potential environmental impacts of the concerned project, environmental standards to be applied to the concerned project by the relevant parties and the results of public consultations with relevant stakeholders. Exchanging information with relevant institutions, NEXI conducts appropriate environmental reviews utilizing information provided by the stakeholders, including local residents and local NGOs (hereinafter referred to as the stakeholders ). Also, where appropriate, NEXI considers any statements or reports made publicly available by Japan s national contact point on the OECD Guidelines for Multinational Enterprises. b) NEXI ascertains whether a project complies with environmental laws and standards of the host national and local governments concerned. c) NEXI ascertains whether a project meets the following standards. World Bank Safeguard Policies or International Finance Corporation (hereinafter referred to as IFC ) Performance standards Notwithstanding the above, IFC Performance Standards in the cases of (i) limited recourse or non-recourse project finance projects, (ii) structured financing transactions that share characteristics with project finance, (iii) other financial institutions who are forming a significant part of the project applying IFC Performance Standards, and (iv) other projects recognized as appropriate. In addition, if there is a relevant section of the, Health, and Safety Guidelines (EHS Guidelines) of the World Bank Group, NEXI will confirm whether the projects meet that section. d) When deemed appropriate, NEXI also uses, as reference points or benchmarks, standards established by other international financial institutions, other internationally recognized standards, and standards or good practices established by developed countries such as Japan. e) If NEXI believes environmental and social considerations of the project substantially deviate from these standards and good practices, it confirms the background and rationale for this, and when necessary, countermeasures against such deviation. [ A] reviews for A projects examine the projects potential negative and positive environmental impacts as well as measures to prevent, minimize, mitigate or compensate for the potential negative impacts and to improve environmental performance. The Applicants must submit the following documents for A projects to NEXI s head office. and Social Impact Assessment (ESIA) reports (see Exhibit 2) and environmental permit certificates issued by the project country s government (hereinafter referred to as the ESIA reports, etc. ) 4

7 Resettlement action plans including livelihood restoration plans when necessary (see Exhibit 1(7) Involuntary Resettlement) in the case of projects involving large-scale involuntary resettlement or large-scale loss of means of livelihood Plans for indigenous peoples (see Exhibit 1(8)Indigenous Peoples)) in the case of projects in which measures for indigenous peoples are required. NEXI undertakes its environmental reviews based on these documents prepared by the project sponsors and submitted through the Applicants. During environmental reviews, NEXI confirms involvement of the stakeholders and the progress of disclosure in connection with the relevant projects, which are implemented according to the host country's system of environmental impact assessment. [ B] The scope of the environmental review may vary depending on each project and that for B projects is narrower than that for A projects. Similarly to A reviews, environmental reviews for category B projects examine the project's potential negative and positive environmental impacts, including measures necessary to prevent, minimize, mitigate or compensate for the potential negative impacts and to improve environmental performance. NEXI conducts environmental reviews based on the information provided by the Applicants. In cases where an ESIA procedure has been developed, the ESIA reports, etc. may be referred to, but this is not a mandatory requirement. [ C] For C projects, environmental reviews will be omitted. The corresponding environmental checklists (see Exhibit 2) for each sector will be referred to in conducting the aforementioned reviews. IV. Incorporating Reviews into Decision-making The outcome of screening and environmental review is taken into account in NEXI s decisions on issuance of commitment. In cases where a certain project might have any significant adverse environmental impact on the host country by lack of appropriate environmental and social considerations, NEXI will encourage the project sponsors, via the Applicants, to give such appropriate considerations. Under certain circumstances, where the project is not recognized to be contributive to sound development of Japan's external transactions or economic or social development of the host country, there may be cases where a commitment letter is not issued. NEXI may include additional requirements on environmental and social considerations (hereinafter referred to as the " Special Clauses, etc.") in the commitment letters, insurance policies and other accompanying documents to assure the implementation of environmental and social considerations by the Applicants or the project sponsors. Notwithstanding other provisions in the Guidelines, however, in exceptional cases where, given the nature of the project, documents necessary for environmental reviews are not available at the time when the decision on the commitment issuance is required, NEXI may make a decision on the commitment issuance based on the condition that it will undertake the environmental reviews after the commitment decision. In this case, NEXI makes confirmation and disclosure with respect to environmental and social considerations prior to the commitment decision to the extent possible, in addition to appropriately applying the policies and procedures of the Guidelines upon environmental reviews. If NEXI is unable to confirm the appropriate environmental and social considerations at the environmental review after the commitment decision, NEXI may cancel the commitment based on the Special Clauses, etc. or may terminate the insurance contract if the insurance contract has been signed already. 5

8 V. Assurance of and Social (Post-Commitment) (1) When necessary, even after commitment, NEXI requests the concerned project sponsors via the Applicants to provide information to judge whether environmental and social considerations are appropriately implemented. For A and B projects, in order to confirm the project sponsors' appropriate implementation of environmental and social considerations, NEXI in principle confirms through the Applicant for a certain period of time from issuance of commitment the results of monitoring by the project sponsors of items which could have significant environmental impacts (see Exhibit 3). (2) If NEXI judges that there is a need for improvement in the situation with respect to environmental and social considerations regarding the project to which a commitment letter has been issued, it may ask the relevant project sponsor through the Applicant to take appropriate actions, taking into account practicability of the measures and the extent of the Applicants involvement in the project. (3) NEXI may cancel the commitment (or the contract after conclusion of the insurance contract) in the following cases: a) Where it is proved that there is any false description in the Screening Form submitted by the Applicant at the time of commitment application; b) Where the Applicant has intentionally or unintentionally failed to report to NEXI any critical fact on its judgment in confirming environmental and social considerations or made a false report; or c) Where the Applicant has violated any of the Special Clauses, etc. VI. Disclosure of Information Regarding Confirmation of and Social NEXI respects business confidentiality of the Applicants and engages in disclosing information on confirmation of environmental and social considerations in accordance with the following clauses of 1) to 6) to ensure its transparency and accountability, taking into account the nature of each project. NEXI will strive for further information disclosure through its environmental review and monitoring by encouraging the project sponsors through the Applicants while complying with the relevant laws and ordinances in the project country. (1) Upon completion of the screening of a project, NEXI discloses, as soon as possible, the project name, country, location, an outline of the project and sector of the project, and its category classification, as well as the reasons for the classification. (2) For A and B projects, NEXI publishes on its website the status of acquirement of the ESIA reports, etc. obtained from the Applicants for confirming environmental and social considerations and promptly makes the ESIA reports, etc. available on its website. Of the documents other than the ESIA reports, etc. obtained by NEXI from the Applicants for confirming the environmental and social considerations, NEXI publishes the status of obtaining those that are being disclosed to the public in the project country and make them available on the NEXI website promptly. (3) NEXI endeavors to disclose information prescribed in (1) and (2) above in a manner that allows enough time before decision-making on covering by NEXI. (4) After conclusion of an insurance contract, NEXI provides on its website the results of its environmental reviews of the projects in Categories A and B for public perusal. (5) After conclusion of an insurance contract, NEXI provides on its website the results of monitoring conducted by project sponsors regarding the projects in Categories A and B only to the extent that the information of the project is disclosed to public in the project country. 6

9 (6) NEXI pays due consideration to the commercial confidentiality of the Applicants, taking into account their competitive relationships, and encourages them to exclude such confidential information from any documents on environmental and social considerations submitted by them which may later be subjected to public disclosure. Any information that is excluded from public disclosure in the contract between NEXI and the Applicants may only be disclosed either with the agreement of the Applicants or in accordance with legal requirements. VII. Ensuring Compliance with the Guidelines NEXI endeavors to ensure appropriate implementation of the policies and procedures stated in these Guidelines and compliance with the Guidelines. In order to ensure its compliance with the Guidelines, NEXI accepts objections regarding its non-compliance with the Guidelines and takes the necessary action. Supplementary Provision These Guidelines shall come into force from April 1, Supplementary Provisions <Effective date of these Guidelines> This Revised Guidelines shall come into force from October 1, <Interim Measure> The original Guidelines shall apply to the projects for which insurance applications have been made before the effective date of these revised Guidelines. <Review of the Guidelines> The Guidelines will be reviewed in future when necessary, taking into account future review progress of the Common Approaches at OECD Working Party on Export Credits and Credit Guarantees (hereinafter referred to as Common Approaches ) or the results of comprehensive review based on the confirmation on the implementation status of the Guidelines. In reviewing the Guidelines, NEXI will seek the opinions of, among others, the Japanese Government, Japanese companies, experts, and NGOs, while maintaining transparency in the process. However, if it is deemed necessary to make the Guidelines consistent with the Common Approaches or if a change is deemed be a minor change, the Guidelines may be reviewed based on the premise that transparency will be ensured. Supplementary Provisions This Revised Guidelines shall come into force from April 1, Supplementary Provisions This Revised Guidelines shall come into force from December 4, Supplementary Provisions The revised Guidelines shall come into force from October 1, To projects regarding which Screening Forms have been received by NEXI before the enforcement date, prior procedures including the previous Guidelines shall apply. Supplementary Provisions The revised Guidelines shall come into force from April 1, To projects regarding which Screening Forms have been received by NEXI before the enforcement date, prior procedures including the previous Guidelines shall apply. 7

10 Exhibit 1 and Social Required of Covered Projects In principle, appropriate environmental and social considerations shall be undertaken, according to the nature of the project, based on the following: (1) Underlying Principles impacts that may be caused by a project must be assessed and examined from the earliest planning stage possible. Alternative proposals or mitigation measures to prevent or minimize such adverse impacts must be examined, and the findings of such examinations shall be incorporated into the project plan: Such examination must include analysis of environmental costs and benefits in as quantitative terms as possible, and be conducted in close harmony with economic, financial, institutional, social, and technical analyses of the project; The findings of such examination of environmental and social considerations, including alternative proposals and mitigation measures, must be recorded as independent documents or as parts of other documents. and Social Impact Assessment (ESIA) reports must be produced for projects in which particularly large adverse impacts are expected; and For projects that have particularly significant adverse impacts or are highly contentious, a committee of experts may be formed to seek their opinions as appropriate, in order to increase accountability. (2) Examination of Measures Multiple alternative proposals must be examined to prevent or minimize adverse impacts and to choose a better project option in terms of environmental and social considerations. In examination of measures, priority is to be given to the prevention of environmental impacts, and when this is not possible, minimizing and mitigating impacts must be considered next. Compensation measures must be examined only when impacts cannot be prevented by any of the aforementioned measures; and Appropriate follow-up plans and systems, such as monitoring plans and environmental management plans, must be prepared; and costs of implementing such plans and systems, and financial methods of budgeting to obtain funds for such costs must be determined. Plans for projects with particularly large potential adverse impacts must be accompanied by detailed environmental management plans. (3) Scope of Impacts to be Examined impacts to be investigated and examined include factors that impact on human health and safety as well as the natural environment through air, water, soil, waste, accidents, water usage, ecosystems, and biota: social concerns including respect for human rights, such as involuntary resettlement, indigenous peoples, cultural heritage, landscape, gender, children s rights, communicable diseases such as HIV/AIDS, working conditions (including occupational safety) and community health, safety, and security; and impacts that may lead to trans-boundary and global environmental problems. While air could include greenhouse gases (GHG), specific requirements for environmental and social considerations on this issue are to be made based on the Common Approaches; and In addition to the direct and immediate impacts of projects, derivative, secondary, and cumulative impacts and impacts of associated facilities are also to be examined and investigated to a reasonable extent. It is also desirable to consider the impact throughout the life cycle of the project. 8

11 (4) Compliance with Laws, Standards and Plans Projects must comply with laws and regulations, and standards relating to environmental and social considerations established by the governments governing the project site (including both national and local governments). They must also conform to policies and plans relating to environmental and social considerations established by the governments governing the project site; and Projects must, in principle, be undertaken outside protected areas that are specifically designated by laws or regulations of the government for the conservation of nature or cultural heritage (excluding projects whose primary objectives are to promote the protection or restoration of such designated areas). Projects shall not impose significant adverse impacts on such designated conservation areas. (5) Social Acceptability and Social Impacts Projects must be adequately coordinated so that the projects are accepted in a manner that is socially appropriate to the country and locality in which the project is planned. For projects with potentially large environmental impacts in particular, sufficient consultations with stakeholders, such as local residents, must be conducted via disclosure of information from an early stage when alternative proposals for the project plans may be examined. The outcomes of such consultations must be incorporated into the contents of the project plan; and Appropriate consideration must be given to vulnerable social groups, such as women, children, the elderly, the poor, and ethnic minorities, all of whom are susceptible to various environmental and social impacts and who may have little access, within society, to decision-making processes. (6) Ecosystem and Biota Projects must not involve significant conversion or significant degradation of critical natural habitats including critical forests areas In case the project involves the significant conversion or degradation of natural habitats including natural forests, priority is to be given to the prevention of environmental impact. When this is not possible, appropriate mitigation measures must be established. Evaluation of the impact on natural habitats by the project and consideration for the offset measures should be based on expert opinion. Illegal logging of forests must be avoided. For the projects involving commercial harvest, the project proponents are encouraged to obtain certifications by forest certification systems as a way to ensure prevention of illegal logging. Illegal logging of forests must be avoided. For the projects involving commercial harvest, the project proponents are encouraged to obtain certifications by forest certification systems as a way to ensure prevention of illegal logging. (7) Involuntary Resettlement Involuntary resettlement and loss of means of livelihood are to be avoided where feasible, exploring all viable alternatives. When it is not feasible to avoid them even after such examination, effective measures to minimize impacts and compensate for losses must be agreed upon with the people to be affected; People to be resettled involuntarily and people whose means of livelihood will be hindered or lost must be sufficiently compensated and supported by the project proponents, etc. at an appropriate time. Prior compensation, at full replacement cost, must be provided, to the extent possible. The project proponents, etc. must make efforts to enable such affected people to improve their standard of living, income opportunities, and production levels, or at least to restore them to pre-project levels. Measures to achieve this purpose may include providing land and monetary compensation for losses (to cover land and property losses), 9

12 supporting the means for an alternative sustainable livelihood, and providing the expenses necessary for relocation and the re-establishment of a community at relocation sites; Appropriate participation by affected people and communities must be promoted in planning, implementation, and monitoring of involuntary resettlement action plans and measures against loss of means of livelihood. In addition, grievance mechanisms must be established for the people affected and their communities; and For projects that will result in large-scale involuntary resettlement or large-scale loss of means of livelihood, resettlement action plans must be prepared and made available to the public. In preparing a resettlement action plan, consultations must be made with the affected people and communities based on sufficient information made available to them in advance. When consultations are held, explanations must be given in a form, manner, and language understandable to the affected people. It is desirable that the resettlement action plan include elements required under the standards of international financial institutions which NEXI benchmarks in its environmental reviews. (8) Indigenous Peoples Any adverse impacts a project may have on indigenous peoples are to be avoided where feasible, exploring all viable alternatives. When it is not feasible to avoid them even after such examination, effective measures to minimize impacts and compensate for their losses must be taken for indigenous peoples; When a project may have adverse impacts on indigenous peoples various rights in relation to land and resources, such rights must be respected in accordance with the spirit of the relevant international declarations and treaties, and free, prior, and informed consents must be obtained; and Measures for the affected indigenous peoples must be prepared as an indigenous peoples plan (which may constitute a part of other documents for environmental and social considerations) and made public in compliance with the relevant laws and regulations in the project country. In preparing the indigenous peoples plan, consultations must be made with the affected indigenous peoples based on sufficient information made available to them in advance. When consultations are held, it is desirable that explanations must be given in a form, manner, and language understandable to indigenous peoples. It is desirable that the indigenous peoples plan include the elements required under the standards of international financial institutions which NEXI benchmarks in its environmental reviews. (9) Monitoring and Follow-up It is desirable that, after a project begins, the project proponents monitor (i) whether any situations that were unforeseeable before the project begins have arisen and (ii) the implementation situation and effectiveness of the mitigation measures prepared in advance, and that they then take appropriate measures (together with a follow-up, hereinafter referred to as monitoring ) based on the results of such monitoring; In cases where sufficient monitoring is deemed essential for the achievement of appropriate environmental and social considerations such as the projects for which mitigation measures should be implemented while monitoring their effectiveness, project proponents must ensure that project plans include monitoring plans, and that such monitoring plans are feasible; It is desirable that project proponents make the results of monitoring processes available to project stakeholders; and When third parties point out, in concrete terms, that environmental and social considerations are not being fully undertaken, it is desirable that a forum for discussion and examination of countermeasures be established based on sufficient information disclosure and with the participation of stakeholders in the relevant project, and that an agreement be reached on procedures to be adopted with a view to resolving the problem. 10

13 Exhibit 2 ESIA Reports for A Projects The following conditions are met in principle: When assessment procedures already exist in host countries, and projects are subject to such procedures, borrowers and related parties must officially complete those procedures and obtain the approval of the government of the host country; ESIA reports (which may be referred to differently in different systems) must be written in the official language or a language widely used in the country where the project is to be implemented. When explaining projects to local residents, written materials must be provided in a language and form understandable to them; ESIA reports are required to be made available in the country where the project is to be implemented, including to the local residents. It is required that the ESIA reports be available at all times for perusal by project stakeholders such as local residents, and that copying be permitted; In preparing ESIA reports, consultation with stakeholders, such as local residents, must take place after sufficient information has been disclosed. Records, etc. of such consultations must be prepared; Consultations with relevant stakeholders, such as local residents, should take place if necessary throughout the preparation and implementation stages of a project. Having consultations is highly desirable, especially when the items to be considered in the ESIA are being selected (i.e., scoping), and when the draft report has been prepared; and It is desirable that ESIA reports cover the items stipulated in the Common Approaches. 11

14 Appendix 1 Information Required for Screening Process The following data shall be used in principle to conduct screening. When necessary, additional data may be required depending on the nature of the project and peripheral circumstances, etc. <s to be Listed> 1. Permits and Approvals Need for permits and approvals for Impact Assessment Status of acquisition of permits and approvals for EIA Date of issue of permits and approvals for EIA Names of organizations issuing permits and approvals for EIA Status of acquisition of other environmental permits and approvals 2. Project Details Location of project site Project Description Relevant sector Scale, etc. of project 3. Impacts Degree of environmental impacts Existence of sensitive areas Existence of sensitive characteristics Scale of sensitive characteristics 12

15 Appendix 2 Categories and s in Checklist The checklists include the following categories and items related to the environment. When using these checklists, the appropriate items should be checked based on the sector and nature of the project. <> <> 1. Permits and approvals, explanations EIA and environmental permits Explanations to the Public 2. Anti-pollution measures Air quality Water quality Waste Soil contamination Noise and vibration Subsidence Odor Sediment 3. Natural environment Protected areas Ecosystem and biota Hydrology Topography and geology Management of abandoned sites 4. Social environment Resettlement Living and livelihood Heritage Landscape Ethnic minorities and indigenous peoples Working conditions (including occupational safety) Community health, safety, and security 5. Other Impact during construction Accident prevention measures Monitoring 13

16 Appendix 3 s Requiring Monitoring s requiring monitoring shall be decided according to the sector and nature of the project, with reference to the following list of items. <s> 1. Permits and approvals, explanations Response to matters indicated by authorities 2. Anti-pollution measures Air quality : SO2, NO2, CO, O2, soot and dust, suspended particulate matter, coarse particulate, etc. Water quality : ph, SS (suspended solids), BOD (biochemical oxygen demand) / COD (chemical oxygen demand), DO (dissolved oxygen), total nitrogen, total phosphorus, heavy metals, hydrocarbons, phenols, cyanogen compounds, mineral oils, water temperature, etc. Waste Noise and vibration Odors 3. Natural environment Ecosystems : Impacts on valuable species, countermeasures, etc 4. Social environment NB: Resettlement Living and livelihood For air and water quality, specify whether you are monitoring emission levels or environmental levels. Also, it should be noted that the items requiring monitoring will differ depending on whether the impacts in question will occur during construction or during operation of the project. 14

17 << References >> (page) I. Screening Form 17 II. Checklists < List > Mining Oil and Gas Development Pipelines Iron and Steel Non-ferrous Metals Smelting and Refining Petrochemicals Petroleum Refining Paper and Pulp Chemical Manufacturing Cement Plants General Manufacturing Thermal Power Nuclear Power Hydro Power, Dams and Reservoirs Other Electric Generation Power Transmission and Distribution Lines Roads, Railways and Bridges Airports Ports and Harbors Water Supply Sewage and Wastewater Treatment Waste Management and Disposal River and Channel Projects Irrigation Projects Agriculture and Livestock Projects Forestry Projects Fishery Projects Other Infrastructure Projects 163 III. Monitoring Form 168 IV. Frequently Asked Questions (FAQ)

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19 I. Screening Form Name of Project: Name of Project Execution Organization: Name of Borrower: Please provide the name, department, job title, and contact details for the person who is responsible for filling out this form. Name: Department and title: Name of Company or Organization: Telephone number: Fax number: address: Date: Signature: Please provide the following information concerning the organization submitting this screening form. Name of Company or Organization: Name of a person in charge: Title: Telephone/Fax: (Note) 1. This Screening Form or the contents thereof may be made public. 2. When any description in this Screening Form has been found false or insufficient due to intent or negligence of the person who submitted this form, NEXI may refuse to pay part or all of the insurance claims or make them refund part or all of the insurance claims, or cancel the relevant insurance contract, based on the insurance contract. 17

20 Questions Q1. Please provide the address of the project site. Address of the project site: Q2. Please provide brief explanation of the project. Q3. Will NEXI insurance be applied to a new project or an executing project? In case of an executing project, please inform of strong claims by stakeholders such as local residents, as well as improvement guidance or cessation orders for construction work / operations, from environmental authorities. New Project Executing Project (with Claim etc.) Executing Project (without Claim etc.) Others (Please specify ) Q4. In case of this project, is it necessary to execute and Social Impact Assessment (ESIA) based on the laws or regulations of the country where the project is to be implemented? If necessary, please inform the progress of ESIA. Required (Completed) Required (Under execution or under planning) Not Required Others (Please specify ) Q5. In case that ESIA is already completed, please inform whether ESIA report is already approved based on the environmental and social assessment system of the country where the project is to be implemented or not. If ESIA report is already approved, please provide the date and name of authorities of the approval. Approved (without condition) Approved (conditional) Under approval process Others (Please specify ) Date of Approval: Name of Authorities: Q6. If environmental and social permit(s) other than ESIA is required, please provide the name of required permit(s). Have you obtained required permit(s)? Obtained Required, but not obtained yet Not required Others (Please specify ) Name(s) of required permit(s): Q7. Will the insurance be used for the undertaking that cannot specify the project at this stage (e.g. export or lease of machinery that has no relation with specific project, or Two Step Loan that cannot specify the project at the time of loan agreement)? (Yes / No) If you answered Yes, it is not necessary to reply to the following questions. If you answered No, please reply to the following questions. 18

21 Q8. Are there any environmentally sensitive area(s) shown below in and around project site(s)? (Yes / No) If you answered Yes, please select applicable items by marking, and reply to the following questions. If you answered No, please reply to the questions 9 and after. (1) National parks, nationally-designated protected areas (coastal areas, wetlands, areas for ethnic minorities or indigenous peoples and cultural heritage, etc. designated by national governments) (2) Forests with important ecological value (including primary forests and natural forests in tropical areas) (3) Habitats with important ecological value (including coral reefs, mangrove wetland and tidal flats) (4) Habitats of rare species requiring protection under domestic legislation, international treaties, etc. (5) Areas in danger of large-scale salt accumulation or soil erosion (6) Areas with a remarkable tendency towards desertification (7) Areas with unique archaeological, historical or cultural value (8) Areas inhabited by ethnic minorities, indigenous peoples or nomadic peoples with traditional ways of life (including areas which are used for cultural or spiritual purposes) and other areas with special social value Q9. Does the project involve following characteristics? (Yes / No) If you answered Yes, please describe the scale of applicable characteristics, and reply to the questions 10 and after. If you answered No, please reply to the questions 11 and after. (1) Involuntary resettlement and/or loss of means of livelihood (Number of affected people: ) (2) Pumping of groundwater (Scale: m3 /year) (3) Land reclamation, development and/or clearing (Scale: ha) (4) Deforestation (Scale: ha) Q10. Under the environmental and social impact assessment system of the country where the project is to be implemented, do the applicable characteristics from (1) (4) of the questions 9 and their scale serve as basis for executing an ESIA for the project? They do They do not Others (Please specify ) Q11. Will the value insured by NEXI in the export, loan or investment project be equal or less than 5% of the total project cost, or equal or less than SDR 10 million? (In the case of additional support for a past project, this shall be the accumulated total amount) (Yes / No) If you answered Yes, it is not necessary to reply to the following questions. If you answered No, please reply to the questions 12 and after. Q12. Does the project belong to either of the sectors that impact on the environment and society is deemed immaterial or is not anticipated under normal conditions (e.g. maintenance of the existing facilities, non-expansionary renovation project, and acquisition of rights and interests without additional capital investment)? (Yes / No) If you answered Yes, it is not necessary to reply to the following questions. If you answered No, please reply to the questions 13 and after. 19

22 Q13. Does the project belong to the following sectors? (Yes / No) If you answered Yes, please specify the sector by marking, and reply to the questions 14 and after. If you answered No, it is not necessary to reply to the following questions. (1) Mining (2) Oil and natural gas development (3) Pipelines (4) Iron and steel (projects that include large furnaces) (5) Non-ferrous metals smelting and refining (6) Petrochemicals (manufacture of raw materials; including complexes) (7) Petroleum refining (8) Oil, gas and chemical terminals (9) Paper and pulp (10) Cement plants (including a greenfield quarry) (11) Manufacturing and transport of toxic or poisonous substances regulated by international treaties, etc. (12) Thermal power (13) Nuclear power (14) Hydro power, dams and reservoirs (15) Power transmission and distribution lines involving large-scale involuntary resettlement, large-scale logging or submarine electrical cables (16) Roads, railways and bridges (17) Airports (18) Ports and harbors (19) Sewage and wastewater treatment having sensitive characteristics or located in sensitive areas or their vicinity (20) Waste management and disposal (21) Agriculture involving large-scale land clearing or irrigation (22) Forestry (23) Tourism (Construction of hotel, etc.) Q14. Please provide information on the scale of the project (project area, area of plants and buildings, production capacity, amounts of power generation, etc.) Further, pleased explain whether an execution of EISA is required on account of the large scale of the project in the country where the project is implemented. 20

23 II. Checklists No. of Checklist Other Infrastructure Projects Fishery Projects Forestry Projects Agriculture and Livestock Projects Irrigation Projects River and Channel Projects Waste Management and Disposal Sewage and Wastewater Treatment Water Supply Ports and Harbors Airports Roads, Railways and Bridges Power Transmission and Distribution Lines Other Electric Generation Hydro Power, Dams and Reservoirs Nuclear Power Thermal Power General Manufacturing Cement Plants Chemical Manufacturing Paper and Pulp Petroleum Refining Petrochemicals Non-ferrous Metals Smelting and Refining Iron and Steel Pipelines Oil and Natural Gas Development Mining Manufacturing Power Generation and Transmission Infrastructure Natural Resource Development s (1) ESIA and Permits 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (2) Explanations to the Public 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (1) Air Quality 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (2) Water Quality 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (3) Waste 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (4) Soil Contamination 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (5) Noise and Vibration 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (6) Subsidence 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (7) Odor 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (8) Sediment 〇 (1) Protected Areas 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (2) Ecosystem and Biota 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (3) Hydrology 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (4) Topography and Geology 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (5) Management of Abandoned Sites 〇 〇 〇 (1) Resettlement 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (2) Living and Livelihood 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (3) Heritage 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (4) Landscape 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 Ethnic Minorities and Indigenous Peoples (5) Working conditions (including occupational safety) (6) (1) Impact during construction 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (2) Accident Prevention Measures 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 (3) Monitoring 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 〇 Class 1. Permits & Approvals, Explanation 2. Anti-pollution Measures 3. Natural 4. Social 5. Other 21

24 Checklist: 1. Mining (1) 1. Permits and Approvals, Explanations (1) ESIA and Permits (2) Explanations to the Public Main Check s 1 Have ESIA reports been officially completed? Have ESIA reports been written in the official language or a language widely used in the host country? 2 Have ESIA reports been approved by the government of the host country? 3 Have ESIA reports been unconditionally approved? If conditions are imposed on the approval of ESIA reports, are the conditions satisfied? 4 In addition to the above approvals, have other required environmental permits been obtained from the appropriate regulatory authorities of the host country s government? 1 Is the project accepted in a manner that is socially appropriate to the country and locality throughout the preparation and implementation stages of the project based on sufficient consultations with stakeholders, such as local residents, conducted via disclosure of project information and potential impacts? 2 Are the records of such consultations with the stakeholders, such as local residents, prepared? 3 Are the written materials for the disclosure prepared in a language and form understandable to the local residents? 4 Are ESIA reports available at all times for perusal by stakeholder such as local residents, and copying of the reports permitted? 5 Are proper responses made to comments from the public and regulatory authorities? Confirmation of and Social Antipollution Measures (1) Air Quality (2) Water Quality 1 Are any measures taken to minimize fugitive dust generated from mine workings and crushing plants? Does it comply with the host country s emission standards? 2 Do air pollutants other than fugitive dust comply with the host country s emission standards? 3 Do air pollutants emitted from the ancillary facilities, such as privately owned power plants comply with the host country s emission standards? 4 Is there a possibility that air pollutants emitted from the project will cause areas that do not comply with the host country s ambient air quality standards? 5 Are adequate measures taken to reduce GHG emissions from the project? 6 Does air quality within the working conditions comply with the host country s occupational health and safety standards? Are adequate worker protection measures, such as use of dust masks taken, if necessary? 1 Do pollutants, such as ph, SS, heavy metals contained in effluents from various sources, such as concentrators, mine drainage, stormwater runoff, waste rock disposal sites, and tailing impoundment sites comply with the host country s effluent standards? 2 Do effluents from the ancillary facilities, such as privately owned power plants comply with the host country s effluent standards? 3 Does the quality of sanitary wastewater from the buildings and housing complexes, such as accommodations and worker colonies comply with the host country s effluent standards?