Egypt: Alex Dev Ltd-03/Beni Suef

Date Filed
10 May 2017
Status
Open
Phase
Compliance
Country
Egypt

Case Tracker

Eligibility
Eligibility
Assessment
Assessment
Dispute Resolution
Compliance
Appraisal
Investigation
CURRENT Status
Investi3gation (COMPLIANCE)

Complaint Overview

Complainant

A group of three former employees claiming to represent 300 other former workers

Concerns

Labor issues, compliance with national law and IFC standards

Cross-Cutting Issues
Labor

Project Information

Region
Middle East & North Africa
Institution
IFC
Name & Number
Alex Dev Ltd 27022
Company
Alexandria Development Limited (ADL)
Sector
Manufacturing
Department
Manufacturing, Agribusiness & Services
Category
B
Commitment

80 million euros

Synopsis

Project Overview

IFC has an active project with Titan Group to support and expand its Egyptian cement operations which consist of two entities: Beni Suef Cement Company (BSCC) and Alexandria Portland Cement Company (APCC). The plants have a combined production capacity of 3.5 million tons per annum (mtpa) and are engaged in an investment program to add a second integrated cement production line in BSCC, and various debottlenecking investments in both plants.

As per IFC disclosures, its project with Titan Group for the expansion of their cement manufacturing in Egypt (#30274, previously #27022) comprised a EUR80 million equity investment in Titan’s investment holding company, Alexandria Development Limited (ADL).

In May 2017, a complaint was lodged with CAO by three former employees of BSCC, claiming to represent more than 300 other former workers through the Egyptian Association for Collective Rights and the Egyptian Center for Civil and Legislative Reform. The complaint raises concerns regarding labor issues, notably involuntary early retirement. 

CAO Action

CAO found the complaint eligible for further assessment in July 2017 and an assessment trip was conducted that same month. During the assessment, there was a lack of consensus amongst the parties to engage in a CAO facilitated dispute resolution process. Hence, in accordance with CAO’s Operational Guidelines, the case was referred to CAO’s Compliance function for appraisal.

The purpose of CAO’s compliance appraisal is to determine whether or not an investigation of IFC's role in the project is merited in order to provide assurance to the World Bank Group President and the public of IFC’s compliance with relevant social and environmental policies and procedures.

In August 2018, CAO merged this case with a previous case, the Alex Dev Ltd. 02 case (ADL-02, as they raise similar issues. The ADL-02 and ADL-03 cases raise concerns regarding project impacts on the health, safety, and livelihoods of current and former workers that are substantial in nature, considering both the impacts of retrenchment, loss of wages, and workplace injuries, and the number of potentially impacted workers. A review of IFC’s pre-investment due diligence and supervision of the project raises compliance questions relevant to the issues in the complaints, namely, whether IFC discharged its review and supervision duties in relation to:

i. The client’s suspension and retrenchment of workers in 2016/2017

ii. The client’s OHS policies and practices

iii. The client’s handling of its ongoing dispute with workers alleging forced early retirement in 2003

In this context, CAO has concluded that the ADL-02 and ADL-03 cases merit a compliance investigation. 

Status

CAO’s investigation is underway.  The Alex Dev Ltd.-02 and Alex Dev. Ltd.-03 cases have been merged for the purposes of the compliance process.

Status as of January 19, 2018

Case Documents

  • Dispute Resolution

    Complaint
    Egypt/ Alex Dev Ltd-03/Beni Suef-Complaint
    Oct 01, 2017
    English
    Egypt/ Alex Dev Ltd-03/Beni Suef-Complaint
    Egypt/ Alex Dev Ltd-03/Beni Suef-Complaint
    Oct 01, 2017
    Arabic
    Egypt/ Alex Dev Ltd-03/Beni Suef-Complaint
    Assessment Report(s)
    Egypt/ Alex Dev Ltd-03/Beni Suef - Assessment
    Oct 01, 2017
    English
    Egypt/ Alex Dev Ltd-03/Beni Suef - Assessment
    Egypt/ Alex Dev Ltd-03/Beni Suef - Assessment
    Oct 01, 2017
    Arabic
    Egypt/ Alex Dev Ltd-03/Beni Suef - Assessment
    IFC's Response to CAO Assessment Report
    Oct 01, 2017
    English
    IFC's Response to CAO Assessment Report
  • Appraisal Report(s)
    Compliance Appraisal Report
    Jan 01, 2019
    English
    Compliance Appraisal Report