Wood Agency Credit Line Vrbas m.d.p. Summary Of Project Information (SPI)       Project Name    Bosnia and Herzegovina - SEF Vrbas m.d.p.      RegionCentral and Southern Europe   Sector   Project No009739   Projected Board DateSeptember 3, 1999   Company NameVrbas m.d.p.   Technical Partner and/or Major Shareholders    	Vrbas was established in 1912 in Banja Luka, Republika Srpska. The company is 98% state owned.      Project Cost Including proposed IFC investment    	The total project cost is estimated at up to DM 3.5 million (US$ 1.95 million equivalent). The proposed IFC investment is a loan representing 90% of the project cost. The local agent bank will participate with the remaining 10% of the funds. Privatization of the company within two years of loan-signing is a requirement under the pre-approved IFC loan.       Location of project and Description of site    	The company is located in the industrial area of the city of Banja Luka, on one of the main roads and near the Transit Highway. The project does not call for any changes to or expansion of the location, but only improvements to the existing facilities and machinery.      Description of Company and Purpose of Project    	Vrbas produces sawn lumber, parquet, furniture parts, upholstered furniture, veneered and case goods furniture, and hardwood furniture.  This project will involve the refurbishment and upgrading of the furniture production lines, as well as the upgrading of the lumber and parquet manufacturing facilities. The purpose of the project is to provide the funds for critical process improvement, working capital and equipment upgrading in order to proceed with the refurbishment and revitalization of the recipients activities. The investment will promote financial recovery of the wood processing sector in which Bosnia has traditionally had a comparative advantage. It is expected that the project will result in stabilized income and employment and will enable the company to respond to market requirements. Provision of technical assistance and support in the privatization process, as important parts of this project, will help the company pursue a path of sustainable long-term growth.         Environmental Category and Issues    	This is a category B project according to IFCs environmental and social review procedure.  The key environmental, health and safety issues reviewed during project appraisal were: wood supply source and management; chemical usage, storage and handling; air emissions and workplace air quality; water supply and effluent; solid and hazardous waste management; emergency response and fire protection; and employee health and safety, and training. Vrbas will develop a formal environmental management system addressing compliance, monitoring, cleaner production, and energy efficiency. Based on its review of available information regarding potential environmental and social impacts and proposed mitigation measures, IFC concludes that this proposed project will meet the World Bank Groups applicable environmental, health and safety policies and guidelines and the applicable requirements of Bosnia-Herzegovina.     The  is  from the InfoShop.       Host country location of environmental documents    Vrbas headquarters in Banja Luka,   IFC field office in Banja Luka      Date SPI sent to InfoShop August 4, 1999   This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporations Board of Directors.  It is provided for the purpose of enhancing the transparency of IFCs activities and should not be construed as presuming the outcome of IFC Board consideration.    For Additional Information contact:  Corporate Relations Unit -   telephone: (202) 473-7711   facsimile: (202) 974-4384  Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).