The World Bank Guatemala Urban Resilience Project (P179462) Concept Environmental and Social Review Summary Concept Stage (ESRS Concept Stage) Public Disclosure Date Prepared/Updated: 09/26/2022 | Report No: ESRSC02997 Sept 26, 2022 Page 1 of 18 The World Bank Guatemala Urban Resilience Project (P179462) BASIC INFORMATION A. Basic Project Data Country Region Project ID Parent Project ID (if any) Guatemala LATIN AMERICA AND P179462 CARIBBEAN Project Name Guatemala Urban Resilience Project Practice Area (Lead) Financing Instrument Estimated Appraisal Date Estimated Board Date Urban, Resilience and Investment Project 10/3/2022 12/2/2022 Land Financing Borrower(s) Implementing Agency(ies) Republic of Guatemala MINISTRY OF PUBLIC FINANCES Proposed Development Objective Public Disclosure To improve urban infrastructure, increase access to basic public services, and enhance housing resilience in selected communities in the Mancomunidad del Sur. Financing (in USD Million) Amount Total Project Cost 120.00 B. Is the project being prepared in a Situation of Urgent Need of Assistance or Capacity Constraints, as per Bank IPF Policy, para. 12? No C. Summary Description of Proposed Project [including overview of Country, Sectoral & Institutional Contexts and Relationship to CPF] The project will address the effects of unplanned urbanization in Guatemala’s Mancomunidad Gran Ciudad del Sur, particularly focusing on increasing communities’ access to urban infrastructure, basic public services, and improved housing. By improving the resilience of urban infrastructure and access to basic services in the urban areas, the project will therefore help municipalities in the Mancomunidad del Sur address one of the main causes of urban poverty and informality. By improving the quality and resilience of the urban poor’s housing, the project will improve the living conditions of the most vulnerable urban dwellers, including women, indigenous groups and the elder, and thus reducing their vulnerability to climate risks. Lastly, by strengthening urban policy and institutional capacity at the Sept 26, 2022 Page 2 of 18 The World Bank Guatemala Urban Resilience Project (P179462) local and national levels, the project will help build stronger foundations needed to address the long-term economic, social, and climate sustainability aspects of rapid urbanization in Guatemala. These objectives are aligned with key government plans, including the 2032 K’atun National Development Plan; the Innovation and Development of Guatemala and the subsequent COVID-19 joint public-private economic and social recovery plan “Guatemala Moving Forward” (Guatemala no se detiene), which call for an efficient and sustained public investment in human capital, particularly among poor and marginalized groups. The proposed operation builds on the participatory approach proposed under the Urban Infrastructure and Violence Prevention Project (P143495), with a broadened scope to reflect the expanded Mancomunidad Gran Ciudad del Sur, and the region’s exposure to multiple hazards. The proposed Project would maintain the original project’s strategy, which includes: a) engaging community residents through a community mobilization process that built on the institutional foundations provided by the existing Community Development Councils (Consejos Comunitarios de Desarrollo, COCODES) ; b) improving basic living conditions in targeted communities through the provision of infrastructure and services that satisfy basic needs (e.g., for potable water, sanitation, and paved roads); enable provision of social and economic services to vulnerable groups (e.g., community centers); and/or reduce social risks and natural hazards through safer and more resilient built environments. The proposed operation’s financing envelope aims to better reflect the needs and absorptive capacity of the larger and more populous, Mancomunidad del Sur, now including Guatemala City, and reflecting Guatemala’s increased risk profile as regards dealing with natural hazards (especially climate-related, like flooding and landslides), the operation will also have a greater emphasis on urban resilience and disaster risk management investments. Public Disclosure The project will be developed under a framework approach by which the operation defines procedures, guidelines, and eligibility criteria for all fiduciary, environmental, and social management aspects. The framework approach is considered appropriate for this type of operation that anticipates implementing a relatively standard package of small-scale investments in multiple project locations. The project will further prioritize specific urban neighborhoods that present high poverty and urban growth rates. Regarding the proposed allocation of financing for each of the seven municipalities within the Mancomunidad Gran Ciudad del Sur, the project will work with the Government, through SEGEPLAN, to include relevant indicators, such as, municipalities’ population as per the National Institute of Statistics; number of informal settlements; qualitative housing deficits; inequality based on the Theil Index by SEGEPLAN; among others. The project’s proposed geographic scope will remain flexible and open to respond to evolving needs of the metropolitan area. D. Environmental and Social Overview D.1. Detailed project location(s) and salient physical characteristics relevant to the E&S assessment [geographic, environmental, social] The Project will support precarious settlements in seven municipalities in Guatemala within the MGCS, an association of 7 major cities within the Department of Guatemala: Guatemala City, Amatitlán, Mixco, San Miguel Petapa, Santa Catarina Pinula, Villa Canales and Villa Nueva. They make up less than 1 percent of the national territory, but they are home to more than 20 percent of the national population. There are 399 precarious settlements in the MGCS territory, 39% are located in Guatemala municipality and 61% in the other 6 municipalities. The indigenous people “Poqomam” are located in Mixco (see ESS7) and indigenous migrants from Maya, Xinka and Garifuna IP are present in all municipalities (see ESS1). Sept 26, 2022 Page 3 of 18 The World Bank Guatemala Urban Resilience Project (P179462) The highest authority of the MGCS is the General Assembly (GA) made up of the 7 mayors and 2 members of each Municipal Council. The GA elects a Board of Directors each year in October and the MGCS technical secretariat submits monthly progress reports and receives instructions on issues they would like to see addressed The GA meets four times a year. The Project will be focusing on increasing communities’ access to urban infrastructure, basic public services, and improved housing conditions. During implementation, the Government will identify and prioritize the typologies of interventions to be financed and validate a sample of pilot interventions to be implemented in the first year of the operation. The project will also prioritize specific urban neighborhoods that present high poverty and urban growth rates. Indicative criteria for investments to be eligible for financing under the project include: (a) interventions located in urban or peri-urban areas, with high population density; (b) be prioritized and validated by a COCODE; and (c) be located on either public land, land demonstrably owned by that community, or land that is in the process of becoming regularized. The primary goal of the MGSC is to bring development to the area, which will be easier if the problems that affect the municipalities are addressed in coordination. The MGCS supports member municipalities in the planning and coordination of interventions to tackle several common challenges, including (a) an increase in the urban population, expected to continue for the next 30 to 40 years, resulting in rapid formation of informal settlements; (b) low coverage of basic services (sanitation coverage as low as 47 percent and only 35 percent of total waste is systematically collected); (c) high proportion of the population living in hazard-prone areas, subject to large-scale disaster risk (Guatemala is located on the Ring of Fire between the Atlantic and Pacific oceans and frequently hit by tropical cyclones, droughts, earthquakes, and volcanic eruptions); (d) increased gender based violence and criminal Public Disclosure activity (Guatemala is among the top ten violent countries in LAC (16.5 homicides per 100,000 people in 2018). Gangs are almost exclusively an urban phenomenon, concentrating in Guatemala City (zones 6, 7, 12,18, 18, and 21) and the nearby cities of Mixco, Villa Nueva, and Amatitlán, see ESS1), and (e) weak capacity to enforce urban planning regulations. To effectively tackle these challenges and achieve sustainable and resilient growth, the MGCS will need to improve access to adequate and inclusive infrastructure and services. By improving the resilience of urban infrastructure and access to basic services in targeted urban areas, the project will help municipalities in the MGCS to address some of the main causes of urban poverty and informality. By improving the quality and resilience of housing for the urban poor, the project will improve the living conditions of the most vulnerable urban dwellers, including women, indigenous population, migrants, youth at risk, and people with disability, thereby reducing their vulnerability to climate risks. Lastly, the project will strengthen urban policy and institutional capacity at the local and national levels. D. 2. Borrower’s Institutional Capacity The implementing agency will be the Ministry of Communications, Infrastructure and Housing (Ministerio de Comunicaciones, Infraestructura y Vivienda – CIV), through a PIU established (this is a condition of effectiveness) within the Vice Ministry of Infrastructure (VMI). The PIU will be responsible for all aspects of implementation, including procurement, disbursement, accounting and financial reporting, E&S risk management, auditing, and monitoring and evaluation (M&E). For the E&S risk management, the Project will require the designation and/or hiring of qualified and experienced E&S staff. This staff will be located at the PIU office at the VMI/CIV in Guatemala City and at the office of the MGCS in Villa Nueva as the MGCS will play an important role in providing the technical territorial support for the implementation of the project. Additionally, the project will benefit from the institutional capacity available in the seven municipalities, each of which have as a minimum: (i) Planning Office, (ii) Environmental Sept 26, 2022 Page 4 of 18 The World Bank Guatemala Urban Resilience Project (P179462) Unit, (iii) Women´s development Department, and (iv) Community Development Office, as well as administrative and financial departments. The initial proposal regarding PIU E&S staff is that the central PIU E&S staff includes an environmental specialist, a social specialist, and a specialist in charge of communication and GRM and local PIU E&S staff located at the office of the MGCS include an environmental officer, a social officer, and a social communications officer. The E&S staff will be responsible for the preparation of the Project’s E&S instruments and their application during project implementation, monitoring and reporting. The need for additional E&S staffing can be revisited during implementation or when more information becomes available from more in-depth institutional assessments of CIV’s capacity. The TORs for staff to be hired would be closely reviewed by the Bank team and early in implementation a clear plan for ongoing project- relevant capacity development will be prepared with the VMI/CIV and MGCS. A project Technical Committee with representation from the CIV and the MGCS will provide technical oversight and validate key decisions related to the selection of neighborhoods and approval of integrated sets of interventions. Although the VMI does not have experience managing World Bank-financed projects, the CIV does have experience executing urban infrastructure improvement projects. Moreover, the PIU will benefit from technical support by the MGCS and their experience in the coordination of supra-municipal projects, projects with bilateral donors, and the IDB Proyecto Fortalecimiento de las municipalidades de la Mancomunidad, from preparation through implementation. The Project will be the first operation that CIV will implement under the ESF, and the World Bank E&S team has already engaged with CIV in discussions on its baseline capacity and the ESF requirements for the Project. It will be critical to establish a mainstreamed and efficient E&S risk management process to align coordination efforts between the PIU located at VMI-CIV and the MGCS located in the territory to facilitate the implementation, monitoring and reporting of the E&S instruments, promote understanding and knowledge of the ESF, and ensure E&S Public Disclosure compliance with the ESF’s requirements and national legislation. The WB team will provide support to the PIU to establish this mainstream efficient E&S process. The E&S management process must be commensurate for the purposes of the Project and to comply with the requirements of the ESF. The project will train CIV and MGCS staff on the World Bank's E&S Framework. The World Bank team will also provide training and support to CIV for developing the project's E&S management instruments, as well as the financial management, the Project Procurement Strategy for Development, and the Operations Manual; additional capacity building during implementation is foreseen and will be included in the ESCP. II. SCREENING OF POTENTIAL ENVIRONMENTAL AND SOCIAL (ES) RISKS AND IMPACTS A. Environmental and Social Risk Classification (ESRC) Substantial Environmental Risk Rating Substantial The environmental risk rating is considered substantial at this stage, due to the potential inclusion of civil works for the planning of urban upgrading of targeted neighborhoods and housing improvements for vulnerable households. Specific technical details related to infrastructure activities, including the location, type, and collective scale/magnitude of expected investments will be detailed during project implementation. As more detailed information becomes available about the specific investments during implementation and the detailed environmental and social assessments are completed, the risk rating will be reviewed and adjusted, if necessary. From an environmental perspective, project related risks will stem from activities related to the rehabilitation and new construction under Component 1 and 2. Some of the key potential impacts may include: (i) diverse impacts on lands and land use, including potentially on natural habitats or other sensitive landscapes for those activities (mostly new Sept 26, 2022 Page 5 of 18 The World Bank Guatemala Urban Resilience Project (P179462) construction works) that may be located in areas of biodiversity importance; (ii) nuisance related to dust generation, vibration, noise and odors; (iii) generation, management and disposal of non-hazardous and hazardous solid waste, residual construction materials waste, and hazardous materials from demolitions; (iv) generation and discharge of wastewater from civil works; (v) disposal from residential water and sanitation connections; (vi) temporary disruptions to local traffic during the construction phase; (vii) health and safety risks to the project workforce and local communities in the surrounding areas of the project activities, including from exposure to hazardous materials and wastes and the possibility of additional disease outbreaks as well as risks of spread of the COVID-19 virus and outbreaks of malaria, dengue or cholera; (viii) direct and indirect impacts from natural hazards (earthquakes, tsunamis, landslides, volcanos, extreme heat, cyclones and floods) that may occur in the selected neighborhoods and surrounding areas. Such impacts would be site-specific and manageable through proper screening and assessment of the eligible and approved subprojects, including careful site selection in observance of factors of E&S sensibility for the new construction work to be undertaken. The implied environmental risks and potential negative impacts of the planned Project activities are not considered significant or irreversible and can be addressed with straight-forward mitigation measures and good practices. The E&S instruments will include measures to manage these risks and impacts appropriate to the scale and nature of the activities. Further, the Project’s ESMF will include an Exclusion List to screen out any activity with the potential to generate high risks/impacts, such as environmentally harmful land use changes like deforestation, and significant adverse impacts on any type of natural habitats or cultural resources. In addition to the above, the environmental risk rating for the Project reflects CIV 's limited capacity on environmental aspects that will require support from MGCS knowledge on the ground and their past experience on the preparation and implementation of urban projects. Social Risk Rating Substantial Public Disclosure The social risk rating is Substantial at this stage, due to a combination of the following factors: (i) the high levels of citizen insecurity in the country and with presence of Gangs concentrated in Guatemala City and the nearby cities of Mixco, Villa Nueva, and Amatitlán, all part of the project intervention area. This could lead to crime and violence incidents associated with the project; (ii) possible exclusion of vulnerable groups such as Persons with Disability (PwD), women, migrants or indigenous people if these groups are not adequately represented in decision making bodies (COCODES); (iii) possible exclusion of families without home property titles (applies specifically to Component 2: home improvement); (iv) potential cases of temporary involuntary resettlement and temporary limitations in access to basic services (schools, health centers) while construction works take place and economic impacts created by the temporary restrictions in access due to construction works, which could affect both established businesses and informal vendors; (v) community health and safety risks, including the increased risk of accidents for the local population as a result of construction works, movement of vehicles and machinery; (vi) labor influx in communities where works will take place could lead to impacts on the local population, especially if project workers do not strictly adhere to codes of conduct; and (vii) SEA/SH risks associated with labor influx and the presence of workers in communities, as well as SEA/SH risk in the workplace among contract workers. The Initial E&S Risk Analysis to be prepared by the borrower characterizes these social risks and describes possible mitigation measures, all of which will be further detailed in the ESMF and other outstanding E&S instruments in a manner appropriate to the scale and nature of the activities. Positive social impacts are several: (i) public safety in general will increase as disaster risk reduction will reduce the risk of for instance landslides; (ii) the improvement of basic services such as sanitation and solid waste management will positively impact public health; (iii) improved public street lightning will increase public safety, especially of women and may positively impact gender-based violence; (iv) boosted resilience of housing of poor households, will reduce their vulnerability to be harshly affected by natural disasters including their hard-won gained assets; (v) PwD will benefit from improved public infrastructure such as pedestrian access roads and walks Sept 26, 2022 Page 6 of 18 The World Bank Guatemala Urban Resilience Project (P179462) (Universal Access features are foreseen); (vi) the project activities are also expected to create employment for men and women, and importantly for young people from communities, many of whom are at risk to be approached to become involved in Gangs or criminal activities; having an employment (even temporarily) can make the difference; and (vii) training activities through project alliances with amongst others, the archbishop´s office or CONADI, for municipal technical staff, will increase the municipalities´ awareness to include and address the need of migrants and PwD. B. Environment and Social Standards (ESSs) that Apply to the Activities Being Considered B.1. General Assessment ESS1 Assessment and Management of Environmental and Social Risks and Impacts Overview of the relevance of the Standard for the Project: ESS1 is relevant. Guatemala is a multiethnic, multicultural and multilingual country where the Mayan Indigenous Peoples (22 linguistic communities), Xinka and Garífuna coexist with non-indigenous population. The IPs living in the MGCS, are made up of two groups: (i) the Poqomam in Mixco and (ii) indigenous population from several different IPs (Maya, Xinka, and Garifuna) that saw themselves forced to migrate from their original territories to the area of the MGCS looking for employment and trying to improve their livelihoods. Of these two groups, the Poqomam fulfill the criteria under ESS7 for IPs. With regard to IPs that have migrated to the MGCS territory and do not fall under ESS7 but are considered part of the vulnerable groups, the 2018 Census indicates that 150,571 are Maya, 2,602 are Xinka and 3,601 are Garifuna (2,1311,712 inhabitants are “non indigenous” and 5,003 are Afro-descendant). This particular Public Disclosure group of IP is especially vulnerable because they have left behind their family networks, ancestral governance structures, and settled in a new territory and different culture. Most live in poverty, have lower educational level than non-indigenous population and illiteracy rates are higher. Several of the IPs in the MGCS area speak little or no Spanish (especially indigenous women). Other vulnerable groups include female headed households, migrants (especially from other CA countries whose intention to migrate to the USA failed and then decided to settle in or near Guatemala city instead of returning to their home country), persons with disabilities, and youth at risk (unemployed and at risk to become involved in Gangs and criminal activities). All vulnerable groups are identified in the SEP and the Initial E&S risk analysis, and specific measures to ensure participation and access to project benefits have been identified in these instruments and will also be further detailed in the ESMF in a specific section on vulnerable groups. The context of crime and violence creates insecurity and possible affection of the physical integrity of project workers, contractors and community leaders and members, but also the possibility of extortions by Gangs of project beneficiary families and contractors. Additionally, there is an increased risk of robbery of materials, tools and equipment at construction sites. Many suppliers do not deliver goods to zones known for high crime rates and transportation costs are likely to increase. Costs will also increase due to the insurances that will have to be acquired for project workers as part of the mitigation measures. Given that the exact scope and locations of the activities will be defined only during Project implementation, the Project has adopted a framework approach to E&S risk management. Terms of Reference (TORs) for ESMF will be developed and disclosed prior to negotiations. The final ESMF will be developed based on the previously approved TORs within 60 days after the Effective Date. The finalization of the ESMF is a condition of disbursement. Sept 26, 2022 Page 7 of 18 The World Bank Guatemala Urban Resilience Project (P179462) The ESMF will provide: (i) a high-level characterization of potential contextual E&S  risks and issues which may be present in different locations; (ii) identify applicable national legislation, (iii) based on the typology of activities to be financed and eligible areas, potential direct and indirect E&S risks and impacts from proposed investments; (iv) generic management and mitigation measures to likely E&S impacts associated with these types of investments; (v) details of the requirements for site-specific Environmental and Social Management Plans (ESMPs); and (vi) implementation arrangements, roles and responsibilities, capacity building measures, monitoring and reporting requirements, and budget for E&S management. It will also consider the WB’s Environmental, Health, and Safety General (EHSG) and good practice Sector-Specific Guidelines. The ESMF will include E&S Screening Checklists for risk classification of subprojects, which will set forth the requirements for subproject Environmental and Social Management Plans (ESMPs) as deemed necessary based on the initial screening and risk classification. The ESMF will include generic E&S risk management procedures in line with the ESF and ESHG and other good international industry practices (GIIP) that can be quickly and easily adapted and tailored to specific subprojects and incorporated into subproject ESMPs and bid documents. Specific attention will be paid to mitigating social risks related to labor influx and the high rates of violence and crime that may affect project implementation and safety of project personnel, contractors´ employees, and communities. Based on the assessment of E&S risks and impacts from proposed investments, the generic E&S risk management procedures for both construction as well as ongoing O&M phase-related (if deemed necessary) will include measures to address construction impact, impacts on natural habitats and ecosystem services, occupational and community health and safety, COVID-19 transmission prevention, waste management, traffic safety, a security contingency plan. The ESMF will also include GBV/SEA risk management procedures, codes of conduct, guidelines for universal access design, Public Disclosure gender measures and chance find procedures.  The ESMF will include an Infectious Disease Prevention and Response Procedure for potential communicable infectious diseases which could affect Project workers, in line with the EHSG, GIIP, including WHO and PAHO guidance. The OHSP will include requirements for the use of Personal Protective Equipment, planning of training activities, and investigation/reporting of accidents The ESMF will include a negative list of activities to exclude those that may result in the long term, permanent or irreversible negative E&S impacts on highly sensitive areas in terms of their biodiversity importance and cultural heritage value. Subproject ESMPs will be prepared once subproject activities are defined and locations are known. These will be then consulted and disclosed before launching its corresponding bidding process and will be included in the bidding documents and subsequent contracts. Based on these ESMPs, the selected contractors will need to develop and implement their own contractor’s ESMPS (C-ESMPs). Engineering and design plans will be grounded in existing national laws and the ESF and will consider climate-resilient aspects tailored to the country and activity. The Borrower will prepare and disclose an ESCP which includes all necessary E&S actions and measures that the Borrower will comply during implementation. E&S requirements will be considered for all TA activities either delegated to the municipalities or third parties. The requirements set out in paragraphs 14–18 of ESS1 will be applied to these activities as relevant and appropriate to the nature of the risks and impacts. The TORs for each TA will be reviewed by the Bank to ensure the requirements of the ESF are reflected. Additionally, the borrower will develop and disclose TORs for the core Project’s instruments to assess and manage E&S risks and impacts: ESMF, LMP, RPF, and IPP. Based on those TORs the borrower will develop, consult, and disclose within sixty (60) days after the Effective Date the ESMF, LMP, RPF, IPP, and updated SEP. The development of these documents and their approval by the Bank will also be a disbursement condition. Details of consultations are outlined under ESS10. Sept 26, 2022 Page 8 of 18 The World Bank Guatemala Urban Resilience Project (P179462) For Component 3 (CERC), the Project will adopt a manual including relevant procedures and requirements to comply with the ESF, as shall be further outlined in the project´s ESMF. The CERC Manual must be completed following the WB’s CERC Guidance (October 2017), prior to any emergency disbursements (disbursement condition). The CERC Manual will be prepared and disclosed within 90 days after the Effective Date. Areas where “Use of Borrower Framework” is being considered: None ESS10 Stakeholder Engagement and Information Disclosure ESS10 is relevant. To address and outline actions that ensure broad consultation and inclusive participation, the Borrower will prepare, consult, disclose and adopt a draft Stakeholder Engagement Plan (SEP). The SEP outlines (i) potential key stakeholders; (ii) their interest and influence over the project; (iii) description of the consultations undertaken during preparation and a plan for consultations after project effectiveness of the E&S instruments that are outstanding (ESMF, LMP, IPP); (iv) key milestones to share information and most effective channels for disclosure of information; (v) participation in the project cycle; (vi) affirmative actions to facilitate the participation of vulnerable stakeholders; (vii) budget and responsibilities; (viii) project-level Grievance Redress Mechanism (GRM); and (ix) monitoring and reporting mechanisms. A consultation process carried out by the borrower in August 2022 during preparation included two in-person and one virtual consultation, as follows. On August 9, 2022, an in-person consultation with municipal technical personnel Public Disclosure from planning, women, environment, and community development units of the seven municipalities (33 participants, 61% women and 39% men), on August 12, 2022, an in-person consultation with male and female COCODE leaders representing community members and vulnerable families from approximately 60 precarious communities in the seven municipalities (75 participants, 56% women and 44% men), and on August 17, 2022, a virtual consultation with representative from other interested parties, including government institutions, environmental and social development NGOs active in the MGCS, and institutions representing PwD. The purpose of the consultations was to inform and receive feedback from the different interested parties about the project design, the initial E&S risk analysis (amongst others, whether risks identified and mitigation measures proposed are relevant and feasible), and the key content of the draft SEP (in particular whether the identification interested parties is adequate, how a grievance mechanism might work, the type of information interested parties would like to receive and through what means during different phases of the project cycle, and how participation of interested parties, especially of vulnerable groups, can be fomented). The feedback received was used to enrich the draft documents. Participants were interested to know how the funds would be distributed amongst the seven municipalities and the MGCS Secretariat provided a clear answer summing up all criteria as proposed by the municipal councils in a MGCS meeting. There were several inquiries as to the topic of regularization of land tenure of informal settlements; and there was a general understanding that, in order to benefit from the project, land tenure has to be regularized. The role of the COCODEs was stressed, their participation in consultations and decision-making on prioritization regarding communities, works, and designs, as well as their role in ensuring meaningful community participation, including the vulnerable groups, and as entity for effective communication with the PIU, the MGCS secretariat and the VMI. Also, the potential of alliances between the project and other entities working in the precarious communities was mentioned, examples were provided of alliances that Sept 26, 2022 Page 9 of 18 The World Bank Guatemala Urban Resilience Project (P179462) would benefit the vulnerable groups and IPs in particular. Importantly, all municipalities already have their own functioning communications strategies, these, as well as examples of local-level GRM have been added to the draft SEP. Finally, valuable feedback was provided with regard to elements of a contingency plan for the violence and crime context the project would operate within. The SEP specifically ensures that the vulnerable groups identified (see ESS1), as well as the Poqomam IP in Mixco (see ESS7) receive adequate and culturally sensitive information in formats accessible to each specific group, and can fully participate in meetings, consultations, and other project related events. The SEP includes a list of mitigation measures to ensure meaningful participation of each of the vulnerable groups and their access to project benefits, all of which have been included in the budget. The project will carry out a mapping exercise of indigenous and non- indigenous migrants and PwD living in precarious communities eligible for project investments in order to ensure their specific needs will be taken into consideration. The consultation process carried out by the borrower in August 2022 during preparation included two in-person and one virtual consultation. The in-person consultation on August 12, 2022, with COCODE community leaders, represented amongst others the Indigenous People living in the precarious communities in the seven municipalities. They confirmed that Indigenous People (described as vulnerable group under ESS1) form an integrate part of the Community Development Councils, that by working with the COCODE the project would ensure that their participation in decision-making and that their needs and interests would be covered. Additionally, the Poqomam´s (IP under ESS7) traditional leaders in the "Cofradias" would have to be consulted as well, respecting their customary practices. The consultation also confirmed the need to provide translation in different indigenous languages Public Disclosure (Poqomam and languages spoken by IPs identified as vulnerable group under ESS1) during events and in communication materials. This feedback was included to enrich the draft SEP. The SEP will be updated by the borrower within sixty (60) days after the Effective Date and will further develop the Project-level GRM to a detail that it can be operationalized. The GRM will set out the length of time users can expect to wait for acknowledgement, response and resolution of their grievances, transparency about the grievance procedure, governing structure, decision makers, and an appeals process when resolution of grievance has not been achieved. The Project will establish a culturally appropriate and inclusive GRM (accessible and respectful of Poqomam IP ancestral institutions and governance and accessible to all vulnerable groups) to respond to complaints throughout the project lifecycle, channels to submit grievances are several and are based on current functional communication channels between municipalities and communities, and include: a project-GRM Web page linked to the page of the Ministry of Infrastructure, Communications, and Housing in the existing "Open Government Platform", by telephone, letter or email, WhatsApp message, GRM-boxes located in municipal offices or personally at the PIU office, municipal offices or the MGCS secretariat. All complaints will be registered in a project wide GRM database; information will be handled confidentially. The GRM will allow for anonymous submission of grievances and will also accommodate SEA/SH grievances that will be addressed focusing on the confidentiality and safety of the victim. The draft SEP will include a directory of institutions that can provide support and counseling to GBV victims. The draft SEP will also describe how the GRM will be socialized amongst different stakeholders. Currently, Guatemala is passing through a fifth wave of the COVID-19 pandemic. As such, all project consultations will be carried out following adequate health and safety guidelines provided by the GoG health authorities, and WHO, including relevant WB’s guidance as a Technical Note for “Public Consultations and Stakeholder Engagement in WB- Sept 26, 2022 Page 10 of 18 The World Bank Guatemala Urban Resilience Project (P179462) supported operations when there are constraints on conducting public meetings (March 20, 2020)”. Identification and mitigation of risks of the eligible investments will also consider potential COVID-19 outbreak-related risks. B.2. Specific Risks and Impacts A brief description of the potential environmental and social risks and impacts relevant to the Project. ESS2 Labor and Working Conditions ESS 2 is relevant. Project implementation will involve various workers ranging from direct, contracted and community workers. The Project will be implemented by staff from the CIV and VMI, as well as the MGCS secretariat with involvement of municipality technical personnel, and additional consultants could be hired. Other types of Project workers will be identified once activities are determined. It is likely that contractors will be required for civil works. Potentially community workers could be involved (Components 1 and 2). In the case of community workers there will be an assessment of relevant risks and the measures as detailed in para 37 of ESS2 will be applied. The borrower will prepare and disclose TORs for the preparation of Labor Management Procedures (LMP) prior to negotiations. These will set out the way in which Project workers will be managed, in accordance with the requirements of national law and ESS2. The LMP will also address the way in which this ESS will apply to different categories of Project workers including direct workers, and the way in which the Project will require third parties to manage their workers in accordance with ESS2. Based on the TORs previously prepared and approved, the LMP will be finalized, consulted and disclosed within sixty Public Disclosure (60) days after the Effective Date; it is also a condition for disbursement. Once approved, the LMP will be implemented throughout the execution of the Project. The provisions of the LMP will be incorporated into the bidding documents for all works and no project workers, with exception of the PIU, will be engaged prior to LMP issuance. The LMP will be reviewed and updated throughout project implementation as required, considering the activities to be undertaken in each subproject entailing additional labor related risks or issues. Among other elements, to ensure health and safety of workers during the construction and implementation phases of the project, the ESMF will include a generic Occupational Health and Safety Plan (OHSP) for likely civil works activities under Component 1, in line with the WBG general guidelines and water and sanitation EHS Guidelines. Some of OHS hazards associated with the project activities may include among others: (i) operation of heavy machinery, (ii) slips, trips and falls; (iii) material handling; (iv) exposure to hazardous substances; and (v) traffic safety. The OHSP will include generic measures addressing these and other types of typical OHS issues, as well as procedures for incident/accidents investigation and reporting, recording, and reporting of accidents, emergency preparedness and response procedures, and continuous trainings for workers. It will also contain measures to address potential risks and impacts that may arise from the interaction between project workers and local communities. At this stage it is uncertain whether there will be major labor influx or if most workers will come from the local areas of project intervention. Nonetheless, to ensure that the project promotes safety of women, and to avoid that those beneficiaries become targets of sexual harassment or assault, the LMP will include a code of conduct, and both labor GRM as well as the overall project GRM will include specific grievance channels, to be managed by trained personnel, for potential complaints related to gender based violence (GBV) or sexual exploitation and abuse (SEA). Mitigation Sept 26, 2022 Page 11 of 18 The World Bank Guatemala Urban Resilience Project (P179462) measures and potential security measures for workers will be included in the LMP. Other health related issues for workers will be included in the ESMF as described under ESS1. The LMP will provide an overview of applicable legislation, expected types of personnel to be hired under the project, and measures to comply with ESS2, including child labor, minimum salary and work hours. The LMP will also include a description of the GRM available to project workers which will be amply socialized, and training will be provided. The ESMF will also include emergency prevention and preparedness measures, as well as response arrangements in the event of any social, labor related and/or natural disaster situation that could take place or evolve during project implementation. Bidding documents for all investments will include OHS requirements, a worker Code of Conduct, and requirements for other labor issues such as labor influx, non-discrimination, equal opportunity, and prevention of all forms of forced labor and child labor. ESS3 Resource Efficiency and Pollution Prevention and Management ESS3 is relevant. The Project will include civil works (rehabilitation and new construction) throughout the MGCS territory. Project activities and civil works investments are expected to be sources of pollution, emissions (including GHG’s), and users of resources as considered by ESS3. The types of potential pollution sources include construction waste, runoff from construction sites and from civil works activities, use of materials, including hazardous materials for construction and petroleum-based products for vehicles and machinery, and air pollution from operation of machinery and vehicles. Pollution: The project design will be geared to incorporate best practices to reduce discharge and waste and is not Public Disclosure expected to imply major potential for air pollution, disturbance by noise, or other forms of pollution. Regarding hazardous materials, it is not expected to be a large user or generator of these material and measures will be taken to ensure minimization of adverse impacts on human health and the environment including proper storage, handling, use, and disposal of hazardous, flammable or potentially contaminating wastes. The ESMF will define institutional responsibilities and will guide the preparation of site-specific management plans as needed, including a sufficient budget for monitoring equipment and capacity-building regarding pollution prevention and emergency incident response among other measures. Rehabilitation may involve managing hazardous materials such as asbestos, lead, and others, for which the management and disposal shall follow the asbestos management plan in the ESMF, and requirements set out in the World Bank’s good practice note. The Bank’s Good Practice note on asbestos related occupational and community health issues are an integral part of TOR and contracts signed with consultants and construction companies. Vegetation and soil: Soil removal and clearance of vegetation may occur from road rehabilitation and widening activities, new construction and urban upgrading financed by the project. All construction material needed for the of infrastructure work (sand, stones, timber, etc.) will be obtained from licensed quarries and certified timber suppliers. Waste management: Construction waste will include mostly waste from excavated soil and debris and hazardous waste such as hydrocarbon oils from construction machinery and vehicles. Any waste generated by project activities will be disposed according to national regulations, GIIP and the WBG’s EHS Guidelines. The ESMF will include generic measures for the management of hazardous material, and the subproject ESMPs will also include specific measures for waste management. Sept 26, 2022 Page 12 of 18 The World Bank Guatemala Urban Resilience Project (P179462) Efficiency measures: Project investments will promote climate-smart activities and productive technologies that can contribute to increase resilience, thus reducing Green House Gas (GHG) emissions of value chains. Subprojects will include climate-smart approaches – where applicable – to enhance natural resource-use efficiency, reduce GHG emissions, and promote climate adaptation. In line with ESS3, the Borrower will characterize and estimate sources of air pollution-related to the Project and will determine with the Bank whether project related emissions may warrant an estimation of gross GHG emissions as per this standard, as well as its technical and financial feasibility. Based on the activities to be financed which will be defined during implementation, the Project may need to undertake a gross GHG estimation using an agreed methodology. In such case, the results of such assessment will be reported along with the implementation progress of the Project. Air emissions and noise: These may be generated during the construction phase from the use of heavy vehicles, machinery, and construction activities. The ESMF considers mitigation measures, which may include dust suppression and vehicle maintenance to minimize the impact of air emissions and to minimize and manage noise levels. Subproject ESMPs to be prepared will include these measures as necessary. Water use: activities under the project will focus on providing access to water and sanitation services. As such, these aspects will be included in the ESMF and reassessed during implementation as the areas of intervention are defined. The borrower will adopt measures, to the extend technically and financially feasible, to avoid or minimize water usage. The borrower must assess the significance of water use (particularly quantity and effects of availability on the local population) under Component 1 and 2. These requirements will be incorporated in all the instruments to be developed. Public Disclosure Energy efficiency: The project will include climate-smart civil work activities; thus, renewable energy technologies (RET’s) will be evaluated and incorporated into the design of subprojects where feasible, such as the use of solar panel systems. ESS4 Community Health and Safety ESS4 is relevant. Various proposed activities may expose communities to health and safety risks, especially if there are communities that are immediately close to the construction sites and activities, mainly in connection with the infrastructure works to be financed under Components 1 and 2. The presence of nearby communities will be confirmed during project implementation, as part of ESMPs, once the exact locations of the project construction activities are determined. With regard to risks related to works to be done within households (Component 2A), GBV from workers inside private dwellings is identified as key social risk; the ESMF will address the risk and mitigating measures. In addition, there are risks for the safety of the people inside the dwelling while construction works are ongoing; on a case-by-case basis this risk will be addressed and if necessary, the inhabitants will need to find alternative housing temporarily; this will be included in the RPF. Also, under ESS1 the crime/violence context was discussed, a risk for families benefitting of improvements to their housing is increased exposure to extorsion by Gangs. This risk will be further detailed and addressed in the ESMF, site specific ESMPs, and the Contingency Plan that will be part of the ESMF. Sept 26, 2022 Page 13 of 18 The World Bank Guatemala Urban Resilience Project (P179462) Hazardous construction materials such as asbestos and lead could be a health and safety concern to the community. To protect both workers and communities, the management and disposal of this type of hazardous materials should strictly follow the hazardous waste management plan in the ESMF and requirements set out in the World Bank’s good practice note. Risks include potential for accidents from increased traffic of project vehicles, machinery, and trucks. Some impacts from civil works that may cause inconvenience to local communities may include air emissions and odors, hazardous materials, closure of roads, traffic disruptions, and others. Engineering designs will consider disaster risk, universal access, and safety of materials used among other considerations under ESS4 requirements. In terms of ecosystem services, the project will protect those services through the conservation investments and pollution control measures resulting from urban upgrading. Emergency preparedness and response will be considered especially if identified investments in areas with natural or induced risks such as fire- or flood-prone areas. The ESMF will identify and lay out generic measures to minimize community risks to these and other issues, while site-specific planning will confirm relevant issues and include more detailed management measures in the site and subproject-specific ESMPs. Measures to reduce road and pedestrian accidents around or near-by construction/rehabilitation of roads will be included in the ESMF. Subproject ESMPs will include traffic management plans and measures for local communities to ensure pedestrian safety, as well as requirements for the adoption of signage and safety barriers in or near construction zones and safe storage arrangements for construction machinery and equipment, measures to avoid the spreading of COVID-19 and other potential infectious diseases, and GBV/SEA risk management procedures. Given that the roads and other infrastructure could be developed in places that had no Public Disclosure previous access, in addition to training and traffic management during construction works, the ESMFs and ESMPs will include awareness activities on-road hazards which could occur during the operations of the road; where previously there were no large vehicles crossing the area or where increased speeds may affect local communities with children and livestock. Due consideration will be put to the specific needs of vulnerable groups such as indigenous population, female headed households, migrants, youth at risk, and persons with disabilities. Nuisances caused to local communities from noise, dust and vibration resulting from the use of construction machinery and vehicle movement during construction works causing disturbance to nearby homes will be addressed in the ESMF, and subproject- specific ESMPs will be required to include specific measures to reduce the impacts from these activities, as necessary, to ensure adherence to this Standard. The use of security forces is foreseen, as construction sites will have to hire private security services to safeguard materials and equipment, especially as crime rates are high in the MGCS municipalities. The participation of police forces is not foreseen, but not impossible if project related or unrelated disturbances would occur in communities where the project is being implemented. Their presence could pose risks to, and have unintended impacts on, both project workers and local communities. Subproject-specific ESMPs will contextualize relevant information regarding crime and violence in the intervention areas and assess if additional security support and safety measures are necessary to protect workers and communities. If armed security forces are expected to participate in some capacity during project activities, the ESMF will specify requirements for subproject- specific ESMPs to carry out security risk assessments to determine the scope of participation of private security forces, identify relevant Codes of Conduct, and establish procedures to be followed in cases of allegations of SEA/Sexual Harassment/Human Rights violations or misbehavior. ESS5 Land Acquisition, Restrictions on Land Use and Involuntary Resettlement Sept 26, 2022 Page 14 of 18 The World Bank Guatemala Urban Resilience Project (P179462) ESS 5 is relevant. Since the exact location of the selected infrastructure and its technical design is not yet clear, a framework approach has been taken, identifying relevant national legislation and any gaps with the criteria included in ESS5. Although the Project will limit land acquisition to a minimum, including temporary land taking, the borrower will prepare a Resettlement Policy Framework (RPF) in cases where land acquisition and/or resettlement are needed for priority infrastructure. The RPF will guide the preparation of any potential Resettlement Action Plans (RAP) for sub-projects. The RAPs will need to be approved by the Bank and must be implemented before any related physical works commence. The Project includes a range of interventions to construct or rehabilitate public infrastructure; this may require limited land taking, possibly on a temporary or small-scale basis, and limited impact on people's livelihoods. Other relevant activities may include temporary land taking for contractors’ camp and storage of equipment and interruption and/or restriction to access any business adjacent to project activities causing loss of income. These impacts can be screened, with mitigation measures included in site-specific RAPs to be prepared by the borrower and submitted for Bank’s approval prior to their consultation and disclosure in the Bank’s website and local disclosure. The borrower will prepare and disclose TORs for the preparation of the RPF. Based on the TORs previously prepared and approved, the RPF will be finalized, consulted and disclosed within sixty (60) days after the Effective Date and is a condition for disbursement. Once approved, the RPF will be implemented throughout the execution of the Project. ESS6 Biodiversity Conservation and Sustainable Management of Living Natural Resources Public Disclosure ESS6 is relevant. Although no significant conversion or degradation of natural habitats is expected, some of the project comprises diverse infrastructure rehabilitation works, which may potentially be located in areas of biodiversity importance. Rehabilitation of existing infrastructure (roads, stormwater drainage, public spaces and community buildings, and others) will be developed within existing footprints and mostly in urbanized and/or degraded areas; however, it may be possible that some civil works may potentially interfere with remaining areas of native vegetation or areas of importance for biodiversity. For the new construction works, the Project will avoid to the extent possible the sitting of infrastructure on natural or critical habitats. The exclusion list to be included in the ESMF will help to screen out project activities that could alter or cause destruction or degradation of any critical or sensitive natural habitats, especially forests and wetlands outside the designated national protected areas. The ESMF will also include generic biodiversity related mitigation measures that will serve as a basis for subsequent development of subproject ESMPs. Potential risks and impacts on natural habitats will be assessed in detail upon the definition of the location, type, and scope of infrastructure work to be financed. Where relevant, appropriate mitigation measures for impacts on natural habitats and ecosystem services will be included in the subproject ESMPs. Subproject ESMPs must be developed before launching the bidding process for the respective subproject. ESS7 Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Local Communities ESS 7 is relevant. The Poqomam IP in Mixco meet the criteria as established in ESS7: (i) they self-identify as IP, (ii) they continue to speak their own language “Pocomam” which is different from the official Spanish language (they are struggling to keep their language alive and are making specific efforts to maintain the language especially amongst the youth), (iii) the Poqomam IP´s cultural practices and customary institutions such as the “Cofradías” are being maintained and practiced until today. They also continue to celebrate their Mayan ceremonies and their bond with Sept 26, 2022 Page 15 of 18 The World Bank Guatemala Urban Resilience Project (P179462) their ancestors and “cosmovision” remains intact, and (iv) collective attachment to land. During colonial times, the Poqomam received land titles from the Spanish crown, however, in the late 1700´s and 1800´s Spanish colonial livestock ranchers started occupying the communal lands and though the Poqomam People appealed and tried to resist they lost their land rights over time. Though they have lost their rights to their previously owned communal lands, their lands within the municipality of Mixco remain essential to their identity, their culture, and the celebration of ancestral ceremonies. To address ESS7 requirements, the Borrower will prepare and disclose TORs for the preparation of an Indigenous Peoples Plan (IPP) for the Poqomam IP located in Mixco municipality. Based on the TORs previously prepared and approved, the IPP will be finalized, consulted, and disclosed within sixty (60) days after the Effective Date and is a condition for disbursement. Once approved, the IPP will be implemented throughout the execution of the Project. The IPP will include a description of the project and of Poqomam IP living in Mixco; an analysis of the national legal framework relevant to this IP; gap analysis with ESS7; a description of potential opportunities, risks and propose mitigation measures; identify positive project impacts on this indigenous population benefitting from the Project, but also any risks related to their participation and access to project benefits, as well as unintended adverse impacts due to their particular circumstances or vulnerabilities. The project is expected to carry out a mapping exercise of the Poqomam IP living in precarious communities in Mixco eligible for project investments in order to ensure their specific needs will be taken into consideration. FPIC is not expected to apply, as the project is not expected to have significant impacts on the Poqoman´s cultural Public Disclosure heritage that is material to their identity and/or cultural, ceremonial, or spiritual lives. Furthermore, as relocation of Poqomam IP is not an issue in this Project and as the Poqomam have lost legal rights on their previously owned ancestral lands and natural resources centuries ago, FPIC doesn’t apply. ESS8 Cultural Heritage ESS8 is relevant since the rehabilitation and construction activities may involve soil excavations; in addition, the project could potentially support rehabilitation of damaged public buildings with cultural or historic value. The ESMF will include provisions for subproject-level screening and assessment of any known sites of cultural or historic importance which may be impacted locally, as well as identification of any sites of cultural/social importance for local communities. The ESMF, and all future subproject ESMPs as needed, will furthermore include: (i) Chance Finds Procedures for the construction areas, and construction contracts will include clauses requiring civil contractors to take proper protective measures in case cultural heritage sites are discovered, including to stop construction activities if cultural property sites are encountered during construction; (ii) a Cultural Heritage Management Plan (CHMP) for civil works outlining mitigation measures to be considered to avoid or reduce impacts on community cultural heritage sites directly affected by the project; and (iii) any needed mitigation measures to avoid or restore community cultural sites. All subproject ESMPs measures will be reflected in corresponding construction contracts. Additionally, the Poqomam Indigenous peoples (see ESS7) maintain distinct cultural practices; their own traditional governance structures, and cultural heritage sites (temples, ceremonial sites, burial sites) in Mixco municipality. During implementation, the borrower will ensure that these practices and culturally important sites are respected, in line with ESS8, ESS7 and as will be documented in the IPP. Sept 26, 2022 Page 16 of 18 The World Bank Guatemala Urban Resilience Project (P179462) ESS9 Financial Intermediaries ESS9 is currently not relevant. C. Legal Operational Policies that Apply OP 7.50 Projects on International Waterways No OP 7.60 Projects in Disputed Areas No III. WORLD BANK ENVIRONMENTAL AND SOCIAL DUE DILIGENCE A. Is a common approach being considered? No Financing Partners None B. Proposed Measures, Actions and Timing (Borrower’s commitments) Actions to be completed prior to Bank Board Approval: Public Disclosure By Appraisal: Develop and Disclose: (i) an A-ESRS; (ii) a Draft ESCP; (iii) a Draft SEP; and (iv) an Initial E&S Risk Analysis. In addition, consultations will be carried out by the borrower regarding the concept stage design, draft SEP and Initial E&S Risk Analysis. Furthermore, the borrower will be asked to develop and disclose TORs before negotiations for the development of (i) an ESMF; (ii) an IPP; (iii) an RPF; and (iv) an LMP. Based on those TORs the borrower will develop, consult, and disclose within sixty (60) days after the Effective Date these outstanding instruments. Compliance with the development of these outstanding instruments is also a disbursement condition. For Component 3 (CERC), the Project will adopt a manual including relevant procedures and requirements to comply with the ESF, as shall be further outlined in the project´s ESMF. The CERC Manual will be prepared and disclosed within 90 days after the Effective Date. Possible issues to be addressed in the Borrower Environmental and Social Commitment Plan (ESCP): 1. Organization structure to manage the E&S risks of the project. E&S Specialists shall be hired or assigned for the Project as a Condition of Effectiveness. 2. Outstanding E&S Instruments (ESMF, IPP, RPF, LMP, and updates to the SEP): shall be developed, consulted, and disclosed as a Condition of Disbursement. 3. The CERC Manual must be completed following the WB’s CERC Guidance (October 2017), prior to any emergency disbursements (disbursement condition). The CERC Manual will be prepared and disclosed within 90 days after the Effective Date. 4. Incidents and accidents notifications. Sept 26, 2022 Page 17 of 18 The World Bank Guatemala Urban Resilience Project (P179462) 5. Operationalizing of the project GRM and the labor specific GRM. 6. E&S Capacity building measures. C. Timing Tentative target date for preparing the Appraisal Stage ESRS 03-Oct-2022 IV. CONTACT POINTS World Bank Contact: Andre Herzog Title: Senior Urban Development Specialist Telephone No: +1-202-458-7412 Email: aherzog@worldbank.org Contact: Dmitry Sivaev Title: Urban Specialist Telephone No: +1-202-458-4502 Email: dsivaev@worldbank.org Borrower/Client/Recipient Borrower: Republic of Guatemala Implementing Agency(ies) Public Disclosure Implementing Agency: MINISTRY OF PUBLIC FINANCES V. FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects VI. APPROVAL Task Team Leader(s): Andre Herzog, Dmitry Sivaev Practice Manager (ENR/Social) Maria Gonzalez de Asis Recommended on 21-Sept-2022 at 21:28:39 GMT-04:00 Safeguards Advisor ESSA Angela Nyawira Khaminwa (SAESSA) Cleared on 26-Sept-2022 at 16:33:7 GMT-04:00 Sept 26, 2022 Page 18 of 18